Advancing Electronics Recycling in the Midwest December 11

1
State of Affairs in Electronics Recycling

• Advancing Electronics Recycling in the Midwest
• December 11, 2002

2
Outline

• Description of the issue
• Current status
• Four prevailing myths
• Nine issues and forecasts
• Discussion

3
Description of the Issue

• E-scrap is a sleeper waste
• Rising attention to e-waste issues
• Concern over loss of resources --
  base metals (copper, aluminum, etc.) -- precious
  metals (gold, silver, palladium, etc.)
  -- plastics
  -- glass

4
Description of the Issue

• Concern over toxicity, especially from the lead
  used in CRTs -- 4 to
  8 pounds of lead in TVs and computer monitors
  -- largest single
  source of lead in municipal solid waste (about
  30) -- funnel glass can contain as much as
  75 ppm of leachable lead

5
Description of the Issue

• Magnitude of the problem --
  two million tons per year of e-scrap
  -- 20 million PCs become obsolete per
  year
  -- e-scrap is accumulative
  -- low recovery rate from homes,
  small businesses, etc.

6
Current Status

• About 500 U.S. firms provide e-scrap recycling
  services --
  brokering
  -- sale of whole operating units
  -- refurbishing
  -- disassembly to
  remove reusable parts -- disassembly to capture
  recyclables -- shredding

7
Current Status

• Barriers exist in e-scrap recovery --
  scrap moves to cheapest reclaimer --
  declining value of scrap (less gold, silver,
  etc.) --
  plastics are a problem for many reclaimers
  -- unstable
  political and regulatory climate inhibits
  investment

8
Current Status

• Institutional/corporate recovery
  -- large generators with high-end
  equipment are fairly well served
  -- large-scale international reuse market seeks
  this scrap -- yields from demanufacturing
  are high (hard drives, circuit boards, etc.)

9
Current Status

• Smaller generators are provided fee-based service
• Capture of residential e-scrap requires
  governmental involvement
• E-scrap is the waste of the decade (beverage
  containers in the 70s, paper in the 80s,
  organics in the 90s)

10
Current Status

• Local collections are increasing --
  in about 1,000 communities in 2002 --
  typically one-day event --
  about one percent participation -- at a
  cost of about 300 per ton -- programs
  tend to be in suburban communities
  -- trend toward permanent
  sites

11
Current Status

• Rising involvement of OEMs --
  many already operate take back of leased units
  -- many are
  moving into fee-based recovery systems
  (Hewlett-Packard, IBM, Dell)
  -- others participate in
  local collection events (Panasonic, Sharp, Sony)

12
Prevailing Myths

• Myth 1 Rising volumes
  -- computer sales declined last year and also
  this year
  -- effect of Y2K investments
  -- slow down in introduction of new
  software and hardware --
  consumer satisfaction with existing systems

13
Prevailing Myths

• Myth 2 Rapid technological change -- weve
  been hearing about HDTV for five years
  -- flat
  panel sales are restricted by high cost versus
  CRTs --
  technological change is slower than commonly
  thought

14
Prevailing Myths

• No. of years to attain 25 of market Year Year
  sTelephone 1875 35Automobile 1885 55Airplan
  e 1903 54Radio 1906 22Television 1925 26V
  CR 1952 34Microwave oven 1953 30 Personal
  computer 1975 15Cellular phone 1983 15DVD
  player 1996 6

15
Prevailing Myths

• Myth 3 E-scrap management is an immense
  environmental problem
  -- some environmental groups overstate the
  effects of e-waste disposal -- the
  data in this field is very poor -- the
  politics of e-waste management have taken
  precedence over the science

16
Prevailing Myths

• Myth 4 Theres gold in garbage
  -- OEMs are putting less recoverable
  materials in electronics
  -- even charities do not seek most types
  of obsolete working computers (those more than
  three years old)
  -- current reuse levels from e-scrap
  collection events are about 10 percent
  

17
Issues and Forecasts No 1

• Product stewardship is the prime issue
• Take back systems operate in a number of
  countries (Belgium, Japan, The Netherlands,
  Norway, Sweden, etc.)
• Japans system will expand next year
• A European Union system will be implemented by
  2006
• Canada is moving forth

18
Issues and Forecasts No. 1

• The National Electronic Product Stewardship
  Initiative may establish a similar system in the
  U.S.
• Nearly 50 members are involved, principally from
  three sectors industry, environmental groups,
  and state and local government

19
Issues and Forecasts No.1

• NEPSI agreement so far
  front-end financed fee followed by cost
  internalization third-party
  national organization shared responsibility
  supportive federal
  legislation

20
Issues and Forecasts No. 1

• Forecast
  -- NEPSI negotiations will take longer
  than planned
  -- a basic agreement will be reached for the
  recovery of CPUs, CRTs and TVs it will be a
  shared-responsibility model full producer
  responsibility is unlikely in the U.S.

21
Issues and Forecasts No. 2

• E-waste exports are an emotional issue
• The BAN report and video were extremely powerful
  
• But they over simplify the reality of e-scrap
  exports and over state the problem
  
• However, e-waste generators are now very
  concerned

22
Issues and Forecasts No. 2

• Forecast
  -- whole-unit, mixed-load shipments will
  decline
  -- shipments of individual scrap
  materials will continue
  -- domestic operations will change
  -- efforts will be made to gather better
  data on the extent of the problem

23
Issues and Forecasts No. 3

• But then, what do we really know about current
  domestic operations? -- lead
  glass processing concerns -- disease
  from processing scrap containing beryllium
  -- crude precious metals
  recovery methods
  -- fly-by-night operators living off
  of fees

24
Issues and Forecasts No. 3

• Forecast
  -- certification efforts will rise (IAER
  environmental audit, ISO 9000 and 14000
  certification, ESM systems, etc.)
  -- some
  states will get involved (NC, PA)
  -- this will
  lead to an increase in processing costs

25
Issues and Forecasts No. 4

• Legislative momentum is at hand
• Major bills were considered in several states
  (CA, MA, NC, NY, etc.)
• Generally focus on CRTs --
  impose a fee on sales of new CRTs -- use
  funds to establish recovery systems

26
Issues and Forecasts No. 4

• Forecast
  -- as part of a strategy to exert
  additional pressure on OEMs and retailers,
  several states will approve measures -- given
  recent Hewlett-Packard announcement, California
  will be the principal battle ground

27
Issues and Forecasts No. 5

• Regulatory approaches are being considered
  -- again,
  they typically focus on CRTs -- they
  commonly entail adding CRTs to universal waste
  rules -- however,
  Massachusetts has banned CRT disposal
  -- EPA has introduced a
  draft regulation

28
Issues and Forecasts No. 5

• Forecast
  -- concern was heard that the proposed
  EPA rule will increase exports
  -- thus, adoption of
  EPA rules will take longer than anticipated
  -- a number of states
  will adopt interim rules (OR, WA, etc.)

29
Issues and Forecasts No. 6

• Prison labor concerns will be in the news this
  year
• Some consider e-scrap prison factories to be
  high-tech sweat shops
• That said, UNICOR is a major player in the
  reclamation industry

30
Issues and Forecasts No. 6

• Forecast
  -- this issue will not garner the
  attention generated by the e-waste export issue
  
  -- pressure will be exerted on e-scrap
  generators to avoid the use of prison factories

31
Issues and Forecasts No. 7

• Current collection and processing methods are
  inadequate
• Recovery levels are low and costs are high
• Processing fees are moving upwards
• With so much up in the air, investment levels
  remain weak

32
Issues and Forecasts No. 7

• Forecast
  -- well plod along for another few years
  -- permanent collection facilities will grow
  in number
  -- states will increase their role, through
  grants (FL, IA, IN, NE, NY, OH) or statewide
  coordinated campaigns (CO, MD)

33
Issues and Forecasts No. 7

• Forecast
  -- the product stewardship end game in
  the U.S. and Canada will determine the ultimate
  collection and processing system
  -- the final system will be unlike
  todays

34
Issues and Forecasts No. 8

• The marketplace will change
• Many folks are watching e-scrap issues for
  possible business opportunities
• Forecast
  -- industry consolidation will occur
  -- just as it has in electronics manufacture

35
Issues and Forecasts No. 8

• The majority of the market for some electronics
  is held by just two firms --
  PCs Dell, H-P/Compaq --
  Cell phones Nokia, Motorola -- Fax
  machines Panasonic, Brothers -- Printers
  H-P/Compaq, Lexmark

36
Issues and Forecasts No. 9

• We may be producing ever-harder-to- recycle
  electronics
• If OEMs are not involved in the recovery system,
  they may not receive sufficient
  design-for-recycling (DfR) economic pressure

37
Issues and Forecasts No. 9

• Forecast
  -- a shared responsibility model will not
  provide much momentum for DfR -- however,
  OEMs are international players
  -- and OEMs in Japan
  and elsewhere operate e-scrap processing systems
  DfR will be addressed internationally

38
Discussion

• Contact information Jerry Powell,
  Editor E-Scrap News P.O.
  Box 42270 Portland, OR 97242 (503)
  233-1305 233-1356 fax jpowell_at_resource-recyclin
  g.com