Why Do We Need Recycling Policy? An Industry Perspective
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1 Why Do We Need Recycling Policy? An Industry Perspective Resa A Dimino Director of Public Policy Indiana Recycling Coalition Conference June 4, 2014
2 Summary Introduction to NAPCOR The Problem How can we solve the problem? Why hasn t government solved the problem? Budget & Resource Constraints Structural Constraints What is the path forward? Why do we need recycling policy? 2
3 Introduction to NAPCOR NAPCOR is the trade association for the PET packaging industry in the United States and Canada 51 members encompass all parts of the PET value chain from resin production to end of life/recycling NAPCOR s priorities are to: Promote the introduction and use of PET packaging Facilitate PET recycling Communicate the attributes of the PET container as an environmentally sustainable package 3
4 NAPCOR Membership 2014 PET Industry Suppliers PET Container Manufacturers Blue Mountain Plastics BP Buhler CarbonLite Industries Clear Path Recycling ColorMatrix Custom Polymers PET Erema North America Evergreen Plastics Husky Injection Molding KHS USA Krones MHT USA Marglen Industries Midwest Exchange Mohawk Industries Muehlstein National Recovery Technology Nissei-ASB Parallel Products Penn Color Peninsula Plastics Recycling Perpetual Recycling Solutions Plastrec Polyquest, Inc Repi. Reterra Sidel Signode Sorema Plastic Recycling Systems Starlinger and Co. GmbH TOMRA North America UltrePet LLC Uniform Color Company Amcor Rigid Plastics Plastipak Packaging, Inc. Yoshino America Corporation PET Sheet / Thermoformers Dart Container Corp. Direct Pack, Inc. Earthbound Farm Genpak LLC Global PET MicroGreen Nu-B, Inc. Par-Pak, Ltd. Peninsula Packaging Company Plastic Ingenuity, Inc Sabert Corporation PET Resin Manufacturers DAK Americas LLC Indorama Ventures USA Inc Nan Ya Plastics Corporation 4
5 NAPCOR & Public Policy NAPCOR has NO POSITION on EPR for Packaging and Printed Products, or on New Beverage Container Deposits Does not support or oppose these policies NAPCOR will continue to engage in policy discussion and dialogues to ensure that programs and policies developed result in an increase in rpet supply and that financing mechanisms treat PET packaging fairly and equitably 5
6 The Problem: A Macro View Recycling rates are stagnant 6
7 The Problem: Demand for rpet Content & Reclamation Capacity Exceeds Supply Number of Plants in the US Reclamation Capacity (Billion Lbs) Clean Flake from US PET Bottles Collected* (Billion Lbs) *Includes bottles currently exported 7
8 The Problem: PET Recycling & Utilization Rates 8
9 The Problem: PET Industry Perspective Industry efforts to date have not moved the needle More than $2 billion invested in PET recycling capacity Industry has invested or leveraged hundreds of millions in pilot and demonstration projects to increase collection NAPCOR alone has spent or leveraged $100 million 9
10 The Problem: The US is Lagging in PET Bottle Recycling PET Bottle Recycling Rate US 30% Canada ~60% Europe 51% 10
11 The Problem: PET Recycling Rates In Context PET Beverage Bottle Recovery Rate (Gross) Bales of RPET Bottles Required (in Billion Lbs) Collection Gap/Add l Bales Needed (in Billion Lbs) 2012 (actual) % % %
12 How can we solve the problem? Collect recyclables everywhere Residential curbside/drop off Multi-family Away from home Commercial (restaurants, gas stations) Process recyclables efficiently Increase participation Incentives (e.g., Pay As You Throw, RecycleBank) Outreach/Education 12
13 Why hasn t government solved the problem? It boils down to the three Ms Money Lack of resources; unsustainable sources Motivation Not self-identified as key link in a supply chain No imperative to improve performance Market Disconnects Inability to affect volume/composition of stream or markets, i.e., no ability to control costs 13
14 Why hasn t government solved the problem? Budget & Resource Constraints Government Budgeting Process Constraints Annual budgeting; conditions vary each year Long-term planning, strategic investment and consistent implementation challenging Inelastic re: commodity pricing Responsive to local conditions and needs, not to commodity market/industry needs 14
15 Why hasn t government solved the problem? Budget & Resource Constraints Government Budget Pressures No New Taxes & Fees Unfunded Mandates Americans with Disabilities Act, Clean Water Act, Medicaid, mandatory recycling requirements and other laws that put costs on local gov ts with no funding mechanism Competition with critical services (schools, libraries, police, fire, etc) 15
16 Why hasn t government solved the problem? Budget & Resource Constraints Examples of state recycling budget pressures NYS allocates $6 to $10 million/year for recycling grants; current wait list is estimated at 12 years NC local grant funding requests are double available state resources Federal Government funding = ~0 16
17 Why hasn t government solved the problem? Structural Constraints Public works/solid waste directors see recycling as a service (adjunct to waste collection) No incentives to maximize recycling No sense of operations as key part of an economic supply chain Plans, skills and expertise vary by community 17
18 Why hasn t government solved the problem? Structural Constraints Responsible party (local gov t) has no ability to influence volume or composition of materials affect materials markets Responsible party (local gov t) is limited by: lack of service or regulatory oversight in multi-family, commercial, away-from-home settings resources to expand services or promote programs ability to regulate activities of non-municipal service providers Political will to implement policy or funding mechanisms 18
19 Why hasn t government solved the problem? Structural Constraints If you were going to design a responsive commodity supply system, why would you rely on decision-makers who appear unmotivated by prices, have competing internal investments and are essentially unrewarded by the marketplace? And why would you set up a system in which the cost of production in this case, collection of discarded materials is not remotely covered by system income, even in the best material value scenarios? Scott Mouw, NCDENR 19
20 What is the path forward? Changing role for government Provide oversight & possibly services Ensure a level playing field Perform key outreach, education functions Greater private sector involvement in recycling supply chain Inject capital to improve overall system performance Foster efficiency, maximize quality and control costs Standardize level of effort and collection approaches Enable company and industry sustainability goals to be achieved 20
21 Why do we need recycling policy? To increase supply of recycled PET! Bring resources into the system to improve collection, processing Rationalize recycling collection as a supply chain Broad application of best practices Consistent resources for education, outreach and promotion Increasing availability of rpet will stabilize the market 21
22 NAPCOR & Public Policy NAPCOR has NO POSITION on EPR for Packaging and Printed Products, or on New Beverage Container Deposits Does not support or oppose these policies NAPCOR will continue to engage in policy discussion and dialogues to ensure that programs and policies developed result in an increase in rpet supply and that financing mechanisms treat PET packaging fairly and equitably 22
23 Reality Check For plastic packaging, there is NO sustainability without recycling! There is no post consumer plastic recycling without public policy! There is no such thing as a polymer so environmentally beneficial it can just be thrown out! 23
24 Thank you! Resa Dimino Director of Public Policy NAPCOR (518)
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