Transcript The future of recycling

The future of recycling
David Palmer-Jones
CEO, SITA UK
17/07/2015
The future of recycling
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The future of recycling
> Asian growth fuels demand
for materials
> Competition for materials
increase values
> Commodity prices mirror
GDP / virgin prices
> Industry and Government
recognise resource
efficiency and scarcity
issues
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Hundred million tons
> Global resource extraction
900
800
700
600
500
400
300
200
100
0
Mineral ores +
200%
Fossil fuels +
81%
Biomass + 68%
Non-metallic
minerals + 114%
1980
2002
2020
The future of recycling
> UK still in infancy - 45 million tonnes still going to landfill, only 24 million
tonnes is active waste.
> Municipal targets 50% in England
The average is 38%, resulting in a 12% short fall of 2 million tonnes
> Industrial and Commercial
recycling driven by cost, resulting
in 5 million tonnes shortfall
> Need new infrastructure and
investment to extract value,
between £0.5 to £0.7 billion
> Zero waste = three per cent
landfill, energy and recycling
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The future of recycling
> Infrastructure develops,
resulting in more
volumes recycled,
resulting in the need for
markets, leading to
export
> Lack of reprocessors in
UK force export
alternative
> China develops local
recycling market reducing
demand for imports
> Lack of reprocessing
capacity in the UK and
demand from Asia leads
to a drop in commodity
prices and higher quality
demands
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The future of recycling
> Industry recognises resource agenda – business sustainability
> Voluntary producer responsibility deals become key to cost
control and material capture
Examples
> Tesco reverse vending
> Car manufacturers owning
stakes in metal reprocessors
(Renault)
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The future of recycling
Mattresses
> Legislative and fiscal drivers
(i.e. landfill tax) create new
markets
> Problem material becomes
valuable resource
> Large market disposed of
per annum
> Cost increasing for disposal
with tax
> Consistent supply of
valuable materials - such as
wood, textiles, metal results in a positive
environmental impact
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The future of recycling
Street sweeping
> Landfill tax creates a new market
> Low grade material becomes of
value
> Recycled materials reused in
construction
> Rare earth metals?
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The future of recycling
ELP diesel
> Market led problems
-
one million tonnes to landfill
> Increasing cost
-
landfill tax burden
> Environmental benefits
-
20% lower CO2 emissions
> Synergy with SITA UK’s business
-
‘natural hedge’
> Local reprocessing
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The future of recycling
Conclusions
> Resource extraction growth and increased scarcity resulting
in the value of secondary raw materials increasing
> Recycling moves from a
political/environmental ideal to integral to
sustainable growth
> From ‘laissez faire’ to interventionist –
Government begins to aid the circular
economy
> Minimisation and re-use strategies begin with
the re-engineering of products leading to the
creation of more easily repaired and recycled
materials
> Cultural acceptance increases as ‘recycling
generation’ grows up
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The future of recycling
Conclusions
> Industry reacts in ‘resource wars’ moving to
‘closed loop’ take back schemes
> Commodity values intrinsically linked to
economic volatility increasing risk profile for
market / industry
> Speed of infrastructure development influences
speed of landfill diversion – planning hurdle
> Active private sector investment needed to develop this
new infrastructure - but limited
> Export demand diminishes as Asia internalises own
recyclables – 70% by 2015?
> Government react too late to create stimulus for
development of UK / European reprocessing industry
> Recyclers move up the value chain to refill the export loss
producing higher grade base materials
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