Scotland's local authorities are starting to look seriously at the potential for composting domestic, commercial, and their own organic waste. The cost of dumping such waste in holes in the ground is growing. Available landfill sites are shrinking in size and number, while EU directives with more demanding targets are looming. ''Plans will need to be formulated now to achieve the targets set by the due dates,'' says the Scottish Environmental Protection Agency (Sepa), in its draft National Waste Strategy, recently put out to public consultation.

It is generally accepted that at least 40% of what goes into the average household's dustbin could be composted. Organic materials, or ''green waste'' such as food remains, leaves, and garden trimmings account for more than 20% of the volume of solid waste in the domestic dustbin. Biodegradable fibres such as paper and cardboard make up a further 20-30%. Much of this could also be composted.

''Composting is a sustainable method of waste management to provide a valuable resource,'' says Conrad Young of the Composting Association. Compost from existing schemes is already being used as a soil conditioner, not just on gardens and allotments, but also on agricultural and forestry land and in land restoration. Left to decompose in landfill sites, however, the material may take up to 200 years to degrade. ''Putricible'', or green waste, generates methane - contributing to the greenhouse effect. It can also cause subsidence and groundwater pollution.

When the government introduced the landfill tax in 1996, it set a target of one million tonnes of organic waste to be recycled annually by the year 2000. But the UK at present composts just 500,000 ts, a mere 3% of the annual 15 million ts of domestic biodegradable waste generated.

The EU Landfill Directive will require EU member countries to divert at least 25% of biodegradable waste (the directive includes paper and cardboard as well as kitchen and garden waste) from landfill by 2006. At present UK volumes this represents 3.5 million ts. It will rise to 50% by 2009 and 75% by 2016.

But the poorer a country's recycling record, it seems, the more time it is to be given to achieve the targets. The Council of Environment Minsters may allow the UK an additional four years, as more than 80% of its waste currently goes to landfill.

The incentive to develop recycling schemes generally and the technology for composting in particular has been far greater for some continental countries. The costs of putting waste in a hole in the ground on the continent can be as high as #60 per tonne, made up of taxes and fees charged by operators of landfill sites. This high cost is a reflection of some much stricter environmental controls, combined in countries such as the Netherlands with a severe shortage of land and landfill sites.

Indeed, the Netherlands banned the disposal of biowaste to landfill in 1994. In the following year Austria made the separate collection of biowaste mandatory. This year Norway is following the Dutch example.

The Chancellor increased the UK tax on green waste sent to landfill by #3 per tonne to #10 per tonne from April 1. It is set to rise by at least #1 per tonne each year for the next five years. But local authorities in Scotland are still only paying some #20 to #25 per tonne to dump it.

Dundee is widely considered to be Scotland's composting capital. The city currently recycles 7000 tonnes of green waste. Roughly two-thirds of this is domestic waste, taken by citizens to a civic amenity site or put out by households in the 10,000 brown bins provided for separate collection. The remaining one-third is from the council's own parks and gardens or from commercial premises. The 7000 tonnes of waste is turned into 2000 tonnes of compost, most of it used by the council, with some 300 tonnes sold to the public in bags, or loose at civic amenity sites. The compost-making process currently used by Dundee is the traditional one, of open-air ''windrows''. The material is first inspected and any non-biodegradable or bulky materials lifted out. It is then put through a shredder.

The ''windrows'' themselves are elongated heaps of material, turned regularly by machine. This allows air into the heap necessary for the bugs which help break down the materials to thrive, at the same time exposing the materials throughout evenly to the high temperatures necessary, not just for decomposition but to kill off weed seeds and pathogens such as salmonella and strains of E-coli.

It can take up to six months to produce compost using the windrow method. The heaps also occupy a considerable area of land.

Dundee continues to consider a range of options, including in-vessel composting, which would produce the same quality of compost but in one month, occupy much less land, and be capable of taking a wider range of materials, including sewage sludge and bin waste.

These large containers can typically cope with 30 tonnes of waste in a day, or 14,000 tonnes a year. They have paddles regularly to turn the mixture, water jets to provide moisture when required, and fans to release oxygen. It would cost #20 to produce a tonne of compost from an invessel composter, compared with #17 per tonne using the traditional windrow method.

In Ayrshire, William Tracey Ltd, the largest independent waste management company in Scotland, is planning to invest #1m in a windrow facility capable of processing 60,000 tonnes per annum. It is in discussion with six local authorities in Ayrshire and Renfrewshire which would supply the green waste feedstock for the plant. The company expects to use much of the resulting 30,000 tonnes of compost for its own operations.

Households in Perth and Kinross each year generate 54,000 tonnes of waste. Last year 4500 tonnes of domestic green waste was composted. This was delivered by householders to skips at the council's civic amenity site. It is sorted, then taken to windrows at the landfill site operated by Northumbrian Environmental Management. NEM pays the council #2.50 for every tonne of green waste delivered. The company makes a net saving of #7.50 per tonne on the landfill tax that would otherwise be payable. The council takes some of the resulting compost for its own use, and to sell back to the public as a soil conditioner.

Perth and Kinross has introduced a special offer on homecomposters. Within one month it had sold 700 of the 330-litre bins to householders at a cost price of #15.80. They retail at #39.95. The council has ordered a third lorry load, so popular have they been. The council estimates that 1.5 tonnes of green waste will be taken out of its waste collection for every 500 full composting bins. Householders can also hire separate wheely bins for green waste, with a separate lorry collection of green waste possible if demand is high enough.

Promising results are also emerging from Elgrow, a year-long homecomposting trial in East Lothian. The trial has involved 500 households, each of them given 210-litre bins. A power shredder has been made available to participants to convert garden clippings into compostable material.

The bins' contents are now being weighed by Leep (Lothian and Edinburgh Environmental Partnership), which is conducting the trial on behalf of East Lothian. Preliminary results indicate that homecomposting could remove more than 30% of materials from the county's waste.

There are advantages for councils of homecomposting schemes, says Douglas Boyle, of Scottish Organic Services, a consultancy set up to advise on composting. They don't have to check, transport, process, or market the material. But it is his experience that without advise and support, households may start to lose interest after a few months, especially if the heap is too wet and if it doesn't look like its composting properly.

''It is entirely appropriate that a full support service has been provided as part of the East Lothian trials, including a telephone advice line,'' says Boyle. ''This service should continue into routine operation.''

He sees one potential disadvantage of homecomposting schemes. ''It will be a requirement of the EU directive that local authorities produce actual evidence that they are diverting waste from landfill. That is likely to be more difficult for local authorities operating home composting rather than centralised schemes.''

Efficient segregation of biodegradable material will be primarily the responsibility of householders, whether it is a homecomposting or a centralised scheme.

One of the main drawbacks of centralised composting has so far been the difficulty in reassuring people about the provenance and quality of the compost produced. This has been partly responsible for slow development of the market. But significant advances have been made in processing the material to rid it of contaminants, such as pathogens and weed seeds. Additional reassurance is likely to be provided by the development of a standard for compost, the work of the Composting Association. The association has received six months' funding under the Landfill Tax Credit scheme from Hanson Environment Fund for its composting standard. Two years' additional funding is being provided by Severn Waste Services to help subsidise promotion, site visits, and analysis.

Sepa plans to set up a compost Development Group. ''The development of composting standards will be significant, as will a more detailed understanding of potential markets and marketing skills,'' says the draft National Waste Strategy.