Industrial ecology- the missing link for sustainable resource recovery
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Industrial Ecology- The missing link for sustainable resource recovery
Grant Musgrove, CEO
About ACOR
• Australia’s peak representative of the resource recovery and recycling industry
• Advocate on behalf of the industry to influence government policy and decision making
• Work closely with the Federal and the State Government to promote a sustainable and productive economy
The “old” waste hierarchy
• This is linear, not circular, but a useful intermediate /transitional framework
grantm@acor.org.au
Linear Vs Circular C&P
Linear C&P
• Unsustainable consumption and production
• Materials lost in the value chain• High operation and production
cost• Increase pressure in landfill• Loss of residue energy
Circular C&P
• Sustainable consumption and production
• Materials are reused/ recycled• Mitigate the impacts of
resource volatility • Reduce waste generation• Save up to 80% of upstream
energy
What are the challenges of businesses and industries
facing today?
“Peak Resources” is Past Us! Need Industrial Ecology for Radical Resource Efficiency
Future Pathway of Waste? Sustainability of Current System?
grantm@acor.org.au
1999-00
2000-01
2001-02
2002-03
2003-04
2004-05
2005-06
2006-07
2007-08
2008-09
2009-10
2010-11
2011-12
0
200
400
600
800
1000
1200
1400
1600
1800
2000
Waste Exports
PaperMetalPlastics
In $
mill
ion
Source: RBA 2013
Volatility has been increasing since peak resources: bad for supply chain certainty/ resource recovery
Increasing Waste Generation
1997-98
1998-99
1999-00
2000-01
2001-02
2002-03
2003-04
2004-05
2005-06
2006-07
2007-08
2008-09
2009-10
2010-11
2011-12
0
50
100
150
200
250
300
Waste generated
Population
GVA
Source: ABS Waste Account 2013
Secondary Resource Prices Are Not Telling the Truth: They are too Expensive!!
• P- price• Q – quantity• D- demand• MPC – marginal
production cost• BUA/regulatory
cost– marginal cost from regulating a resource as a waste
P
QD
MPC
MPC +BUA cost
Dimensions of Resource Scarcity
Physical
Not accessible
Decline of ore grade
Depletion of reserve
Economic
Price volatility
Market development
Skill shortage
Geopolitical
Resource nationalism
Political stability
Regional conflicts
Technological
Supply bottlenecks
Lack of innovations
Environmental
Social license to operate
Climate change
Environmental standards
China’s Green Fence Policy
• Come into effect in February 2013• Higher standards on imports of recycled material to
promote circular economy • Reject shipments considered to have a contamination
rate of 1.5% or higher – Loads of shipping containers that carried recyclable
materials have been rejected• Provide discounted prices for local manufacturing
companies to purchase new equipment for manufacturing recycled products
CHINA is moving fast to a circular economy
Other issues
• Information gap between waste generators and recyclers in relation to material inputs and outputs
• Increasing operation cost of recyclers subject to carbon tax liability
• Increasing production cost of manufacturers due to high resource prices
• Loss of valuable commodities and materials suitable for recycling due to export and loss to landfill
• Environmental and social issues
Opportunities and Barriers to Industrial Ecology
Opportunities
• The total value of resource recovery in Australia is over $9.5 billion
• NSW EPA supports the development of IEP– Waste Less, Recycle More strategy: $465.7 million
package over 5 years – $4 million investment in the IE program over 4 years – Sustainability Advantage Program
• NSW 2014 recycling targets
Increasing NSW Recycling Rates
2002-03 2004-05 2006-07 2008-09 2010-110
10
20
30
40
50
60
70
80
MSWC&IC&DOverall
Source: Waste Less, Recycle More 2013
%
Barriers to IE
• Legislation and regulation– High- level resource recovery policies & strategies
are inadequately integrated across govt portfolios, e.g. industry policy, environmental planning, regulation and enforcement
– Current legislation/ regulation is too strict on wastes, esp. prescribed wastes inhibit firms’ search for industrial waste reutilization
– Different jurisdictions have different interpretations on the definition of waste
Barriers to IE (Cont.)
• Costs of licensing and approvals– Time consuming (up to 5 years),
complicated assessment process• Not enough markets to absorb recyclables
and quality issues (contamination)• Lack of communication between product
manufacturers and recyclers
Barriers to IE (Cont.)
• Site location and planning– Difficulties in obtaining development
approval when aspects such as location, community agreement and capital cost are in place
– Lack of certainty about planning policy– The site location is often ‘out in the bush’ or
lacks of social license to operate= complaints= NIMBY
What is Required for Success?
Recommendations
• resource recovery and recycling policy integration and alignment
• The definition of waste needs to narrow so that the inherent value of recyclable materials can be reflected
• Clear and consistent definitions of waste and resource recovery
Recommendations (Cont.)
• No legislative constraint on businesses to favour recycling/IE as long as the materials do not threaten human and environmental health
• Master plan for approvals to ease the costs and streamline the approval process
• A broad network of the IEP to facilitate and support interactions between industries
• “Rethink design” = Made to be made again
Reduce unnecessary complexity in streams
A Precinct and Partner Identification Program (PPIP)
• Deliver both bi- lateral symbiotic relationships for existing businesses
• Work with companies and governments on precinct identification and development
• Create new investments opportunities in industrial processes, mining and agriculture
PPIP Key Process Steps
• Maximum source separation of waste– Green waste, recyclables, hard/ difficult/ problem
wastes and residual waste• Creation of infrastructure and technology
advancement– Reduce material separation and pre- sorting costs
• The development should be gradual and led by industry
Elements of PPIP• Accessible and user friendly for the community• Accept and process a wide range of wastes• Diverse business activities• Industry- led• Driven by economic motivations• Maximise the output of energy from waste • Operate 7 days
Key Facilities
• A composting or Biochar operation- Green waste
• A MRF- Recyclables• An energy from waste plant- Residual
materials• An e- waste plant• A drop off centre
Organic wasteGlass, paper, cardboard,
beverage cans, etc
E- wasteBatteries, paint, oil
and chemicals Residual Waste (wood, textiles, masonry)
Recycling Process
Manufacturing industry
Composting Facility
MRF
Residual Derived Fuel
Domestic Consumption
Export Market
Renewable Energy
Renewable Energy
Renewable Energy
Outcomes• Reduction of illegal dumpling• Sustainable employment creation and investment
opportunities• Less resilience on landfill• Business cost reduction and improved community
relations • Support local re- manufacturing, reprocessing and
national and international trade• Develop export markets for recovered resources • Create revenue streams from commodities
Transitioning Towards Industrial Ecology and a Genuinely Sustainable Materials Economy Means…• To provide ‘correct’ incentives for behavioural change, the regulation
of wastes (BUA’s, storage regulations) being applied to “wastes” needs to cease when the waste becomes a resource as long as the “negative externalities” (harm to environmental, and human health) cease to exist
• This should be risk based regulation reflecting the magnitude and probability of occurrence of negative environmental ‘externalities’
• Industrial ecology is potentially a great business model too because of ↑ resource prices/input costs!
• Govt policy is contradictory, both promoting and constraining simultaneously
• We may need to start with a blank piece of paper, and share the pen around!
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