Financial assessment of mixed plastics recycling in the UK ... - Wrap
Financial assessment of mixed plastics recycling in the UK ... - Wrap
Financial assessment of mixed plastics recycling in the UK ... - Wrap
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Methodology• Build mass balance and f<strong>in</strong>ancial andmodels for:• MRF.• PRF and plastic reprocess<strong>in</strong>g facility.• Test sensitivities:• Costs.• Throughput.• Different configurations.
MRF element• Models <strong>in</strong>cremental costs and revenuesfor an exist<strong>in</strong>g MRF.• 10t/hr scale for base case model.• Composition, throughput and cost dataderived from Nextek trials at three <strong>UK</strong>MRFs.
Manual MRF
Cost breakdown – manual MRF
Semi-automated MRF
Cost breakdown – semi-automated MRFCapex£580kLease cost41%sorter wagecost36%Ma<strong>in</strong>tenancecost9%managementcost9%
Cost breakdown – Automated MRFCapex£160k
MRF price assumptionsSales value £/tBaled films 0Baled <strong>mixed</strong> colour PET 200Baled <strong>mixed</strong> colour HDPE 250Baled rigids exclud<strong>in</strong>gHDPE/PETBaled rigids <strong>in</strong>clud<strong>in</strong>gHDPE/PET40100
MRF sensitivitiesCommercial gate fee forplastic(15% project IRR)Base case 10t/hrManual MRF£121/t(£9 gate feepremium /trecyclables)Semi-autoMRF with NIRsort<strong>in</strong>gAuto MRF(no paper <strong>in</strong>feed)£32/t -Larger scale 20t/hr £100t -£38/t -Higher staff wages£15/hrSeparate only film +<strong>mixed</strong> rigids <strong>in</strong>cbottles£209/t £61/t -£121/t £9/t -£37/t
MRF conclusions• Separate only baled film and <strong>mixed</strong>rigids at <strong>the</strong> MRF• Segregated paper collection allowsautomated <strong>mixed</strong> plastic separation atmuch lower cost• Manual plastic sort<strong>in</strong>g needs gate feepremium <strong>of</strong> about £9/t recyclables
PRF and reprocess<strong>in</strong>g element• Model estimates f<strong>in</strong>ancial returns for two options:• New stand alone plant• Add on to exist<strong>in</strong>g facility• 80,000t/yr scale for base case (<strong>in</strong>c 30% films)• Model <strong>in</strong>cludes full mass balance with separationefficiencies• Composition, throughput and cost data based onpractical trials by Nextek
OUTLINE PRF FLOWSHEETPrimary SeparationFEED1Manual FilmSeparation3NIRPET Sep5NIRHDPE Sep7 NIR9 NIR11NIR13PP SepPS SepPVC SepPrimary Sort<strong>in</strong>gResidue to Waste1210PVC Bales8Lower grade rigids processPSWash37PSExtrusion39PS Pellet636Waste38Waste4PPWash33PPExtrusion35PP Pellet32Waste34Waste2High grade rigids process23Jazz HDPEWash28 Waste29Jazz HDPEExtrusion30 Waste31Jazz HDPE PelletHDPE ColourSep22Nat HDPEWash25Nat HPDE27ExtrusionNat HDPE Pellet17Jazz PETWash24Waste4526WasteJazz PETExtrusion47Jazz PET Pellet44Waste46WastePET coloursep16Nat PETWash19Nat PETExtrusion21Nat PET Pellet18Waste20WasteNIR Film Sort15Film Wash<strong>in</strong>gandAgglomeration41Film Extrusion43LDPE Pellet14Waste40Waste42WasteFilm Process<strong>in</strong>g
Price assumptionsfull <strong>in</strong>tegrated PRF & reprocessorBase case £/tBaled film feed 0Baled <strong>mixed</strong> rigids feed <strong>in</strong>clud<strong>in</strong>gbottles100Food grade clear PET pellet 800Mixed colour PET pellet 500Food grade natural HDPE pellet 800Mixed colour PE pellet 500PP pellet 500PS pellet 500LDPE film pellet 450Baled PVC 25
Price assumptionsNIR separation onlyPrice £/tBaled <strong>mixed</strong> rigid feed <strong>in</strong>c bottles 100Baled <strong>mixed</strong> rigid feed exc40bottlesBaled film 0Baled clear PET 200Baled <strong>mixed</strong> colour PET 150Baled natural HDPE 250Baled <strong>mixed</strong> colour HDPE, PP, PS 140Baled PVC 25PRN value 20
Sensitivities – base operationBase case Sensitivity Project IRR Yr 5 op pr<strong>of</strong>itBase case - - +19% £9.9mHigherthroughputHigher yield(better NIRsorterefficiency)Lower pricesdue to lowerqualityLower capitalcost80Kt/yr 100kt/yr +24% £13.5m56% 60% +24% £12.1m- -20% forallproducts+2% £4.9m£29m £23m +26% £10.3m
Sensitivities: add-ons to exist<strong>in</strong>g <strong>recycl<strong>in</strong>g</strong> plantCapexIncrementalproject IRRYr 5 oppr<strong>of</strong>itBase case £29m +27% £9.9mFull plant for 56,000t/yr <strong>mixed</strong> rigidsexclud<strong>in</strong>g clear PET and natural HDPE(feed cost £40/t) No film£19m +9% £4.4mAs above but 80,000t/yr £23m +26% £7.6mNIR sort only for 56,000t/yr <strong>mixed</strong> rigids<strong>in</strong>clud<strong>in</strong>g clear PET and natural HDPE(feed cost £100/t)NIR sort only for 56,000t/yr <strong>mixed</strong> rigidsexclud<strong>in</strong>g clear PET and natural HDPE(feed cost £40/t)£6.4mVerynegative£0.4m£6.4m +2% £1.3mFilm process<strong>in</strong>g alone 24,000t/yr £4.6 +18% £2.7m
Conclusions• Big economies <strong>of</strong> scale for a fully <strong>in</strong>tegrated plant• Project sensitive to:• Price variations• Yield (NIR sort<strong>in</strong>g efficiency and wash process)• Capital cost• Food grade HDPE and PET add most value• Film process<strong>in</strong>g commercially viable at delivered pricesbetween £0-20/t
Axion Consult<strong>in</strong>grmorton@axionconsult<strong>in</strong>g.co.uk
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