Navigant Research Blog

Is Recycling Garbage?

— December 28, 2015

Recycling has been a topic of recent media trash talk. Energy consumption associated with the practice, particularly through transport, is high, negating many of its environmental benefits. In addition, the price of many recyclable commodities has fallen dramatically (aluminum fell from $0.80 to $0.37 per pound in recent months), undermining the economics of recycling. However, depending on the material, recycling can still have a major environmental benefit. Recycling aluminum saves 10 tons of CO2 per ton of metal. Glass, on the other hand, only saves 0.34 tons of CO2 per ton of material, and these small savings are quickly offset by emissions from transportation, collection, and distribution. Cities are increasingly seeing that recycling is, in many cases, just not worth the investment.

In Portland, Oregon, for example, recycling recovery rates (the amount of recyclables recovered from municipal waste) fell between 2013 and 2014. Some of this decline is easily explained by reduced circulation of magazines, junk mail, and newspapers. However, the construction of new buildings rose in the city, increasing the amount of metal and wood waste that could have been recycled. The WestRock paper mill, Portland’s wood processing facility, closed in October of 2015 due to financial troubles. The cost of recycling remains high elsewhere as well, especially for curbside recycling. In Augusta, Maine, the cost of recycling is $879 and $113 per ton for curbside collection and collection at Augusta City Center, respectively. On December 17, the Augusta city council voted to end curbside recycling in May 2016.

Recycling is still very popular among consumers. In fact, since its introduction in the 1980s, there are now more than 9,800 curbside recycling programs in the United States. However, recycling is, and always has been, energy intensive and costly. Materials like aluminum are beneficial to recycle, but for plastic and glass, the current systems and technology makes the practice economically and environmentally unfavorable. For recycling to work, the system has to change.

Technology to the Rescue

Recent advances in recycling technology could solve many of these problems. For example, Epson’s new waterless PaperLab allows offices to recycle up to 6,720 sheets of paper a day onsite. This eliminates the need to transport heavy, used paper. In Denver, Colorado, Alpine Waste is setting up a state-of-the-art Styrofoam recycling system. This will allow the city to process a previously hard-to-recycle material and prevent a lengthy trip to far-away processing facilities.

Another improvement involves a new type of easily recycled plastics. Discovered by Eugene Chen and Miao Hong of Colorado State University, the material is known as poly(GBL), and can be reduced to its original monomer state (for remaking into plastics) at 220°C  and 300°C (428°F and 572°F) for linear and cyclic polymers, respectively. The process to recycle poly(GBL) completely breaks down polymers and does not require the same high level of energy or water as previous plastic recycling systems—since the raw material doesn’t reach as high of a temperature, less water is required to cool it. This material promises to be cheaper to produce and recycle than many petroleum- or bacteria-derived plastics currently in production.

The current system of recycling is not cost or energy efficient. However, many recent advances have been made to usher in more efficiency. Arlene Karidis of Waste Dive, a news source dedicated to covering of municipal waste, recently published an article stating that technological advancements in recycling are expected continue in 2016, with increased emphasis being placed on safety, automation, and separation of materials. As 2015 ends, the year ahead promises a renewal in the way we think about recycling.

 

Gasification Projects Drive Smart Waste Evolution

— June 27, 2014

As the waste industry slowly evolves toward more integrated solutions for municipal solid waste (MSW) management, increasing volumes of trash are now being handled by so-called smart technologies.  Waste-to-fuels (W2F) – a subsegment within the energy recovery market that converts MSW into finished fuels, like ethanol and jet fuel – has become especially active, with advanced gasification technologies reaching important commercial milestones.

Enerkem, a Canadian company that recently gained first-mover status with the opening of a 10 million gallon per year (MGY) waste-to-methanol plant in Edmonton last month, is the first pure-play W2F project in development to reach the commissioning stage.  The company plans to add an advanced ethanol module later this year.  In April, British Airways and U.S.-based Solena Fuels (which are jointly developing GreenSky London, a 19 MGY facility converting landfill waste into jet fuel, bionaptha, and renewable energy) announced the selection of a site to commence commercial development and commissioning by 2017.

Faced with high capital costs, both projects depend on the low cost and widespread availability of waste as a feedstock to drive initial viability and future expansion.

Landfilling

According to World Bank estimates, nearly 1.5 billion tons of MSW is generated globally each year.  This total is expanding rapidly due to urbanization and rising levels of affluence in developing economies across Asia Pacific and Africa.

While 16% of MSW generated globally is never collected in the first place, and 27% is diverted for either material or energy recovery, more than 50% is still dumped in landfills, according to Navigant Research estimates.  Although there is plenty of trash to go around for higher value applications like W2F, market development depends on tightening regulations driving landfill diversion, since landfilling is typically the lowest-cost solution in areas where waste is actively managed.

In Western Europe, and to a lesser extent, North America, where waste diversion is gaining the most traction, momentum appears to be increasingly on the side of emerging companies like Enerkem and Solena Fuels commercializing breakthrough energy recovery conversion technologies.

Smart Waste

As forecast in Navigant Research’s report, Smart Waste, annual revenue in the smart MSW technology market – of which, energy recovery is a key subsegment – is expected to more than double from $2.3 billion in 2014 to $6.4 billion in 2023.  Annual revenue from smart MSW technologies is expected to surpass conventional technologies by 2019.

Annual MSW Management Revenue by Technology Type, World Markets: 2014-2023

 

(Source: Navigant Research)

While Waste Management in North America remains an active investor in Enerkem and other early-stage companies commercializing smart MSW technologies and solutions, traditional waste haulers face a revenue decline similar to that faced by traditional electric utilities.  As more MSW is targeted as a strategic feedstock, there is less trash for waste haulers to manage, resulting in less and less revenue.

Despite this evolution, companies like Enerkem and Solena Fuels still have a long road ahead.  These companies must compete for municipal contracts – in most cases, with traditional waste haulers – often pitting the high capital cost of an advanced energy conversion facility against landfilling on one hand and relatively inexpensive fossil fuel refineries on the other.

Enerkem’s Edmonton facility is estimated to cost $7.50 per gallon of production capacity to build.  GreenSky London, which incorporates the Fischer-Tropsch gasification process to convert MSW to synthetic gas (syngas), is expected to cost more than $14.00 per gallon of production capacity.  While the initial capital cost of such facilities is expected to decline over time, both platforms will depend on multiple revenue streams to be commercially viable.

 

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