Table Of ContentC
BearingPoint
Benchmarking Evaluation of DAO
Stewardship Programs in Alberta
Final Report
Report Commissioned by Alberta Environment
February 28, 2006
Business and Systems Aligned. Business Empowered.
Alberta Environment
Benchmarking Evaluations of DAO Stewardship Programs Final Report
February 28, 2006
ISBN: 978-0-7785-6760-8 (Printed Edition)
ISBN: 978-0-7785-6761-5 (On-line Edition)
Web Site: http://environment.qov.ab.ca/info/home.asp
Disclaimer: Although prepared with funding from Alberta Environment (AENV), the contents of this
document do not necessarily reflect the views or policies of AENV, nor does mention of trade names or
commercial products constitute endorsement or recommendation for use.
Any comments, questions, or suggestions regarding the content of this document may
be directed to:
Conservation and Education Branch
Alberta Environment
Main Floor, Oxbridge Place
9820- 106th Street
Edmonton, Alberta T5K 2J6
Fax: (780) 422-4086
Additional copies of this document may be obtained by contacting:
Information Centre
Alberta Environment
Main Floor, Oxbridge Place
9820- 106th Street
Edmonton, Alberta T5K 2J6
Phone: (780) 427-2700 (toll free by first dialing 310-0000)
Fax: (780) 422-4086
Email: [email protected]
Copyright in this publication, regardless of format, belongs to Her Majesty the Queen in right of the
Province of Alberta. Reproduction of this publication, in whole or in part, regardless of purpose, requires
the prior written permission of Alberta Environment.
© H er Majesty the Queen in right of the Province of Alberta, 2007
Business and Systems Aligned. Business Empowered.
Authors
This report was prepared by:
Charles Meredith, Manager
BearingPoint LP
Suite 127, Commerce Place
10150 Jasper Avenue
Edmonton, AB T5J 1W4
T: 780-429-5859
F: 780-428-5190
[email protected]
Brent Schultz, Management Analyst
BearingPoint LP
Suite 127, Commerce Place
10150 Jasper Avenue
Edmonton, AB T5J 1W4
T: 780-429-5887
F: 780-428-5190
[email protected]
Graham Vanderwater, Management Analyst
BearingPoint LP
Suite 127, Commerce Place
10150 Jasper Avenue
Edmonton, AB T5J 1W4
T: 780-429-7610
F: 780-428-5190
[email protected]
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©2006 BearingPoint LP
Alberta Environment
Benchmarking Evaluations of DAO Stewardship Programs Final Report
February 28, 2006 BearingPoint
TABLE OF CONTENTS
1 Executive Summary 2
2 Introduction 8
2. 1 Project Objectives and Scope of Work 8
2.2 Key Questions to be Addressed 8
2.3 Project Deliverables and Timelines 9
3 Overall Findings and Conclusions 12
3 . 1 Beverage Containers 12
3.2 Scrap Tires 17
3.3 Waste Electronics 20
3.4 Overall Findings and Conclusions 26
4 Beverage Containers 29
4. 1 Alberta Beverage Container Stewardship Program 29
4.2 Overview of North American and European Beverage Container Stewardship Programs 37
4.3 Canadian Deposit Programs 38
4.4 American Deposit Programs 40
4.5 International Deposit Programs 44
4.6 Canadian Non-Deposit Programs 45
4.7 Governing Structure 47
4.8 Recovery Mechanism 48
4.9 Funding Mechanism 50
4. 1 0 Performance 52
4. 1 1 Deposits Values 58
4. 1 2 Handling Commissions 61
4.13 Scandinavian Programs 63
4.14 Ontario Analysis 67
4. 1 5 California Analysis 75
4. 1 6 Key Questions 78
©2006 BearingPoint LP
Alberta Environment
Benchmarking Evaluations of DAO Stewardship Programs Final Report BearingPoint
February 28, 2006
5 Scrap Tires 90
5.1 Alberta Scrap Tire Stewardship Program 90
5.2 Overview of North American and European Scrap Tire Stewardship Programs 107
5.3 International Programs 117
5.4 Governing Structure 124
5.5 Recovery Mechanism 125
5.6 Performance 125
5.7 Incentive Analysis 131
5.8 Key Questions 137
6 Waste Electronics 144
6.1 Alberta Waste Electronics Program 144
6.2 Overview of North American and European Waste Electronic Stewardship Programs 148
6.3 European Jurisdiction Summaries 151
6.4 North American Waste Electrical and Electronic Equipment Schemes 169
6.5 Governing Structure 172
6.6 Program Scope 173
6.7 Funding Mechanism 174
6.8 Recovery Mechanism 175
6 . 9 Key Questions 177
Appendix A - A lberta Handling Commission Rates (2005) 198
Appendix B - Alberta Deposit and Container Recycling Fee Rates (2005) 200
Appendix C - H istorical Price of Aluminium 202
Appendix D - S tewardship Ontario Paper & P ackaging Fee Schedule (2003-2005) 2 04
Appendix E - S candinavian Non-Refillable Deposit Program Comparason 206
Appendix F - P urchasing Power Parity Table 21 1
Appendix G - H istorical Energy Prices 213
Appendix H - E RA Advanced Disposal Surcharge Rates 215
ii ©2006 BearingPoint LP
Alberta Environment
Benchmarking Evaluations of DAO Stewardship Programs Final Report BearingPoint
February 28, 2006
Appendix I - C alifornia Electronic Waste Recycling Fee 217
Appendix J - E l Kretsen Product Surcharge Rates 219
Appendix K - S WICO Advanced Recycling Fee Rates 222
Appendix L - S ample Recupel Product Recycling Fee Rates 227
Appendix M - E cycle Solutions Recycle Process 230
Appendix N - B everage Containers Bibliography and References 232
Appendix O - S crap Tires Bibliography and References 239
Appendix P - W aste electronics Bibliography and References 245
iii ©2006 BearingPoint LP
Alberta Environment
Benchmarking Evaluations of DAO Stewardship Programs Final Report BearingPoint
February 28, 2006
1 Executive Summary
1 ©2006 BearingPoint LP
Alberta Environment
Benchmarking Evaluations of DAO Stewardship Programs Final Report BearingPoint
February 28, 2006
I
I
1 EXECUTIVE SUMMARY
Alberta Environment manages the use of Alberta's diverse landscapes to sustain a h ealthy environment, a p rosperous
economy and strong communities. Alberta is committed to protecting the province's air, land, and water while striving
to be a leader stewarding the environment. To support this goal, Alberta Environment engaged BearingPoint to
conduct a b enchmarking evaluation of Alberta’s DAO Stewardship Programs versus comparable programs in other
jurisdictions. The review focuses on three programs:
• Non-milk beverage containers (managed by the Beverage Container Management Board — BCMB),
• Scrap tires (managed by the Alberta Recycling Management Authority, Tire Recycling Alberta — TRA), and,
• Waste electronics (managed by Alberta Recycling Management Authority, Electronics Recycling Alberta —
ERA).
The information is required as a basis to inform policy and program decisions for improving the environmental
outcomes of the programs in a cost effective manner, while maintaining a h igh level of public confidence.
The key objective for this evaluation and related analysis is to benchmark Alberta Environment’s effectiveness and
cost-effectiveness with programs in other jurisdictions. Effectiveness focuses on the achievement of specific
objectives while cost effectiveness focuses on the relationship of cost and effectiveness (cost per incremental unit of
achievement of objectives or effectiveness) in comparison to programs or approaches to waste stewardship that are
carried out in other provincial/state/national/intemational jurisdictions.
* * *
Beverage Container Recycling Program
Alberta ’s beverage container recycling program is mature and very effective — but has plateaued.
Alberta has one of the broadest program scopes in North America and Europe, driving significant diversion of
beverage containers from the Alberta waste stream. Few other programs include “non traditional” products in their
scope that typically have far lower recovery rates — most programs focus strictly on beer and non-beer aluminium, '
plastic and glass containers. 4
Recoveries in Alberta are comparable to all other jurisdictions with similar structures and are far superior to 1
jurisdictions with non-deposit programs. Alberta’s overall recovery is approximately 80% and typically only marginal i
points behind the leader of any container category. Virtually all of Alberta’s beverage containers are recycled or re- (
used in what is essentially a closed loop system.
Alberta’s beverage container recycling program costs are competitive to comparable jurisdictions with the highest
recoveries. Transportation and processing costs compare very favourably to other jurisdictions despite duplication
created by two recycling streams — beer and non-beer. Alberta handling commissions are an issue as they offset these
transportation and processing efficiencies. Handling commissions in bottle depots, driven by average labour rates
approaching $15 per hour for handling waste beverage containers, are generating a significant financial burden on the
overall system.
2 ©2006 BearingPoint LP
Alberta Environment
Benchmarking Evaluations of DAO Stewardship Programs Final Report
BearingPoint
February 28, 2006
There is an interesting comparison of different program structures between Alberta and Ontario. Ontario’s program is
based on a municipal Blue Box program (with a very broad scope) with no deposits on containers, and with program
costs shared between municipalities and industry. Taking non-beer beverage containers in isolation, Ontario’s
recoveries are about half of Alberta’s (40% versus 75%), but Ontario’s program costs are less than a t hird of Alberta’s
($0,017 versus $0,058) on a unit recycled cost basis. The cost benefit analysis of the comparison of these two
programs is a matter of public policy along with provincial and municipal environmental stewardship strategy.
Alberta recovery rates are excellent and compare to those in leading jurisdictions, but they have plateaued during the
past seven years. Alberta should consider increasing and potentially harmonizing deposit rates (including adjusting
recycling levies) to drive increased recoveries, adding milk containers to broaden the program scope, implementing
technology based innovations to increase efficiencies in the collection stream, and focusing marketing efforts on
increasing consumer awareness for categories such as tetra packs, gable tops, as well as aluminium cans. Other
jurisdictions — California and Saskatchewan — have increased their recoveries in their previously plateaued programs
primarily through increasing deposit rates with success.
Finally, while the current structure is sound and generates excellent results compared to other programs, there is an
inherent conflict when funding the beverage container recycling program through unredeemed deposits and recycling
fees or levies. This structure creates an incentive for industry to minimize recovery rates to avoid higher recycling
levies that would increase to the total purchase price of beverages.
Scrap Tire Recycling Program
Alberta ’s scrap tire program is effective but high cost — the policy to not burn tires and to invest in research and
development for alternative uses creates significant cost impacts.
Scrap tires as a component of the waste stream are typically benign and individually have little environmental impact
other than the space required to manage them and the resources wasted by not recycling the materials. When stored in
volume, the potential risk becomes exponential with tire fires being a p rimary concern. Stockpiles are also excellent
artificial breeding habitats for disease carrying insects (i.e. West Nile Virus).
The Alberta program scope encompasses passenger, light truck and commercial tires; and excludes off-road tires that
are typically larger construction and mining equipment tires. Virtually all programs have comparable scopes, as few
handle problematic off road tires due to the infrastructure required — off road tires tend to be exceptionally large, heavy
and difficult to handle. Alberta’s recoveries are exceptionally high and comparable to leading jurisdictions with
similar program scopes. Most of these tire programs are mature and recycle virtually every tire sold, reporting
recoveries approaching 100%.
Alberta’s overall program costs are higher than most comparable programs. Despite this, the actual collection,
transportation and process costs — incentives paid — ranged between $2.62 and $2.92 per tire, and these are comparable
to most other jurisdictions. Two key policies drive Alberta’s program costs higher than others:
Most jurisdictions elect to bum tires and report acceptable environment stewardship outcomes. Alberta’s policy to not
bum tires results in the subsidization of alternative end use products — all more expensive than burning. Alberta’s end
uses for tires include civil engineering products (e.g. shred lining for landfills, asphalt, etc) and manufactured products
(e.g. mats, bricks flooring, etc). This policy makes Alberta’s program more expensive than most other programs thus
Alberta may want to revisit this policy. An important consideration is that crumb rubber is an alternative fuel source
3 ©2006 BearingPoint LP
Alberta Environment
Benchmarking Evaluations of DAO Stewardship Programs Final Report BearingPoint
February 28, 2006
commodity that is influenced by the price of traditional fuel sources — the rising price of oil, gas and coal typically
increases the value of scrap tires as a f uel source.
In addition, Alberta has committed to fund research and development into alternative end uses for scrap tires. Over
40% of the Alberta program revenues over the past three years have been expended on research and development for
alternative end uses for tires along with program marketing (public education). Few other jurisdictions allocate funds
for comparable research and development, thus Alberta is essentially “going it alone” and has generated minimal
results to date. The policy question is who should conduct research and development, and how should it be conducted
and funded? Alternative models for research and development should be considered involving both industry and
stakeholders in other jurisdictions nationally and internationally.
Alberta should consider burning all categories of tires while continuing to support alternative end use products,
developing end of life solutions for these end use products ensuring a closed loop system, broadening the program
scope to include off road tires, and devising an alternative research and development strategy for end uses for scrap
tires incorporating manufacturers along with other stakeholders to more effectively and equitably pursue long term
solutions.
Waste Electronics Recycling Program
Alberta ’s waste electronic recovery program is in its infancy — most European programs have much broader scopes
driving efficiency and exponentially greater waste diversion.
Rapid technological advancement combined with declining product life cycles is creating a global proliferation of
electronic products. Despite the drive towards miniaturization, the overall tonnage of electronics manufactured and
sold throughout the world is ever increasing.
The resulting waste streams are creating issues both locally in Alberta, and across the world. Waste electronics consist
primarily of metal and plastic; with much smaller amounts of glass, rubber, and a h ost of other materials including
many toxins such as lead, mercury and freon. Total metals and plastics comprise approximately 12% of the current
overall waste stream in Alberta. Scrap electronics contribute a p ortion of this tonnage, and the associated toxins create
a s ignificant environmental stewardship concern.
There are few formal electronics recycling programs actually implemented — there are only two others besides Alberta
in North America with the balance being in Europe and Asia. Most other North American jurisdictions deal with
electronics on a project basis (e.g. annual round-ups, etc) with larger metal-centric goods (e.g. appliances) being
recycled haphazardly driven primarily by geography and commodity prices. Europe hasn’t moved much faster — it
appears that only six of the 25 European countries have actually implemented a p rogram, with the balance of European
countries still developing a p rogram, despite a E urope wide directive to have a p rogram in p lace in 2005.
Alberta’s eWaste program’s scope is comparable or better than the other North American programs in Delaware and
California. Alberta has a much narrower program scope than the European programs — driving a much lower diversion
of waste electronics from the Alberta waste stream. European programs include white goods (washers, dryers, etc),
brown goods (smaller household appliances such as blenders, toasters, etc), power tools, gardening tools, toys, medical
equipment and lighting (tubes and fixtures). Medical equipment and lighting are of particular interest given their
propensity to contain toxins.
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©2006 BearingPoint LP
