£4.75M windfall for north London councils from publicly owned energy-from-waste facility

Seven London councils, which represent two million residents, are on course to receive budgetary boosts totalling £4.75 million this November, due to windfall electricity earnings from a publicly owned energy-from-waste facility at Edmonton EcoPark in Enfield.

Since 1971, the facility has used householders’ black-bin-bag waste to generate electricity for the National Grid instead of sending it to landfill, with income from energy generation offset against the cost of disposal for council taxpayers. This year, due to price rises in global energy supply markets, the facility will see its income rise considerably. North London Waste Authority (NLWA), the public body responsible for the facility, is proposing that these unexpected earnings be returned as a ‘windfall dividend’ to communities via their borough councils to help fund crucial services during the UK’s cost-of-living crisis.

NLWA manages the recycling and waste produced by north London residents and is the 100% shareholder of LondonEnergy Ltd, the company that operates the energy-from-waste facility in Edmonton. At its next Authority Meeting on 31 October 2022, NLWA Members will consider a recommendation to waive the cost for waste disposal for the month of November for each of its constituent boroughs*: Barnet, Camden, Enfield, Hackney, Haringey, Islington, and Waltham Forest, effectively delivering them a ‘windfall dividend’.

NLWA Chair, Cllr Clyde Loakes, said: “Because NLWA deals with its waste by generating energy from it in a 100% publicly owned facility, our councils don’t have to pay huge sums to private companies to dispose of it. And rather than a private company earning large profits, north Londoners will benefit instead from a ‘windfall dividend’.

"During this extreme cost-of-living crisis and rising inflation, we’ve decided to act now to return this money to the public by helping to ease the monetary pressures on their local councils and their services. Wholesale energy prices are expected to remain high over the winter, and if that is the case there will be further ‘windfall dividends’ to come. This shows that the public ownership of utilities can bring direct benefits to communities, instead of just the shareholders of the big energy companies.

“I expect councils will be looking to use this cash in a range of different local interventions to help protect some of our most vulnerable residents from the full impact of the cost-of-living crisis this winter such as retrofitting homes to help reduce household energy bills, which will also benefit the climate, as well as bolstering support for critical front-line council services and local voluntary and community organisations.”

The waiving of the November charge for waste disposal by NLWA will be designed to ensure councils benefit immediately, instead of waiting to introduce a complex new payment mechanism. While most of the increased earnings are due to the increase in electricity income, NLWA is also earning more from the selling of recycling collected across north London, such as aluminium and plastic, due to strong market demand for these commodities.

NLWA became the 100% owner of LondonEnergy in 2009. As the sole shareholder, NLWA ensures that funds gained from electricity generation by the energy-from-waste facility are used to reduce the cost of waste disposal for north London residents, with monies instead spent on essential services for residents.

Last month, construction began on NLWA’s replacement of the current energy-from-waste facility, now Europe’s oldest, with a new publicly-owned advanced, high-tech Energy Recovery Facility. The new facility will not only generate electricity but will also produce heat for thousands of local homes, bringing energy security and freedom from gas boilers, whilst ensuring that north London council taxpayers can benefit financially from a facility that they own.

*Each borough pays a monthly levy to NLWA proportional to the volume and composition of waste collected the previous year. The levy pays for the processing of recycling, the disposal of waste, and the operation of reuse and recycling centres.  The following levies will be waived in November 2022.