Industry Data and Trends

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Industry Data and Trends

• Walter Alcorn, ISEE 2006

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History

• In 2001 SAIC developed a simulation model of the
  electronics recycling industry as a decision
  support tool for the Polymer Alliance Zone of
  West Virginia
• Model inputs were gathered from various
  recyclers, manufacturers and industry experts

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2001 PAZ Simulation Tool Assumptions

• There was a lively, if precarious glass-to-glass
  recycling market
• Remember Techneglas?
• Mixed plastics was a cost to all electronics
  recyclers, not just the no export recyclers
• Value of commodities were lower (steel, copper,
  aluminum)
• SB 20 was just an idea

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Whats up now?

• Demand
• Commodity prices, especially metals, plastics
• Supply
• E-waste volumes
• In regulated states (CA, ME)
• Everywhere else
• Domestic recycling capacity
• Exports?

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Demand Commodity Pricing Trends

• CRB Metals Sub-Index of 5 markets
• Copper Scrap
• Lead Scrap
• Steel Scrap
• Tin
• Zinc
• 1947 1973 prices moved within a range
• 1974 2003 prices moved within a higher range
• 2004 2006 priced moved dramatically higher, a
  new range???

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Supply Collection Volume Trends

• Higher overall
• Driven by
• Policy/regulation
• Financed collection programs (for households) and
• Volume potentially available

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Policy Regulation Drivers of Supply

• State Mandates
• CA, ME, MD, WA..
• State Local Collection Programs
• Hennepin County, Delaware, Massachusetts, and
  hundreds of local government collections
• Regulation of business e-waste
• Business users usually not allowed to dispose of
  old equipment as regular trash
• Reuse patterns???

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Mandatory State Program Volumes

• California
• Collected about 65 million pounds in their first
  program year (2005)
• Most was collected during the second half of the
  year
• With a population of 36 million thats about 1.79
  lbs./capita
• ME, MD, WA Amounts Still TBD
• Washington amounts TBD annually, plans to compete
  to reach share threshold

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State and Local Collection Programs

• Hennepin County the most quoted
• Developed as an extension of traditional
  recycling programs (bottles, cans, paper, etc.)
• Funding for these programs comes from a variety
  of sources
• EOL fees are common
• Landfill tipping fees
• Bottle bill proceeds

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Volume of Electronics to be Recycled

• A primary question of U.S. EPAs draft Baseline
  Study
• Two approaches
• Review actual return amounts from existing
  programs (lbs./capita)
• Project amounts theoretically available from
  historic sales
• EPA Baseline Study to focus on amounts
  theoretically at end-of-life based on historic
  sales

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Actuals Per Capita Calculations from the NCERs
CDR

• Massachusetts (2004)
• 2.94 lbs./capita (average for the 197
  towns/cities reporting to the MA DEP)
• Californias first program year (2005)
• 1.79 lbs/capita
• Branford, CT (2004)
• 1.61 lbs./capita (CRTs only)
• Kirkland, WA (2004, curbside program)
• 1.61lbs./capita
• Snohomish County, WA (2004, transfer station)
• 1.71 lbs./capita
• Hennepin County, MN (2004)
• 3.4 lbs./capita

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Actual vs. Projected

• Actual returns from existing comprehensive
  electronics collection recycling programs are
  less than half amounts projected from sales.
  Why?
• Electronics are not trade-in items like car
  batteries, tires
• Reuse patterns not well documented nor
  understood, particularly for business use
  products
• There is something seriously wrong with
  projection models and/or data
• Export?

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Data compiled by ERG for EPA Baseline Study.
Data for desktops and portable PCs from IDC WW
Quarterly PC Tracker in October 2005. Data for
flat screen and CRT computer monitors were based
on ERG analysis of US Census data on shipments,
imports, and exports.
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Source Data compiled by ERG for EPA Baseline
Study 2006. TV data were obtained from Consumer
Electronics Association Market Research, 2005.
The number of flat screen TVs sold was derived
from analyses of Other TVs (this category
includes flat screen and monochrome TVs) in US
Census data on shipments, imports, and exports,
combined with CEA data on monochrome TVs.
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A Clear Trend the State Patchwork

• Many dead weight costs being studied by the
  NCER as a NERIC initiative
• National Electronics Recycling Infrastructure
  Clearinghouse
• Who incurs these dead weight costs?
• Industry
• Government
• Consumers

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State Patchwork Costs Being Studied

• Policing/excluding out-of-state e-waste
• Inherent state-level enforcement limitations
• The continuous start-up for industry compliance
  
• New requirements forcing changes to IT systems
• Compliance requirements trajectory unclear

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State Patchwork Costs Being Studied (cont.)

• Redundant program staff
• Redundant brand counts (ME, WA)
• Redundant fund administration
• Redundant reporting, registration and
  recordkeeping requirements
• Redundant program development engagements

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State Patchwork Costs Being Studied (cont.)

• Higher processing costs due to
• Lower economies of scale compared with
  national-scale volumes
• Market fragmentation caused by state-restrictions
  on out-of-state processing
• State Program Financing Overlap, Over-chargers
  and Free Riders
• The nexus fee-collection problem in states with
  advance fees

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State Patchwork Costs Being Studied (cont.)

• Additional patchwork costs?
• Ongoing survey of industry and government
  officials
• The NCER seeks your input!
• info_at_ecyclingresource.org
• Website www.ecyclingresource.org

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What We Need

• A harmonized national-level financing system
• An efficient decentralized collection
  infrastructure
• Systems that can evolve as needs evolve
• National ESM Standards
• Better data
• Demand for recycled materials

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Thank You!

• For more information, contact
• Walter Alcorn
• walter_at_alcornconsulting.com
• 703-390-9200