It is all beginning to look a bit like the Winter of Discontent - freezing weather, a tired Labour Government and vast piles of uncollected rubbish. The difference between now and 1979 is that the rubbish is building up not in Leicester Square but in warehouses on industrial estates and that it is the result not of public sector strikes but of a supposedly enlightened recycling policy.

If, like me, you spend an hour a week sorting out your newspapers from your junk mail and your milk cartons from your plastic bottles, you will not be amused to see the pictures of Britain's mountain of 100,000 tonnes of recyclable waste. If you are the South Welsh man fined £100 for putting a piece of paper in the wrong sack, you will be more bitter still.

Even at the best of times, much material collected for recycling was quietly being dumped in landfill sites or, worse, mysteriously appearing on rubbish pyres in China. But over the past few months the market for waste paper has collapsed.

Councils are paying to store the resulting mountains of paper because sending it to landfill sites would incur stiff taxes and because Britain lacks the capacity to incinerate the waste.

The most shocking thing is that the Government knows incinerating paper is better for the environment than recycling it and yet still has persisted with its recycling policy. It knows because the 2006 study it funded into the matter, Carbon Balances and Energy Impacts of the Management of UK Wastes, said so.

Recycling sounds worthy. The trouble is that when you compare the energy needed to transport and recycle waste paper with the energy that could be produced by burning it in power stations, it becomes clear we could cut carbon emissions by abandoning recycling and instead building incineration plants. The Institution of Civil Engineers has concluded that incineration of paper and other types of waste could generate one sixth of the nation's electricity needs - eradicating the need for new coal and nuclear power stations. In future, we should be able to do even better: gasification technology under development should make incineration far more efficient.

We persist with recycling for two reasons. First, the environmental lobby has scared the public about incineration plants - it has only to mention the word “dioxin” to cause mass fright, when in fact a well-run incinerator at high temperatures emits fewer dioxins than a typical bonfire.

Second, sorting out material for recycling has become a quasi-religious observation that the green lobby likes us to undertake in order to atone for our environmental sins - and which, as councils have discovered all too quickly, provides an ideal excuse to squeeze us with fines.

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