Why Are Rubbish Removal & Skip Bin Hire Costs Rising?
You may have noticed that rubbish removal services are increasing in price in Australia, regardless of where you look. There’s more to these price increases than meets the eye; in fact, skip bin hire companies have been impacted by many market changes. So what exactly is causing these price increases?
Rubbish removal and skip bin hire costs in Australia are impacted by domestic and international factors. This includes rising fuel prices, transfer station site costs and more stringent regulation from the EPA on proper waste collection. Labour shortages as caused by COVID-19 have also hindered waste removal.
Here’s all you need to know about rubbish removal costs in Australia. We’ve unpacked some key reasons behind the price rises, and also put together some suggestions to help you get the best value on your skip bin hire.
Rubbish Removal & Skip Bin Costs Explained
Are you looking to hire a skip bin for an upcoming project? You’ll probably want to know how skip hire costs are calculated and what factors into the cost.
Skip bin costs are determined by customer needs such as:
- Waste type
- Skip size and weight
- Landfill and processing costs
- Skip hire time period
- Delivery time
However, there are other fixed costs that skip bin companies and rubbish removal services need to cover. Some of these skip bin hire company expenses include:
- Site ownership or rental for waste transfer site
- Vehicle, bins & equipment purchase, upkeep and maintenance
- Driver and site staffing costs
- Waste processing equipment
- Fuel expenses
- Site and operating insurance
- Landfill levies and fees for disposal
- Cost of EPA regulatory compliance
- Administration costs
As these expenses vary – for instance, when fuel prices rise, or landfill levies increase – skip bin companies need to factor these price increases into the customer costs.
Why Have Rubbish Removal Costs Increased?
Rubbish removal costs have increased due to a steep rise in operating expenses, combined with greater challenges facing Australia’s waste disposal and recycling industries.
Depending on where the waste originated, the prices increased from 2021 to 2022 for prescribed metro premises refuse collection. Several states have shipped waste to Victoria for lower disposal rates, but in 2022, ‘waste levies’ or ‘landfill levies’ increased the prices for interstate transport.
Previously, $105.90/tonne for municipal waste and 105.90/tonne for industrial waste; non-prescribed municipal rural refuse collection premises is 52.95/tonne and industrial waste at 93.19/tonne in 2021. Several states have shipped waste to Victoria for lower disposal rates, but in 2022, ‘waste levies’ or ‘landfill levies’ increased the prices for interstate transport.
Below, we’ll break down the components of several of the reasons so that you can gain a holistic picture of why prices have increased for both you as a consumer and us as a service provider. If you have further questions, our team at Jim’s Skip Bins is available for assistance.
Several states have shipped waste to Victoria for lower disposal rates, but in 2022, ‘waste levies’ or ‘landfill levies’ increased the prices for interstate transport.
Increased Landfill Levies
Landfill levies, a major factor in the cost of waste disposal, have been on the rise Australia-wide over the past few years. The increased waste levies make it more expensive for rubbish removal companies to operate, and those additional costs have led to higher prices for consumers.
Full infographic at https://jimsskipbins.com.au/victoria-waste-levy-infographic/
In 2021, Victoria’s landfill levy increased by up to 40% for some waste categories. Previously, Victoria’s waste levy was one of the lowest in Australia, which encouraged many companies to off-load the waste into Victoria for cheaper disposal fees.
Improper waste disposal was impacting the resource recovery rate in Victoria and other states, meaning less materials were being recycled. The current goal is to redirect at least an additional 2.01 tonnes/year from landfills for a resource recovery rate of 80%, up from the 65% recorded in 2017-2018.
Overall, this change is designed to incentivise recycling and encourage more sustainable waste removal practices. In fact, almost 80% of people surveyed in the C&D waste industry agree waste levies are an effective measure.
However, it does mean rubbish removal and skip bin companies are paying significantly more to dispose of their non-recyclable waste. Although sustainable waste removal methods are objectively better for us and for the environment, they do require more time, effort and expense to carry out. This means prices for consumers are on the rise.
Unfortunately, this does mean prices for consumers are on the rise – but these price hikes would also apply to tip fees paid by individual customers as well. Ultimately, these landfill levy increases are designed to make waste disposal in Australia cleaner and greener.
We unpack Victorias waste levy increase in more detail here.
Increased Supply Costs
A rise in operating costs is impacting businesses Australia-wide, and rubbish removal companies are being hit hard by these expenses. Skip hire companies rely heavily on transport vehicles, labour and facilities to collect and process rubbish. However, this also means there are many expenses involved.
Some of the reasons rubbish removal companies are facing additional expenses include:
Labour shortages: During the pandemic, the workforce took a hit, drastically reducing domestic and imported labour resources. As of February 2022, a record 85% of Australian businesses report staff shortages are holding back their ability to operate at full capacity. The waste collection industry was no different, with COVID staff shortages delaying waste collection in many areas.
Fuel cost increases: Transportation of skip bins, waste and recycled materials requires diesel. In some parts of the country, such as Queensland, diesel prices have reached $2.38/litre and increased fuel costs are predicted to stick around. Fuel price increases mean it costs more to deliver and collect skip bins, as well as transport sorted materials to facilities or landfills. This means that consumer costs for rubbish removal are rising to reflect higher costs of transport.
Commercial rents and property prices: As the value and scarcity of land in Australia escalates, it becomes more and more expensive to own and operate a waste transfer site. With an already-limited selection of suitable sites for waste transfer facilities, market pressures are rising. This not only contributes to a shortage of services and waste processing capacity, but also adds to the costs operators must pay.
Insurance: With waste management facilities facing higher insurance premiums, the cost of operating a waste transfer and sorting site is steeply increasing. Increased regulation and changing licence statutes require higher levels of general risk maintenance, additional training of personnel, costs of new facilities and maintenance of current ones and greater liability considerations.
More Stringent EPA Regulations
Regulatory changes from the Environmental Protection Authority have drastically increased operating and disposal costs for rubbish removal companies. More stringent criteria also mean that more waste is now non-recyclable and must go to landfill, leading to added waste disposal costs for skip bin companies.
Global attention to the impacts of poor waste management has led to increasingly more stringent environmental legislation in Australia. The cost of regulatory compliance is significant enough to push some providers out of the market entirely, meaning fewer suppliers of rubbish removal services left to meet higher demand.
The push for proper waste disposal has become a global issue. The industrial fires in Campbellfield and illegal chemical dumping in Kaniva are some domestic consequences of improper waste disposal which have come to the public’s attention. Despite the penalties for illegal dumping in Australia, many of these practices continue today.
As the climate crisis becomes more prevalent and Australia being named one of the worst offenders for emissions, renewables and energy use (a decrease of four spots overall in the 2021 Climate Change Performance Index), it’s safe to say that waste disposal is under the spotlight for State and Federal governments at the moment.
These stricter EPA regulations include stricter criteria on recyclables and recovered materials in New South Wales from July 2022. Instead of paying a single upfront cost for disposal, companies must now pay by tonnage, resulting in an unknown element. Charging by weight rather than capacity can increase skip tip fees by about 400-500 per cent, before transportation fees and other administrative costs are considered.
This policy change comes from the EPA in an effort to improve quality of recovered fines – a soil or substrate substitute generated from construction and demolition refuse suitable for reuse.
Most skip bin rubbish is recycled: up to 90% of waste. When the recyclable percentage of waste decreases, landfilling expenses for rubbish removal companies also increase, and operators are able to recoup fewer costs through resource recovery.
Due to population growth, the amount of waste per capita in Australia grows considerably higher. Meanwhile, increased pressure is placed on Australian facilities as export destinations like China impose more stringent criteria. This means finite waste disposal and recycling capacity faces more demand than ever.
In its latest release, the Australian Bureau of Statistics measured a 10% increase in waste since 2016-2017 reporting. In a 35% increase, the construction industry spent considerably more on waste services than in previous years: around $2 billion.
Of the total waste generated, 38.5 tonnes (75%) of solid waste was sent for recycling, with the remainder being sent to landfills. The manufacturing sector generated the most waste, 12.8 million tonnes, with households only contributing 12.4 million tonnes (16.3%) of overall waste.
Plastic waste: 2.5 million tonnes of plastic waste was generated, with only 9% of intake being sent for recycling. The remainder was sent to landfills; out of the total, 32% of plastic waste was high-density polyethylene. Households contributed the most to this metric, supplying around 47%. The recovery rate of plastic materials was among the lowest, coming in at 19%.
Organic waste: 15.3 million tonnes of organic waste was generated, with 42% being sent for recycling. Organic waste tonnage increased by 10% from 2016-to 2017, with households being the most significant contributor in this area, seconded by manufacturing. The agriculture sector was fourth-highest in waste generation, coming in at 23 tonnes/$m.
Hazardous waste: 8 million tonnes of hazardous waste was generated, making up 11% of the total waste. Around 6% of this waste was tyres, and 4.6 million tonnes were sent to landfills instead of recycled. Manufacturing industry leads by supplying 24% of all hazardous waste. Hazardous waste has the lowest recovery rate, with only 27% of it being able to be utilised for energy production or export.
Because of this added pressure, sustainable waste disposal is under the spotlight more than ever before. China’s waste import ban has skyrocketed domestic pressure, as it was formerly the primary export location for Australian waste. Now 99% of formerly accepted waste and recyclables are no longer accepted by China, and other nations are following suit.
State governments have had to develop ways to mitigate the increase in cost and create an infrastructure that can support recyclable processing while being cost-effective in vast proportions. With a limited domestic market for household recyclables like paper and plastic, the waste crisis is intensifying across the nation.
However, there are many factors that have limited the supply of waste and recycling facilities in Australia, and makes it challenging for Australian on-shore capacity to increase. Oversupply of recycled materials has also reduced the value of these goods in Australia.
Reduced supply of landfills and suitable waste disposal facilities is an unfortunate effect of several market factors. Public opposition has slowed or halted attempts to increase recycling and waste infrastructure.
The Waste Management Association of Australia proposed an action plan to resolve the crisis, but this requires a $150 million investment in infrastructure. Attempts to add more waste facilities to lessen the strain are often met with ‘NIMBY’ (Not In My Backyard) resistance from local residents. Public opposition to waste recycling plant construction centres on risks like degradation of air quality, noise, ecological impact and safety, highlighting several challenges around new recycling facilities and the quality of life in these areas.
For example, the New South Wales government proposed the construction of a waste facility to process up to 250,000 tonnes a year of waste from Sydney, reducing the cost of transport. Designed to lessen the strain and inconvenience on consumers, the project has faced strong opposition from locals.
Without enough facilities, however, recycling rates and processing capabilities are suffering. With an increasing number of waste facilities finding operating costs are now higher than revenue, Australia is facing increased pressure – referred to by some as a waste crisis.
All three factors combine to put upward pressure on the cost of rubbish removal and skip bin hire for everyday Australians.
How Much Does Skip Bin Hire Cost in Australia?
Skip bin hire pricing can be complicated, and getting a custom quote is the only way to anticipate all factors. The ultimate cost of skip hire depends on the type of waste, size of bin, location and duration of hire.
Compared to rubbish removal alternatives, skip bin hire is cost-effective for many different scenarios. For more information on skip bin hire costs in Australia, see the full Jim’s Skip Bins Pricing Guide.
How to Save Money on Rubbish Removal
With all of the above information, is there any good news for Australian customers when it comes to rubbish removal costs? Luckily, we have some tips to make waste disposal more accessible and save you money.
Choose skip bin hire over individual trips to the tip: Skip bins can hold between two and twelve trailer-loads of waste and vary in size and type, and we have flexible schedules for rentals. Avoid paying for petrol, trailer or truck hire and multiple rounds of tip fees – instead, hire a skip bin when renovating or clearing out unwanted goods.
Get a skip bin of the right size, requiring less frequent emptying: Choosing the right size skip bin gives you the best value for money, as emptying it multiple times adds to the cost.
Get a skip bin suitable for your type of waste: Ensure that your skip bin is suitable for the type of waste you have, and learn how to divide your skip bin waste correctly. Waste types shouldn’t be mixed, and a mixed waste skip bin requires additional sorting, adding to the cost.
Plan your hire period ahead of time: Jim’s Skip Bins offers hire for up to a five day period, and flexibility if you require additional time. However, planning ahead and knowing your hire period helps you get the best rate.
Ensure your skip bin company gets the correct permits – Depending on your state, local regulations may require a permit for skip bin placement there are several things to consider, such as potential hazards and obstacles to access, possible damages to property, and proper permissions. Be sure to check your permissions before hiring a skip bin to avoid the fine, and follow a skip bin placement guide.
Get a personalised upfront quote: When getting skip hire quotes online, many providers don’t consider your individual scenario, and you may face unexpected costs later. Ensure there are no catches you’re not aware of (like weight limits) or get a skip hire quote for your exact needs with Jim’s Skip Bins.