CC - Item 2A - Republic Services Recycling PPTJames Castro
General Manager, Anaheim Recycling Center
Elizabeth Martinez
Municipal Manager
Recycling is Broken
Overcoming Today’s
Challenges…
Special Meeting
Agenda Item No. 2.A
2
The Recycling Life Cycle
Factors Driving Costs
•Participation rates –
Higher participation,
while the goal, drives
more costs
•Pounds per set-out –
plays a significant role in
service cost per
household
•Commodity mix –
changes in the stream
can impact processing
costs
•Residual/contamination –
drives additional direct
costs
•Commodity value –direct
impact on any returns
3
Trends in Markets
•Glass has negative
value in most
markets, unless
supported by
subsidies
•Corrugated
Cardboard has
decreased in price
per ton for last 5
years
•End markets
impacted by global
slow-downs
4
Trends Implications
Material no longer in circulation
18M tons in 2000 ~2M in 2015
Lighter-weight and limited end markets
HDPE off-spec PET
Lighter-weight and flexible packaging
not recyclable
Tin can copolymer pouch
Trends in Material
Waste minimization increasing pressure on total waste and recycling tons
5
China Sword Explained
Reductions took effect in March 2018, and drive costs and changes at most
recycling facilities in the country to meet new standards
•A significant reduction in acceptable
contamination levels (From ~3% to
0.5%) in any recovered paper and
plastic grades.
•Additionally, China banned all mixed
paper from import, regardless of
contamination levels.(20% of
historical stream).
For decades, China has been the largest importer of the world’s recycled
commodity, and the U.S. was 40% of the inbound stream.
In 2017, China announced efforts to clean up the country, which included
dramatic changes for acceptance criteria of imported recyclables.
6
Market Impacts of China Sword
7
China Sword Immediate Impacts
While we continue to process mixed paper and old newsprint, we are
proactively evaluating the need to dispose of excess material that
deteriorates beyond the point of commercial value, or poses safety risks
•Actively exploring other domestic and international markets
−Many are flooded by the global industry shifting away from China
Jan 2018 –Processed bales in Northwest,
without market buyers, deteriorated by weather
•Adjusted processing speeds to
improve quality of sorted material
−As a result, some facilities are unable
to handle daily material volume
•Adding human resources to our sort
lines, and increasing self-inspections
to further reduce contamination
•Exploring investments in newer, more
accurate sorting technology (in select
markets)
8
Market Impact on Rosemead Residential
Rosemead Per Ton Annual
Commodity Sales Shortfall $ 36.39 $ 64,006.01 Residential Accounts 11,690
Increased Processing Cost $13.29 $23,375.6 Per Unit Monthly Charge $ 0.62
Total $ 49.68 $ 87,381.66
Material Type
Characterization Annual Tonnage 2017 Commodity Pricing Sale of Material Revenue
Lbs.%2015-2017 Avg May 2018 YTD Historic Revenue Current Revenue
FIBER 134.6 46.25%813.6
OCC (Old Corrugated Containers)52.8 18.14%319.1 $ 150.98 $ 100.97 $ 48,183.58 $ 32,223.45
ONP (Old Newsprint)0.0 0.00%0.0 $ 115.50 $ 56.14 $ -$ -
Mixed Paper 81.8 28.11%494.4 $ 83.51 $ 2.87 $ 41,289.30 $ 1,419.00
Office Paper 0.0 0.00%0.0 $ 179.95 $ 136.65 $ -$ -
PLASTICS 20.6 7.08%124.5 $ 485.75 $ 456.66 $ 60,481.94 $ 56,859.87
#1 PET 1.2 0.41%7.3 $ -$ -$ -$ -
#2 HDPE -Natural 1.8 0.62%10.9 $ -$ -$ -$ -
#2 HDPE -Pigmented 3.8 1.31%23.0 $ -$ -$ -$ -
#3 -#7 (Mixed Plastics)12.8 4.40%77.4 $ -$ -$ -$ -
LDPE/Recoverable Film 1.0 0.34%6.0 $ -$ -$ -$ -
MRP (Mixed Rigid Plastic)0.0 0.00%0.0 $ -$ -$ -$ -
METAL 11.2 3.85%67.7
Aluminum Cans 0.2 0.07%1.2 $ 3,255.14 $ 2,423.80 $ 3,935.01 $ 2,930.03
Ferrous Metal Cans 3.8 1.31%23.0 $ 84.22 $ 139.46 $ 1,934.39 $ 3,203.16
Scrap Metal 7.2 2.47%43.5 $ 73.05 $ 128.89 $ 3,179.06 $ 5,609.15
GLASS 28.4 9.76%171.7 $ 66.97 $ 24.75 $ 11,495.94 $ 4,248.54
OTHER RECOVERABLE 0.0 0.00%0.0 $ -$ -$ -
E-Waste (Electronics)0.0 0.00%0.0 $ -$ -$ -
Wood 0.0 0.00%0.0 $ -$ -$ -
Aggregate/Textile 0.0 0.00%0.0 $ -$ -$ -
RESIDUAL 96.2 33.06%581.5 $ -$ -$ -
TOTAL 291.0 100.00%1,758.9 $ 170,499.20 $ 106,493.20
9
Republic Services Confidential
Current Residential Rate (Effective 8/1/18)$18.98
Recycling Impact $0.62
Updated Residential Rate $19.60
Ninety percent of
U.S. residents
want recycling
and are willing to
pay for “it”
Rosemead Residential Rate Impact
10
Collection
•Cost to provide truck, driver, container and scheduled collection service on contracted basis
•Collected material transported to processing facility
Processing
•Capital & labor intensive process
•Comingled material sorted into separate products, removing contamination
•Clean products baled and prepared to ship
Residual
•Contaminated or non-recyclable material
•No marketability
•Must be transported and disposed at landfill for a cost
Commodity Sales
•Processed material transported and sold to end markets
•Subject to quality standards
•Product mix and quality drives value
•Some material may have negative value
The Cost of Recycling
New Recycling Business Model
Monthly Collection
Charge
Net Processing Fee
(Commodity sales –processing costs –residual cost)
The cost of a recycling collection program is the sum of the
Collection Charge and the Net Processing Fee
+
11
Long Term -Public Education
1.Public Education –WHAT to Recycle
Paper Plastic
CardboardMetal
Glass
ALWAYS
Recyclable
NEVER Recyclable
Diapers Garden
Hoses
Plastic Bags
Shoes/
Clothing
Food
Waste Yard
Waste
Empty. Remove any remaining food or liquid contents from your
recyclable item before placing it in a recycling container;
Clean. Lightly rinse the recyclable item to remove any remaining
residue; and
Dry. Gently shake out excess water or let the recyclable item air dry
before placing it in a recycling container.
SOMETIMES
Recyclable
(Select Markets)
2.Public Education –HOW to Recycle
12
Partnerships and Outreach
Goal
•Promote the need to keep
recycling sustainable
•Educate customers on recycling in
an easy-to-understand way
Campaign Objective
•Playbook
•Direct Mail and Email
•Video
•Social Media
•School Districts (Rosemead and Garvey)
•Area Watch meetings
•Chamber of Commerce
•Social media
•Booth
o Multilingual Outreach
o Interactive education
o Recycling Rewards
13
Recycling Simplified (Video)
For more information:
https://recyclingsimplified.com/recycling-basics/
14
Next Steps
1.Price Increase needed to address shortfall due to
collection costs no longer covered by commodity
revenues
2.Implement Public Education programs to inform
residents what to recycle and how to recycle –
clean up the contamination in the stream
The decades old recycling model is no longer executable or viable.
Immediate partnering is needed, as well as a new business model