The strategy marks a shift toward a circular economy approach to materials management.
The U.S. Environmental Protection Agency (EPA) released its “2021 National Recycling Strategy” Nov. 15, which also kicks off America Recycles Week. The strategy is designed to address major recycling challenges, including contamination, to create “a stronger, more resilient and cost-effective municipal solid waste recycling system,” the agency says, with the goal of achieving a 50 percent national recycling rate by 2030. The strategy also addresses the climate impacts of producing, using and disposing of materials and the human health and environmental impacts of waste and waste-related facilities in overburdened communities.
According to the strategy, “The National Recycling Goal and the National Recycling Strategy are integrated and support the ultimate goal of improving recycling and increasing circularity within the United States. The methodology to measure the recycling goal and its key metrics is under development and expected to be finalized later this year. In the development of the implementation plan, EPA will bring the recycling goal and National Recycling Strategy together into a comprehensive plan. As EPA moves beyond recycling to develop additional strategies, EPA also will develop a new goal to reduce the climate impacts from materials production, consumption, use and disposal that will complement the focus on a circular economy approach. This new goal will complement the National Recycling Goal, as well as the U.S. goal to halve food loss and waste by 2030.”
In 2018, in response to recent international policy changes and other challenges, EPA focused on U.S. recycling, hosting the inaugural America Recycles Day Summit in 2018. That was followed by publishing the “National Framework for Advancing the U.S. Recycling System,” in 2019, a collaborative effort by stakeholders from across the recycling system that highlighted the need to promote education and outreach, enhance infrastructure, strengthen materials markets and enhance measurement. The "2021 National Recycling Strategy" adds environmental justice and circular economy focuses.
The EPA says among the challenges the U.S. recycling system faces are reduced markets for recyclables, recycling infrastructure that has not kept pace with today’s changing material stream, confusion about what materials can be recycled and varying methodologies to measure recycling system performance. The “2021 National Recycling Strategy” identifies actions designed to address these challenges under its five strategic objectives:
The strategy also focuses on how the EPA will address environmental justice, climate change and the circular economy:
The EPA says it will work with stakeholders, including communities, local, state, federal and Tribal partners, and with public and private stakeholders, to develop a plan to implement the strategy.
The circular economy approach to materials management represents a change in how the nation currently mines resources, makes them into products and then disposes of those products. This approach would reduce material use, redesigns materials and products to be less resource-intensive and recaptures “waste” to use in manufacturing new materials and products, according to the EPA.
EPA Administrator Michael S. Regan says, “Our nation’s recycling system is in need of critical improvements to better serve the American people. EPA’s National Recycling Strategy provides a roadmap to address system challenges and pave the way for the future of recycling. As we move forward with this strategy, EPA is committed to ensuring that historically underserved and overburdened communities share in the benefits that our work will deliver. Together with the historic investments in recycling from the bipartisan infrastructure deal, the strategy will help transform recycling and solid waste management across the country while creating jobs and strengthening our economy.”
“The full impact of waste materials is connected to a broad range of issues, and having a strategy that promotes better materials management can help lead us to solutions for these larger issues,” says Sacoby Wilson, EPA National Environmental Justice Advisory Council member and University of Maryland Associate Professor/Director, Community Engagement, Environmental Justice and Health Initiative, Maryland Institute for Applied Environmental Health and Department of Epidemiology and Biostatistics. “We have to work with industries that are significant sources of single-use products. And, when we address recycling, we must address where these waste products come from, where they go and how they’re impacting the health, sustainability and quality of life in communities of color.”
The Institute of Scrap Recycling Industries (ISRI), Washington, took part in an advance briefing by Carlton Waterhouse from the EPA Friday, Nov. 12. ISRI’s Director of Advocacy Adina Renee Adler says that by taking climate change and environmental justice into consideration, the strategy is more expansive than the original draft, which was released in October and focused on contamination, collection and markets.
She says the EPA offered some thinking on how to achieve each of the objectives outlined in the strategy in the briefing, such as extended producer responsibility, or EPR, and recycled-content mandates to enhance circularity and address the challenges associated with recycling. The strategy calls for conducting an analysis of different policies such as these that could address recycling challenges.
Adler adds that ISRI does not support recycled-content mandates. Instead, the association says it supports legislation that expands the use of recycled plastic in applications that are appropriate, noting that these levels vary by application and type of plastic.
ISRI says it supports manufacturers incorporating the principles of Design for Recycling (DfR) to ensure their products are more easily recycled, which Adler says is one of the EPA’s possible suggestions for improving collection and materials management infrastructure, though the agency refers to it as "design for environment."
“That was music to our ears,” she says. “It was good to see that captured in the strategy.”
The Solid Waste Association of North America (SWANA), Silver Spring, Maryland, which also took part in the EPA briefing last Friday, has voiced its support of the strategy. SWANA says it has engaged with EPA throughout the past four years, helping the agency respond to China’s National Sword program, including participating actively on several recycling workgroups and advocating for EPA’s 50 percent waste diversion goal by 2030.
“SWANA is very pleased that EPA has broadened the draft National Recycling Strategy to encompass climate change, environmental justice and other topics,” says David Biderman, SWANA executive director and CEO. “We look forward to working closely with EPA and other stakeholders to educate Americans about the strategy and helping to implement it.”
The strategy notes that stakeholders submitted comments on whether to include chemical recycling in the scope of the National Recycling Strategy, adding, “All options, including chemical recycling, should be discussed when considering methods for sustainably managing materials. Therefore, chemical recycling is part of the scope of this strategy and further discussion is welcome.”
Joshua Baca, vice president of plastics for the American Chemistry Council (ACC), Washington, issued a statement on the strategy that reads in part, “Advanced (or chemical) recycling is critical for achieving a more circular economy for plastics. Since 2017, 65 advanced recycling projects have been announced that have the potential to divert more than 5 million metric tons of waste annually from landfills.
“There is significant alignment in what America’s Plastic Makers are calling for in our 5 Actions for Sustainable Change and what EPA has laid out in its National Recycling Strategy. This is particularly evident in the strategy’s support of increasing domestic markets for recycled material, creating national recycling standards to reduce contamination and measure results more effectively and enhancing recycling infrastructure.
“Congress can further help the EPA implement its strategy and achieve its recycling goals by enacting policies such as a national standard requiring plastic packaging to contain 30 percent recycled plastic by 2030 and an American-designed producer responsibility system to improve recycling access and collection of all materials,” Baca continues.
He concludes, “Consumers want packaging with more recycled plastics material, more than 400 brands have committed to increasing the amount of recycled material in their packaging, and America’s Plastic Makers have set a goal to have 100 percent of plastic packaging to be reused, recycled or recovered in the U.S. by 2040. EPA’s Strategy lays the groundwork to make much of this possible.”
The standard is a voluntary, market-based framework to ensure consistent labeling of products that contain or support certified recycled plastic.
GreenBlue, a Charlottesville, Virginia-based environmental nonprofit dedicated to the sustainable use of materials, and the Recycled Material Standard (RMS) team have officially launched the RMS and are ready for brands and suppliers in the plastics recycling value chain to pursue RMS certification.
The RMS is a voluntary, market-based framework to ensure consistent labeling of products and packaging that contain or support certified recycled material. It has been developed as a multistakeholder initiative using a consensus process.
According to a news release from GreenBlue and RMS, the RMS offers average recycled content and mass balance allocation claims as well as a certificate trading system that channels investments to recyclers. The two groups say this allows for targeted investments to help grow the supply of available recycled materials. Those seeking certification can apply to the program, access supporting documents and connect with a certification body to pursue an audit.
“The RMS promises to be the most comprehensive standard available for North American plastics supply chain members,” says Laura Thompson, director of the RMS. “When recyclers, converters and brands learn about the RMS, they understand the opportunity it provides to advance the use of recycled materials and help producers reduce their reliance on virgin plastics.”
The RMS will help track and trace the use of recycled materials in both mechanical and chemical recycling systems. Through the purchase and trade of attributes of recycled content (ARC) certificates, companies can invest in the recycling system. RMS and GreenBlue report that because certified recyclers can immediately generate ARCs, brands can purchase and use credits, helping to expand the supply of recycled materials.
The standard supports verification of postconsumer and postindustrial plastics to enable a full and accurate accounting of the use of all types of recycled plastics. The RMS also offers multisite certification, which GreenBlue and RMS say is an advantage for larger companies operating multiple locations in North America.
“The RMS really reflects a solution to the challenges that we’ve been hearing from the plastics industry when it comes to meeting circularity goals,” says Nina Goodrich, executive director of GreenBlue, the parent organization that supported the development of the RMS.
A copy of the standard, along with the plastics module and other supporting documents can be downloaded here.
Over the course of the last three months, Rotochopper has hosted three field day events across the country to showcase its equipment.
Over the course of the last three months, St. Martin, Minnesota-based Rotochopper has hosted three field day events across the country. The events, hosted at Rotochopper customers sites in Wisconsin, Tennessee and Texas, provided an opportunity for attendees to see Rotochopper equipment in action, network with other business owners and operators, and connect with the Rotochopper team.
The first event was conducted at Hay Creek Companies in Pittsville, Wisconsin. Machines demoed at the event included two horizontal grinders owned by Hay Creek Companies—a B-66 and an EC-366 that feeds into a Rotochopper RMT Hammermill. In addition, the 75DK slow-speed shredder, GB-250 Bagger and Rotochopper’s new 365R Radial Stacking Conveyor were demonstrated at the event. During the field day, attendees were able to tour Hay Creek Companies facility and learn more about their operation in which they produce animal bedding, wood pellets and mulch.
The next event was hosted at The Compost Company outside of Nashville, Tennessee. Rotochopper’s Mid-Atlantic sales team provided attendees with a full day of demonstrations and learning. The day included demos of the Rotochopper B-66L, FP-66, 75DK Shredder and a GB-250. In between machine demos, attendees were also able to learn more about Rotochopper’s exclusive screen change system.
The final event was hosted by Rotochopper’s South-Central sales team at GWG Wood Group in Dallas. Attendees were able to see the B-66L grind green waste and whole logs, and after a screen change, switch to quickly process regrinding material. The MP-2 showed its ability to efficiently grind pallets and pallet scrap. Additionally, the 75DK Shredder was on-site to demo C&D materials and tires. Attendees were also able to view GWG’s two machines, the B-66 and B-66E, in action. Combined, these machines have over 11,000 hours logged. Rotochopper also provided a presentation on RotoLink to share the advantages of a remote monitoring system with attendees.
“The Rotochopper field day events provide a unique opportunity for attendees from a regional area to participate in an up-close-and-personal demo event. Attendees are able to not only learn from the Rotochopper sales and service team, but also from other business owners. The connections made at these events are immeasurable,” Rotochopper Marketing Manager Nicole Klein says.
The city renewed its contract with Waste Management despite a competitive bid from FCC Environmental Services.
The city of Fort Worth, Texas, voted unanimously Nov. 9 to extend its contract with Houston-based Waste Management valued at nearly $479 million over 12 years.
As reported by the Fort Worth Report, this decision comes despite at least one company—The Woodlands, Texas-based FCC Environmental Services—estimating it could save the city $60 million during that same time period.
Assistant City Manager Valerie Washington told the Fort Worth Report before a city council meeting that it is easy for competitors to make such claims when they don’t have to back them up. She thinks the city got the best deal it could under the circumstances.
However, FCC Environmental Services Director of Public and Governmental Affairs Erica Holloway questioned how Washington could know that.
“Fair and open competition is what makes the economy go round, and the only way to know for certain you’re getting the best deal is to test the marketplace,” Holloway told the Fort Worth Report.
The deciding factor for several city council members was Waste Management’s proposal to subcontract with Fort Worth-based Knight Waste Services, a minority-owned local business; to waive the consumer price index adjustment for fiscal year 2022; and to install cameras in its trucks.
“We spend a lot of staff time and resources trying to ascertain missed trash pickups. The cameras will help us capture that information on the front end,” said council member Carlos Flores.
Waste Management will install the cameras and train its personnel on how to use them by May 1, 2022, according to the contract extension term sheet.
Other changes to the contract include a requirement to pick up missed trash and recycling within 24 hours and missed yard waste and bulk waste within 36 hours. If Waste Management fails to pick these up within that time frame, it would be considered “a priority one collection.” The company must strive to reduce this type of collection by 20 percent for trash and recycling and 10 percent for yard waste and bulk waste. It also must meet other goals set each quarter by the city to avoid $60 fines for missed collections.
The contract extension allows the city to fine Waste Management if it misses three daily collection routes in a month. The fine would be $300 per missed route collection.
At Waste Today’s Corporate Growth Conference, a panel of seasoned executives discussed what operators should know when thinking about selling their business.
The decision whether or not to sell is often a painstaking one for waste and environmental services business owners, but in an era marked by M&A activity, it is a decision many operators are being forced to consider.
At Waste Today’s Corporate Growth Conference, which took place Nov. 4 in Chicago, a panel of experts discussed what operators should know about the selling process in a session titled, “What I've Learned Selling My Waste Business.”
Moderated by Houlihan Lokey Managing Director Scott Sergeant, the session featured a panel that included Anthony Lomangino, former owner and CEO of Southern Waste Systems; Mike Malatesta, former owner and CEO of Advanced Waste Systems; James Devlin, chairman of the board of directors and CEO of Inframark LLC; and Danny Ardellini, founder and CEO of Environmental 360 Solutions.
According to Sergeant, every potential deal has distinct challenges that operators have to navigate.
“My team and I have executed 60-plus M&A transactions in the environmental services sector, and every one of those deals is different,” he said. “The deal dynamics are different, the ownership structure, the type of buyer, working toward the objectives, the culture and personalities and all the other nuances of the deal [are unique in each case].”
According to Lomangino, who successfully sold two companies to Waste Management, his decisions to sell were based both on the timing of the market and his desire to free himself from some of the financial responsibility of owning his companies.
“There are a number of reasons why people sell, but in my case, it was the timing of it,” Lomangino says. “You want to be wise and sell when the market is starting to peak. And also, you [have to assess what is] your individual tolerance for debt. So, we didn't [take on] private equity [partners] … so you get a lot more pressure on you that way, and that can get to you after a while. So, in my case, we grew it as much as we wanted to grow it, and the market timing was correct, so we just wanted to take some chips off the table and move on.”
For Malatesta, his foray into selling a business came when Covanta expressed its interest in acquiring Advanced Waste Services’ industrial waste business in 2015.
“We were going to be a platform company [of Covanta], and I started to see a lot of opportunity for the folks on our team that could be accelerated in a way that I couldn't accelerate it at the time,” he said. “And so, I personally said no, not interested [at first]. And I thought about it for a while. And then I started writing down some numbers and I thought, ‘Well, if we get to this number, I'm going to sell,’ and we eventually got to that number [which was $51.5 million, or around 8 times EBITDA.”
Malatesta also said that it was a good time to sell for the business because Advanced Waste was free from lawsuits, violations and other legal and regulatory entanglements at the time, which helped frame the business in a positive light and allowed the company to maximize its return.
For Ardellini, who was approached by GFL Environmental in 2009, it was a good time to sell because it helped relieve him of some personal debt he incurred in growing his business, but also, the opportunity allowed his team to stay onboard and intact following the acquisition.
“Obviously, multiple is everything when you're selling your business, but our employees became the foundation for the solid waste business at GFL,” he said. “So, it wasn't [like selling to one of the big public companies at the time who would come in and] get rid of all my management and dismantle everything we built. That was a very important part of my decision and merging with GFL—the employees would stay onboard.”
Malatesta also shared that one of the lessons he learned when selling his first business was the importance of bringing on third-party advisors rather than trying to sell the business on his own. This lesson hit home when the acquiring company called him late in the sales process to reduce its offer.
“Had I had professional representation, first of all, I never would have gotten that call,” he said. “Second of all, that call would have come to somebody else, and they would have told them that's not happening and these are the reasons why. I would never have wasted energy on that.”
Ardellini echoed Malatesta’s sentiments on the importance of seeking professional representation when selling a business in order to help make the process easier and free up the owner to concentrate on operations.
“Today, when I’m on the other side of the table buying companies and I interact with these owner-operators, I encourage them to go get professional help because the process of making the deal is one thing, but all the due diligence and all the follow-up becomes tedious,” Ardellini said. “These owner-operators are entrenched in running the day-to-day business, and you don’t want to distract them from that while they're getting an acquisition checklist together of 80 to 100 things that they have to do.”
In terms of assessing interest parties, Lomangino noted that sellers should both think about the multiple that is being offered as well as the likelihood that the acquiring company is going to see the deal through to its completion.
“If you're entertaining a number of different possible buyers, one of the main things you got to consider is who's the most likely to complete the transaction,” he said. “Are they big enough? Are they ‘bigger than the deal?’ It always helps if they are bigger than the deal because when you get to crossing the t’s and dotting the i's and you’re down to the finish line, if you’re dealing with scared money, they could jump away from the table after you’ve left everybody else behind.”
Lomangino also stressed the importance of keeping the prospect of a sale confidential to employees—both to keep business running as usual, but also, because no deal is certain to close due to various macro and microeconomic factors.
Finally, the panelists agreed that selling a business requires being able to mentally distance oneself from attachment to the company and being able to cope with the feelings of estrangement that may ensue following a sale.
“I always thought that my first company was one of my children, and I was worried about handing it off to the next person,” Ardellini said. “That was until I talked to my lawyer at the time who told me, ‘This is a business. You’ve done very well for yourself. Let it go.’ And it was hard for me to let go of my first company. It took me months to get over.”