Introduction

Lately, we have been talking with councils a lot about landfill gas reduction, food and garden organics (FOGO) expansion, and broader circular economy issues. The main question we are currently being asked is “what kind of circular measures will lead to the largest emissions reductions and the best economic outcomes?”

Councils want robust information to:

• Identify and prioritise waste diversion measures
• Understand the relative costs and benefits of different options
• Compare landfill gas capture upgrades with FOGO rollouts, organics processing, construction and demolition diversion, reuse initiatives, and procurement reform
• Quantify emissions reduction over time – not just in a single reporting year

The humble MACC

Interestingly, one of the most useful tools in this conversation is the humble MACC chart – the Marginal Abatement Cost Curve. The MACC is proving useful for assessing circular economy measures because it allows for incorporation of a wide range of relevant costs and benefits.

A well-constructed MACC clearly communicates:

• Relative costs and benefits, over time, in net terms (column height)
• Total abatement potential of each measure (column width)
• The sequencing of measures in terms of cost effectiveness (left to right)
• Which initiatives are financial “no regrets” and which require deeper strategic commitment (negative vs positive net cost measures)

However, to build a credible MACC for waste and circular economy, we have to go well beyond traditional linear thinking. The 12 Rs of Circular Economy framework may be used as a guide or checklist to help explore potential practical measures for dealing with resources that would otherwise just be dumped in landfill.

Downstream impacts – getting landfill modelling right

Landfill gas emissions remain crucial. Any credible circular economy model must include solid first-order decay modelling, informed by accurately prepared calculation inputs. Many councils are still grappling with establishing this crucial foundation.

We still rely heavily on first-order decay modelling tools such as the NGER Solid Waste Calculator to quantify methane generation over time. This is essential to:

• Model baseline (business-as-usual) emissions
• Quantify cumulative abatement over decades, not just annual snapshots
• Compare diversion scenarios consistently
• Assess timing impacts

But downstream impacts go beyond methane. Councils are increasingly asking us to integrate:

• State waste levy costs
• Gate fees and transport costs
• Long-term environmental management and remediation liabilities
• Future landfill cell construction and closure costs
• Risk exposure from tightening methane regulation

If modelling stops at landfill emissions modelling, it misses the broader strategic and financial impacts.

Upstream impacts – the hidden side of the equation

For decades, the Western economic model has been “take, consume, dispose.” As a result, we often forget that downstream impacts imply upstream consequences. Every material sent to landfill potentially represents something that must be replaced, or provided for, “upstream”.

For example, in practical terms:

• Every decent piece of timber landfilled is timber that council may need to purchase for landscaping or infrastructure.
• Every tonne of brick or concrete disposed to landfill is a tonne of aggregate that council may need to purchase for civil works.
• Every tonne of garden waste disposed to landfill is roughly half a tonne of compost that council may otherwise have to buy to maintain parks and gardens.
• Every tonne of anything that goes into landfill carries with it the need for council to budget in advance to ensure adequate resources and staff are in place to manage and administer the ever-increasing pile of rubbish.

Expenses such as these carry:

• Financial cost
• Supply chain risk
• Scope 3 emissions

When we model circular economy measures properly, we increasingly include quantification of upstream benefits by examining avoided procurement and other council costs. Because most councils calculate Scope 3 emissions using spend-based emissions factors, reduced expenditure translates directly into reduced Scope 3 emissions.

That means a single well-devised circular economy measure can:

• reduce Scope 1 methane emissions from landfills, while extending landfill life
• AND reduce Scope 3 emissions
• AND reduce council operating expenditure across the board

All while delivering benefits within the local economy – that is circular systems thinking.

Closing the loop – where the biggest wins are

The most cost-effective and impactful waste management measures tend to be those that maximise benefits both upstream and downstream. The strongest performers in MACC analysis, at least in net cost terms, are often initiatives that maximise diversion of organics from landfill at low upfront cost (e.g., education campaigns).

An example of a MACC for circular economy is shown below.

When we quantify both sides of the system, the abatement cost per tonne often shifts dramatically. Measures that appear “expensive” with modest abatement under narrow methane accounting may become a lot more feasible when upstream avoided purchases are included. That can change the prioritisation conversation.

However, it is important to note that no two circular economy MACCs look alike. Each varies significantly with respect to local conditions, strategies, plans, waste volumes, landfill management costs, and so on. The chart below shows a MACC for a different council in a different state, and the differences are striking.

This highlights the value in conducting MACC analysis specific to a local policy and geographic context, rather than relying on generic MACC calculations undertaken at State or Commonwealth level, such as the NSW EPA’s Carbon Abatement Opportunities for Circular Economy report (2022).

The detailed modelling used to build a council-specific circular economy MACC can then be meaningfully integrated into a council’s own emission reduction forecast model, as seen in the example below, thereby helping to more accurately predict what the final offsetting and/or “insetting” requirements are likely to be in the “target year” for net zero.

Summary

In summary, the trend we’ve been seeing across councils is that they want:

• Detailed emissions forecasts over 10–30 years
• Integration of landfill gas, FOGO measures, and upstream procurement
• Clear MACC-based prioritisation
• Quantification of both financial and emissions impacts
• Transparent assumptions

Fundamentally, they want modelling that reflects circular dynamics – changes to upstream and downstream systems interacting simultaneously. That is where the real strategic insights are emerging.

If you need help with landfill gas modelling, FOGO scenario analysis, circular economy MACCs, or any integrated Scope 1 and Scope 3 waste modelling, don’t hesitate to reach out to Ian, Mark, Patrick, or Barbara.

 

If you need help developing a climate transition strategy and action plan, or a climate risk assessment, contact us today to learn how we can support your transition. Reach out to  Barbara or Patrick for more information.

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