And that's the view of the chief executive of one AD firm, which has an arrangement with Sainsbury to secure waste from its stores – and suppliers and is in talks to secure another deal with Morrisons.
Alan Lovell, chief executive and chairman of Tamar Energy – which will have a network of 40 AD plants by 2018 – said securing feedstock contracts was extremely difficult.
“This is because of the on-going efficiencies of retailers and manufacturers,” he added.
Lovell has experienced retailers' and manufacturers' efforts at close hand, because Sainsbury is one of Tamar's investors, as well as being a supplier of waste from its stores and a provider of introductions to its suppliers.
‘Removed a high source of feedstock’
“[However], Sainsbury has driven such high standards around food waste, and for its suppliers," said Lovell. “This has removed what would have been a potentially high source of feedstock.”
Despite being in talks to set up a deal with Morrisons, which would also lead to introductions to the supermarket's suppliers, Lovell added that ongoing efficiency drives by food manufacturers meant firms like his had to look for national contracts or go elsewhere for much of their feedstock.
“We are looking for national networks with retailers and processors but we are also looking for alternative sources – although I can't say too much about that because this is a very competitive sector,” he said.
When Tamar was established 18 months ago, Lovell believed that his feedstock pool would be divided equally between agriculture, food processors and post-consumer waste.
Now it is more heavily weighted towards the latter, with many companies scrambling to secure long-term local authority contracts for food waste collections.
The tightening up of controls around food waste by manufacturers and retailers was posing an additional problem, added Lovell, and that was the knock-on effect the shortage of feedstock had on funding opportunities.
“Most banks are reluctant lenders and like to see secure feedstock contracts in place,” added Lovell.
Despite the travails, Lovell said Tamar was on track to meet its goals of generating 100MW of renewable energy by 2018 and meeting its ambition of being the UK's leading developer and operator of AD sites.
Last month Food Manufacture reported the views of BV Dairy's technical director Alan McInnes, who called for a national strategy on AD to ensure there was an even distribution of feedstock and sites across the country.