Comparative assessment of instruments

None of the above-mentioned instruments is capable of addressing all of the identified market distortions and failures. Each policy type has its specific pros and cons. Although economic and communication instruments seem to be most in line with the generally recognised principles of promoting economic efficiency, it is unlikely that these instruments eliminate the need for regulation entirely. Regulatory instruments provide a greater degree of certainty of outcome than other types of...

Set clear targets while maintaining flexibility

In Europe, the implementation of a European-wide ban on landfilling has had an enormous impact. Although such a uniform ban may not have necessarily led to the most efficient outcome in economic terms, it certainly created large momentum in the tyre recycling business. Countries and organisations are forced to come up with creative solutions to respect European legislation. Earlier attempts on a purely voluntary basis, such as those attempted in the Netherlands, failed miserably. (An argument...

Current configuration of the used tyre market

The international comparison depicted in Table 4.1 shows how the configuration of options to process used tyres varies widely between countries. On the one hand, Northern European countries have all achieved their objective to ban or significantly reduce tyres from landfills. The Eastern European countries and some of the Southern European countries, on the other hand, still landfill the majority of their used tyres. Another typical feature in Table 4.1 is that countries such as Denmark and...

Existing tyrerelated policies

The different policy regimes in the tyre waste management sector are shown in Figure 4.10. The policy instruments that deal with waste and therefore encourage recycling, either directly or indirectly, can be divided into three broad categories direct regulation, and economic and communication policy instruments (Opschoor and Turner, 1994). In the following overview these instruments are briefly explained, supplemented by examples from the used tyre sector. Figure 4.10. Policy regimes in the...

Policy recommendations

If recycling has significant environmental and economic benefits, then the expansion of the capacity of the recycling industry and the improvement of the secondary rubber market has to be promoted further. Most countries discussed in this study acknowledge this. The question remains how this aim should be accomplished. Several policy recommendations have been derived from the above analyses that are aimed specifically at reducing the market failures and barriers for rubber recycling markets. By...

Environmental policies designed to reduce wasterelated environmental damages

As noted above, the ultimate objective of waste-related environmental policies is to reduce environmental impacts to their economically efficient level. (See OECD, 2004 for a full discussion.) If the use of recyclable materials has fewer waste-related environmental impacts than primary materials, the internalisation of waste-related externalities should increase recycling rates, even if the ultimate policy objective is to decrease environmental damages rather than to increase recycling rates as...

Technological externalities

Technological externalities relate to the use of plastics with characteristics that make recycling more costly or difficult than would otherwise be the case. Examples include the use of composite plastics, special additives or mixing of colours. However, such characteristics cannot be described as market failures, unless there are missing markets in the production-consumption chain, which discourage manufacturers from using optimal product designs. For instance, if manufacturers face no...

The nature of potential market imperfections in secondary material markets

As noted above, in this section markets for secondary materials will be examined through the lens of the theory of market efficiency. Not all sources of market inefficiency which affect recycling rates are discussed. For instance, imperfect internalisation of externalities from raw material extraction will have a very significant influence on recycling rates, distorting markets in a manner that has negative consequences for material recovery. In addition, the imperfect internalisation of...

Welltargeted support for research and development

At present, the rubber recycling sector suffers from a number of technological impediments. Governments could support research and development to overcome these problem areas in the recycling industry. First, the currently limited market for secondary material applications could be expanded. For example, products could be designed in such a way that they could contain a higher content of recycled materials or could be used in different production processes. This is the case for example in the...

The market for secondary rubber

The configuration of the market for secondary rubber in each country depends on local economic and institutional conditions. Therefore, differences in recycling activities and waste management of used tyres occur naturally between countries. Moreover, market failures and distortions may be present in certain countries that reduce the efficiency with which markets for recyclable material operate, possibly leading to sub-optimal levels of recovery. This section describes the current configuration...

Policy influences in the market for secondary rubber

Public policies can have both a positive and a negative impact on the economic and environmental performance of recycling and waste management of the used tyre sector. On the one hand, government strategies can be developed to correct market failures. On the other hand, if applied inappropriately, policies are sometimes counterproductive in making the waste stage of tyres more sustainable. This section aims to evaluate the existing tyre-related policies and suggest potential improvements in...

Consumption externalities related to products derived from secondary materials

The previous section examined information failures which may relate to sources of secondary materials at the production input stage. However, there may also be information failures and commercial disincentives to the use of secondary materials directly in final products. These failures relate to cases in which buyers have incomplete information about the suitability of a given waste for a particular use, i.e. the product in question contains characteristics related to its use that are not...

Actively fight illegal dumping

In the case of used tyres, one of the main market distortions to be addressed includes illegal disposal. Incentives for illegal disposal will arise from imposition of a ban on landfilling or from the application of charges. Illegal disposal is generally dealt with through the establishment of deposit refund schemes because these provide a strong incentive for the consumers to return their used products in a proper state. In the case of used tyres, however, illegal disposal does not occur at the...

Annex Loss Aversion An Example

Cex Recycler

Assume that the use of retreaded tyres rather than new tyres results in increased probability (p) of a crash due to a tyre blow-out, and that in extreme circumstances this might result in estimated damages of 10 000 (i.e. due to a crash).21 If the household weights adverse outcome22 relatively more than the benign outcome (y),23 it will behave as though the probability of a blow-out is much greater than it actually is. For instance, a probability of 2.65 under such conditions will result in a...

Collection and waste management

The final stage in the lifecycle describes the ultimate destination of used tyres. Used tyres are generated after replacement or when shredding a vehicle. Various actors are involved. Generally, tyres are collected in tyre service centres. In some countries, consumers pay a limited fee to the service centre for proper disposal of the used tyre. For example, in Canada, consumers pay approximately 2 per tyre for disposal. In turn, the service centre passes part of that fee (roughly 50 ) on to the...

Consumption

An important product characteristic of the demand for tyres is the type of application, i.e. passenger car and truck tyres. This distinction is important as the two types of tyres have rather different material properties, thereby influencing their retreadability and recyclability. Approximately 70 of total weight of car tyres and 65 of truck tyres is rubber compound that is a combination of natural and synthetic rubber hydrocarbons. In general, truck tyres have larger natural rubber content...

Encourage extended producer responsibility

Extended producer responsibility (EPR) is an approach increasingly being used in OECD countries to address the environmental impacts of used tyres at their post-consumption phase. For instance, the tyre manufacturing industry in Europe formally accepted its responsibility in early 2002. Plans for setting up the EPR scheme are currently being developed by BLIC, the European Association of Tyre Manufacturers. In each country under an EPR scheme, the tyre manufacturers collectively create a joint...

Ensuring policy consistency

If it was possible for market participants to switch easily between different waste management options, changes in relative costs and policy incentives could be absorbed relatively easily by the market. However, as has been noted the start-up costs for re-refining can be very significant, not only because of the physical capital but also due to other factors associated with market entry such as testing costs. As such it is extremely important that policymakers provide clear incentives to...

European Union

The Commission of the European Communities issued a Directive on Waste Oils in 1975,40 whose purpose is to protect the environment against the harmful effects of illegal dumping and of treatment operations by ensuring safe collection, storage, recovery and disposal of waste oils. It requires member states to give priority to the regeneration of 40. Council Directive 75 439 EEC as amended by Council Directives of 22 December 1986 (87 101 EEC) and 23 December 1991 (91 692 EEC). waste oils in...

France

In France there were approximately 3 600 establishments involved in material recovery and recycling in 2002, employing 28 800 people. This represented a decline from approximately 4 200 establishments in 1999, reflecting an on-going trend toward increased concentration in the sector. As in the United States the facilities are generally very small, with 81 of firms having fewer than 10 employees (FEDEREC, 2003). Total receipts in the sector in 2002 were almost EUR 7 billion, with annual...

Illegal dumping

A growing problem in the waste management stage is the increase in illegal dumping of used tyres. Generally these tyres have already been sorted only the tyres that are no longer retreadable or reusable are fly-tipped. Related to this problem is the abandonment of monofill sites without processing the stored tyres. Such examples have been recorded in Canada, the US, the Netherlands and the UK (UK Environment Agency, 1998 US EPA, 1998). Unfortunately, there is limited information available on...

Incineration and landfilling

Landfilling of tyres is categorically rejected as inefficient by most financial-engineering studies. These options are commonly considered a waste of valuable materials and cause of environmental problems. Still, despite the implementation of the landfill ban in Europe by 2006, these options are still widely used in some countries. The cost for used tyre collectors of landfilling and incineration versus alternative management options is often the main driver of the configuration of the waste...

Information failures relating to recovered oil quality

Re-refining plants are more sensitive to contaminants in the waste oil pool than all other competing uses. While tankers tend to have separate compartments to allow for segregation of waste oils of different qualities, collectors (buyers) of waste oil can never be certain that the oil is free of these and other liquid contaminants to which re-refining is sensitive. Unless a comprehensive mobile testing programme is in place, the cost of concealment is negligible and the cost of detection...

Market conditions and price volatility

Price volatility is the reason most often cited as the cause of inefficiency in postconsumer recycled plastics markets. Such price volatility can be a consequence of the market barriers and failures discussed in Section 4 above, since they can lead to uncertain and thin markets. In this section, we review the evidence for price volatility in secondary plastics markets, seek to find empirical evidence for the reasons for the price volatility which does exist, and undertake some simulations which...

Market failures and barriers

Clearly the most important determinant of market participants to adopt one waste management option over another is financial cost. Some routes are more costly than others due to the importance of different factor inputs required. Public policy measures can play an important role in determining these factor input costs, whether implicitly or explicitly. For instance, a landfill tax will clearly have an impact on waste generation costs if the effects of the tax are transmitted back to the...

Market power

Market power can restrict the market for recyclable materials. In most cases problems of market power should be dealt with through standard competition and anti-trust law. For instance, if it is found that downstream manufacturers are exercising market power in a manner which discriminates in favour of the use of primary materials (and thus prejudices the penetration of recyclable materials in the market), this should be addressed through standard competition law. However, it appears that clear...

Maximising and optimising collection without restricting rerefining

Unfortunately, efforts to maximise collection rates (e.g. through return incentives) can have a negative effect on the potential to re-refine waste oils. Since it can be costly to run parallel collection schemes due to significant density economies (particularly in remote regions), there is a tendency for heterogeneous oils to be mixed at the point of collection. In some cases oils with high water content may be collected. In other cases, there is a danger that the waste oil may contain...

Oecd Q

ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT The OECD is a unique forum where the governments of 30 democracies work together to address the economic, social and environmental challenges of globalisation. The OECD is also at the forefront of efforts to understand and to help governments respond to new developments and concerns, such as corporate governance, the information economy and the challenges of an ageing population. The...

Optimal configuration of the used tyre market

In order to assess the efficiency of the market, it is first important to assess whether the current configuration of processing options for used tyres is optimal from an economic point of view. Deviations from the optimal configuration can indicate the presence of market failures and distortions. Thus far, no studies have sought to identify the optimal configuration of the complete range of waste management options for used tyres and only a limited number have made a comparison of the...

Price Volatility for Selected Primary and Secondary Materials

Natural Rubber Synthetic Rubber > Reclaimed Rubber Natural Rubber Synthetic Rubber > Reclaimed Rubber 25. Standard deviations of monthly price changes. Source US Bureau of Labour Statistics (www.bls.gov). Time periods are monthly and range from 1962 to 2001. However, due to missing data, in order to ensure consistency within commodity pairs, the time period varies.

Production

The basic components used to produce a tyre are synthetic and natural rubber, textile, steel and chemical additives. The proportions in which these components are used depend heavily on the specific characteristics of the tyre. This is clearly demonstrated if we look at the ratio between natural and synthetic rubber in different tyres generally, truck tyres have a larger natural rubber content than passenger car tyres. Natural rubber comes from the sap collected from Hevea brasiliansis (rubber...

Promote retreads to the public

Retreading should be seen as the first step in the management of post consumed tyres. It saves 80 of the raw materials and energy necessary for production of tyres and reduces the quantity of waste to be disposed of. Retreading, therefore, should be promoted by prolonging the lifecycle by producing retreadable tyres and improving their image, thus creating markets for retreaded tyres. Possible measures to achieve thais are to implement quality standards for tyre manufacturers to produce...

Providing information to market participants

For markets to operate efficiently, market participants must have access to reliable information. There is, therefore, a strong case to be made for an active government role in informing small and medium enterprises generating waste oils and do-it-your-self' households about the potential environmental damages to the environment of illegal dumping and unregulated burning, and the fines they will incur if they adopt such a strategy. This should be complemented by information campaigns concerning...

Removing market and policy distortions

As noted above, allowing direct incineration of waste oil without any pollution control device or imperfect enforcement of air emissions regulations result in an unfair competition between re-refining and energy recovery. In effect, there is a market distortion if externalities are left internalised in one waste management option but not in the other. However there are other potential distortions in the market(s) which may favour one or the other waste management option. For instance, in the...

Risk aversion to using rerefined base oils

As noted above, buyers of base oils typically blend base oils with additive packages to achieve a consistent product that delivers specified performance attributes. These buyers are highly sensitive to the risk of using materials that may cause their own products to fail in use or for their own production process to be stopped as additive packages fall out of suspension. Moreover, lubricants offer performance-critical attributes for a value that is typically insignificant when compared to the...

Targeting environmental policy objectives

It is clear that use of waste oil in unregulated small burners or dumping of waste oil into the natural environment results in significant environmental damages. As such, it is important to maximise collection rates, ensuring, to the greatest extent possible, that waste oils do not end up being discharged into the natural environment, whether through illegal dumping or incineration. A secondary issue is the ultimate use to which the waste oils are put after they have been collected. LCA studies...

The market for lubricants

3 700 million tonnes of crude oil are refined worldwide, of which approximately 1 is used to manufacture lubricant products. Lubricants derived from mineral oils are by far the most common type of lubricant, and it is on these products that this paper is focused. 27. See Groupement Europ en de l'Industrie de la R g n ration (2005) An Environmental Review of Waste Oils Regeneration (www. geir.fedichem.be). The small segment of lubricant products derived from vegetable sources and esters are not...

Search and transaction costs

Search and transaction costs are common in all markets, but may be particularly problematic for markets for recyclable materials due the particular nature of their generation and their heterogeneous nature. This can result in significant costs to identify market counterparts, to agree upon a price, and to conclude a transaction. While such costs may reduce as markets mature, if they are important enough at the outset they may prove to be an insurmountable barrier and the market itself never...

Conclusions

Many OECD governments have introduced targeted policies to encourage recycling. Such policies, if designed and implemented efficiently, can reduce the environmental externalities associated with waste generation to an optimal level. However, this assumes that all other aspects of the market are functioning efficiently. However, as we have seen, there may be market inefficiencies such as information failures, consumption and technological externalities, market power, and other factors at work,...

Transaction costs and search costs in secondary material markets

Transaction costs arise when there is friction in the market - i.e. market transactions are not undertaken costlessly.4 They can take many forms There may be costs associated with price discovery, whether due to lack of transparency or other factors. There may be significant search costs with buyers unable to identify potential sellers and sellers unable to identify potential buyers. There may be extensive administrative costs associated with actually undertaking the transaction (i.e. due to...

United Kingdom

A Government statement from 1985 describes the UK position on post collection uses. The Government favours the regeneration of waste oil as lubricant wherever practicable but sees no reason, environmental or otherwise, to discriminate against the use of base oil as supplementary fuel It is highly questionable whether regeneration is always the most rational way of re-using waste oil, and the decision as to whether to regenerate as lubricant or to use as fuel is best left to the operation of...

Market power and vertical integration in waste recovery

One of the few areas in which there has been considerable work on the effects of market failures on recycling markets relates to market power. In effect, it is argued by some that dominance of the market by a limited number of firms in the production of primary materials has restricted recycling markets by giving primary material producers the power to influence markets in such a way as to undercut more competitive producers of secondary materials. In general it is found that economies of scale...

Competition in the packaging industry

Recycling companies can set up within the system. There is scope for cartel behaviour in purchases from packaging companies or of sales to waste material traders. Whilst the Federal Cartel Office scrutinises statutes of companies for cartel behaviour, the general intention of the retail trade to only buy and sell Green Dot products is a possible violation of the German cartel ban. In addition, local government and waste disposal companies have set up joint ventures with long term exclusive...

Information failure and uncertainty related to waste quality

Full information is vital to the successful functioning of all markets. As we have seen above, inadequate information concerning prices can increase transaction costs. However, for recyclable materials in particular there may be another source of information failure related to the quality of information concerning the characteristics of secondary materials. In many cases this is either inadequate, unevenly distributed or altogether missing. Such information failures can have additional...

Competition aspects of waste collection and recycling

Arguments can be made that there are likely to be restraints of competition within DSD. If companies fulfil the take-back obligations on their own, then no competition issues arise. However, DSD was introduced to help realise some element of cost reduction - i.e. through economies of scale. As such, most firms use the system, and this is likely to have implications for the degree of competition. By its very nature, it introduces an element of co-operative behaviour between certain firms....

Policies targeted directly at recycling

Recycling is not an economic activity which should be supported by government policy measures in and for itself. However, environmental externalities associated with solid waste generation and management can be considered public bads. Moreover, solid waste is an area in which it is notoriously difficult to apply first-best environmental policies to reduce these bads (Eichner and Pethig 2001, Calcott and Walls, 2000). This is due in part to the mixed nature of much of the solid waste stream. A...

The plastics recycling industry

The recycling of plastics involves various separate activities. These are collection sorting cleaning and granulation and re-processing. Typically, each of these different activities are undertaken by different firms or public bodies. They are very different activities from those of firms involved in virgin plastics production, with much less technological sophistication. This is not to say that there are not difficult problems associated with separation. Factors affecting the profitability of...

The recycling process

Plastics can be recovered for either material or calorific values. This report focuses on recovery for material use, but it is important to note that energy recovery is more important in most countries. Table 3.5 gives data for European Union countries for 1999. The degree of variation is marked, with some countries recovering very little plastic (e.g. Ireland) and others a very high proportion (e.g. Denmark). As the percentage of unrecovered waste increases across countries, the proportion...

Consumption externalities

The degree of risk aversion associated with goods manufactured from some recyclable materials (retreaded tyres, used lubricating oil, etc.) appears to be out of proportion to the actual inferiority of the products relative to substitute goods manufactured from primary materials. In cases in which consumers preferences are affected significantly by the preferences of other consumers (i.e. consumption externalities), this can undermine the market for recyclables significantly. The cases of...

Illegal disposal

The most significant environmental impacts associated with lubricating oils almost certainly arise from illegal disposal. The extent of deliberate dumping in the US was highlighted in a survey by the Bureau of Transportation Statistics in 2002. It concluded that 5 of people who change their own motor oil dump the recovered oil in the drainage system, pour it on the soil, or place it in the municipal waste bin. The Bureau estimates that 43 million US residents change their own motor oil (BTS...

Mechanical vs feedstock recycling

The distinction between mechanical recycling and feedstock (or chemical) recycling is that mechanical requires physical separation, whereas feedstock recycling converts mixed PE PP PS PVC into basic hydrocarbon building blocks. Thus, mechanical recycling is appropriate for the primary and secondary recycling routes discussed above, through the grinding of plastic products into pellets or flakes. Feedstock recycling technologies, whilst they can handle contaminated and mixed material, are...

Source of waste postindustrial vs postconsumer recycling

On the basis of data from the Netherlands, it is found that the quantity of plastic waste being reabsorbed into the production system almost matches the quantity of postindustrial waste (Joosten, Hekkert and Worrell (2000). This is not surprising as the recycling rate for post-industrial material has been high for a long time, whilst the post consumer recycling rate has been low. In-house recycling of scrap plastics process waste is carried out extensively. It makes financial sense to recycle...

Introduction

This report reviews evidence of environmental damage caused by inappropriate management of used lubricating oil provides an overview of the markets for used lubricating oil reviews the market barriers and failures affecting some of the postcollection markets, and highlights the implications for public policy.26 Of the 37 million tonnes of lubricants sold globally in 2001, 40 to 50 was consumed or lost during use the fate of the remaining 50 to 60 of the oil which is potentially recoverable is...

Nick Johnstone and Soizick de Tilly OECD Environment Directorate Introduction

It has often been argued that levels of recycling for a number of potentially recyclable materials are sub-optimal, both from an economic and from an environmental perspective. For this reason many governments have sought to encourage recycling through measures such as subsidised municipal collection schemes, mandated sorting of wastes, recycled content standards, government procurement policies, etc. Such measures directly seek to affect the level of recycling either by decreasing the cost of...

Japan

In Japan the overall level of material recovery is 11 for municipal solid waste (MSW) and 41 for non-MSW. In the area of non-MSW, the highest levels are for metal scraps (75 ), construction waste (70 ), and slag (65 ). Wastepaper has a recovery rate of 48 , while the figures for waste oil (27 ), textiles (11 ) and rubber (13 ) are lower. For MSW the highest figures were steel cans (82.9 ), aluminium cans (78.5 ), glass bottles (78.6 ) and paper (56.3 ) in 1999. These figures have all been...

International trade

International markets are important throughout the lifecycle of tyres. Natural rubber can be produced only in tropical areas and high-quality tyres are manufactured in a limited number of industrialised countries. The waste management stage is also increasingly subject to international trade. Yet, knowledge on the commodity and regional patterns of international trade in used tyres and tyre-derived rubber waste is scant (UNCTAD, 1996). However, based on the limited data available, it can be...

Collection transaction and search costs

Commercial and, in particular, domestic plastic waste arisings are found in diverse locations in low volumes. The cost associated with collection from the point at which the waste arises and transportation to a recycling facility can often be prohibitive. Table 3.6 below gives illustrative figures for the UK and is based on information published by RECOUP in November 2000. Market prices for collected material are linked to the value of virgin material, which are cyclic in nature. The bottle...

Switching costs and barriers to entry

Incumbents seek to protect their market position and since volume growth in the lubricant market is small, it is customers of the incumbents who must switch to the entrant. The minimum efficient scale of 60 000 tonnes for a re-refining plant presents a major challenge in such a market. Once production starts, the existing market will need to accommodate the new source of supply. The existing vendors are typically large 39. Dollbergen in Germany did this during the 1980s and early 1990s....

Germany

Like other countries, plastics use in Germany has grown rapidly over the last two decades, although very recently there has been a marked levelling-off of production. However, Germany remains the third largest producer and consumer of plastics in the world. Production of plastics grew at a rate of 2.2 per annum from 1976 to 1995 and consumption of plastic products grew at a rate of 3.8 per annum. OECD, STAN Industrial Database . In addition, Germany is the second largest consumer of plastic...

The environmental impacts of plastics and plastics recycling

The rapid growth of plastics production is reflected in the growth of plastic waste as a proportion of total Municipal Solid Waste MSW . This can be seen in Table 3.3, which gives figures for the United States. Table 3.3. Proportion of plastic in MSW Table 3.3. Proportion of plastic in MSW The difference in the plastic component of European waste in the early 1990s is shown below in Table 3.4, with figures ranging from 6 UK to 11.5 Ireland . Table 3.4. Proportion of plastics in MSW by weight...

Competition between domestic and foreign firms

DSD does not discriminate against foreign suppliers in so far as they can obtain a Green Dot on their packaging. However, in practice the quota for refillables could be barrier as imported packages are more likely to be one-way. The deposit refund will only be appropriate for domestic firms. So a refillable quota could limit imports. A tax on oneway containers would lead to increased supply of domestic returnables and tend to leave the amount imported unchanged, so there would be no problem as...

Implement harmonised standards for retreads crumb rubber and TDF

Safety should of course not be compromised just to reduce the problem of waste tyres, but studies have shown that retreads can be just as safe as new tyres and the retread industry even claims they are of a higher quality than the budget tyres from Asia and Russia. The main problem then is to convince the public of this fact. One way to do this is the introduction of clearly communicated safety standards for retreaded tyres that should be very similar to standards for new tyres. The UNECE...

The lifecycle of tyres

Tyre Lifecycle

The increased number of vehicles has led to a tremendous growth in the volume of used tyres. Over a billion tyres reach their end of life in the world each year Brown and Watson, 2002 of which about 200 000 000 arise in Europe and 290 000 000 in the United States RMA, 2003 . From 1998 to 2008 this is expected to change by 2 every year. Vast quantities of tyres are stocked piled in designated landfills or illegally dumped, since a small quantity is presently reused and recycled see www .rma.org...

Signalling and market segmentation

Other market characteristics may also inhibit the take-up of recycled plastics. For instance, market signalling may play a role.48 Similar processes occur with other goods and services where product quality or similar attributes may be unobservable. Thus high quality cars are sold from opulent showrooms, and inferences will be made about cars sold from more basic premises. This could be used as a means of price discrimination, where a manufacturer will separate customers into those with a high...

Italy

Steinel Dali Plus

In contrast to the UK, long-term enthusiasm for the re-refining of waste oil has led policy makers to support the manufacture of base oil from waste oil sources. From July 2003, new regulations were introduced to reform a system of subsidies paid to re-refiners and collectors of waste oils A statutory consortium consisting of representatives from the manufacturers of lubricants, waste oil collectors and re-refiners as well as public regulators manages the contractual arrangements for waste oil...

Nature of recovery closed loop open loop and energy recovery

Closed loop recycling refers to the situation where the recycled item is re-made, e.g. using PET bottles to make new PET bottles. This reduces the amount of raw material going into this product. Open Loop recycling refers to the case where different items are made, e.g. using PET from collected bottles to make synthetic fibre or plastic lumber. In this case, the amount of raw material going into PET bottle production is not reduced, and the savings arising here from the recycling of PET are at...

Addressing market inefficiencies in recyclable material markets

If markets operate in conditions of maximum efficiency and regulatory standards and other policy measures are introduced for different waste management options such as to reflect their external environmental effects, recycling will be at its optimal level. However, in addition to the potential for non-internalisation of environmental externalities, other types of market failure may constitute an impediment to the realisation of commercial opportunities in recycling markets. This project has...

Technological externalities related to recovery and reuse of secondary materials

A technological externality exists when the production function of one agent enters another agent's production or utility function, without the latter being compensated Kolstad, 2000 . Environmental externalities when they affect productive processes such as polluted irrigation water are, of course, specific examples of the more general case of technological externalities. However, they are by no means the only type of technological externality. In this section, the focus of the discussion is...

Alberta Canada

A comprehensive description of the Alberta EPR system was prepared for the OECD in December 2002 CMCL, 2002 . The system imposes an ADF the Environmental Handling Charge on most lubricant and oil filter products at point of sale and distributes payments Return Incentives to collectors to provide an incentive to return waste oil, packaging and oil filters to almost 600 specified facilities. The policy is broadly revenue-neutral, and the programme, which has been developed and is directed by...

Characteristics of lubricant oils

A complex variety of compounds, such as detergents, dispersants, anti-oxidants, emulsifiers, corrosion inhibitors etc., are later added to base oils by specialist manufacturers to create an extensive range of lubricant products. These additives can contribute 5 to 10 of the weight of the lubricating oil. Once base oils have been blended with additives, packaged and marketed the value-added-multiple for engine oil is in the range 5 to 60 times the average value of crude oil. The exact mix of...

Sweden

Chart Ldpe Recycling Epa

Reidy 1992 reports that the average composition of waste in Sweden in the years up to 1990 is 35-45 paper, 8-10 plastics, 20-40 other assorted recyclable materials, and 25-35 food and garden waste. A high content of paper and increasing content of plastics with reduced content of metals leads to high calorific value of 10-12 MJ kg. Packaging waste accounts for about half of all municipal solid waste in Sweden. Around 35 billion packaged products are sold each year. Attempts have been made to...

References

AAMVA 2000 , The Commercial Driver's Handbook, American Association of Motor Vehicle Administrators, Washington DC. Aardvark Associates 2001 , Post-Consumer Tyres Shifting Perceptions to Create Opportunities, Working Paper prepared for the Retread Manufacturers Association, Dorset. ADEME 2001 , tude du co t des fili res de traitement des pneus usag s, Rapport Final, ADEME, Paris. AIRP 2002 , Drop in Energy Consumption and Environmental Pollution One Million of Oil Barrels were Saved in 2001...

Evidence of price volatility

Prices for secondary plastics are collected by various bodies in different countries. In this section we will review some of the data from Germany, the United States and the United Kingdom. Generally speaking waste plastic prices in all three countries exhibit considerable volatility. Moreover, such variability tends to be greater for lower quality plastics, such as mixed PE plastics. Table 3.8 gives the standard deviations of prices for different recycled plastic products in three countries...

Conclusions and policy recommendations

The light-weight and wide range of resin qualities make plastics an effective material for many applications. The lighter weight of plastics packaging has benefits in transportation as well as reduced material in the waste stream. On the other hand, these same characteristics can make plastics difficult to recycle. Plastics packaging resin sales are increasing about four times faster than plastic packaging recycling. Since 1995, US plastics packaging resin sales have increased at an average...

Uses of major plastics

Given their versatility, it is not surprising that plastics have found a large number of commercial applications. Products based upon the production of plastics include the following APME 2000b High-density polyethylene HDPE Containers, toys, housewares, industrial wrapping and film, gas pipes. Low-density polyethylene LDPE Film, bags, toys, coatings, containers, pipes, cable insulation. Polyethylene terephthalate PET Bottles, film, food packaging, synthetic insulation. Polypropylene PP Film,...

Conclusion

An important conclusion to draw concerning the types of environmental risks described in this section is that those arising before collection, such as illegal dumping, are considerably greater when compared to the net increase in the risk of environmental damages from preferring any one recycling route over another. Consequently, if the policy objective is to minimise the risk of environmental damage, maximising the collection of the recoverable proportion of lubricants should be a priority. In...

Base oil and lubricant product trends

Base Oil Prices

As can be seen in Figure 2.1 world demand for lubricants has been broadly static over the past 10 years, with a slight decreasing trend. However, static global demand masks regional variations that show demand falling in North America and Western Europe and, to a lesser extent Latin America. Conversely, the Asia-Pacific region and Central and Eastern Europe are exhibiting growth rates in the region of 2 per annum see Table 2.2 . Figure 2.1. World lubricant demand including marine oil Figure...

Retreading

When examining market failures for retreads, it is important to make a distinction between truck tyres and passenger car tyres. Although the technique of retreading tyres has been established for decades it has never broken through in the passenger car tyre market as a serious substitute for new tyres. Conversely, retreads are fully accepted for truck tyres, where about 50 of used tyres are retreaded. The limited share of retreads in the passenger car market is somewhat surprising but can be...

Removing policy failures which discourage recycling

Another public policy area which directly impacts upon recycling rates concerns the existence of policy failures which affect the degree of substitution between primary and recyclable materials.65 Two areas seem to be particularly important The provision of subsidies for substitute primary resource extraction and exploitation. The use of material standards which discourage optimal material choices. It has often been argued that various types of subsidies for the extraction and processing of...

The process of making plastics

Diagram For Making Plastic Pellets

Plastics can be divided into two major categories thermoplastics and thermosets. Thermoplastics can be remelted and reformed many times into different shapes. For this reason, they are the most commonly recycled plastics. Thermosets can only be formed once. After that, they may be ground and used as filler for future plastic products. Thermoplastic resins are the primary focus of this report because they are more readily recycled. The major categories of thermoplastic resins are high-density...

Waste oil and used oil

Approximately 40 to 50 of the lubricants sold are being lost through leaks or in the exhaust emissions during use the fate of the remaining 60 to 50 of the oil is potentially recoverable European Environment Agency, 2002 .28 Following a period of use that is typically less than 6 months, remaining lubricant is recovered along with various combustion, friction and heat-related contaminants. This oil - sometimes mixed with other contaminants such as water, solvents, antifreeze, brake fluid, paint...

Rubber recycling

Characteristics of the rubber recycling market Shredded tyres, also called crumb rubber, have various applications in the rubber recycling sector. Figure 4.7 shows that in the US in 2001, of the total 0.45 million ton 996 million pounds of crumb rubber produced, asphalt and moulded products were almost equal in market share, and combined had approximately 60 of the total market. The remaining 40 was used for the manufacturing of new products. Figure 4.7 shows that although consumption by...

Postcollection environmental impacts

Before or during collection from multiple-point sources, waste oil can be contaminated from either in-use sources or materials introduced through mixing. As noted above, in-use additives include a variety of compounds added during manufacture to meet performance specifications. In addition, waste oil is also likely to contain metals from engine wear unburned fuel PAH polyaromatic hydrocarbons from polymerisation and incomplete combustion of fuel particulates and water. It may also contain -...

The consequences of price volatility

Pet Recycling Diagramm

Price fluctuations in the overall market will have important consequences for profitability and the long term survival of firms involved in recycling. Fluctuations in the quantities of different types of materials collected will interact with this, and firms will need to be able to cope with both types of uncertainty. Such fluctuations can arise from collection where the amount of particular materials included in the waste stream will change on an unexpected basis. This type of problem will be...

The reasons for price volatility

The financial viability of reprocessing firms arises out of the relationship between waste plastics and virgin resins. Where these are close substitute goods then the two markets need to be considered in parallel as demand in one market will depend on price in the other. Thus, forces determining the level of demand in one market will affect related markets. For many uses, reprocessed materials are imperfect substitutes for plastics made from virgin resins. In other cases, they are - at least in...

Table of Contents

Executive Summary Improving Recycling Chapter 1. Introduction and Overview of Market Failures and Barriers 15 2. The economic importance and structure of the recycling sector in OECD countries 15 United 3. The nature of potential market imperfections in secondary material markets 19 3.1. Transaction costs and search costs in secondary material markets 20 3.2. Information failure and uncertainty related to waste 3.3. Consumption externalities related to products derived from secondary...

Executive Summary Improving Recycling Markets

Markets for many recyclable materials are growing. The growth of markets for many classes of potentially recyclable materials is due in part to policy incentives, but also to more general commercial conditions. In many cases their development is supported directly by public authorities through measures such as collection schemes for recycled materials, deposit-refund systems, and public procurement schemes. Public authorities also provide indirect support for such markets through the...

Evaluation Of Costs And Benefits For The Achievement Of Reuse And Recycling Targets For The Different Packaging

Gallager 2001 , Mixed Signals Market Incentives, Recycling and the Price Spike of 1995, Tufts University, Global Development and Environment Institute, Working Paper 01-02. Akerlof, George, A. 1970 , The Market for Lemons Quality Uncertainty and the Market Mechanism, Quarterly Journal of Economics, 89 3 . Anderson, Simon P. et al. 1994 , Price discrimination via second-hand markets, in European Economic Review, Volume 38, Issue 1, January 1994, Pages 23-44. Apotheker,...

Comparative assessment

Given the paucity of data and the differences across the programmes it is difficult to provide a systematic comparative assessment of their relative efficiency. However, there does seem to be a distinction between governments which have introduced policies designed to favour the re-refining of waste oil and those which have sought to maximise collection rates. The former have necessarily sought to overcome the barrier of unsuitable quality waste oil undermining the viability of the re-refining...

The importance of plastics in OECD economies

Plastics cover a large range of different materials and uses. Since the introduction of celluloid in the 1870s, plastic has been used in an increasing number of products. The commercial development of plastics began in the 1930s, when polystyrene, acrylic polymers and PVC started to be mass-produced from petroleum. During the Second World War, the production of polyethylene, polystyrene, polyester, nylon and silicones grew, and polyethylene terephthalate was discovered in 1941. Since the 1950s...