Barr Labor government poised to block Fyshwick recycling plant if re-elected

City Services Minister Chris Steel said Labor had grave concerns about Capital Recycling Solutions' proposed materials processing plant and would not support it in its current form.

While Mr Steel's view is not the formal position of the ACT government, as it hasn't been considered by cabinet, his comments send a dire warning to Capital Recycling Solutions about the project's future should Andrew Barr and Labor win another term on October 17.

The company's director Adam Perry declined to comment when contacted by The Canberra Times.

Labor's stance could prove the most significant setback yet for the recycling firm, which has already spent three years and more than $3 million fighting to get the various elements of the project off the ground. The blow comes just two months after the company's environmental impact assessment was accepted, and after it recently lodged a development application to redevelop the Ipswich Street site.

Mr Steel made the comments after the ACT Greens called for a moratorium on approvals on all waste projects in Fyshwick until a series of hurdles had been cleared, including a review of planning rules in industrial zones.

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The Greens' position had been welcomed by the Inner South Canberra Community Council and Fyshwick Business Association, which had been vocal opponents of the project.

But in a statement to The Canberra Times, Mr Steel said Labor would go further and examine options to oppose the project if re-elected.

"ACT Labor has grave concerns about the Capital Recycling Solutions' waste proposal as it stands," Mr Steel said.

"The Greens have proposed a moratorium - Labor considers this is not enough. We need to be clear right now with Capital Recycling Solutions and the community that we are not supportive of their proposal.

"A re-elected Labor government will consider the available options to oppose the project."

The Canberra Times sought clarification on exactly what options the government would have at its disposal to stop the project.

In response, a Labor spokeswoman said the ACT Planning and Land Authority would have to consider a minister's opposition to the project when it was weighing up whether to approve or reject it.

"A re-elected Labor government will explore further options to influence the proposal if our actions so far are insufficient," the spokeswoman said.

Mr Steel's comments are understood to be the first time a Labor MLA, let alone a minister, has spoken out publicly against the recycling plant proposal, despite it being the subject of extensive media coverage and intense interest in the inner-south community for more than two years.

Despite the apparent silence, Labor holds numerous concerns about the project.

It addition to doubts over the economic viability of the plant, Mr Steel's team is worried about an increased risk of stockpiling of rubbish. Labor also believes the proposal clashes with its climate change strategies.

There are also concerns the plant would be in conflict with a so-called "proximity principle" written into the territory's waste management laws, which requires that "waste and recovered resources should be managed as close to the source of generation as possible".

Mr Steel said Labor were opposed to processing household waste in Fyshwick, as Capital Recycling Solutions intends to do. He noted the ACT government's waste management strategy earmarked Hume as the location for materials recovery centres.

Capital Recycling Solutions elected to pursue the materials recovery project after abandoning plans in mid 2018 to build a waste incinerator amid opposition from the community and ACT Greens. The ACT government has since banned the burning of rubbish to create electricity under a new energy policy.

The Fyshwick plant was designed to process about 300,000 tonnes of waste a year, extracting recyclables from material that would have otherwise gone into landfill. The non-recyclables would be transported via rail from Ipswich Street to the Woodlawn Bioreactor, near Tarago in southern NSW.

The project has been mired in controversy and plagued by delays for much of the past two years, including due to a court battle over the bungled assessment process for a planned rail freight terminal.

The company's anger and frustration with the ACT government over its handling of the project has boiled over on a number of occasions, with Mr Perry earlier this year describing Canberra as a "nightmare place to get anything done".

"I'm sure many good proponents simply abandon projects because it's all too hard," Mr Perry said.