Touted as a $300 million facility capable of processing up to 400,000 tonnes of materials a year, efforts to build a large waste to energy plant in Ballarat have stalled with council blaming the State Government for a 'policy vacuum'.

Key points: Five year-long efforts to build a waste-to-energy plant in Ballarat are on hold

Five year-long efforts to build a waste-to-energy plant in Ballarat are on hold An industry consultant says Ballarat has 'one of the best' sites in Australia for waste-to-energy processing

An industry consultant says Ballarat has 'one of the best' sites in Australia for waste-to-energy processing Concerns have been raised that the City of Ballarat's approach has disadvantaged some alternative proposals

The City of Ballarat estimated the facility, proposed by Kuala Lumpur-based company Malaysian Resources Corporation Berhad [MRCB], would inject $202 million into the local economy, divert 60 per cent of the city's waste away from landfill and create 120 ongoing jobs.

Despite extending its initial 120-day agreement with MRCB on two separate occasions, the council announced this month that it was putting a hold on the development of a waste-to-energy facility.

Instead, council will wait until the State Government has released its circular economy policy in late 2019.

But a company proposing a separate, smaller facility said the City of Ballarat had pursued a "flawed" approach to waste-to-energy that had prevented alternative proposals from being properly considered.

Concerns alternative proposals disadvantaged

After four years of considering waste-to-energy's potential, the City of Ballarat signed an exclusive Heads of Agreement with MRCB in August 2018 to explore the feasibility of an incinerator to generate electricity.

The agreement also prevented council from negotiating with other waste-to-energy proponents, including BlueGas Technologies, formally known as Concord Blue.

Ballarat councillors and MRCB representatives signed a Heads of Agreement in August 2019. ( ABC Ballarat: Dominic Cansdale )

The company's project manager, Juris Austrums, said despite holding "brief" discussions with councillors and executive staff, BlueGas Technologies was restricted from providing more detailed information about alternative waste to energy methods.

"We were humoured and there was no realistic follow through by any of the council officers," he said.

"There was mixed information coming back to us ... but our discussions with other councils have been met with great interest and acceptance."

City of Ballarat councillor Grant Tillett said while the agreement with MRCB prevented council from formally accepting other proposals, it served as "a hiatus to allow one player to have some confidence that the council was serious".

"There is no effort or intent on the part of council to inconvenience any player that thinks they have the technology worth looking at," he said.

No need to wait, says consultant

Chairman of the Australian Waste to Energy Forum and industry consultant, Barry Sullivan, said the City of Ballarat's decision to sign an exclusive agreement with MRCB, had pushed other prospective developers away.

"Others started focusing on other areas within Victoria and other parts of Australia because it made no sense to try to do something here when exclusivity didn't allow anybody to discuss other opportunities with the city," he said.

"Everything was put on hold and we can only hope that those who are able to put a good facility in place will still be around [and] are still interested in stepping forward."

But Mr Sullivan said the proposed site's close proximity to industry and infrastructure made it "one of the best I've seen, not just in Victoria but in Australia as a whole" and that council should not wait for the State Government.

"Waste-to-energy replaces the hole in the ground," he said.

"That stuff that's not recycled [and] goes into the tip would go into a waste-to-energy facility instead.

"So it's what spins out of that circular economy, so waiting isn't necessary."

State Government 'taking their bloody time'

Cr Tillett said the City of Ballarat had to put its waste-to-energy plans on hold because there was "no clear direction from the government and no sign of serious support for councils to even be brave and have a bit of a crack".

He said councils needed a clear set of rules and regulations from the State Government to guide waste-to-energy developments.

"We've got no yardstick to measure them against. It's very frustrating frankly," he said.

"They're taking their bloody time."

The State Government's circular economy policy is expected to outline how waste-to- energy projects will fit into Victoria's waste and resource recovery system and is due to be released later in 2019.

"We're continuing to consult with the community to ensure we get this policy right and that it meets the needs of an industry experiencing significant challenges," a State Government spokesperson said.

Finding the right technology

While Ballarat only produces around 30,000 tonnes of municipal waste a year, well below the 400,000 required by MRCB's proposal, other surrounding councils have expressed interest in sending their waste to the regional city.

But Cr Tillett said he was concerned that such an arrangement could make Ballarat the "garbage capital" of Victoria and he did not want trains "full of Melbourne's rubbish" coming into the city.

He said smaller projects like BlueGas Technologies', which uses machinery called a Concord Blue Reformer to thermally heat waste to produce gas, are possible alternatives.

"It's a bit of a reverse of the Malaysian one…this one will work on about 50 to 60 [thousand tonnes of waste a year]," he said.

An MRCB spokesman said its research indicated "a large scale W2E facility at Ballarat is viable, feasible and realistic" but that details remain commercially confidential.

But Mr Sullivan said MRCB's proposal was too large and it would be more appropriate to build a facility capable of processing 100,000 tonnes of waste per year.

"Often they try to make a council fit into their technology as opposed to bringing a technology along into the council's needs," he said.

"I'm always using the expression 'when you sell hammers, everything looks like a nail'."

In a statement, a City of Ballarat spokesperson said council had "enthusiastically welcomed all waste-to-energy' companies" and it would consider options available to advance projects in the city once there was a state circular policy.