industry data and trends

Industry Data and Trends

Walter Alcorn, ISEE 2006

History

In 2001 SAIC developed a simulation model of the electronics recycling industry as a decision support tool for the Polymer Alliance Zone of West Virginia

Model inputs were gathered from various recyclers, manufacturers and industry experts

2001 PAZ Simulation Tool Assumptions There was a lively, if precarious glass-to-glass

recycling market Remember Techneglas?

Mixed plastics was a cost to all electronics recyclers, not just the “no export” recyclers

Value of commodities were lower (steel, copper, aluminum)

SB 20 was just an idea

What’s up now?

DemandCommodity prices, especially metals, plastics

SupplyE-waste volumes

In regulated states (CA, ME) Everywhere else

Domestic recycling capacity Exports?

Demand: Commodity Pricing Trends CRB Metals Sub-Index of 5 markets:

Copper Scrap Lead Scrap Steel Scrap Tin Zinc

1947 – 1973 prices moved within a range 1974 – 2003 prices moved within a higher range 2004 – 2006 priced moved dramatically higher, a

new range???

Supply: Collection Volume Trends

Higher overall Driven by:

Policy/regulationFinanced collection programs (for

households) andVolume potentially available

Policy & Regulation Drivers of Supply State Mandates

CA, ME, MD, WA….. State & Local Collection Programs

Hennepin County, Delaware, Massachusetts, and hundreds of local government collections

Regulation of business e-waste Business users usually not allowed to dispose of old

equipment as regular trash Reuse patterns???

Mandatory State Program Volumes

California Collected about 65 million pounds in their first

program year (2005) Most was collected during the second half of the year

With a population of 36 million that’s about 1.79 lbs./capita

ME, MD, WA Amounts Still TBD Washington amounts TBD annually, plans to compete

to reach % share threshold

State and Local Collection Programs Hennepin County the most quoted Developed as an extension of “traditional”

recycling programs (bottles, cans, paper, etc.) Funding for these programs comes from a

variety of sources EOL fees are common Landfill tipping fees Bottle bill proceeds

Hennepin County Collected Units

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

1998 1999 2000 2001 2002 2003 2004

Year

Un

its

Volume of Electronics to be Recycled A primary question of U.S. EPA’s draft Baseline

Study Two approaches

Review actual return amounts from existing programs (lbs./capita)

Project amounts theoretically available from historic sales

EPA Baseline Study to focus on amounts theoretically at end-of-life based on historic sales

Actuals: Per Capita Calculations from the NCER’s CDR Massachusetts (2004)

2.94 lbs./capita (average for the 197 towns/cities reporting to the MA DEP)

California’s first program year (2005) 1.79 lbs/capita

Branford, CT (2004) 1.61 lbs./capita (CRTs only)

Kirkland, WA (2004, curbside program) 1.61lbs./capita

Snohomish County, WA (2004, transfer station) 1.71 lbs./capita

Hennepin County, MN (2004) 3.4 lbs./capita

Actuals vs. Projected

Actual returns from existing comprehensive electronics collection & recycling programs are less than half amounts projected from sales. Why? Electronics are not trade-in items like car batteries,

tires Reuse patterns not well documented nor understood,

particularly for business use products There is something seriously wrong with projection

models and/or data Export?

Data compiled by ERG for EPA Baseline Study. Data for desktops and portable PCs from IDC WW Quarterly PC Tracker in October 2005. Data for flat screen and CRT computer monitors were based on ERG analysis of US Census data on shipments, imports, and exports.

U.S. Sales of Electronics (IT) 1990-2004In 1,000s of Units

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

Year

Un

its

Desktops

Portables

CRT Monitors

Flat Screen Monitors

Total U.S. TV Sales 1981-2004 (1,000s of Units)

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

50,000

1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

Source: Data compiled by ERG for EPA Baseline Study 2006. TV data were obtained from Consumer Electronics Association Market Research, 2005. The number of flat screen TVs sold was derived from analyses of “Other TVs” (this category includes flat screen and monochrome TVs) in US Census data on shipments, imports, and exports, combined with CEA data on monochrome TVs.

A Clear Trend: the State Patchwork

Many “dead weight” costs being studied by the NCER as a NERIC initiativeNational Electronics Recycling Infrastructure

Clearinghouse Who incurs these dead weight costs?

IndustryGovernmentConsumers

State Patchwork Costs Being Studied Policing/excluding out-of-state e-waste Inherent state-level enforcement

limitations The “continuous start-up” for industry

compliance New requirements forcing changes to IT

systemsCompliance requirements trajectory unclear

State Patchwork Costs Being Studied (cont.) Redundant program staff Redundant brand counts (ME, WA) Redundant fund administration Redundant reporting, registration and

recordkeeping requirements Redundant program development

engagements

State Patchwork Costs Being Studied (cont.) Higher processing costs due to:

Lower economies of scale compared with national-scale volumes

Market fragmentation caused by state-restrictions on out-of-state processing

State Program Financing Overlap, Over-chargers and Free Riders

The “nexus” fee-collection problem in states with advance fees

State Patchwork Costs Being Studied (cont.) Additional patchwork costs? Ongoing survey of industry and

government officials The NCER seeks your input!

info@ecyclingresource.orgWebsite: www.ecyclingresource.org

What We Need

A harmonized national-level financing system An efficient decentralized collection

infrastructure Systems that can evolve as needs evolve National ESM Standards Better data Demand for recycled materials

Thank You!

For more information, contact:

Walter Alcorn

walter@alcornconsulting.com

703-390-9200