Waste to Energy Scheme

Despite improvements in recycling rates, Victorians are forecast to send nearly 9 million tonnes of waste to landfill every year. At this rate Victoria will start to run out of approved landfill capacity in the mid-2030s.

Securing waste infrastructure that can handle this volume of waste is a priority for Victoria and we need waste to energy to help us do this.

Only waste that can't be recycled can be treated in thermal waste to energy facilities.

Waste to energy provides an alternative to landfills for most types of residual waste, reducing the state’s reliance on landfills for non-recyclable or non-recoverable waste.

Waste to energy involves recovering energy from waste materials that are currently destined to go to landfill and can’t otherwise be recycled, to produce heat, liquid fuels or electricity.

These facilities can also enable the recovery of materials that would otherwise go to landfills, like metals and aggregates such as bricks, rubble and glass. These materials make up a significant portion of our residual waste and can be re-used.

The Waste to Energy Scheme encourages investment that supports diversion of residual waste from landfill, while avoiding risks to recycling outcomes in the future.

The purpose of the Scheme is to:

encourage investment in facilities that help achieve the goals and targets of Recycling Victoria
support a diverse and competitive waste to energy market
have a consistent, transparent and fair mechanism for licensing.

There is a cap on the amount of permitted waste that is treated in thermal waste to energy processes to ensure investment in waste to energy facilities does not compromise current and future investment in Victoria's efforts to avoid, reuse and recycle more waste.

Further information

Updated 30 July 2025