Australian recycling plants have no incentive to improve

In the wake of a devastating fire at the Melbourne Coolaroo recycling facility earlier this month, Victorian environment minister Lily D'Ambrosio has announced a statewide audit of recycling facilities.

The audit is designed to identify other facilities with dangerous stockpiles of paper and plastic, but will also have the benefit of simply telling us how many plants are in Victoria.

It’s currently almost impossible to say how many recycling facilities are in Australia, where they are, and what they’re capable of sorting. And market forces can incentivise stockpiling material, creating the potential for yet more severe fires.

Where does our recycling go?

Australia generates roughly 50 million tonnes of waste a year, around 50-60% of which is recycled.

Some is defined as “construction and demolition” waste and recycled at specialist facilities, while a portion of food and garden waste is composted.

Most of the rest is collected from businesses and households, sorted at a recycling facility and then sent on to another facility to be turned into new products or packaging.

Overall, the volume of waste we generate generating is increasing at an estimated 7-10% per annum – more waste and recyclables that require sorting.

According to a 2013 report from the Department of Environment and Energy there are an estimated 114 facilities in Australia that sort recyclables from the commercial/industrial and household sectors.

However, this tells us very little. We don’t know the true number, as each council licenses the facilities in their area but there’s no central database. Some will manage household recyclables, while some will specialise in materials like paper and cardboard, or glass.

These facilities vary in how much volume they can process, as well as the variety of materials. Some rely totally on human labour to sort the materials, and others are a mix of mechanical and labour.

In light of our growing need for recycling facilities (and events like the Coolaroo fire), it’s clear that we need a national registry, updated with an annual survey.

Private companies recycle for Australia

Across Australia, most recycling is done by private companies. Councils are responsible for collecting household recyclables, but with very few exceptions they pay businesses to do it. Regardless, we are charged for the service through our rates.

Many different materials can be recycled – even plastic shopping bags and polystyrene. But it requires dedicated equipment at the recycling facilities to do so, and well as a market for the sorted product. Installing plastic-bag-recycling equipment is expensive and the markets are volatile, meaning that the expense for collection and sorting may not be repaid.

When prices for material like metal, glass or paper drop, companies may hold on to material waiting for an increase, or simply send them to landfill to reduce costs.

Another issue not often considered is the location of these facilities. As forward planning has been limited, new facilities will need to be placed in rural or regional areas, increasing transport costs and further shrinking the profit margins of the industry.

It also means more emissions as waste is transported from collection, to the sorting facility and then back to industry and shipping locations. At the same time, recyclables from many regional councils are transported to specialist sorting facilities located closer to metropolitan Melbourne, as there are no such facilities close to them.

What we can do to fix it

Fundamentally, Australians want more recycling, less landfill and less overall waste. Fortunately there are a number of process that can help deliver these outcomes.

States and territories can upgrade recycling facilities. New South Wales has been extremely proactive in spending money from its landfill levy to improve waste management, but the Victorian government has a A$500 million sustainability fund that should be used for the same purpose.

Particular attention should be paid to increasing our capacity to sort more materials, diverting them from landfill.

Tax breaks and other financial incentives should be offered to plant operators who upgrade their equipment, and manufacturers who use recyclable material in their products.

At the same time, we should consider penalising businesses who use non-recyclable packaging when alternatives exist, and retailers who sell goods in multi-material packaging (like polystyrene and plastic) without providing an alternative.

Recycling is very different to landfills, which are also generally privately owned. There’s significant government investment in landfill, as well as strict environmental and social restrictions. Importantly, landfills are not subject to the same market forces that cause large price fluctuations.

While the Victorian audit is a positive step, it does not address the basic lack of sorting facilities in the right locations, without policies to encourage development.

Recycling reduces overall greenhouse gas emissions, and energy, water and raw material consumption. Yet, apart from continual policy statements, little is being done.

Of course, it’s a complex issue. Forcing recyclers to sell their product at low rates can cause businesses to collapse; at the same time, less valuable material can end up in clearly dangerous stockpiles or yet more landfill.

Kneejerk reactions are not the answer. First and foremost, we need to find out how many facilities exist across Australia, where they are and what their capacity is. Only then can we usefully plan.