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RECYCLING EDUCATIONA MRF’S EYE VIEW

CHRIS COADYDIRECTOR, MUNICIPAL BIDDING AND GOVERNMENTAL AFFAIRS

RECYCLING EDUCATION AND THE BOTTOM LINEOCTOBER 15, 2015PAPER AND PLASTICS RECYCLING CONFERENCE | CHICAGO, IL

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ReCommunity Stats:

• Pure Play Recycler• 31 Facilities• 28 MRFs• 3 Transfer Stations• 1,500 + Employees• Approx. 1.8 M Tons

Processed in 2014• We don’t own landfills• We don’t own trucks• We are focused on

maximizing recovery and sharing the profits with our community partners

RECOMMUNITY AT A GLANCE

THE PARADIGM SHIFT

COMPOSITIONCHANGES IN SINGLE STREAM RECYCLING

COSTSMRF & LABOR COSTS INCREASING FASTER THAN CPI

CONTAMINATIONMRF PROCESSING AND MAINTENANCE

COMMODITIESGLOBAL PRICES IN PROLONGED DECLINE

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THE PARADIGM SHIFT

STREAM COMPOSITION CHANGES

RISING LABOR COST

INCREASING MAINTENANCE/ PROCESSING COSTS

DEPRESSED COMMODITY PRICES

• Shifts in consumer preferences, increasing levels on non-recyclables in the bin and industry driven product lightweighting

• Legislative actions continue to increase minimum wages rates $0.50/hour can increase labor cost by as much as $3/ton

• Negative effects of stream composition, increased down time due to higher contamination rates and requirements attributed to “Green Fence”

• Revise revenue sharing provisions to share commodity risk more equitably

CHALLENGE What Happened

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COMPOSITIONSHIFTING CONSUMER PREFERENCES AND NEW PACKAGING DESIGNS ARE

CAUSING A SIGNIFICANT CHANGE IN THE COMPOSITION OF WASTE STREAMS PROCESSED BY MRFS

SHIFTING CONSUMER PREFERENCES AND NEW PACKAGING DESIGNS ARE

CAUSING A SIGNIFICANT CHANGE IN THE COMPOSITION OF WASTE STREAMS PROCESSED BY MRFS

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COMPOSITIONPAPER AND NEWSPRINTIncreased online consumption of news and media has significantly reduced the amount of newspapers and magazines available to recycle.

SOURCE REDUCTIONAluminum and metal containers are becoming thinner and lighter, requiring more units and effort at the MRF to collect and sort the same metric tonnage.

BIO-BASED PACKAGINGNon-recyclable bio-based packaging, like PLA, often gets mixed with recyclables like PET, thus contaminating the stream and reducing overall value.

FLEXIBLE PACKAGINGManufacturers are seeking out and using flexible composite plastic packaging, instead of paper or glass. These materials are difficult to recycle, if they can be recycled at all.

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CONTAMINATIONNON-RECYCLABLE RESIDUE AND

CONTAMINANTS ARE CONSISTENTLY HIGH ACROSS FACILITIES, LOWERING

PLANT EFFICIENCY AND THE VALUE OF COMMODITIES PRODUCED

NON-RECYCLABLE RESIDUE AND CONTAMINANTS ARE CONSISTENTLY

HIGH ACROSS FACILITIES, LOWERING PLANT EFFICIENCY AND THE VALUE

OF COMMODITIES PRODUCED

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CONTAMINATIONWISHFUL RECYCLINGMajor cause is “wishful recycling.” Residents toss items in the recycling bin/cart, hoping materials can be recycled, even if not officially acceptable.

UNSAFE MATERIALSYard waste, wood, hoses, wires, cables as well as bio-waste items, medical waste, diapers and needles create extremely dangerous conditions for our employees.

HOUSEHOLD WASTEResidents in some areas are simply treating the recycling cart as an extra trash can, contaminating the stream with food waste, dirt and plastic bags, which cause significant downtime at the MRF.

MORE

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COSTSMRF FINANCIAL PERFORMANCE

HAS SUFFERED DUE TO THE CUMULATIVE NEGATIVE EFFECT

OF STREAM COMPOSITION CHANGES ON PRODUCTIVITY &

COMMODITY VALUE

MRF FINANCIAL PERFORMANCE HAS SUFFERED DUE TO THE

CUMULATIVE NEGATIVE EFFECT OF STREAM COMPOSITION

CHANGES ON PRODUCTIVITY & COMMODITY VALUE

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COSTSCAUSE & EFFECTStream composition changes can directly cost a typical MRF up to nearly $100k per month in lost productivity due to slower throughput, higher residue rates and increased downtime.

LABOR INCREASEMRFs create opportunity for entry-level workers and are sensitive to minimum wage increases.

Legislative actions are increasing hourly wages.

$0.50/hour increase can raise processing costs by $3/ton.

CPI DISPARITYMany contracts use CPI as a measure of labor cost increases, however, wages and benefit costs are steadily rising faster than CPI.

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COMMODITIESTHE MARKET FOR RECYCLED

COMMODITIES HAS GLOBALIZED WHILE PRICES FOR ALL

RECOVERED MATERIALS HAVE BEEN IN A PROLONGED DECLINE

THE MARKET FOR RECYCLED COMMODITIES HAS GLOBALIZED

WHILE PRICES FOR ALLRECOVERED MATERIALS HAVE

BEEN IN A PROLONGED DECLINE

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COMMODITIESCOMMODITY PRICING LOWONP & OCC pricing has declined over the past few years. Plastic prices have dropped sharply due to declines in oil pricing.

CHINA CONNECTIONChina’s “Operation Green Fence” raised the quality bar, forcing MRF operators to work even harder at producing high quality materials in a complicated stream.

FUTURE UNCERTAINForecasts vary on how long oil prices will stay low. Some industry analysts predict that pricing will not return to higher rates until 2020 or later.

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PUBLIC AND PRIVATE PARTNERSHIPS MUST

WORK TOGETHER AND ADAPT TO

INDUSTRYCHALLENGES

EDUCATION IS KEY

QUALITY STANDARDS

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An influx of unacceptable materials/contaminated loads at many of our facilities

Time and money to inspect, reject, extract contaminants from the system

Creates dangerous conditions for our employees

We must enforce more stringent quality standards for inbound materials- End Markets, MRF’s, Haulers, Municipalities

WHICH SCREEN WORKS?

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INBOUND QUALITY INSPECTIONS

Dedicated Safety Staging area for random Inbound Quality Inspections

Grading system for inspected loads

Inspectors trained to look for non conforming items

Photos and data recorded on electronic tablet

Information provided in real time

INBOUND QUALITY INSPECTIONS

NON PROGRAM MATERIAL

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DANGEROUS CONTAMINATION

Lack of care in households for what goes in the recycling bin

More food waste, other household trash

Yard waste, wood, hoses, etc. on the rise

Increase incidence of bio-waste materials like medical waste and diapers

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NEED FOR STRUCTURAL CHANGE

Recycling cannot be seen as ‘free’

Operators cannot bear the combination of higher costs and lower revenues due stream quality

Residents need simple, clear messaging in what does and doesn’t belong in the recycling bin

Consistent Ongoing Education Key

National Waste& Recycling Association

Recycling SmartRecycling is the first step in the process, it's important to put materials in the bin that actually belong there. Know before you throw!

website: beginwiththebin.org

Collection Crews can record location and details

Information instantly uploaded to a real-time map for supervisors.

Problem locations easily flagged with a mobile device GPS

Cameras in truck can capture images

Easily accessible App, No new software

MOBILE 311-GIS SOLUTIONS

Website: facilitydude.com/solutions/gis/mobile311/

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PUBLIC AND PRIVATE PARTNERSHIPS MUST

WORK TOGETHER AND ADAPT TO

INDUSTRYCHALLENGES

EDUCATION IS KEY

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THANK YOU