SECOND REPORT TO CONGRESS
RESOURCE RECOVERY
AND SOURCE REDUCTION
This publication (SW-122) was prepared
by the OFFICE OF SOLID WASTE MANAGEMENT PROGRAMS
as required by Section 205 of The Soh'd Waste Disposal Act as amended
and was delivered March 26, 1974, to the President and the Congress
U.S. ENVIRONMENTAL PROTECTION AGENCY
1974
For sale by the Superintendent of Documents, U.S. government Printing Office, Washington, D.C. 20402 - Price $1.88
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FOREWORD
The Solid Waste Disposal Act (P.L. 89-272, Title II, Section 205) requires
that the U.S. Environmental Protection Agency (EPA) study the recovery of
resources from solid waste and the reduction of solid waste at the source. This
document represents the Agency's second report to the President and the
Congress on these subjects.
The first EPA report, issued February 22, 1973, discussed the environ-
mental benefits of recycling, identified the technical and economic factors that
appeared to impede recovery of waste, and outlined the major options available
to increase resource recovery or reduce the generation of waste. Program
activities to analyze and evaluate these options were described. This second
report presents the findings of EPA's studies to date.
The information contained in this report was derived from a number of
contractual efforts, demonstration grants, and in-house analyses. The Agency
staff members who made major contributions to the development and
preparation of this report are John H. Skinner, Stephen A. Lingle, Eileen L.
Claussen, Frank A. Smith, Arsen J. Darnay, J. Nicholas Humber, Laurence B.
McEwen, Michael Loube, and Fred L. Smith.
-RUSSELL E. TRAIN
Administrator
U.S. Environmental Protection Agency
in
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CONTENTS
PAGE
Summary ix
1. Resource Conservation, Environmental, and Solid Waste
Management Issues I
THE QUANTITY AND COMPOSITION OF POST-CONSUMER SOLID
WASTE 2
Estimates for 1971 2
Waste Generation Projections 5
SOLID WASTE MANAGEMENT SAVINGS FROM RESOURCE
RECOVERY AND SOURCE REDUCTION 5
Waste Management Costs 6
Potential Feasible Savings 8
MATERIAL CONSUMPTION AND NATURAL RESOURCE SUPPLY
ISSUES . . 9
Historical Trends in U.S. Raw Material Consumption 10
General Extrapolations of Past Trends 11
Future Raw Material Supplies and Natural Resource
Conservation 12
Resource Recovery and Source Reduction Implications for
Resource Conservation 13
ENVIRONMENTAL QUALITY PROTECTION IMPLICATIONS 16
REFERENCES 17
2. Existing Federal Policies and Their Effects on Virgin and
Secondary Material Use 19
FREIGHT RATES FOR VIRGIN AND SECONDARY MATERIALS .. 19
Transportation Costs and Rates 19
Rates and Costs for Rail Shipments 20
Ocean Freight Rates 22
The Effects of Freight Rates on Recycling 23
Conclusions and Recommendations 24
FEDERAL PROCUREMENT OF PRODUCTS CONTAINING
RECYCLED MATERIALS 25
Federal Procurement as a Demand Creation Mechanism 25
General Services Administration Recycled Paper Procurement
Programs 28
Department of the Army Retread Tire Program 28
Joint Committee on Printing Use of Secondary Fibers in
Printing and Publishing Papers 28
Barriers to Expanded Use of Recycled Materials in Federal
Purchases 29
Conclusions and Recommendations 29
TAX BENEFITS FOR VIRGIN MATERIALS 29
Definitions of Tax Benefits for the Virgin Material Industries ... 30
Quantitative Estimates of Tax Benefits 31
The Rationale for Virgin Material Tax Benefits 34
Conclusions and Recommendations 36
REFERENCES 36
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RESOURCE RECOVERY AND SOURCE REDUCTION
PAGE
3. Recovery of Resources from Post-Consumer Solid Waste ... 37
ENERGY RECOVERY 37
Emergence of Energy Recovery Technology 37
Potential Market for Energy Recovery Systems 38
Trends in Solid Waste Energy Recovery 40
Federal Stimulation of Energy Recovery 42
Conclusions and Recommendations 45
PAPER RECYCLING 45
Sources and Uses of Recycled Paper 45
Status and Trends of Paper Recycling 47
Paper Recycling Potential 48
Barriers to Increased Paper Recycling t . . . 49
Fiscal Incentives for Increased Paper Recycling 50
Conclusions and Recommendations 51
STEEL CAN RECYCLING 52
Statistical Overview 52
Markets for Post-Consumer Cans 52
Supply of Post-Consumer Cans 53
Conclusions and Recommendations 54
GLASS, ALUMINUM, AND PLASTICS RECYCLING 55
Glass 55
Aluminum 55
Plastics 56
Conclusions and Recommendations 56
REFERENCES 56
4. Product Controls 59
PRODUCT CONTROLS FOR SOURCE REDUCTION 60
Selection of Products for Source Reduction 61
Mechanisms To Achieve Source Reduction 61
PRODUCT CONTROLS FOR RESOURCE RECOVERY 62
CONCLUSIONS AND RECOMMENDATIONS 62
5. Studies of Resource Recovery and Source Reduction of
Special Wastes 65
AUTOMOBILES 65
Automobile Recycling 66
Automobile Abandonment 70
Conclusions 74
PACKAGING 75
Resource Consumption and Waste Generation 75
Trends Toward Increased Use of Packaging 76
Increasing Average Package Size 79
Eliminating Overpackaging 80
Reusing Packaging 80
Packaging Control Measures 82
BEVERAGE CONTAINERS 82
Trends Toward Increased Use of Nonrefillables 82
Beverage Containers and the Environment . . . . , 83
Control Measures 83
The Oregon Mandatory Deposit Law 86
Conclusions 87
RUBBER TIRES 87
Consumption and Discard 87
Disposal Issues 87
Recycling Opportunities and Problems 88
New Recycling Opportunities 88
Conclusions , 89
REFERENCES 89
Appendix ADescription of Newly Developed Resource
Recovery Systems Under Demonstration Through the
EPA Grant Program 91
vi
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CONTENTS
PAGE
SHREDDED WASTE AS A COAL SUBSTITUTE-ST. LOUIS,
MISSOURI 91
SHREDDED WASTE AS A FUEL SUBSTITUTE OR AS COMPOST-
WILMINGTON, DELAWARE . . . 92
WET PULPING FOR MATERIAL RECOVERY-FRANKLIN, OHIO . . 93
PYROLYSIS TO PRODUCE FUEL OIL-SAN DIEGO COUNTY.
CALIFORNIA 94
PYROLYSIS FOR STEAM GENERATION-BALTIMORE,
MARYLAND 95
INCINERATOR RESIDUE SEPARATION-LOWELL,
MASSACHUSETTS 97
RESOURCE RECOVERY RESEARCH 98
RESOURCE RECOVERY COMPONENT DEVELOPMENT 98
Appendix BProduct Design Modifications for Resource
Recovery, Source Reduction, or Solid Waste Manage-
ment Purposes 99
PRODUCT RECYCLABILITY 99
Social Significance 100
Technical Feasibility 100
Practical Maximum Impact on Problems 100
Importance for Public Policy Consideration 102
RECYCLED CONTENT OF PRODUCTS 102
Social Significance and Objectives 102
Technical Feasibility 103
Practical Maximum Impact 103
Importance for Public Policy Consideration 103
ECONOMIC DURABILITY OF PRODUCTS 103
Social Significance 103
Technical Feasibility 104
Practical Maximum Impact on Problems 105
Public Policy Considerations 105
PRODUCT REUSABILITY 105
Social Significance 105
Technical Feasibility 105
Practical Maximum Impact on Problems 106
Importance for Public Policy Consideration 106
PRODUCT POTENTIAL FOR DISPOSAL DAMAGES 106
Social Significance 106
Technical Feasibility 106
Practical Maximum Impact on Problems 106
Importance for Public Policy Consideration . .' . 106
PRODUCT DEGRADAEILITY FOLLOWING DISPOSAL 107
Social Significance 107
Technical Feasibility 107
Practical Maximum Impact on Problems 107
Importance for Public Policy Consideration 108
Appendix C-An Analysis of the Product Charge 109
CONCEPT 109
SIZE AND APPLICATION 109
EFFECTIVENESS 110
IMPACTS Ill
Environment Ill
Personal Income Ill
Disbursement of Revenue Generated 112
SUMMARY 112
REFERENCE '. 112
Vll
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SUMMARY
This report presents a review of EPA's studies and investigations for the
year 1973 on the subjects of resource recovery (i.e., the utilization of material,
energy, and products recovered from solid waste) and source reduction (i.e., the
reduction in the generation of waste through a reduction in material or product
consumption). The objective of this report is to present the various resource
recovery and source reduction programs that EPA has studied and to discuss
results related to conservation of energy and material resources, protection of
the quality of the physical environment, and economic effects. EPA expects that
this report Will be useful to interests outside the Federal Government, including
State and local governments, private citizens, industry, the academic com-
munity, and private consulting groups.
This report examines the many and diverse issues associated with this field.
Its five chapters discuss (1) projected trends in resource utilization, environ-
mental pollution, and solid waste generation that give impetus to consideration
of resource recovery and source reduction measures; (2) the effects of several
existing Federal policies and programs on the level of use of virgin and recycled
materials; (3) resource recovery systems and the markets for materials and
energy recovered from post-consumer residential and commercial waste; (4)
product controls, such as bans, standards, charges and deposits, directed at
regulating the design or consumption of products for resource recovery or source
reduction purposes; (5) studies of resource recovery and source reduction of
several special wastes: automobiles, packaging, beverage containers, and rubber
tires. A summary of key findings in these areas follows.
RESOURCE CONSERVATION, ENVIRONMENTAL,
AND SOLID WASTE MANAGEMENT ISSUES
Continuation of historical growth rates of production and consumption
will maintain demands on raw material and energy supplies and will lead to the
generation of increased quantities of solid waste.
There exist a number of areas of considerable uncertainty and risk
regarding future resource supplies. These include the extent of mineral
discoveries and the costs of exploiting them, future growth rates of world
market demands, and the impact of geopolitical events on international resource
markets.
Future material supply efforts could place burdens on the physical
environment. The levels of atmospheric emissions and effluent discharges could
increase and large-scale surface mining and forest cutting operations could cause
detrimental effects.
Increased solid waste generation rates could involve higher waste
management costs, greater land disposal requirements, and environmental risks
attendant to waste collection, processing, and disposal.
be
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RESOURCE RECOVERY AND SOURCE REDUCTION
The energy potentially recoverable from post-consumer residential and
commercial solid waste (equivalent to 400,000 to 500,000 barrels of oil a day)
could supply roughly 1 percent of the Nation's current energy demand.
Materials recycled from post-consumer solid waste could provide 7 percent
of the iron, 8 percent of the aluminum, 20 percent of the tin, and 14 percent of
the paper consumed annually in the United States. While these percents
represent the practical potential for resource recovery to provide new energy and
material supplies, actual recovery levels will be constrained by technical,
economic, and institutional factors.
Resource recovery and source reduction have the potential of achieving
reductions in the cost of solid waste disposal. Source reduction would also effect
waste collection cost savings.
Utilization of recycled material rather than virgin material generally
results in reduced levels of atmospheric emissions, reduced effluent discharges to
natural waters, and reduced generation of industrial and mining wastes when all
stages of material acquisition, processing, and transportation are considered. In
addition, recycling is typically much less energy intensive than virgin material
production.
Source reduction is believed to result in a reduction of the negative
environmental impacts associated with the production of materials and
products and the generation of waste.
While resource recovery and source reduction offer potential for
conservation of resources and improvement of environmental quality, the
mechanisms through which they could be accomplished should be evaluated
from the standpoint of economic feasibility and efficiency.
The economics of resource recovery and source reduction may be
expected to improve for several reasons: land disposal and incineration costs
may be expected to rise as more environmentally sound practices are adopted,
costs of production from virgin materials may be expected to increase because of
pollution control and other costs, and rising costs of energy production by
conventional means may stimulate greater use of solid waste as an energy source.
EXISTING FEDERAL POLICIES AND THEIR EFFECT ON VIRGIN
AND SECONDARY MATERIAL USE
Freight Rate Policies
There is evidence to indicate that the current freight rates for some
recycled materials are high relative to rates for competing virgin materials (rail
rates for scrap iron, glass cullet, and reclaimed rubber and ocean rates for
wastepaper). Rates for these recycled materials exceed transport costs by a
higher percent than the rates for virgin materials.
While it is difficult to predict the degree to which a rate increase would
result in lower levels of recycling, there is evidence to indicate that freight rates
represent a significant fraction of the cost of using many recycled materials
(scrap iron, wastepaper, glass cullet, and scrap rubber).
It is recommended that the transportation regulatory agencies, in
consultation with EPA, conduct a study of rate-setting practices for all recycled
materials shipped by rail and ocean carriers to determine the extent to which
discrimination exists against recycled materials.
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SUMMARY
It is recommended that in all future proceedings in which rates for
recycled materials are adjusted, a specific finding be required that such rates do
not discriminate against recycled materials.
Federal Procurement Policies
Although the Federal Government is the single largest consumer of
many products, Federal procurements generally represent a small fraction of
national material markets. Therefore, the direct market creation effects of a
program of Federal procurement of recycled products would probably be small.
However, because Federal procurement specifications are widely circulated and
duplicated by State and local governments and some industries, such a program
is desirable to provide national leadership in this area.
It is recommended that EPA, in conjunction with the Federal supply
agencies, develop guidelines for the inclusion of recycled materials to the
maximum extent practicable in products purchased by the Federal Government.
Taxation Policies
Various provisions of the Federal tax code (depletion allowance, capital
gains treatment, and foreign tax credits) provide substantial benefits to the virgin
material production sectors that are not available to the recycled material
sectors. (These benefits are estimated to be more than $200 million annually for
the virgin mineral and timber production segments.)
It is difficult to estimate the quantitative impact of these tax provisions
on material use; however, they do provide opportunity for expansion and
investment in the virgin material sector. To the degree that these benefits reduce
virgin material prices, they could result in overconsumption of virgin resources
and act to inhibit the use of recycled materials. To be consistent with the
national goals of conserving energy and material resources, it is recommended
that consideration be given to revaluation of these tax provisions.
RECOVERY OF RESOURCES FROM POST-CONSUMER SOLID WASTE
Municipal waste recovery is emerging as an economic alternative to
traditional forms of solid waste processing, especially in areas where disposal
costs are high and adequate markets exist for recovered commodities. As energy,
material, and disposal costs continue to rise, the economics of resource recovery
will become even more attractive.
There are a number of technical systems available today for the
recovery of material and energy from solid waste. In the 1975-76 time frame,
several additional technical options will be in full-scale demonstration operation
and will widen the available technical choices and range of products that could
be obtained from wastes.
Energy recovery-especially the use of shredded waste as a utility
fuel-appears to be an economical near-term recovery option. Energy recovery is
usually accompanied by metal and glass recovery as well.
Paper recovery through separation at the source and separate collection
of wastepaper grades such as old newspapers and corrugated paper is an
economically feasible form of resource recovery that is being practiced in many
communities today. Technological systems for extraction of fiber from mixed
municipal refuse are under development.
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RESOURCE RECOVERY AND SOURCE REDUCTION
There are several markets for steel cans, which can be separated
magnetically from mixed municipal waste. These'markets include the steel
industry, copper precipitation industry, and the detinning industry. Detinning of
steel cans results in a high-grade steel scrap and also recovers another valuable
resource-tin. Aluminum contamination of steel can scrap increases the costs of
detinning.
The major barriers to aluminum and glass recycling are related to the
economic extraction of these materials from mixed municipal waste. Once
extracted, there appears to be sufficient demand to facilitate significant increases
in recycling of these materials. Technology is under development for aluminum
and glass recovery but has not proven to be economically feasible to date.
While systems for separation of plastics from mixed municipal waste for
recycling are not available, plastics could be recovered as energy. However,
combustion of polyvinyl chloride plastic fractions could result in increased costs
and potential air and water pollution problems.
A number of States and communities are pursuing implementation of
recovery systems. More than six States are actively planning programs to
promote waste recycling. Three of these States have or will soon have funding
programs to support community facility construction, and two additional States
are known to be considering some type of statewide resource recovery activity.
A number of municipalities are moving forward with their own plans to install
systems, some with State support, some with their own financing, and some with
private developer financing to be repaid in the form of service charges. Eighteen
cities have been identified as actively pursuing establishment of a resource
recovery facility. In these cities either construction has begun, a design contract
has been awarded, or the city is firmly committed to proceed. At least 20
additional cities are known to be at the preliminary investigation stage. More
than 70 cities currently operate separate collection systems for newspapers, up
from a handful 2 years ago.
Capital markets appear to be capable of supplying funds needed for
municipal resource recovery expenditures. However, some methods of.obtaining
financing are. not well understood or used on a wide scale by municipal
authorities. In addition to the traditional general obligation bonds, other sources
of financing include revenue bonds, bank loans, leasing, industrial revenue
bonds, public authority financing, and State grants.
While recovery system implementation is proceeding, some institutional
and marketing problems exist that will impede or slow down developments.
Federal technical assistance/technology transfer to aid in the implementation of
recovery systems is being provided. In addition, an applied research and develop-
ment activity at the Federal level is being undertaken to improve current
systems, to upgrade products from recovery plants, and to assess the
environmental consequences of recovery systems.
Studies indicate that fiscal incentives to stimulate the demand for
recycled materials are not necessary at this time. For many recycled materials,
demand is currently high, prices are up, and supply shortages have occurred. In
the future, however, the historic problem of inadequate demand for recycled
materials may return. As a result, demand incentives may become'desirable.
xn
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SUMMARY
There are considerable uncertainties in this volatile market area, and the demand
situation should be carefully analyzed and monitored in the future.
PRODUCT CONTROLS FOR SOURCE REDUCTION AND RESOURCE
RECOVERY
The theoretical justification for product controls for resource recovery
or source reduction purposes is based on the supposed failure of private market
decisions to evolve socially optimal product designs including consideration of
factors such as product durability, repairability, ease of material recovery, or
waste disposal costs. Little or no economic analysis exists on the subject of the
social efficiency of product design; however, general observation of product
design from a resource conservation, waste disposal, or recovery perspective
provides evidence of the need for further study of product control possibilities.
Possible product controls for source reduction could include regulation of
product lifetime, reusability, consumption level, and material or energy
intensivity. Control mechanisms include taxes or charges, deposits, bans, and
design regulation. Possible product controls for resource recovery could include
regulation of reclaimability and recycled material content.
' Although there could be resource conservation and environmental
benefits from various product control approaches, these measures could also
have negative impacts on the market system and result in economic dislocations.
At present, there is insufficient information to evaluate the necessity or
desirability of product control measures.
It is recommended that EPA continue to study and evaluate product
controls in an attempt to identify measures that would lead to increased overall
efficiency of resource utilization, pollution control, and waste management.
Several studies in this direction are currently underway.
STUDIES OF RESOURCE RECOVERY AND SOURCE REDUCTION
OF SPECIAL WASTES
Obsolete Automobiles
Strategies for dealing with abandoned automobiles involve preventing
abandonment and arranging for the collection and shipment of derelict vehicles
to scrap processors. Innovative measures (e.g., deposits, bounties, and registra-
tion certification) have been suggested and tried to implement these strategies;
none has been used on a large scale.
Continued recycling of obsolete automobiles depends in part 'upon
continued'high prices for steel scrap. Changes in automobile design (e.g., lighter
automobiles and substitution of plastics and aluminum for steel) and changes in
steelmaking technology could also reduce the price of automobile scrap and
impede recycling.
Packaging Wastes
.Packaging wastes represent the single largest product class in the
municipal waste stream (34 percent by weight), and the consumption of
packaging material is growing at an accelerated rate (on a per capita basis,
packaging material consumption was 412 pounds in 1958 and 621 pounds in
1971, a growth rate of 51 percent per capita in 13 years). This trend has led to
Kill
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RESOURCE RECOVERY AND SOURCE REDUCTION
increased consumption of virgin materials and energy (with attendant adverse
environmental effects) and an increased rate of generation of solid wastes.
There are three technical approaches that have been identified to reduce
packaging material consumption and wastes: using larger containers, eliminating
ovefpackaging of particular products, and using reusable containers. Several
regulatory and fiscal measures are being evaluated for. packaging control,
including a tax on packaging weight, a tax on packaging weight with a rebate for
the use of recycled materials, and a unit tax on rigid containers. The
environmental and economic impacts of these measures for packaging waste
reduction are being evaluated through ongoing EPA studies.
Beverage Containers
Preliminary EPA analyses indicate that the reuse of refiilable bottles
results in lower levels of energy consumption, atmospheric emissions, and
waterborne and solid wastes as compared to other existing beverage container
systems (e.g., throw-away bottles and aluminum, bimetallic, and steel cans).
Three beverage container control mechanisms have been studied: a
$0.05 mandatory deposit, a ban on nonrefillable bottles, and a $0.005 tax for
generating revenues for litter control. The results indicate that the ban or deposit
would probably result in a reduction in litter and a reduction in material and
energy consumption. However, this would probably be accompanied by a
decline in beverage and container sales, resulting in economic dislocation and
unemployment. Although a tax could generate significant funds for litter
cleanup, it would have little effect on waste generation or resource consumption
and little effect on the beverage or container industries.
Rubber Tires
Motor vehicle tires are relatively very difficult to dispose of by means of
conventional solid waste landfill or incinerator systems; therefore, many tires are
disposed of inadequately 6r are accumulated and piled on open ground. The
existing markets for recycling and reuse of old tires are the retreading industry,
the rubber reclaiming industry, and the tire splitting industry. The latter two
markets are small relative to the quantity of tires discarded, and the retreading
market has been declining in recent years.
Further evaluation of the technical and economic feasibility of tire
processing alternatives is necessary as well as the analysis of possible mechanisms
(e.g., regulations, incentives, demonstrations, and technical assistance) to
implement these options.
xiv
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Chapter 1
RESOURCE CONSERVATION, ENVIRONMENTAL, AND
SOLID WASTE MANAGEMENT ISSUES
Resource recovery and source reduction are
approaches that are responsive to three major inter-
related problems of modern society: (1) conservation
of virgin natural resources, (2) management of solid
waste, (3) preservation of the quality of the physical
environment. It is well known that the United States
consumes a disproportionate share of the world's raw
material supplies and that consumption rates have
grown substantially with time. If these trends con-
tinue, the residuals and waste from production
processes will continue to grow as well. To maintain
acceptable levels of environmental quality in the face
of continued growth, more stringent emission and
effluent regulations will be required and will result in
increased costs of air and water pollution control. At
the same time, solid waste generation rates will
increase, suitable land for disposal of waste will
become less readily available, additional processing of
waste will become necessary prior to disposal, and the
costs of solid waste management will increase. It is
against this background that resource recovery and
source reduction activities need to be considered.
Resource recovery is defined as the use of mate-
rials, energy, and products reclaimed from solid
waste. There are numerous examples of resource
recovery. .The secondary material industry handles
millions of tons of secondary materials each year,
mostly recycled from industrial waste sources. There
are thousands of neighborhood recycling centers
where citizens bring bottles, cans, newspapers, and
other wastes separated at home. Several firms are in
the process of developing, demonstrating, and
marketing equipment and systems for extracting
resources from mixed municipal waste. All of these
activities will be discussed in greater detail in later
chapters.
Source reduction is defined as the reduction in the
generation of waste through a reduction in the
consumption of materials or products. Examples of
source reduction include the reuse of products (i.e.,
the retreaded tire or refillable beverage container);
the use of less material-intensive products (i.e., a
smaller automobile); the improvement of product
durability, or extension of product lifetime; and the
reduction of the number of products consumed.
Source reduction is a basic conservation approach
that is similar to other measures recently discussed
(such as fuel rationing and automobile weight reduc-
tion for energy conservation purposes).
The focus of the present' report is on "post-
consumer" solid waste, defined to include the mate-
rial generated by households, commercial and
government office buildings, wholesale and retail
trade, and other general business and service sectors
of the economy. Explicitly excluded are mining,
agricultural,, and industrial processing and converting
wastes; sewage sludge; and wastes derived from
demolition and construction activities.
Thus defined, the generation of post-consumer
solid waste is currently estimated to be less than 135
million tons per year. Although this constitutes a
relatively small fraction of the several billions of tons
of solid, liquid, and gaseous wastes produced annually
by all sectors of the economy, it has become
increasingly apparent that this category is of partic-
ular significance, not only from an urban solid waste
collection and disposal standpoint but also from the
broader resource conservation and environmental
protection point of view.
This first chapter, designed to provide quantitative
background and analytical perspective on some of the
general issues involved in evaluating resource recovery
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RESOURCE RECOVERY AND SOURCE REDUCTION
and source reduction, is divided into four sections.
The first provides estimates of the aggregate national
quantity and composition of post-consumer solid
waste, together with some notes on future trends.
The last three sections deal, in turn, with solid waste
management costs, natural resource conservation, and
environmental quality issues.
The second chapter presents an analysis of existing
Federal policies and their effect on virgin and
secondary material use. Specifically, tax benefits for
virgin materials, virgin and secondary material freight
rates, and Federal procurement of products contain-
ing recycled materials are discussed.
Chapter 3 discusses the recovery and use of
resources from post-consumer waste. Topics include
energy recovery and the recycling of paper, steel,
nonferrous metals, glass, and plastics. The EPA
resource recovery demonstration grant program is
reviewed along with State and local activities related
to the installation of resource recovery plants. Sub-
sidies and other incentives for plant construction,
equipment investment, and use of secondary mate-
rials are also discussed in this chapter.
The fourth chapter outlines the options for
product controls for resource recovery and source
reduction and discusses regulatory and fiscal measures
designed for this purpose.
Finally, Chapter 5 presents the results of several
studies of resource recovery and source reduction
strategies for specific wastes: automobiles, packaging
materials, beverage containers, and rubber tires.
The three appendixes contain data on technical
systems for resource recovery and research and
development activities (Appendix A), analyses of
several product control options (Appendix B), and a
more detailed discussion of fiscal measures for source
reduction (Appendix C).
THE QUANTITY AND COMPOSITION OF
POST-CONSUMER SOLID WASTE
Estimates for 1971
Many of the issues relating to resource recovery
and source reduction could be brought into much
sharper focus with the use of detailed and consistent
base-line data on waste quantities and compositions.
Although there is no entirely satisfactory data base at
present, Table 1 contains EPA's most recent estimate
of the total quantity and material composition of
post-consumer solid waste. This table also provides a
cross-classification of the waste stream by product
category.
With the exception of the food, yard, and miscel-
laneous inorganic fractions, all the product and
material figures are derived from analyses Of aggregate
U.S. industrial material production and product
marketing data, together with estimates of average
product lifetime and material recovery rates. These
estimates have thus been developed entirely inde-
pendently of refuse collection data and sample refuse
composition measurements. The food, yard, and
miscellaneous inorganics categories, on the other
hand, are based on average proportions of these
materials reported in published refuse collection
studies.1 The data thus represent an estimate of
aggregate U.S. post-consumer waste generation, net of
current material recovery.
The "as generated" waste tonnages assume typical
moisture content of the material prior to discard or
collection. Thus, paper, textile, and wood materials
have an "air-dry" moisture of approximately 7 to 15
percent, food and yard wastes contain 50 to 70
percent moisture, and all other materials are assumed
to contain zero moisture. Because most published
refuse composition studies reflect the moisture
content of mixed wastes delivered to incinerator or
landfill sites, the "as disposed" tonnages have been
adjusted to reflect moisture transfer en route to the
disposal site, [in making interpretations and compar-
isons, the "as generated" weight composition is thus
more relevant from the standpoint of evaluating
potential material recovery from solid waste, whereas
the "as disposed" weight composition should be more
comparable to other published composition studies
based on measured samples.
The data presented will differ from measured
municipal refuse collection samples in a number of
respects. For example, most sampling has typically
excluded the so-called "bulky" refuse-major home
appliances, furniture, and automobile tires-which
according to EPA estimates accounts for about 7
million tons. In addition, the given estimates attempt
to account for most but not all container and
packaging waste, including a portion of that which
originates at industrial plant sites and is often
disposed of privately. Furthermore, virtually all
composition studies have been highly localized, and
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TABLE 1
MUNICIPAL SOLID WASTE GENERATION BY MATERIAL AND SOURCE,
10' tons of waste by
Type of material
Paper
Glass
Metal:
Ferrous
Aluminum
Other nonferrous
Plastic
Rubber and leather
Textiles
Wood
Food
Subtotal
Yard waste
Miscellaneous inorganics
Newspapers, Containers
books, and and
magazines packaging
10.3 20.4
- 11.1
6.1
- 5.4
.6
.1
Trace 2.5
Trace
Trace Trace
- 1.8
10.3 41.9
Major
household
appliances
Trace
1.9
1.7
.1
.1
.1
.1
-
-
2.1
1971
product source category
Furniture
and
furnishings
Trace
Trace
.1
Trace
Trace
Trace
.1
Trace
.6
2.3
3.2
aothin9 Food
and
, products
footwear
Trace
_
Trace
_ _
.2 -
.5 -
.5
Trace
- 22.0
1.2 22.0
Total
As generated
Other
8.4
1.0
3.8
3.5
.1
.2
1.3
2.7
.7
.5
18.4
10' tons
39.1
12.1
11.9
10.6
.8
.4
4.2
3.3
1.8
4.6
22.0
99.1
24.1
1.8
Percent
31.3
9.7
9.5
8.5
.6
.3
3.4
2.6
1.4
3.7
17.6
79.3
^193)
l'A
As disposed
10' tons
47.3
12.5
12.6
_
4.7
3.4
2.0
4.6
17.7
104.9
18.2
1.9
Percent
37.8
10.0
10.1
3.8
2.7
1.6
3.7
14.2
83.9
14.6
1.5
RESOURCE CONSE
I
|
\
%
O
s
§
*«
>
T1
Jj
o
CO
g
5
\
a
s
Total
Percent product source composition
125.0
8.2
33.5
IT
1.7
2.6
1.0
17.6
14.7
100.0
79.3
125.0
/'
'V.
100.0
83.9
s
PI
a>
-------
RESOURCE RECOVERY AND SOURCE REDUCTION
most have not covered the complete spectrum of
residential, commercial, institutional, and other post-
consumer waste sources.
~" Table 1 explicitly excludes sewage sludge, demoli-
tion, and contract-construction-type wastes, as well as
obsolete automobiles. (Chapter 5 presents data on
automobiles.)
The total waste generation estimate of 125 million
tons per year (3.32 pounds per capita per day) for
1971 is significantly lower than the widely quoted
190 million tons per year (5.3 pounds per capita per
day) result estimated from the 2968 National Survey
of Community Solid Waste Practices.2 A portion of
this difference exists because the National Survey
results included some industrial demolition and con-
struction wastes not included in the present. esti-
mates. An additional small part of the difference
could probably also be accounted for by the fact that
some net moisture is added to the solid waste stream,
both in the household from kitchen activities and in
the storage and collection system en route to the
disposal site. Nevertheless, it appears that the
National Survey tended to somewhat overestimate
the national solid waste stream. In this regard it
should be noted that the National Survey results were
themselves principally based on collected tonnage
estimates (as opposed to systematic measurements)
prepared by the reporting local solid waste agencies.
The present estimates for total waste are judged to be
accurate to within 20 percent, given the waste
categories covered.
The figures for product categories represent the
first attempt to estimate physical weight quantities
for the product sources of the solid waste stream. The
first two categories (newspapers, books, and maga-
zines and containers and packaging) are judged to be
accurate to within 10 percent. Other categories are
judged to be accurate to within 25 percent.
The estimated values in Table 1 can serve as a
satisfactory working basis for general analysis and
policy formulation purposes at the national level.
However, these composition estimates should not be
utilized for detailed engineering system design pur-
poses at the local level. The remainder of this
subsection describes salient characteristics of post-
consumer solid waste by examination of the
generation weight data estimates.
Material Composition. Eighty percent of the
waste stream is organic (including synthetics) and 20
percent inorganic (9.7 percent glass, 9.5 percent
metals, and 1.4 percent miscellaneous inorganics). Of
the materials recoverable as recyclable materials, only
the paper, glass, and ferrous fractions each comprise
more than 8 percent of the total waste stream. Other
individual recyclable materials each comprise less
than 3 to 4 percent of the total. Twenty to
twenty-five percent of the total material weight is
contributed by moisture originating principally in the
food and yard waste fractions.
Product Composition. About 80 percent of solid
waste (generation weight data) is derived from market
product sources (as opposed to yard and garden-type
wastes). Excluding food wastes, market product
sources account for about 60 percent of the waste
flow. It is this 75 to 80 million ton fraction at which
product source reduction and material recycling
programs are principally directed. If we define and
measure the waste stream in terms of dry weight, the
nonfood product sources account for 78 percent.
Container and packaging materials currently contrib-
ute about one-third of total post-consumer waste,
42 percent of product waste, and 54 percent of
nonfood product waste. The container and packaging
fraction currently accounts for about 72 percent of
the total mineral (combined glass and metals) frac-
tion. In terms of individual materials, this source
category contributes well over 90 percent of the glass,
75 percent of the aluminum, and at least 45 to 55
percent each of the the ferrous metal, paper, and
plastic fractions of the waste stream. Consumer
durable goods, including household appliances, furni-
ture, recreational equipment, and the like, account
for about 10 to 12 percent of total wastes.
Newspapers, books, and magazines account for about
8 percent.
Combustion and Heat Characteristics. Roughly
80 percent of the weight of typical raw municipal
refuse is composed of combustible materials. The ash
content of raw refuse, including the noncombustible
metal and glass fractions, is about 20 percent by
weight; excluding metal and glass, the ash content of
combustibles is roughly 5 percent. Total weight
reduction by burning is thus on the order of 80
percent. Volume reduction - by burning under
-------
RESOURCE CONSERVATION, ENVIRONMENTAL, AND SOLID WASTE MANAGEMENT ISSUES
optimum conditions is close to 90 percent of gross
refuse and over 95 percent of the combustible
fraction. Approximate heat values are 4,600 British
thermal units per pound for total raw refuse and
5,500 British thermal units per pound for refuse
excluding metal and glass. ,,
Waste Generation Projections
Very little is known regarding the factors that
determine total and per capita solid waste generation
rates, and there is a substantial lack of historical data
in this area. Components of the municipal waste
stream have certainly changed over the past several
decades in response to shifts in consumer technology
and expenditure patterns. For example, in the past,
coal and wood ash were major components of
municipal waste. Similarly, food wastes on a per
capita basis have declined with increased consump-
tion of industrially prepared foods, and the introduc-
tion of kitchen waste disposals has probably caused a
reduction in food waste collected by diverting it to
the sewage disposal system. On the other hand,
packaging waste has increased very substantially in
per capita terms, and its composition has also shifted
considerably, particularly in the beverage container
area.
Recognition of major historical shifts such as
these, together with the general lack of detailed
historical data and correlation analysis, suggests
caution in the construction and interpretation of
gross projections of future solid waste trends or the
manner in which such projections might be modified
by various public policy measures.
There is currently underway at EPA a research
effort designed to project the major components of
post-consumer waste over the next 1 5 to 20 years as a
base line for policy analysis. ' Until the results of that
project are available, the following discussion of
future waste trends must be regarded as very crude
and tentative.
If it is assumed as a first approximation that the
total real consumer expenditure for durable and
nondurable goods is the major variable determining
post-consumer solid waste generation, then, based on
the experience of the past decade, solid waste should
be expected to grow at a rate of about 4.5 percent
per year. However, there are a number of reasons why
this growth rate should probably be considered an
upper limit. First, many of the major product source
components of the waste stream (most notably
foods) have been growing at a much slower rate than
the average. The faster growing segments, such as
containers and packaging, would probably by them-
selves not push the overall waste growth to a higher
level. The fastest growing component of the con-
sumer goods expenditure has been the durable goods
category, but items in this category comprise only a
relatively small fraction of the present waste stream
(about 10 to 12 percent); and there is reason to
suppose that the weight of durable goods does not
necessarily increase in proportion to expenditure
value. Finally, fully 20 percent of the waste stream
(Table 1) is composed of yard wastes, and these are
not likely to grow very rapidly. Therefore, a 3.0- to
3.5-percent annual growth rate, in the absence of
major material recovery or source reduction pro-
grams, would seem a more reasonable basis for
projecting growth in the total solid waste stream.
To project boundaries of future waste generation
rates, Table 2 summarizes projections for total waste,
assuming low, medium, and high growth rates.
TABLE 2
PROJECTED TOTAL SOLID WASTE QUANTITIES*
Assumed annual
compound growth
(percent)
Waste (10° tons)
1980
1985
1990
2.5 (low)
3.5 (medium)
4.5 (high)
155
170
185
175
200
230
200
230
290
*1971 base =125 million tons.
SOLID WASTE MANAGEMENT SAVINGS FROM
RESOURCE RECOVERY AND SOURCE
REDUCTION
The most obvious benefits from resource recovery
or source reduction are the cost savings attributable
to community waste collection and disposal activities.
Basically, these costs are of two broadly different
types: (1) the direct costs of operating the waste
collection; transportation; and landfill, incinerator, or
other disposal site operations and (2) the social costs
attributable to any adverse environmental quality
-------
RESOURCE RECOVERY AND SOURCE REDUCTION
effects associated with collection and disposal. The
latter can include noise, air pollution from transport
and incineration, water pollution from landfill
leachate or the quenching of incinerator residues,
public health problems due to poorly controlled land
disposal, and general aesthetic effects associated with
any of these operations.
The present section is concerned only with the
first of these two cost issues. Environmental damages
are discussed in the concluding section of this
chapter. It should be noted, however, that the two
types of costs generally tend to be inversely related to
one another. That is, as the environmental damage
costs of waste disposal are reduced, the greater will be
the capital, labor, and other direct costs of waste
management.
The purpose of this section is to provide a very
preliminary quantitative perspective on the order of
magnitude of the feasible direct solid waste manage-
ment cost savings from a program of source reduction
and resource recovery implemented on a national
basis. Estimates for current and projected waste
collection and disposal costs are provided first,
followed by an evaluation of possibilities for their
reduction. Such estimates must be viewed as gross
approximations, however, because data on present
waste management costs are imperfect, and future
projections are obviously subject to question. In
addition, costs vary so widely across the Nation that
generalization is extremely difficult.
Waste Management Costs
Unit Collection Costs. Cost estimates for residen-
tial waste collection are available from a set of
municipal case studies made for EPA.4 The data show
considerable variation among cities in unit collection
costs-depending on quality and frequency of service,
population density, degree of mechanization, and
other factors. The costs range from less than $11 per
ton to as high as $43 per ton. The average residential
waste collection cost for the 15 cities studied was $22
per ton.
Detailed cost data on commercial and institutional
collection are not available. However, the unit cost of
this collection can be expected to be somewhat lower
than costs of residential collection because of larger
waste volumes per source and generally higher source
densities in commercial areas. A very rough estimate
is that the cost of commercial collection could be
roughly 50 percent lower than residential collection,
and commercial waste accounts for roughly 40
percent of the total municipal post-consumer solid
waste collection. Using these estimates, a national
average for collection costs (combining residential
and commercial costs) of $18 per ton can be derived.
It is not clear whether unit collection costs should
be projected to rise or fall in the future. On the one
hand, a great many municipal collection systems are
presently subject to considerable inefficiencies in
management and design. Cost-reducing innovations
and improved management could cause unit costs to
decrease. On the other hand, as close-in landfill sites
become scarcer and more costly, longer haul distances
might well consume both equipment and labor time,
thus increasing future unit costs. Because it is not
known whether these counteracting trends will be of
equal magnitude, no change is assumed in future
collection cost per ton of waste handled.
Unit Waste Disposal Costs. Whereas unit collec-
tion costs have been found to vary among cities by as
much as a factor of four to one, disposal costs per ton
are known to vary by as much as twenty to one.
Principal determinants of cost are (1) mode of
disposal (incineration being more costly than landfill
or ocean disposal), (2) quality of disposal in terms of
minimizing adverse environmental impacts, (3) scale
of operation (larger systems generally show lower
unit costs), (4) local geophysical conditions that may
cause disposal site preparation and operating factors
to be more or less costly (e.g., in terms of leachate
control or availability of cover soil). Thus, even with
respect to sanitary landfills operated to achieve
acceptable environmental quality standards, current
disposal costs might be expected to vary from less
than $2 per ton to as much as $6 per ton or $8 per
ton in extreme cases. The previously cited case
studies indicated disposal costs for 13 cities with
landfills ranging from less than $1 per ton up to $6
per ton, with an average of about $3.20 per ton. The
cases covered a variety of landfill performance levels
and can probably be taken as reasonably representa-
tive of current urban area land disposal costs.
However, it should be realized that prices actually
paid for land disposal in areas where land is scarce
-------
RESOURCE CONSERVATION, ENVIRONMENTAL, AND SOLID WASTE MANAGEMENT ISSUES
and private landfill owners have a virtual monopoly
'could be higher than these figures. Charges up to $17
per ton have been reported.
The overall national average cost of solid waste
disposal is probably somewhat higher than the $3.20
per ton average landfill cost, however. About 10
percent of collected waste is incinerated for volume
reduction, mainly in the larger cities, and
incineration-based disposal generally costs on the
order of $7 to $12 per ton. In addition, it is felt that
many if not most reported landfill system cost figures
tend to understate the full cost, either by failing to
include interest charges on capital account or (almost
universally) failing to include the opportunity cost of
land use (e.g., forgone tax revenues to the municipal
treasury). Thus, it is estimated that current average
costs of solid waste disposal operations are closer to
$4 per ton on a nationwide basis.
These average costs are most likely to rise in the
future, in real terms, because of environmental
protection efforts (upgraded sanitary landfill and
incinerator air pollution emission standards) and also
because of the rising real values of alternative land
use. Under these conditions, a $5 per ton average
national cost of solid waste disposal is a very
conservative projection for the 1980-85 period.
For areas of high population density, the waste
management costs, particularly disposal costs, are
likely to be significantly higher than this national
average. One reason is that according to 1973 EPA
estimates, incineration already accounts for roughly
30 percent of disposal in the Nation's 50 largest
cities. The need to process or dispose of waste by
incineration, long-haul landfill, or methods other than
close-in sanitary landfill will undoubtedly increase.
Landfill in these larger urban areas is usually more
costly because of higher land values and the greater
distances of the disposal sites from the sources of
waste generation. Although accurate data are not
available, it is likely that present disposal costs in
larger cities, when disposal is performed in an
environmentally acceptable manner and all costs are
included, probably range from $5 per ton to $10 per
ton and are expected to grow considerably in the
future.
Total National Costs. Combining the estimated
national average unit collection and disposal cost
estimates with the total waste generation projections
from the previous section yields total cost projections
(Table 3).
Currently, with collection at $18 per ton and
disposal at $4 per ton, the total national cost of
handling 120 million tons of collected post-consumer
solid waste would be $2.64 billion, with collection
accounting for 82 percent or $2.16 billion and
disposal for 18 percent or about $0.5 billion. (It
should be noted that this total 1971 cost estimate of
$2.64 billion is generally consistent with estimates
presented in the 1968 National Survey of Community
Solid Waste Practices, from which costs of roughly
TABLE 3
U.S. POST-CONSUMER SOLID WASTE COLLECTION AND DISPOSAL COSTS
Item
Collected waste (10* tons)*
Unit costs (dollars/ton):
Collection
Disposal
Total
Total national costs [millions of dollars (1971)] :
Collection
Disposal
Total
1971
(estimated)
120
18
4
22
2,160
480
2,640
1980
Low
150
18
. 5
23
2,700
750
3,450
(projected)
Medium
160
18
5
23
2,880
800
3,680
High
175
18
5
23
3,150
875
4,025
1985
(projected)
Low Medium
165
18
5
23
3,150
875
4,025
190
18
5
23
3,420
950
4,370
High
220
18
5
23
3,960
1,100
5,060
*It is assumed that 95'percent of the projected waste generation (Table 2) is collected.
-------
8
RESOURCE RECOVERY AND SOURCE REDUCTION
$3.1 billion for residential and commercial waste
management can be derived.5) Assuming no sig-
nificant resource recovery or source reduction, the
median projections based on a 3.5-percent annual
growth in waste collections suggest a likely increase in
total cost to $3.7 billion in 1980 and $4.4 billion by
1985. These represent cost increases from 1971 of 40
percent by 1980 and 66 percent by 1985.
Potential Feasible Savings
In evaluating potential savings to communities as a
result of a program of source reduction or resource
recovery, it is necessary to separate national average
costs from those incurred in larger cities. It is also
necessary to estimate the probable resource recovery
system costs that will be substituted for present waste
handling costs.
The savings or costs derived here apply only to the
municipal waste management function; they do not
include other costs or savings related to areas such as
industries' utilization of secondary versus virgin mate-
rials, pollution damages, or various impacts on natural
resource conservation or U.S. international trade.
Potential Savings from Resource Recovery: Collec-
tion Costs. Once solid waste has been generated at
the final consumer level, collection costs must be
incurred regardless of whether the material is destined
for disposal or resource recovery of useful values. In
particular cases, materials destined for recovery may
incur greater or lesser pickup, storage, and/or trans-
port costs than would be required under the disposal
alternative. However, the most reasonable assumption
is that collection costs will probably be unaffected by
the introduction of widespread resource recovery
programs. Thus no savings in this regard for
community solid waste management activities are
estimated.
Potential Savings from Resource Recovery:
Disposal Costs. An active resource recovery program
would involve both source separation of certain
recyclable fractions of the waste stream (especially
paper) as well as processing of mixed waste in
large-scale centralized plants operated by the public
or private sector or both. The preponderant tonnage
would probably pass through processing plants.
For present purposes, it is assumed that processing
plants would be used for material recovery of the
noncombustible metallic and glass fractions and some
portion of the paper fraction and energy recovery
from the remaining combustible fractions. Further-
more, it is assumed that various grades of wastepaper
(news, corrugated, and mixed) will be obtained by
separate collection. A sufficient number of alternative
processing plants, involving various forms of material
recycling and conversion, are in a sufficiently
advanced stage of design or demonstration operation
to suggest . technically feasible possibilities for
reducing final disposal volumes more than 80 percent
when implemented in combination. Indeed, some
communities may find it possible to virtually
eliminate "waste disposal" as conventionally defined
and practiced. This could be achieved either by using
the inert combustion residuals in productive landfill,
as a general construction aggregate, or by conversion
into structural building materials. However, total
elimination of residual waste disposal may not be
generally possible, and an average reduction in con-
ventional waste disposal costs of 80 percent for
participating systems is seen as a reasonable working
figure for present purposes.
A discussion of the cost of resource recovery
systems is presented in Chapter 3 of this report. The
net cost of such systems ranges from $4 to $15 per
ton and includes the total operating and capital cost
plus the cost of residue disposal minus the revenue
from the sale of recovered material and energy.
Recovery systems will be economical in situations
where the net costs are lower than the costs of waste
disposal by other means. As was indicated previously,
disposal costs in large cities range from $5 to $10 per
ton. Therefore, in some cities with low disposal costs
some resource recovery systems will not be
economical, while in other cities, with disposal costs
near $10 per ton, savings up to $6 per ton could be
realized through resource recovery. If a saving of $3
per ton was achieved in the Nation's 50 largest cities
(comprising 20 percent of the Nation's population),
this would represent disposal cost savings of $100 to
$130 million in 1985.
If, in addition to respurce recovery through mixed
waste processing, certain materials such as news-
papers, corrugated boxes, and office papers are
separated at the source and directly recycled (i.e., not
passing through a recovery plant, and thereby not
incurring processing costs), an average disposal saving
-------
RESOURCE CONSERVATION, ENVIRONMENTAL, AND SOLID WASTE MANAGEMENT ISSUES
of $4 per ton could be realized. Recycling 10 to 12
'million tons of paper through source separation could
result in disposal savings of $40 to $50 million a year. *
.(Chapter 3 discusses the potential for recovery of
source-separated paper.) '
Savings from Source Reduction,. By definition,
source reduction involves a decrease in solid waste
generation. Thus, unlike resource recovery from
generated waste, source reduction implies solid'waste
management cost savings for -both collection ' and
disposal. In addition, source reduction programs
could be effective in population areas of small density
where solid waste densities might be insufficient to
support an economical scale of resource recovery.
Furthermore, some source reduction measures could
have a positive impact on litter reduction, an aspect
of the overall solid waste management problem that is
not directly affected by resource recovery. Thus, for
a variety of reasons, source reduction may have a
unique role to play as a broadly defined tool of
national solid' waste management in achieving cost
savings in waste handling as well as other waste
management and material utilization goals.
The key questions here relate to how much and
what kinds of waste reduction one can reasonably
expect as the result of various types of solid waste
control options. These are extremely difficult ques-
tions owing to. the inherent complexities in both
product design and utilization options as well as in!
human consumer behavior. For example, on the one
hand, it is not known to what extent it would be
possible to redesign consumer goods for ease of repair
and increased lifetime; on the other hand, it is not
known whether such goods would actually be utilized
for longer periods after such design changes were
instituted. EPA's studies of source reduction and
product controls have not advanced sufficiently to
permit confident analysis of the effect of such
measures.
The effect of source reduction on waste collection
costs is difficult to predict. Source reduction does not
reduce the number of individual household and
commercial waste sources for which service must be.
provided. Rather, the quantities of waste generated at
each point would decrease. In theory this would
permit a collection truck to make more stops and to
make fewer runs to the disposal site. In practice,
however, a'small reduction in waste would probably,
not induce collection organizations to reroute trucks
to take advantage of the reduction. Collection
organizations are likely to react to waste reduction
only if the reduction is substantial (for example, if
the reduction was equal to one-third of the waste
load, it would be .possible to eliminate a trip to the
disposal site for trucks that make three trips a day).
Therefore, in the short term,.waste.reduction on the
order of 10 to 20 percent might not result in a
decrease in collection costs. However, in the long
term, a reduction in the quantity or rate of growth of
waste generation would forestall the need to purchase
additional trucks and expand collection services and
would entail a reduction in future collection costs.
Disposal savings from source reduction are a
certainty almost by definition. For example, an 8-
percent reduction in waste generation could result in
disposal savings from source reduction of from $70 to
$90 million in 1985. Such a reduction may be
achievable by undertaking one. or several of the
waste control measures discussed in Chapters 4 and 5,
such as eliminating nonrefillable beverage containers,
increasing the use of bulk containers, reducing throw-
away products, or eliminating excess packaging.
In conclusion, it appears on the. basis of prelim-
inary analyses that both source. reduction and
resource recovery have the potential of achieving
reductions in the cost of solid waste management.
The 'national sayings in disposal costs resulting from a
combined program of resource recovery and source
reduction are in the range of over $200 million
annually. This is not an insignificant amount and
would, represent a sizable fraction of total disposal
costs in any particular year. Source reduction would
also involve collection cost savings that have not been
estimated.
.MATERIAL CONSUMPTION AND NATURAL
RESOURCE SUPPLY ISSUES
One of the principal arguments in favor of
implementing resource recovery and source reduction
measures lies in' the potential for augmenting natural
resource supplies. Two aspects of this issue are (1)
resource conservation and the future adequacy of the
resource base to sustain desired rates of economic
growth and (2) the increasing dependency on foreign
sources of crude raw materials and the.consequent
-------
10
RESOURCE RECOVERY AND SOURCE REDUCTION
adverse implications for international balance of
payments, strategic self-sufficiency, and international
relations.
In this section historical and projected raw
material consumption trends are reviewed and some
of the domestic natural resource conservation and
international resource dependency issues to which
these trends give rise are analyzed. An attempt is also
made to provide a preliminary quantitative perspec-
tive regarding the potential contribution of resource
recovery and source reduction to the broad resource
supply problem.
Historical Trends in U.S. Raw Material
Consumption
A summary of the historical pattern of U.S.
material consumption for broadly defined raw mate-
rial commodity categories is , shown in Table 4.
Although the data are in dollars, the conversion to
constant 1967 dollars provides a reasonably valid
basis for assessing physical quantity growth trends
within the individual commodity groupings.
The annual value of all raw materials consumed
has virtually quadrupled since 1900. The greater part
of this increase is accounted for by food and energy
raw materials, which together tend to dominate the
absolute value magnitudes. In relative growth terms,
the mineral groups have exhibited the most rapid
rates of increase, both for the century as a whole and
for recent decades. The slowest growth has been in
the forestry products and nonfood agricultural group,
which' is dominated by sawlogs, U.S. consumption of
which has grown little over the century.
The data indicate that material consumption
growth rates have increased over the past 40 years.
Comparison of percent increases in consumption for
the successive 20-year periods 1929-49 and 1949-69
shows that the more recent period exhibits higher
growth for all categories except metallic minerals and
nonfood organic materials. Similarly, the most recent
10-year period, 1959-69, shows a higher percent
growth than the earlier 1949-59 decade for all raw
material groups except the nonfuel, nonmetallic
minerals. Thus, not only are the absolute quantities
growing rapidly for most categories of crude raw
materials, but there is also some evidence that even
the percent growth rates have been increasing over
the recent past.
A comparison of crude raw material consumption
with gross national product (GNP) shows that crude
and semiprocessed raw materials currently contribute
a relatively small proportion to the GNP, and this
contribution has been decreasing continuously since
TABLE 4
U.S. CONSUMPTION OF RAW MATERIALS, 1900-69
Year
Annual value | millions of dollars (1967) | :t
1900
1929
1949?
1959
1969
Increase (percent):
1909-29
1929-49
1949-59
1959-69
1949-69
1900-69
All raw
material
17,358
31,979
44,357
53,737
68,590
43
39
21
28
55
295
Food
material
10,448
16,834
22,279
26,411
32,275
31
32
19
22
45
209
Nonfood
agricultural
and forestry
products
3,347
5,608
7,017
6,987
7,431
27
25
0
6
6
120
Energy
material*
2,447
6,508
10,167
13,295
19,170
94
56
31
44
89
683
Metallic
minerals
594
1,663
2,648
3,212
4,046
71
59
, 21
26
53
581
Oth6r
nonfuel
minerals
499
1,179
1,618
3,046
4,338
136
37
88
42
168
769
*Includes wood burned as fuel.
tSpencer, V. E. Raw materials in the United States economy: 1900-1969. Working Paper 35. Washington, U.S. Bureau of the
Census, July 1972. 66 p.
11948 and 1950 values are averaged here to minimize the effect of the 1949 recession year influence on consumption growth
trends.
-------
RESOURCE CONSERVATION, ENVIRONMENTAL, AND SOLID WASTE MANAGEMENT ISSUES
11
at least 1929-down from 13.4 percent in 1929, to 10
percent in 1959, to 8 percent in 1969. Thus, in spite
of the rapid growth in raw material consumption, the
GNP has expanded at an even more rapid pace. This is
because the services sector of the economy (including
especially government services) has grown faster than
the physical goods sectors and within the goods
sectors an increasing portion of the value added has
come in the form of more intensive material process-
ing, synthesizing, and fabrication of final goods in
relation to material content. The only major category
of raw materials that has come close to matching the
aggregate GNP rate of growth is the energy materials.
General Extrapolations of Past Trends
Table 5 summarizes the results of extrapolating
historical growth trends to the years 1980, 1985,
1990, and 2000. Two alternative projections are
made for each year, a "high" value, based on the
individual category's 1959-69 growth rate experience,
and a "low" value, based on its longer term 1929-69
growth rate. The results are presented in the form of
growth factors or ratios of the level projected for
future years relative to corresponding 1972 values,
assuming compound annual growth at the rates
experienced in earlier periods. All factors are based
on constant dollar value increases. Thus, on this basis,
GNP is expected to reach 3.25 times its 1972 level (or
an increase of 225 percent) in real terms by the year
2000 under the high growth rate assumption or 2.42
times its 1972 level (an increase of 142 percent)
under the low growth rate assumption.
The projections for consumer or household sector
total personal consumption closely follow those for
the GNP, with durable goods growing substantially
faster and nondurable goods somewhat less rapidly.
On the basis of past performance, raw material
consumption should grow proportionately less
rapidly than either GNP or the household final
demand component of GNP. Nevertheless, annual
consumption of raw materials would double by the
end of the century under the high growth assump-
tion, or increase by about 70 percent under the low
growth projection. Within the mineral categories the
consumption of metallic minerals would increase by
about 85 to 90 percent, mineral fuels by 110 to 180
percent (most energy projections are at or above this
higher figure), and other nonfuel minerals at between
150 and 170 percent. Nonfood agricultural and
forestry products will probably grow by somewhat
more than our higher figure of 22 percent because
pulpwood and other nonsawlog components will have
increasing weight within this category. Given the
TABLE 5
PROJECTED GROWTH FACTORS FOR GNP, PERSONAL CONSUMER EXPENDITURES, AND RAW MATERIAL
CONSUMPTION
Growth factor*
Item
GNP
Personal consumer expenditures:
Durable goods
Nondurable goods
Total
Material consumption:
All raw material
Metallic minerals
Nonfuel, nonmetallic minerals
Energy material
Nonfood agricultural and forestry products
Food material
Population^
1980
High
1.40
1.72
1.29
1.41
1.22
1.20
1.33
1.34
1.05
1.17
1
Low
1.29
1.39
1.24
1.28
1.16
1.19
1.30
1.24
1.06
1.14
.07
1985
High
1.73
2.41
1.51
1.75
1.38
1.34
1.58
1.60
1.08
1.29
1
Low
1.51
1.71
1.41
1.49
1.28
1.33
1.53
1.41
1.09
1.23
.13
1990
High
2.13
3.38
1.76
2.21
1.56
1.51
1.89
1.92
1.11
1.43
1
Low
1.76
2.10
1.62
1.73
1.40
1.48
1.79
1.62
1.13
1.33
.18
2000
High
3.25
6.65
2.42
3.34
2.00
1.89
2.69
2.77
1.18
1.74
1
Low
2.42
3. 36
2.1)
2.35
1.69
1.84
2.48
2.11
1.22
1.56
.27
*The projected ratio of the future year value to the 1972 (base year) value.
+Based on the most recent U.S. Department of Commerce Bureau of the Census' Series E population projections.
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12
RESOURCE RECOVERY AND SOURCE REDUCTION
decrease in population growth presently projected by
the U.S. Census Bureau, food consumption growth
should probably .be closer to our low 56 percent
growth rate value. Furthermore, much of this value
increase should be accounted for by continued trends
toward higher valued components of the food cate-
gory rather than an increase in per capita demand
measured by weight of food consumed.
These projections are very crude and do -not
include consideration of the effect of price rises on
future demand. However, they do provide a reason-
ably accurate quantitative perspective on the U.S. raw
material requirements that would be necessary to
sustain recent growth rates in our aggregate living
standards for another three decades. In summary, this
rate of economic growth implies, by the year 2000,
an increase in overall U.S. demands on the so-called
"renewable" agricultural and forestry resources of 50
percent or more and on mineral deposits of about 2.5
times our present consumption rate.
Future Raw Material Supplies and Natural
Resource Conservation
Questions regarding the future adequacy of the
natural resource supplies' essentially relate to the
capability of a -finite natural resource base -to sustain
high and continuously rising levels of consumption
for rising population levels. These questions relate not
only to nonrenewable resources, such as mineral
deposits, which are incapable of natural replenish-
ment once exploited, but also they relate to
renewable, resources such as agricultural, forestry, and
wild fishery products. The latter may, through wise
investment and management be capable of continu-
ally increased sustainable yields; however, they also
may be subject to upper bounds. As in the case of
many significant ocean, fisheries and in many arid
land irrigation projects, these resources are frequently
subject to overexploitation and possible irreversible
declines in productivity.
Two extreme viewpoints regarding the adequacy
of resource supplies are often put forth. One is the
neO'Malthusian specter of economic catastrophe that
must inevitably overtake us at some future time as
high-grade mineral deposits become successively ex-
hausted, low-grade deposits become increasingly
costly to discover and exploit, and the upper limits of
sustained-yield resources are achieved. In this view,
the finiteness of national and world resources is a
basic assumption and the key issue is not whether
they will last but only how long.
At the other extreme are those who believe that
maintaining high per capita growth rates of material
consumption depends primarily on human ingenuity.
In this view, present knowledge of the extent of
mineral deposits is infinitesimal compared with the
unexplored reaches of the planet. Limits are those
imposed by human knowledge, technology, and
economic organization; natural resources are not
believed to be in short supply in any real sense.
Although individual materials may be limited, the
functional characteristics for which any given mate-
rial is employed is regarded in principle as potentially
available in other materials. Furthermore, the
economic system is seen as capable of devising
entirely different final products to serve traditional
demands or uses- for example, telecommunications as
a substitute for physical transportation.
.Given this orientation, it is difficult to identify
any specific natural resource commodity that is
essential or critical in any absolute sense or to
identify any nonreplenishable resources that are
exhaustible. To the technologist, the limits to
economic growth lie in man himself, not in the
inherent characteristics or physical limitations of the
resource base.
Historically,'U.S."public policy has apparently not
placed significant value on resource conservation. It
could be argued that with few exceptions laws and
institutions have been biased toward the short-run
exploitation of natural resource assets. The Mining
Law of 1872. HopHnion allowances, and Federal
subsidies for resource exploration and technology are
some of the principal ways in which material use has
been encouraged throughout the history of the
Nation's economic development.
Even with the most optimistic assumptions regard-
ing the role of technology and market forces, there
are a number of reasons for a more prudent approach
toward resource conservation today. The current
shortages of energy and materials should serve to
illustrate that even if the resource base is adequate,
acquisition of materials can be accompanied by severe
short-term dislocations and social costs. In addition,
there remain a number of areas of considerable
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RESOURCE CONSERVATION, ENVIRONMENTAL, AND SOLID WASTE MANAGEMENT ISSUES
13
uncertainty and risk regarding long-term future virgin
resource supplies. Some of these areas of uncertainty
relate to-
(1) The extent of future mineral discoveries and
the cost of exploiting them. Continued high and
growing rates of resource consumption could well
force use of lower grade ores or energy materials at
high extraction costs (in capital, labor, and energy)
accompanied by high waste generation.
(2) Future growth rates of world market
demands, especially of the presently underdeveloped
nations of the world, and increasing competition for
many commodities on world markets.
(3) Geopolitical events that could significantly
affect the U.S. position in international markets for
particular commodities or cause unusual demands on
U.S. exports. Today U.S. dependence on foreign
minerals is already high and translates into a large
outflow of gold ($8 billion in 1970). By 1985,
according to Department of the Interior estimates,
the mineral deficit will have reached $32 billion, 1.8
percent of the GNP, up from 0.8 percent in 1970.
(4) Whether private industry will be as effective in
the future as it has been in the past in innovating and
organizing raw material acquisition, especially at the
scale that will be required in the future on a
worldwide basis.
In addition, it must be noted that the large-scale
development of raw material supplies is not in itself
costless. Exploration, research and development, and
capital investment costs at unprecedented scales-
both public and private-are the most obvious.
Indeed, the Federal Government now seems prepared
to invest some $10 billion in energy research and
development alone over the next few years. Less
obvious, but no less real, are the community and
regional disruption costs associated with industry
relocation due to dynamic change in raw material
types and sources. These are seldom if ever factored
into the private market pricing calculus as future
social costs of natural resource supply.
Another aspect omitted is that the exploitation of
low-grade resources (e.g., shale oil versus crude oil) is
generally accompanied by external environmental
costs (such as bulk shale oil residues, which require
large land area for disposition) that tend not to be
internalized by Government action until the impact is
obvious and far advanced.
Given factors such as these, a good case can be
made for a more conservative national posture
regarding the rate at which the natural resource base
is used.
Today the tools for assessing the social value of
resource conservation are not well developed. It is
difficult to compare the implicit tradeoffs, in market
price or other terms, between enhanced future
availability of virgin resources and present sacrifices
in forgone consumption. Methods of evaluation are
being developed. However, today the decision to
conserve or not to conserve resources remains a
matter of judgment based on consideration of
environmental, economic, and political factors.
Resource Recovery and Source Reduction
Implications for Resource Conservation
Both resource recovery and source reduction are
almost by definition conservative. To the extent that
raw materials recovered from waste streams compete
with or substitute for virgin materials, the latter are
saved for future use. In fact, as far as recycling is
concerned, the same material units may be reused
many times over a period of years, each time saving
an equivalent -amount of virgin raw material. In
effect, the introduction of a recycle process closes the
loop on an otherwise open system of extraction,
consumption, and disposal.
Source reduction implies the absolute reduction of
material consumption, either through redesign of the
final product or packaging, through increased product
lifetime, or through reduction in actual per capita
consumption levels.
Detailed analyses of the practical quantitative
potentials for resource recovery and source reduction
to save natural virgin resources have not yet been
developed; However, some preliminary evaluations
with respect to resource recovery potentials have
been made that suggest the order of magnitude of
virgin material savings at issue.
Table 6 summarizes the recycling potentials for
selected materials in post-consumer municipal waste
in relation to certain measures of U.S. material
consumption. The estimated recovery potentials for
the individual materials are based on the following
assumptions: (1) 95 percent of the waste generated is
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14
RESOURCE RECOVERY AND SOURCE REDUCTION
TABLE 6
POST-CONSUMER WASTE AND MAXIMUM MATERIAL RECYCLE POTENTIALS RELATIVE TO U.S. CONSUMPTION
AND PRODUCTION FOR SELECTED MATERIALS, 1971
Item
Material quantity (103 tons):
Post-consumer waste*
U.S. consumption
U.S. primary production:
Domestic raw material
Total
Percent ratio of post-consumer waste to
U.S. consumption
U.S. primary production:
Domestic raw material
Total
Estimated maximum recovery potential:
As percent of waste material
Total recovered (103 tons)
Percent ratio of potential recovery to
U.S. consumption
U.S. primary production:
Domestic raw material
Total
Iron
10,600
183,500
tSI.SOO
$81,400
12.7
19.4
13.0
53
5,618
6.7
10.3
6.9
Aluminum
800
$5,074
$377
£3,925
15.8
212.2
20.4
53
400
8.4
112.5
10.8
Copper
250
t2,823
1 1,411
1 1,592
8.9
17.7
15.7
53
133
4.7
9.4
8.3
Lead
t?5
* 1,431
*585
*666
5.2
12.8
11.3
53
40
2.8
6.8
6.0
Tin
t28
*78
_
_
35.8
> oo
oo
53
15
18.9
ob
oo
Paper and
paperboard
39,100
§58,770
§38,110
§42,060
66.5
102.6
93.0
21
8,200
14.0
21.5
19.5
*Based on EPA calculations.
tTin can fraction only.
tU.S. Bureau of Mines. 1971 Minerals yearbook. Washington, U.S. Government Printing Office, 1972.
§The statistics of paper. Washington, American Paper Institute, 1972.
collected, either through mixed-waste collection or
specialized source-separated collection systems; (2)
70 percent of the collected waste is processed for
recovery of specific material and energy values
[roughly equivalent to the waste collected in U.S.
standard metropolitan statistical areas (SMSA's) as
defined by the U.S. Department of Commerce]; (3)
with respect to paper, it is assumed that only 40
percent of SMSA collected weight is processed for
fiber recovery; (4) with respect to the material
actually processed for recycling, final material
recovery efficiency is assumed to be 80 percent.
Although crude, these assumptions are consistent
with current knowledge of the waste stream itself and
current (or soon-to-be-available) technology for
material recovery.
The final national recovery ratios themselves-53
percent for minerals and 21 percent for total paper-
represent practical maxima from a technical stand-
point. They assume, for example, the existence of
large-scale recovery plants serving the entire U.S.
SMSA population, and they also assume implicitly a
significant expansion in material-user-industry capac-
ity in most instances. They are thus obviously not
recovery values that could be implemented or
achieved in the near future under any circumstances
and should not be so interpreted. They represent
what could conceivably be achieved with current or
near-future technology under a very vigorous imple-
mentation program. Note that because they are based
on current waste flow, they represent net additions to
any recovery already being achieved.
Thus, for example, if the incremental recycle
quantity had been achieved in 1971 for iron, then
assuming the same total demand for the material, it
would have been possible to have supplied about 7
percent of this demand from the municipal waste
stream rather than from domestic or imported virgin
sources. For the six materials shown, the percent of
U.S. consumption that could have been supplied from
post-consumer wastes is seen to range from a low of 3
percent for lead up to as much as 18.9 percent for
paper and paperboard. products.
The set of ratios in the next-to-last line of Table 6
is most indicative of U.S. natural resource conserva-
tion benefits because it relates to U.S. primary
production based on domestic ore (or forests, in the
case of paper). The potential reductions in primary
-------
RESOURCE CONSERVATION, ENVIRONMENTAL, AND SOLID WASTE MANAGEMENT ISSUES
15
production from virgin domestic resources could have
amounted to 10.3 percent for iron, 9.4 percent for
copper, 6.8 percent for lead, 21.5 percent fqr paper,
and over 100 percent for aluminum and tin. In the
case of aluminum, for which 90 percent of U.S.
primary production is based on imported bauxite and
alumina, it would have been possible in principle to
have reduced the aluminum industry's demand for
domestic bauxite to zero and also to have reduced
imports. In the case of tin, where the U.S. produces
negligible quantities of ore and refines less than 1
percent of our virgin consumption, the total substitu-
tion would necessarily have to come entirely at the
expense of imports.
Two principal conclusions emerge from these
figures. The first is that recycling post-consumer
waste materials is not a panacea in the sense that it
cannot be expected to supply the majority of the
Nation's raw material demands. On the other hand,
the substitution possibilities, both with regard to
total consumption and domestic virgin material
supply, are not insignificant.
In addition to these direct material resource
savings, there will also accrue further net indirect
savings in the form of reduced capital equipment and
other material input requirements in the mining, ore
reduction and beneficiation, and smelting sectors of
the virgin mineral industries, as well as similar
reductions in the tree harvesting, wood preparation,
and wood pulping segments of the pulp and paper
industry. No attempt has yet been made to evaluate
these in quantitative terms. There will be, of course,
some offsetting new capital goods requirements for
processing the waste material, but these generally
appear to be substantially less than those for virgin
material.
The preceding discussion has dealt entirely with
recycling or the recovery of materials as materials and
the material resource savings possible from this
activity. Energy resource savings can also be derived
from resource recovery. Essentially these can accrue
in two ways. First, the combustible organic fraction
of the solid waste stream can either be burned
directly as a fossil fuel substitute or processed to
produce hydrocarbon fuels. EPA estimates indicate
that the potential energy retrievable from municipal
waste sources could supply 1.5 to 2 percent of the
Nation's gross current primary energy demand. How-
ever, locally, especially in regions where heavy
industry is not predominant, energy derived from
solid waste could contribute a more substantial
fraction to local energy demands.
The second source of energy savings is an indirect
result of material recycling. As was reported in EPA's
First Annual Report to Congress on Resource
Recovery, recycling is typically less energy inten-
sive than virgin material production, when all
the stages of material acquisition, transportation, and
processing are considered. One study, for example,
estimates that for five metals evaluated (comprising
80 to 90 percent of energy consumption in all
primary metals industries), secondary metal recovery
required only 1.5 to 31 percent of the energy per ton
of product required by the virgin counterpart
material.6 Other work also suggests substantial energy
savings from paper and glass recycling.7'8 Contract
research projects in progress will provide a consider-
ably firmer basis . for developing quantitative
perspective in this area.9 ' °
No attempt has been made here to review possibil-
ities for converting solid waste into by-product forms
of material recovery-for example, the production of
brick or other building materials from incinerator
residue or compost from the organic fraction. A wide
variety of technologically feasible opportunities in
this regard have been demonstrated.'' However, it
appears that these represent, for the most part,
products with lower values from an economic stand-
point than recycling and energy recovery. Neverthe-
less, to the extent that these physical conversion
options prove viable, either as a substitute for or in
addition to, recycling and energy conversion options,
they would represent additional ways for conserving
virgin raw materials.
In summary, virgin natural resource material
savings including nonfuel mineral ores, fossil fuels,
and forest resources occur as the result of resource
recovery. EPA's studies to date have not attempted to
evaluate in any detail the potential natural resource
savings of broad source reduction programs, because
many of these involve complex product redesign
considerations and technical feasibility issues.
The national welfare benefits of these resource
savings would accrue to future generations in the
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16
RESOURCE RECOVERY AND SOURCE REDUCTION
form of a larger available natural resource base. These
benefits are difficult to evaluate but fall into the same
category as those that national programs of research
and development related to energy, minerals, and
forestry activities are attempting to achieve.
ENVIRONMENTAL QUALITY PROTECTION
IMPLICATIONS
In addition to solid waste management cost savings
and natural resource conservation benefits, resource
recovery and source reduction can also contribute to
improvements in environmental quality.
Empirical evidence developed by the Council on
Environmental Quality relating to the environmental
impacts of resource recovery was outlined in EPA's
First Annual Report to Congress on Resource
Recovery. Comparisons between virgin and secondary
material processing systems for paper, glass, and
ferrous metals demonstrate substantially lower pollut-
ant discharge levels on a ton-for-ton production basis
from the use of secondary materials. These initial
estimates were derived assuming 1968-70 levels of air
and water pollution control.
Two EPA-sponsored projects currently underway
are designed to improve upon this earlier knowledge
by developing the technical data in more depth,
extending the coverage to a larger number of impor-
tant industries, and constructing effluent and
emission comparisons on the basis of 1975 pollution
control standards.9'' ° In addition, an effort has been
made to develop a more sophisticated analytical basis
for evaluating environmental implications of relevant
resource recovery and source reduction potentials and
to achieve a broader awareness of the complexities
involved in the quantitative assessment of
environmental benefits.
Enough is known about the relationships involved
to indicate that the net national environmental
effects will be beneficial in virtually all instances
where resource recovery is concerned and beneficial
almost by definition for source reduction. The
environmental implications extend well beyond those
that would occur at landfill and incinerator sites and
include changes in material processing effluents and
beneficial natural landscape effects. In fact, there is
evidence to indicate that the beneficial effects on
primary extractive and processing industry environ-
mental impacts may substantially outweigh those
relating to community solid waste disposal.
At the same time, many factors make it extremely
difficult to assess the significance of these benefits.
One of these is the sheer magnitude of the data' and
computations required to achieve quantitative
perspective on specific industrial process and loca-
tional factors; however, this assessment process is well
underway. Because of the highly interrelated pattern
of industry material flows, the environmental benefits
stemming from any particular waste recovery oc
reduction measure would be spread out over many
different industry segments and geographic regions.
Many of the benefits may appear to be marginal and
not of obvious significance.
In a similar respect, it may be argued that various
pollution control and other environmental protection
programs scheduled over the next decade will
(assuming success) achieve many if not most of the
potential environmental quality improvements and
the incremental benefits possible from source reduc-
tion or recycling will thus be only of limited
significance. Although there is a certain validity to
this statement, at least three points weaken this
argument.
One is the question of whether environmental
standards established will be set at socially optimal
levels. Another is the question of the extent to which
political and institutional factors will allow achieve-
ment of the environmental standards or whether
short-term energy or material supply difficulties may
compel relaxation of environmental goals and
priorities. The future of environmental quality pro-
tection involves a number of risks and uncertainties,
and risks of unfavorable outcomes could imply higher
social costs. The third point is that many activities,
by their nature, create important environmental
disamenities that cannot be adequately internalized
and controlled. Thus, for example, it is impossible to
engage in large-scale surface mining, forest cutting, or
solid waste landfill operations without disrupting
landscapes and disturbing ecological systems. This
would be true even assuming eventual site restoration
and biological recovery. In this respect, as with the
uncertainty of achieving satisfactory standards by
other direct control measures, it would seem that
solid waste source reduction and resource recovery
-------
RESOURCE CONSERVATION, ENVIRONMENTAL, AND SOLID WASTE MANAGEMENT ISSUES
17
options may be able to make important contributions
to the Nation's environmental protection.
To the extent that source reduction and resource
recovery decrease the demand for virgin material,
some decrease in the number of virgin material
extraction and processing sites can be anticipated.
This would probably be among the most significant
sources of environmental benefit, although the specific
cause-effect sequence may not be easy to observe or
monitor in practice. In other instances, the primary
industry production sites would not achieve as large a
scale of operation over time as they otherwise would,
so that given degrees of pollution control will imply
lower absolute emission quantities.
Table 6 indicates some of the primary industries
that would be most significantly affected and suggests
some preliminary inferences regarding quantitative
implications. Consider, for example, substitution of
recycled post-consumer ferrous metal waste for up to
10 percent of the virgin pig iron supplied from
domestic iron ore mining. In this case, both iron ore
mining and associated beneficiation operations would
be reduced by roughly the same 10 percent, as would
both coke oven and blast furnace pig iron production.
Similar relative reductions would be implied for other
raw materials, such as coking coal and limestone; and,
in addition, the energy fuel requirements (including
those for electricity generation) for all these stages of
production would be similarly reduced. On the other
hand, to the extent that the substitution went against
imported iron ore, the implied reduction in U.S. iron
ore mining would not be realized. In the case of both
tin and bauxite ores, the impact would be almost
totally on foreign mining operations.
Potential reductions of over 20 percent are
possible for the domestic wood and primary pulp and
paper processing segments of the paper industry. For
copper, the environmental impact on mining would
be larger in absolute terms than would be apparent
from the modest 9 percent potential substitution,
because copper ore averages only 0.5 percent copper.
There will, of course, be some offsetting effects.
The waste material separation and processing plants
will themselves be a source of some environmental
side effects, although they are presently estimated to
be quite minor. Of somewhat greater concern are the
secondary metal smelters and secondary paper de-
inking and pulping operations. Nevertheless, every
indication from the research thus far available
suggests that these are both less energy intensive than
their virgin material processing counterparts and
generate, in most instances, fewer emission and
effluent quantities per unit of product.
In many important cases, such as basic oxygen
steelmaking, glass manufacture, and certain paper and
paperboard mill applications, the final secondary
recovery processing will occur as a blending of
recycled and virgin raw material in primary processing
plants. In such instances, additional specialized
secondary plant sites will not be required.
To the extent that virgin material production is
reduced by solid waste source reduction, there will be
little if any offsetting environmental impacts to
weigh against the savings in the virgin material
sectors. Thus, per unit of waste disposal averted,
source reduction can generally be expected to
produce somewhat greater net environmental quality
benefits than resource recovery options.
Current EPA research contracts dealing with
aluminum, steel, plastics, paper, glass, and rubber will
provide extensive technical data on comparative
effluent and emission parameters as well as fuel,
transportation use, and other environmental impact
indicators. In combination with analysis regarding the
potential extent of secondary material substitution
and/or source reduction, these data will provide the
basis for general quantitative assessments of many of
the physical dimensions of the potential environ-
mental benefits at the national level.
However, the problem of assessing the social
impact remains. Although this may well prove an
intractable problem from a scientific standpoint,
future work should nevertheless provide policymakers
with much greater quantitative perspective on the
nature and degree of environmental impact.
REFERENCES
1. Niessen, W. R., and S. H. Chansky. The nature of refuse.
In Proceedings; 1970 National Incinerator Confer-
ence, Cincinnati, May 17-20, 1970. New York,
American Society of Mechanical Engineers, p.1-24.
2. Muhich, A. J. 1968 national survey of community solid
waste practices; an interim report. In Proceedings;
1968 Annual Meeting of the Institute for Solid
Wastes, American Public Works Association,
Chicago, Oct. 1968. p.13.
3. Midwest Research Institute. Research recovery forecasts.
U.S. Environmental Protection Agency Contract
No. 68-01-0793, [19731- (Ongoing Study.)
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18
RESOURCE RECOVERY AND SOURCE REDUCTION
4. Applied Management Sciences, Inc. Solid waste man-
power utilization profile and analysis. U.S.
Environmental Protection Agency Contract No.
68-03-0041, [1972J.
5. Munich, 1968 national survey, p.12, 14, and 49.
6. Bravard, J. C., H. B. Flors, II, and C. Portal. Energy
expenditures associated with the production and
recycle of metals. Report No. ORNL-NSF-EP-24.
Oak Ridge, Tenn., Oak Ridge National Laboratory,
Nov. 1972. 87 p.
7. Hannon, B. System energy and recycling: a study of the
beverage industry. Urbana, Center for Advanced
Computation, University of Illinois, [19711. 47 p.
8. Midwest Research Institute. Economic studies in support
of policy formation on resource recovery. Unpub-
lished report to the Council on Environmental
Quality, 1972.
9. Calspan Corporation. Analysis of the environmental
impacts of production from virgin and secondary
ferrous, aluminum, and plastics. U.S. Environ-
mental Protection Agency Contract No:
68-01-0794, [1973]. (Ongoing study.)
10. Gordian Associates. Analysis of the environmental
impacts of production from virgin secondary
paper, glass, and rubber. U.S. Environmental
Protection Agency Contract No. 68-01-1815,
[19731. (Ongoing study.)
11. Proceedings; Third Mineral Waste Utilization Sympo-
sium, Chicago, Mar. 14-16, 1972. U.S. Bureau of
Mines and IIT Research Institute. 445 p.
-------
Chapter 2
EXISTING FEDERAL POLICIES AND THEIR
EFFECTS ON VIRGIN AND SECONDARY MATERIAL USE
This chapter will discuss three existing Federal
policies that affect material use: (1) freight rate
regulations for virgin and secondary commodities,
(2) Federal procurement specifications for products
containing recycled materials, (3) tax benefits for
various virgin material industries. The objective of
this discussion will be to identify the impact of these
measures on the use of virgin or secondary materials
and to identify changes in these policies that might
lead to increased rates of resource recovery or source
reduction. It should be kept in mind, however, that
these measures have been investigated primarily to
determine impacts on resource recovery and source
reduction. Many other consequences or impacts that
may or may not be beneficial have not been
thoroughly evaluated.
The first section of the chapter, dealing with
freight rate regulations, reviews the evidence per-
taining to discrimination against the shipment of
secondary material by rail and ocean transport and
makes several recommendations toward the establish-
ment of a more equitable rate structure.
The second section investigates the potential for
development of demand for recycled material
through the Federal procurement mechanism, iden-
tifies barriers to increased Federal procurement of
products containing recycled material, and recom-
mends changes in Federal purchasing practices.
In the final section of the chapter the values of the
tax benefits available to virgin material industries
through the percentage depletion allowance, capital
gains treatment, and various foreign tax provisions are
estimated. The rationale for these benefits in terms of
insuring adequacy of virgin material supply is
reviewed, and the potential impact of these tax
benefits on resource recovery and resource conserva-
tion is discussed.
FREIGHT RATES FOR VIRGIN AND
SECONDARY MATERIALS
The current controversy concerning freight rates
for secondary materials centers around the issue of
discrimination. Although the Interstate Commerce
Act does not refer to discrimination explicitly, it
makes it unlawful for any carrier to give an undue or
unreasonable advantage to any particular shipper or
to subject any shipper to undue or unreasonable
prejudice. To demonstrate discrimination against
secondary material, it must be shown that the rate
relationship between virgin and secondary materials is
the source of actual injury to shippers of secondary
material. This essentially requires demonstration that
current rates for secondary material are too high
relative to the rates for virgin material and that, as a
result, there is a decrease in recycling.
Transportation Costs and Rates
Regulated freight rates are generally based on two
considerations: cost and value of service. Factors that
determine the cost of service of shipping a particular
commodity include shipping weight, liability to
damage, perishability, insurance costs, liability to
damage other commodities, liability to combustion or
explosion, susceptibility to theft, ease or difficulty in
loading or unloading, stowability, excessive weight,
excessive length, and frequency and regularity of
shipments. A ratemaker considers each of these
factors to establish the variable cost of providing a
transportation service and then establishes a contribu-
tion above variable cost based on value-of-service
considerations. This is accomplished by assessing the
19
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20
RESOURCE RECOVERY AND SOURCE REDUCTION
demand for the transportation service and pricing it
accordingly. This is, in effect, charging "what the
traffic will bear" and is similar to most pricing
practices in commerce and industry. However, in a
free market situation, competition drives prices down
to the point where they exceed costs only by a
minimum profit margin. When competition is limited,
the situation for many transportation services, it is
necessary to regulate this margin.
Discrimination could exist in a situation in which
value of service considerations results in rates with a
higher percentage contribution of revenue over cost
for one commodity than for a competing commodity.
Areas of potential discrimination can be identified by
inspection of the ratio of revenue to cost for two
competing commodities. If this ratio is higher for one
commodity relative to the other, discrimination may
exist. To eliminate discrimination, rates should be
based on cost of service plus an equivalent percentage
profit margin for the two commodities.
The existence of higher rail rates for secondary
material than virgin material does not constitute
discrimination in itself. Secondary and virgin
materials have distinctly different transportation
characteristics in terms of length of haul, density, and
typical size of load; therefore, their rates should be
different. Comparison of rates with costs is necessary
to establish discrimination.
Rates and Costs for Rail Shipments
The Burden Study. Revenue-to-cost ratios are
presented in the Burden study performed by the U.S.
Department of Transportation.1 Data for iron ore
and iron and steel scrap are exhibited in Table 7. As
can be seen for shipments in Official Territory
(Northeast and Great Lakes region) and for shipments
from Western to Official Territory, the revenue-
to-cost ratio for ore is greater than for scrap. For
other territories the results are just the opposite:
there is a very high contribution of revenue over cost
for scrap. (The ratios are as high as 2.33). When the
figures for the entire United States are averaged, a
higher revenue-to-cost ratio results for scrap than for
iron ore. Table 8 indicates that for paper, in all
instances, the ratio of revenue to cost is lower for
wastepaper than for wood pulp. The cost techniques
used in the Burden study were developed by the
TABLE 7
REVENUE-TO-COST RATIOS FOR IRON ORE
AND IRON AND STEEL SCRAP*
Shipment location
Ratio of revenue
to variable cost
Official Territory:
Iron ore
Iron and steel scrap
Official to Southern Territory:
Iron ore
Iron and steel scrap
Southern Territory:
Iron ore
Iron and steel scrap
Western to Official Territory:
Iron ore
Iron and steel scrap
Western Territory:
Iron ore
Iron and steel scrap
Entire United States:
Iron ore
Iron and steel scrap
1.43
1.37
1.41
2.33
1.04
1.80
1.51
1.48
1.21
1.36
1.30
1.42
*Source: An estimation of the distribution of the rail
revenue contribution by commodity group and type of rail
car, 1969. Washington, Office of the Secretary, U.S. Depart-
ment of Transportation, Jan. 1973.
TABLE 8
SELECTED REVENUE-TO-COST RATIOS
FOR WOOD PULP AND WASTEPAPER*
Shipment location
Ratio of revenue
to variable cost
Southern to Official Territory:
Wood pulp
Wastepaper
Southern Territory:
Wood pulp
Wastepaper
Southern to Western Territory:
Wood pulp
Wastepaper
Western Territory:
Wood pulp
Wastepaper
Entire United States:
Wood pulp
Wastepaper
1.81
1.21
1.98
1.33
1.78
1.33
1.44
1.23
1.50
L15
*Source: An estimation of the distribution of the rail
revenue contribution by commodity group and type of rail
car, 1969. Washington, Office of the Secretary, U.S. Depart-
ment of Transportation, Jan. 1973.
Interstate Commerce Commission but have not been
adopted for rate determination purposes. In addition,
the procedures for allocating costs over shipments of
-------
EXISTING FEDERAL POLICIES AND THEIR EFFECTS ON VIRGIN AND SECONDARY MATERIAL USE
21
different weights and mileages have been questioned
and criticized by transportation experts. However,
these limitations notwithstanding, the following con-
clusions can be drawn: (l)for iron and steel scrap
there is evidence of an unfavorable rail rate structure;
however, this evidence is not consistent and varies
regionally; (2) for wastepaper there is no evidence of
an unfavorable rate structure.
EPA Freight Rate Study. One of the limitations of
the Burden study is that it averaged data over
different distances (e.g., shipments of distances
greater than 2,500 mijes were combined with move-
ments of less than 100 miles). It is reasonable to
expect that value of service rate practices would
result in different revenue cost ratios for different
haul lengths (as competition with other modes of
transportation would vary with haul length). There-
fore, aggregating shipments with very different
mileages could obscure significant features of the
results.
The EPA study attempted to compare moves of
secondary and virgin material that meet the following
three criteria: (1) movement over similar distances,
(2) movements that .originate in the same territory,
(3) movements in high-density traffic corridors.2
Revenue-to-cost ratios were computed for the
following secondary and virgin materials:
Virgin material
Iron ore
Wood pulp
Glass sand
Natural and synthetic
rubber.
Aluminum ingots
Secondary material
Iron and steel scrap
Wastepaper
Glass cullet
Scrap and reclaimed
rubber
Aluminum scrap
The results for iron ore and iron and steel scrap are
presented in Table 9. For all mileages the revenue-
to-cost ratio is greater for scrap than for ore. This
indicates that, in general, scrap shipments make a
proportionately greater contribution to railroad
profits than ore shipments.
Table 10 shows the results for wood pulp and
wastepaper. In this case the secondary material is
contributing less to railroad revenue than the virgin
commodity.
TABLE 9
VARIATION OF REVENUE-TO-COST RATIO
WITH MILEAGE FOR IRON ORE AND
IRON AND STEEL SCRAP*
Mileage
100
200
300
400 . .
500
600
700
800
Ratio of revenue
Iron ore
1.92
1.72
1.56
1.45
1.33
1.25
1.17
1.09
to variable cost
Iron and
steel scrap
2.17
2.10
2.04
2.02
1.94
1.88
1.83
1.80
*Source: Moshman Associates, Inc. An analysis of
transportation rates and costs for selected virgin and second-
ary commodities. U.S. Environmental Protection Agency
Contract No. 68-01-0790, Sept. 1973.
Table 11 presents the results for glass sand and
cullet. For all mileages the revenue-to-cost ratio is
higher for cullet.
The data in Table 12 indicate that reclaimed
rubber makes a much higher revenue contribution
above cost than natural and synthetic rubber. On the
other hand, the revenue-to-cost ratio for scrap rubber
is lower than for all other rubber products studied.
TABLE 10
VARIATION OF REVENUE-TO-COST RATIO
WITH MILEAGE FOR WOOD PULP AND
WASTEPAPER*
Ratio of revenue to variable cost
Mileage
250
500
750
1,000
1,250
1,500
1,750
2,000
2,250
Wood pulp
2.59
2.43
2.29
2.17
2.04
1.94
1.85
1.75
1.68
Wastepaper
1.75
1.66
1.59
1.53
1.46
1.41
-
-
*Source: Moshman Associates, Inc. An analysis of
transportation rates and costs for selected virgin and second-
ary commodities. U.S. Environmental Protection Agency
Contract No. 68-01-0790, Sept. 1973.
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22
RESOURCE RECOVERY AND SOURCE REDUCTION
TABLE 11
VARIATION OF REVENUE-TO-COST RATIO
WITH MILEAGE FOR GLASS SAND AND
GULLET*
Ratio of revenue to variable cost
250
500
750
1,000
Glass sand
1.52
1.45
1.38
1.32
Cullet
1.98
1.94
1.89
*Source: Moshman Associates, Inc. An analysis of
transportation rates and costs for selected virgin and second-
ary commodities. U.S. Environmental Protection Agency
Contract No. 68-01-0790, Sept. 1973.
TABLE 12
VARIATION OF REVENUE-TO-COST RATIO
WITH MILEAGE FOR NATURAL, SYNTHETIC,
SCRAP, AND RECLAIMED RUBBER*
Ratio of revenue to variable cost
Mileage
250
500
750
1,000
1,250
1,500
1,750
2,000
Natural and
synthetic
1.92
1.96
2.04
2.08
2.10
2.15
2.72
2.25
Scrap
1.41
1.60
1.85
Reclaimed
3.33
2.89
2.60
-
-
-
*Source: Moshman Associates, Inc. An analysis of
transportation rates and costs for selected virgin and second-
ary commodities. U.S. Environmental Protection Agency
Contract No. 68-01-0790, Sept. 1973.
For aluminum, Table 13 shows that the virgin
aluminum ingot has a higher revenue-to-cost ratio
than aluminum scrap.
The results of this analysis do not indicate a
consistent pattern of all freight rate discrimination
against all secondary materials. Some secondary
materials bear a larger portion of railroad operating
costs than their virgin material counterparts, and
some secondary materials bear a smaller portion of
these costs. There is evidence that the rate structure
potentially discriminates against scrap iron relative to
iron ore, against cullet relative to glass sand, and
TABLE 13
VARIATION OF REVENUE-TO-COST RATIO
WITH MILEAGE FOR ALUMINUM INGOTS
AND SCRAP*
Ratio of revenue to variable cost
mileage
250
500
750
1,000
1,250
1,500
1,750
2,000
2,250
2,500
Ingots
2.44
2.38
2.33
2.22
2.17
2.13
2.08
2.04
2.00
1.92
Scrap
1.82
1.72
1.67
1.60
1.53
1.47
1.43
1.39
1.33
1.29
*Source: Moshman Associates, Inc. An analysis of
transportation rates and costs for selected virgin and second-
ary commodities. U.S. Environmental Protection Agency
Contract No. 68-01-0790, Sept. 1973.
against reclaimed rubber relative to other rubber
products.
Ocean Freight Rates
Ocean carriers that serve U.S. ports may form
shipping conferences and agree on rates for various
commodities. These rates must always be filed with
the Federal Maritime Commission.
Rates for a particular commodity may be either
closed or open. When rates are closed, all carriers in a
conference must charge the same rate for that
commodity. When rates are open, individual confer-
ence carriers may establish their own rates. The
rationale for open rates is to allow competition with
nonconference carrier traffic in a particular com-
modity.
An inequitable rate structure could result if the
rates are open for one material but closed for a
second competing material. For example, in a recent
order of investigation of rates for wastepaper and
wood pulp, the Federal Maritime Commission
observed that the rates on wood pulp were open,
allowing each conference member to set rates based
on its individual operating expenses.3 This permitted
wood pulp exporters to utilize the services of carriers
having the lowest rates at the time of shipment. On
the other hand, exporters of wastepaper were
-------
EXISTING FEDERAL POLICIES AND THEIR EFFECTS ON VIRGIN AND SECONDARY MATERIAL USE
23
required to contract exclusively with conference
carriers at fixed rates.
To eliminate discrimination, costs should be the
only basis for setting rates. Handling and haul costs
depend primarily upon the weight and volume of a
shipment. Table 14 presents data on rates charged on
containerized shipments of wood pulp and waste-
paper. If ship space were the only consideration, the
rates should be equal for containers of the same size.
Table 14 indicates that this is not the case-the rates
for containers of paper are higher than the rates for
equivalent-sized containers of wood pulp. Further-
more, because pulp is a denser material than waste-
paper, its containers should be charged a higher rate
from a weight standpoint. However, the data indicate
that the wastepaper rates are 16 to 19 percent higher
per container than for wood pulp. As a result, the
revenue per ton is 48 to 95 percent higher for
wastepaper. The above evidence is based on weight
and volume considerations only. There are other cost
factors that must be considered before it can be
determined whether an unfavorable rate structure
exists.
TABLE 14
COMPARATIVE OCEAN RATES FOR WOOD PULP
AND WASTEPAPER*
Material
Wood pulp
Tab cards
Wastepaper
Average
revenue
per 20-ft3
container
(dollars)
327
378
388
Average
weight
per 20-ft3
container
(short tons)
18
14
11
Average
revenue
(dollars/ton)
18.16
27.00
35.27
*Source: Order of Investigation, Pacific Westbound
Conference. Investigation of rates, rules, and practices per-
taining to the movement of wastepaper and wood pulp from
United States West Coast ports to ports in Japan. Docket
72-35. [Washington], Federal Maritime Commission, June
20, 1972.
The Effects of Freight Rates on Recycling
Even if the rates for virgin and secondary materials
were cost based and a rate increase was instituted, a
reduction in recycling could result. The size of the
reduction would depend on the elasticities of supply
and demand for the secondary material. If the rate
structure discriminated against secondary materials to
start with, an across-the-board percent rate increase
would further distort the situation.
To examine the effect of freight rates on recycling,
two issues will be considered: the competition
between secondary and virgin materials and the
proportion of transportation costs to the total cost of
using secondary materials. The first issue is directed
at assessing the degree to which displacement of
secondary materials by virgin materials can, in fact,
occur; while the second issue involves an estimation
of the sensitivity of secondary material consumption
to freight costs.
Competition between Secondary and Virgin Mate-
rials. It is very difficult to generalize about the
degree to which competition between secondary and
virgin materials exists, and the competition issue has
resulted in a major controversy in freight rate
hearings. For example, it can be argued that a steel
product made from scrap is technically and metallur-
gically equivalent to a product made from iron ore,
hence these two raw materials are functional substi-
tutes. On the other hand, it can be argued that raw
material purchase decisions are affected more by sunk
cost factors such as blast furnace and mine owner-
ships than by current material price and the use of
scrap in steelmaking has remained constant regardless
of the fluctuation in price.
EPA studies of the markets for secondary mate-
rials have discovered that two types of competition
may exist.4"6 First, there are certain situations in
which secondary and virgin materials openly compete
at the process level or in the final product market-
place. In these instances, a change in price of raw
material will result in a change in consumption. In
other words, freight rates can effect the short-term
marginal consumption of some secondary materials.
Second, long-range capital investment decisions (such
as to expand capacity by building basic oxygen or
scrap-intensive electric furnaces) are based, among
other factors, on the cost of obtaining raw materials.
In this regard, secondary and virgin materials can be
said to compete in the boardroom if not in the
marketplace.
Decisions concerning competition are critical in
the determination of discrimination, and it is the role
of the transportation regulatory agencies to decide,
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24
RESOURCE RECOVERY AND SOURCE REDUCTION
based on the facts presented in each case, whether a
true competitive relationship exists. (These considera-
tions provide only general guidelines for the decision
process.)
Freight Rates and the Total Cost of Using
Secondary Materials. Data showing rail freight rates
as a percent of the delivered price of various materials
are presented in Table 15. These results employ the
average freight rate and delivered cost data derived
for each of the commodities in the EPA study. Using
these figures, a rough indication of the sensitivity of
secondary material use to freight charges can be
obtained. For' secondary materials of lower value,
such as scrap iron,.wastepaper, glass cullet, and scrap
rubber, the freight rate is a substantial fraction of the
overall delivered cost. For these materials, a signifi-
cant adjustment of freight rates could cause a
significant price change; and, if the demand is elastic,
a corresponding change in consumption. These
materials would be affected most severely by a
discriminatory rate structure. For secondary materials
of higher value, such as aluminum and reclaimed
rubber, the freight rate is a smaller fraction of cost,
and consumption would be expected to be less
sensitive to freight charges.
Data showing ocean freight rates as a percent of
the price of wood pulp and wastepaper are shown in
Table 16. For lower grades of wastepaper (old
corrugated board), the freight rate is approximately
100 percent the material price at the shipper. For
higher grade tab cards, the freight rates are approxi-
mately 25 percent of this price. In these instances
freight costs are a very significant fraction of the
costs of using these materials. For wood pulp the
freight rate is a smaller fraction of the material price.
TABLE 16
COMPARISON OF OCEAN FREIGHT RATES WITH
MATERIAL PRICE FOR WOOD PULP AND
WASTEPAPER
Material
Wood pulp
Tab cards
Wastepaper (old
corrugated)
Average
freight
rate* .
(dollars/ton)
18.16
27.00
35.27
Material
pricet
(dollars/ton)
160-180
110
34-37
Freight rate
as a percent
of material
price
10-11
25
90-105
*Order of Investigation, Pacific Westbound Confer-
ence. Investigation of rates, rules, and practices pertaining to
the movement of wastepaper and wood pulp from United
States West Coast ports to ports in Japan. Docket 72-35.
[Washington], Federal Maritime Commission, June 20, 1972.
tAt the pulpmill or paper dealer; data obtained for
west coast prices in mid-1973 from the staff of Official Board
Markets, a trade publication for the paper and pulp industry.
Conclusions and Recommendations
There is evidence to indicate that the current
freight rates for some secondary materials are high
relative to competing virgin materials (rail rates for
scrap iron, glass cullet, and reclaimed rubber and
TABLE 15
RAIL FREIGHT RATES AS A PERCENT OF DELIVERED PRICE FOR VARIOUS MATERIALS, 1969*
Material
Iron ore
Scrap iron
Wood pulp
Wastepaper
Glass sand
Glass cullet
Aluminum ingot
Aluminum scrap
Natural and synthetic rubber
Reclaimed rubber
Scrap rubber
Average
delivered price
(dollars/ton)
13.94
25.12
128.00
19.17
10.86
20.00
540.00
285.80
554.83
224.00
14.00
Average
freight rate
(dollars/ton)
2.39
7.71
8.59
7.06
6.86
8.83
18.47
16.17
18.83
14.90
11.46
Freight rate
as a percent of
delivered price
17
31
7
37
63
44
3
6
3
7
78
*Source: Moshman Associates, Inc. An analysis of transportation rates and costs for selected virgin and secondary
commodities. U.S. Environmental Protection Agency Contract No. 68-01-0790, Sept. 1973.
-------
EXISTING FEDERAL POLICIES AND THEIR EFFECTS ON VIRGIN AND SECONDARY MATERIAL USE
25
ocean rates for wastepaper). Although it is difficult to
predict the degree to which a rate increase would
result in lower levels of recycling, freight rates
represent a substantial fraction of the cost of using
many secondary materials (scrap iron, wastepaper,
glass cullet, and scrap rubber). Although these
findings indicate a potential for freight rate discrimi-
nation against some secondary materials, they do not
prove discrimination from a legal point of view. This
would require evidence of a reduction in recycling
resulting from rate relationships. In addition, all
secondary materials have not yet been studied.
Therefore, it is recommended that the Interstate
Commerce Commission and the Federal Maritime
Commission, in consultation with the Environmental
Protection Agency, and other appropriate agencies,
conduct a thorough and complete study of rate-
setting practices for all secondary materials shipped
by rail and ocean carriers. The objective of this study
should be to determine the extent to which discrimi-
nation against secondary materials exists. The Inter-
state Commerce Commission has initiated such a
study.7 Furthermore, it is recommended that future
rate increases for secondary materials should only be
permitted if it is determined that such increases are
nondiscriminatory (i.e., that such increases are neces-
sary to offset increased cost of shipping the specific
commodities for which the increases are proposed).
At any proceeding before the transportation regula-
tory agencies in which rates are adjusted, a specific
finding should be required that such rates do not
discriminate against secondary materials.
FEDERAL PROCUREMENT OF PRODUCTS
CONTAINING RECYCLED MATERIALS
The Federal procurement process can play an
important role in bringing about increased utilization
of secondary material. In the past, Federal purchasing
regulations, not unlike such practices in the private
sector, have been discriminatory in requiring the use
of virgin materials when technically equivalent
secondary materials were available.
To evaluate the prospects for encouraging resource
recovery through Government purchase of products
containing recycled material, several issues will be
discussed: (1) the potential for Federal procurement
to develop market demand for recovered resources,
(2) previous attempts to incorporate recycled mate-
rials into federally purchased products and oppor-
tunities to expand these practices, (3) the barriers to
increased Federal procurement of waste-based
products and the problems of administering and
implementing such programs.
Federal Procurement as a Demand Creation
Mechanism
Of the $66 billion in direct Federal procurement
in 1970, $53.4 billion was defense and $12.6 billion
was nondefense related (Table 17). These expendi-
tures represent 3.12 and 0.74 percent of the gross
domestic output, respectively.* Table 18 presents the
procurement expenditures for various commodities as
a percent of the domestic output of that commodity.
TABLE 17
DIRECT FEDERAL PROCUREMENT EXPENDITURES,
1970*
Type of
expenditure
Defense
Nondefense
Total
Expenditure
Billions
of dollars
53.4
12.6
66.0
Percent
of gross
domestic
outputt
3.12
.74
3.86
*Source: Arthur D. Little, Inc. Study of Fedeiri
purchasing to reduce solid waste. U.S. Environmental Protec-
tion Agency Contract No. 68-03-0047, [1973]. (Ongoing
study.)
t$1.71 trillion in 1970.
Federal expenditures that represent a large percent
of the domestic market for a commodity fall mainly
in defense-related areas: ordnance, 75 percent; explo-
sives, 48 percent; aircraft, 41 percent; communication
equipment, 31 percent; ships, trains, trailers, and
cycles, 19 percent; nonferrous ore mining, 19 per-
cent; and industrial organic chemicals, 11 percent.
Many of these commodities represent special-purpose
equipment for which secondary material utilization
would not be suitable. In addition, it would be very
difficult to specify the secondary material content of
a multicomponent complex product such as an
airplane or motor vehicle.
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26
RESOURCE RECOVERY AND SOURCE REDUCTION
TABLE 18
DIRECT FEDERAL PROCUREMENT EXPENDITURES AS A PERCENT OF DOMESTIC
OUTPUT OF THAT COMMODITY, 1970*
Commodity
Ordnance
Explosives
Aircraft and parts
Communication equipment
Ships, trains, trailers, and cycles
Nonferrous ore mining
Industrial organic chemicals
Instruments and clocks
Electronic components
Office supplies
Engines and turbines
Maintenance construction .
Industrial gases
Batteries and X-ray and engineering electronic equipment
Office computing and accounting machines
Electric apparatus and motors
Optical and photographic equipment
General industrial machines and equipment
Materials and handling equipment
Industrial inorganic chemicals
Biological products
Petroleum refining
Gum and wood chemicals
Miscellaneous rubber products
Construction and mining machinery and equipment
Truck trailers
Household textiles and upholstery
Machine shops and miscellaneous machinery
Office furniture
Pharmaceutical preparations
Commercial printing
Motor vehicles and parts
Coal mining
Metalworking machinery and equipment
Chemical preparations
Tire and inner tubes
Cellulosic man-made fibers
Dairy products
Agricultural, forestry, and fishery products
Polishes and sanitation goods
Service industry machines
Fertilizers
Fiber cans
Wooden containers
Grain mill products
Inorganic pigments
Iron and ferro alloy ore mining
Sanitary paper products
Agricultural chemicals
Primary and secondary aluminum
Wood preserving and miscellaneous products
Miscellaneous plastic products
Structural metal products
Medicinals and botanicals
Noncellulosic organic fibers
Stampings, screws, machine products, and bolts
Meat packing
Hardware, plating, wire products, and valves
Special industrial machinery
Coated and converted paper
Papermill products
Defense
55.63
45.52
35.26
27.47
14.84
18.10
10.69
7.04
7.65
4.28
5.69
3.86
3.37
5.31
4.36
4.88
3.43
4.72
4.54
3.76
1.03
3.35
.03
3.35
2.74
2.40
1.96
2.00
.67
.98
2.69
1.57
1.42
1.22
1.40
1.42
1.38
.69
1.31
.87
1.08
.03
1.12
1.08
.08
.92
1.70
.34
.34
.63
.42
.53
.51
.58
.58
.44
.42
.38
.28
.32
.13
Nondefenset
19.39
2.32
5.26
3.96
4.06
.51
.52
2.28
1.17
3.57
.99
2.69
3.06
.82
1.67
.91
1.96
.41
.50
2.72
.31
3.58
.17
.18
.23
.06
1.26
.88
(-.85)
.16
.24
.40
.10
.08
.67
.01
.40
.09
1.09
.01
.87
(-.79)
.56
.39
.03
.23
.09
.09
.13
.14
.17
.27
.21
.40
Total
75.02
47.84
40.52
31.43
18.90
18.61
11.21
9.32
8.82
7.85
6sn
.68
6.55
6.43
6.13
6.03
5.79
5.39
5.13
5.04
3.76
3.75
3.66
3.61
3.52
2.92
2.40
2.19
2.06
1.93
1.86
1.84
1.73
1.66
1.62
1.50
1.50
1.38
1,36
1,32
1.27
1.17
1.12
1.12
1.09
.95
.92
.91
.90
.73
.66
.65
.62
.60
.58
.58
.57
.56
.55
.55
.53
.53
-------
EXISTING FEDERAL POLICIES AND THEIR EFFECTS ON VIRGIN AND SECONDARY MATERIAL USE
27
TABLE 18
DIRECT FEDERAL PROCUREMENT EXPENDITURES AS A PERCENT OF DOMESTIC
OUTPUT OF THAT COMMODITY, 1970-Concluded
Commodity
Defense
Nondefenset
Total
Plastics materials and resins
Soap and other detergents
Household furniture
Glass and glass products
Rubber footwear
Apparel
Farm machinery and equipment
Electric lighting and wiring equipment
Primary and secondary copper
Cyclic intermediates and crudes
Miscellaneous food products
Cardboard boxes
Rugs, tire cord, and miscellaneous textiles
Book printing and publishing
Synthetic rubber
Fabrics and yarn
Metal containers
Canned and frozen goods
Stone and clay products
Primary and secondary iron and steel
Bakery products
Household appliances
Corrugated and solid fiber boxes
Shoes and other leather products
Sugar
Beverages
Paints and allied products
Paperboard mill products
Stone and clay mining and quarrying
Miscellaneous manufactured products
Leather tanning
Chemical and fertilizer mineral mining
Confectionery and related products
Livestock
Newspapers
Periodicals
Sawmill and planning mill products
Toilet preparations
.51'
.42
.23
.28
.46
.26
.36
.37
.08
.35
.05
.23
.21
1.19
.31
.29
.29
.17
.34
.20
.13
.16
.12
.11
.09
.09
.08
.09
.42
.12
.06
.05
.03
.01
.01
-
"
_
.09
.27
.21
-
.17
.04
.02
.30
-
.30
.09
.11 .
(-.88)
-
.10
(-.07)
.01
.07
.04
.05
.02
.04
.03
.04
.03
(-.31)
(-.02)
.02
.01
.02
.02
.01
-
"
.51
.51
.50
.49
.46
.43
.40
.39
.38
.35
.35
.32
.32
.31
.31
.29
.29
.27
.27
.21
.20
.20
.17
.13
.13
.12
.12
.12
.11
.10
.08
.06
.05
.02
.02
.01
Negligible
~
*Source: Arthur D. Little, Inc. Study of Federal purchasing to reduce solid waste. U.S. Environmental Protection Agency
Contract No. 68-03-0047, [1973], (Ongoing study.)
^Negative numbers represent Federal subsidy.
As may be seen in Table 18, for many commod-
ities Federal expenditures are less than 2 percent of
domestic output. Included in this category are com-
modities that have a significant potential for
secondary material content: paper and paperboard
products, iron and steel, nonferrous metals, glass
products, plastics, and rubber products. It is apparent
that Federal purchases do not dominate the market
for these commodities. Although the Federal Govern-
ment is a large single consumer, Federal expenditures
only represent a small fraction of combined indus-
trial, commercial, and personal expenditures in these
areas.
The direct market creation effect of Federal
purchasing of waste-based products would probably
be small. However, Federal procurement specifica-
tions are widely circulated and duplicated by State
and local governments and some industries. If the
results of Government experience with secondary
material were publicized through a technical assist-
-------
28
RESOURCE RECOVERY AND SOURCE REDUCTION
ance and information program, more widespread
utilization of secondary material in other sectors
could result.
In Executive Order 11514, March 1970, the
President directed Federal agencies to "initiate
measures needed to direct their policies, plans, and
programs so as to meet national environmental
goals." This charge was reiterated by the President in
the 1971 environmental message, and the General
Services Administration was directed to institute a
program requiring a percent of recycled fibers in
purchased paper products. Other agencies have also
attempted to utilize various secondary materials.
General Services Administration Recycled Paper
Procurement Programs
In this program, paper procurement specifications
were adjusted to require various percents of recycled
fiber. The specifications are written in two parts. The
first part specifies the required percent of recycled
fiber from post-consumer waste sources (e.g., old
corrugated boxes, newspapers, magazines, mixed
wastepapers, and all fibrous materials recycled from
municipal solid waste). The second part of the
specification indicates the percent of secondary fiber
that may be derived from converting and fabrication
wastes (e.g., envelope cuttings, paper trimmings,
rejected paperstock, and other papermill and textile
mill wastes).
The required percents are set by taking into
consideration technical performance requirements,
availability of supply, and product price. No special
consideration is given to suppliers who can exceed the
required percents. Suppliers are required to certify
that the recycled fiber content of paper items sold to
the Government conform to these specifications.
The General Services Administration utilizes 144
different paper specifications. In fiscal 1972 it pur-
chased $88 million in paper products. To date 77
specifications, representing $56.6 million in
purchases, have been changed to require some percent
of reclaimed fibers. Table 19 summarizes the pur-
chases in various paper commodity areas along with
the ranges of post-consumer waste and other recycled
fibers.
Department of the Army Retread Tire Program
The Department of the Army has exercised a
program of retreading automobile and truck tires
TABLE 19
SUMMARY OF RECYCLED FIBERS REQUIRED
IN GENERAL SERVICES ADMINISTRATION
PROCUREMENTS, FISCAL 1972*
Purchases Reclaimed Post-consumer
Commodity ' (millions fibers waste fibers
of dollars) (percent) (percent)
Building materials
Office supplies
Packaging
Tissue
Total
0.2
17.5
19.5
19.4
56.6
40
15-100
3-100
20-95
30
0-75
0-90
5-35
*Source: Data provided by the General Services
Administration.
since World War II. This program was intensified in
1970 after issuance of Executive Order 11514. In
addition to reducing solid waste, retreading has
substantial cost advantages. For example, a 50-per-
cent cost saving can be achieved by retreading a tire
rather than purchasing a new replacement. The
Army's present goal is to retread 75 percent of the
tires it replaces. Table 20 shows that progress toward
the goal has been significant.
This practice could also be extended to other
agencies such as the Postal Service and the General
Services Administration, which also maintain motor
vehicle fleets, but tire safety and performance con-
siderations are major, issues preventing this more
widespread use of retreads.
TABLE 20
SUMMARY OF RETREADING PROGRAMS,
DEPARTMENT OF THE ARMY*
Period
Total tires Retreaded Retreads
replaced tires (percent)
July to December 1971
January to June 1972
July to December 1972
278,108
233,798
227,785
162,195
160,248
160,743
58
68
71
*Source: Data provided by Staff for Logistics, Mainte-
nance Engineering Branch, Department of the Army.
Joint Committee on Printing Use of Secondary
' Fibers in Printing and Publishing Papers
The Joint Committee On Printing is responsible for
specifications for all stationery, printing, and publish-
ing paper used by the Federal .Government. In
December 1972 EPA was granted permission by the
-------
EXISTING FEDERAL POLICIES AND THEIR EFFECTS ON VIRGIN AND SECONDARY MATERIAL USE
29
Joint Committee on Printing to use recycled paper
for internal bulletins, newsletters, and press releases
on an experimental basis. No minimum percent of
secondary fibers is specified, but the suppliers are
required to certify recycled fiber content. EPA
printing departments and the Government Printing
Office are evaluating this program, which if successful
may be extended to other agencies.
Barriers to Expanded Use of Recycled Materials
in Federal Purchases
It is apparent that although there have been major
inroads in a few areas, such as recycled paper use and
tire retreading, on the whole there has not been
widespread utilization of secondary materials in
products purchased by the Federal Government.
Uncertainty of supply, budgetary constraints, and
administrative and implementation problems appear
to be the major barriers to more extensive recycled
material procurement.
The basic mission of the Federal supply services is
to provide other Government agencies with the
materials and products that they need, when they are
needQd, at the lowest possible cost. Use of recycled
materials introduces technical and economic risk into
this process. There are two aspects to the uncertainty
of supply: uncertainty regarding the technical per-
formance of products supplied and uncertainty as to
the availability of secondary materials. Expanded tire
retreading is inhibited by the former aspect and the
General Services Administration recycled paper pro-
gram was constrained by the latter (whenever a
possibility of shortage occurred, the recycled fiber
requirement was reduced or eliminated).
Budgetary constraints arise from the fact that for
many products it is more expensive to use secondary
than virgin material. This is especially true for paper.
The cost difference is very significant for high-grade
paper such as printing paper and stationery; for lower
grade paperboards this cost constraint is not as severe.
In the General Services Administration paper
program, higher prices were not offered for products
containing higher percents of recycled fiber. Further-
more, if the price of a recycled product was found to
be unreasonably high relative to a virgin product
counterpart, the recycling percents were reduced.
Administrative and implementation problems arise
because of the need to revise procurement specifica-
tions and procedures and monitor and certify
recycled material levels.
Conclusions and Recommendations
Federal procurement in itself will not create a
significant new market demand for recycled material
but can serve a valuable function in helping to
establish the technical and economic factors of
recycled material use. Recycling considerations intro-
duce higher prices for purchased goods, uncertainty
of supply, and an additional new administrative
burden into the procurement process.
Therefore it is recommended that EPA, in con-
junction with the supply agencies, develop guidelines.
for the inclusion of secondary material to the
maximum extent practicable in products purchased
by the Federal Government. These guidelines should
consider level of recycled material content, costs, and
monitoring procedures.
In developing these guidelines, EPA in conjunction
with the procurement agencies should perform the
studies necessary to establish (1) criteria for selecting
materials and products to be considered in this
program, (2) technical and economic limitation of
recycled material use in various products, (3) present
and future sources of secondary material supply.
TAX BENEFITS FOR VIRGIN MATERIALS
Various provisions of the Federal tax code result
in benefits to the virgin material production sectors
of the economy as opposed to the secondary material
sector. In this section those tax benefits available to
the virgin mineral and paper industries are identified
and defined, preliminary quantitative estimates of the
dollar size of the benefits are provided, and the
purpose and rationale for these special tax provisions
are analyzed. The objective of this discussion is to
attempt to evaluate the degree to which these tax
provisions influence the use of virgin rather than
secondary materials.
The tax code provides a number of ways to deduct
the cost of doing business from sales. All such
provisions (such as accelerated depreciation, invest-
ment tax credits, and deduction of State and local
taxes) that apply equally to both the virgin and
secondary material industries are not considered in
this report. Only those tax provisions that are
available only to virgin material industries and, in
effect, subsidize virgin material use, are analyzed.
-------
30
RESOURCE RECOVERY AND SOURCE REDUCTION
Definitions of Tax Benefits for the
Virgin Material Industries
^ Depletion Allowance. The depletion allowance is
a tax deduction based on the depletion of a mineral
deposit. There are two methods for calculating
depletion allowance: the percentage method and the
cost method. Each year the method providing the
larger deduction is used. As will be explained, the tax
benefit is the excess of the percentage depletion
allowance above the cost depletion allowance.
Cost depletion provides for the recovery of the
investment required to exploit a mineral deposit. If
10 percent of a mineral deposit is extracted in 1 year,
10 percent of the costs of acquiring that deposit can
be deducted from gross income. This type of deple-
tion is not considered to be a special benefit. It is
analogous to the deduction of other costs of doing
business such as the depreciation of the plant and
equipment. The cost depletion allowance takes into
account the exhaustion of a stock of capital, just as
depreciation accounts for the predictable replacement
of capital because of wear and tear and obsolescence.
Unlike cost depletion, the percentage depletion
allowance bears no relationship to the cost of
acquisition of a property. In fact, using the percentage
depletion formula, the cumulative annual deduction
from income can eventually exceed the original cost.
The percentage depletion allowance is calculated by
taking a fixed percentage (e.g., 22 percent for
petroleum) of the gross income generated by the
property. The percentage depletion allowance is
limited by the fact that it cannot exceed 50 percent
of the taxable income in any year. Even so, the
percentage depletion allowance is in many cases much
greater than the cost depletion allowance. Therefore,
the percentage depletion allowance provides a tax
benefit for the virgin mineral industries that has no
analogous counterpart in other areas of industry or
commerce. The actual benefit provided by the
percentage depletion allowance is the amount of the
deduction taken by the mineral industries above that
allowed by the cost depletion method.
Expensing of Capital Expenditures. For most
capital assets, costs required to develop, improve, or
otherwise increase the value of the asset cannot be
deducted from income in the year that they are
incurred but must be capitalized instead (i.e., added
to the cost of the asset and recovered over time
through depreciation or depletion). However, the
mineral industries are allowed to deduct from current
income exploration and development costs that occur -
before a mine reaches the production stage. The
timber industry is allowed to deduct from current
income costs for pruning, thinning, and shaping of
trees as well as disease control expenditures. The
effect of this provision is to advance the timing of
recovery of these costs and provide a benefit equiv-
alent to the time value of the funds recovered.
Capital Cains Treatment. For most corporations,
property held and then sold in the ordinary course of
doing business is subject to ordinary income taxes at
the time of sale at the maximum rate of 48 percent.
But the income received from the sale of timber is
subject instead to capital gains tax treatment. This
special allowance for the sale of timber reduces tax
payments from the ordinary 48 percent rate to the 30
percent capital gains tax rate.
In the case of coal and domestic iron ore, if after
disposing of a commodity an economic interest is
retained and royalties are received, such royalties are
also eligible for capital gains treatment.
Foreign Tax Allowances. There are several special
tax provisions available to U.S. firms with foreign-
based operations. Because many U.S. firms in the
virgin material business own foreign holdings, these
provisions provide a benefit not available to domestic
secondary material firms. Four foreign tax benefits
have been identified: the foreign tax credit, the
exclusion for less-developed country corporations,
the exclusion for controlled foreign subsidiaries, and
the Western Hemisphere trade corporation deduction.
Foreign Tax Credit. Firms operating outside the
United States can deduct foreign taxes directly from
their U.S. tax liability. This differs from treatment
for other taxes (State and local), which are deducted
from gross income. The tax credit provision results in
a tax deduction twice as large as that which would
occur if foreign taxes were deducted from gross
income (for firms in the 48-percent tax bracket). The
foreign tax credit is available to U.S. timber and
mining firms operating in foreign nations.
Exclusion for Less-Developed Country Corpora-
tions. For virgin material firms operating in coun-
tries defined by the President as "less developed,"
-------
EXISTING FEDERAL POLICIES AND THEIR EFFECTS ON VIRGIN AND SECONDARY MATERIAL USE
31
there is an alternative method allowed for deter-
mining the amount of foreign tax credits available to
offset U.S. taxes that increases the value of the tax
credit to the U.S. firm.
Exclusion for Controlled Foreign Subsidi-
aries. For certain firms that do not repatriate foreign
earnings, a deferral of U.S. taxes is allowed.
Western Hemisphere Trade Corporation. For
firms operating within the Western Hemisphere, there
is a method of calculating U.S. tax owed that reduces
the taxes payable by about one-third.
Quantitative Estimates of Tax Benefits
An estimate of the magnitude of the tax payments
saved by the virgin material industries because of
special tax provisions was made using tax data
available from various public sources. The analysis
was restricted to virgin materials which compete with
material that could be recycled from post-consumer
solid waste. An estimate of the tax benefits was made
for the following virgin materials: timber (as virgin
wood pulp could be displaced by post-consumer
wastepaper); oil, gas, and coal (as the use of these
fuels could be displaced by energy recovery from
post-consumer solid waste); iron ore (which could be
displaced by steel from obsolete automobiles or metal
cans); primary aluminum (which could be displaced
by aluminum from discarded beverage containers and
other packaging); and glass sand (which could be
displaced by post-consumer cullet).
This analysis was limited by the way in which
available public tax data are collected and organized.
Data are normally collected by corporation and
aggregated by industry. However, for purposes of this
analysis it was necessary to develop estimates on a
material by material basis. As an example of the
problems encountered, it was found that only one-
fifth of the depletion allowance statistics are reported
as accruing to the mining and timber industries; the
remaining four-fifths are reported as accruing to other
industries in the economy. Because these tax provi-
sions are only applicable to the mineral and timber
industries, it is obvious that many firms performing
mining and forestry activities are classified in the tax
statistics as being predominantly involved in other
production areas. Therefore, various assumptions had
to be made to estimate the distribution of the
aggregated tax benefits across the individual material
areas.
Because of the assumptions necessary in this
analysis, the following results should be viewed only
as preliminary order-of-magnitude estimates. A more
thorough analysis is currently underway using
unpublished tax data obtained from industrial
sources.9
The results shown in Tables 21 to 29 indicate that
the capital gains treatment in the timber industry and
the percentage depletion allowance in the mineral
industries are the most important tax benefits.
The results for timber show an average combined
benefit of $0.90 per ton of paper (Table 21). No
estimate was made for the additional tax savings due
to the expensing of certain capital items because data
were not available.
TABLE 21
ESTIMATES OF TAX BENEFITS FOR PAPER*
PRODUCTION FROM VIRGIN MATERIALS,
1970
Type
Capital gains treat-
ment
Foreign tax credit
Total
Value for
timber
(millions
of dollars)
T130.0
*9.8
139.8
Value for
Unit
(dollars/ton)
0.836
0.063
.899
paper
Total
(millions
of dollars)
35.10
2.65
37.75
*27 percent of all wood goes to paper production; 42
million tons of paper were produced from wood pulp in
1970.
tU.S. Congress. Joint Economic Committee. The
economics of Federal subsidy programs. Part 1. General
study papers. Washington, U.S. Government Printing Office,
May 8, 1972. p.76.
tEPA analysis of data from Internal Revenue Service.
Statistics of income, 1970. Corporation income tax returns.
Washington, U.S. Government Printing Office, 1973.
The combined savings for petroleum, $0.35 per
barrel, and natural gas, $0.022 per 1,000 cubic feet,
are shown in Table 22. In both cases the depletion
allowance is of primary importance; the foreign tax
credit is the next most important.
The results for iron ore, coal, bauxite, and sand are
shown in Tables 23 to 26. Aluminum, mined as
bauxite, receives a substantial foreign tax credit
-------
32
RESOURCE RECOVERY AND SOURCE REDUCTION
TABLE 22
ESTIMATES OF TAX BENEFITS FOR PETROLEUM
AND NATURAL GAS, 1970
Value
Type (millions
of dollars)
TABLE 23
ESTIMATES OF TAX BENEFITS FOR
IRON ORE, 1970
Depletion allowance*
Foreign tax credit*
Intangible expensest
Exclusion for controlled foreign
subsidiariest
Exclusion for less-developed country
corporations^
Western Hemisphere trade corporation
deductiont
Total
1,063
500
184
36
12
5
11,800
*EPA analysis of data from Internal Revenue Service.
Statistics of Income, 1970. Corporation income tax returns.
Washington, U.S. Government Printing Office, 1973.
tEPA analysis of data from U.S. Congress. Joint
Economic Committee. The economics of Federal subsidy
programs. Part I. General study papers. Washington, U.S.
Government Printing Office, May 8, 1972. p.46.
tFor the petroleum industry the benefit is $0.35 per
barrel, for a total of $1,350 million; and for the natural gas
industry the benefit is $0.22 per 1,000 cubic feet, for a total
of $450 million. The total benefit was apportioned by the
quantity and value of the commodity at the wellhead:
petroleum, 75 percent; natural gas, 25 percent. U.S. Bureau
of Mines. 1969 Minerals yearbook, v.l. Washington, U.S.
Government Printing Office, 1970.
because most of the raw material is produced outside
the United States. The results for all commodities are
summarized in Table 27.
The maximum impact of virgin tax benefits on
material prices is shown in Table 28. This price effect
is shown related to virgin raw material prices and to
the prices of processed materials. At the raw material
stage this benefit is equivalent to between 6 and 26
percent of the selling price. At the processed material
stage the maximum price effect is equivalent to
between 1 and 15 percent of the price.
Table 29 shows a comparison of the tax benefits to
the difference in cost of using virgin versus secondary
materials. This cost differential is taken at a point in
production where virgin and secondary materials are
equivalent inputs to the production process. For the
cases shown in Table 29, use of virgin materials
always resulted in a lower cost than use of secondary
materials. As the data indicate in most cases, the tax
Unit value* Total value
TyPe (dollars/ton) <"f 'J^
v of dollars)
Depletion allowance t
Foreign tax creditt
Exploration and development
expensing t
Exclusion for controlled foreign
subsidiaries -f
Capital gains treatment t
Western Hemisphere trade
corporation deductiont
Exclusion for less-developed
country corporations*
Total
0.364
.229
.107
.016
.016
.011
.005
.748
47.00
29.60
13.80
2.11
2.00
1.43
.70
96.64
*U.S. Bureau of Mines. 1969 Minerals yearbook, v.l.
Washington, U.S. Government Printing Office, 1970.
tEPA analysis of data from Internal Revenue Service.
Statistics of income, 1970. Corporation income tax returns.
Washington, U.S. Government Printing Office, 1973.
tEPA analysis of data from U.S. Congress. Joint
Economic Committee. The economics of Federal subsidy
programs. Part 1. General study papers. Washington, U.S.
Government Printing Office, May 8, 1972. p.46.
TABLE 24
ESTIMATES OF TAX BENEFITS FOR COAL,
1970
Unit value* Total value
Type .... /,_. (millions
(dollars/ton) - ...
v of dollars)
Depletion allowance t
Exploration and development
expensing t
Foreign tax creditt
Capital gains treatment t
Exclusion of controlled foreign
subsidiaries t
Exclusion for less-developed
country corporations*
Total
0.072
.053
.011
.005
.0008
.0002
.142
41.00
30.20
6.00
3.00
0.43
0.14
80.77
*U.S. Bureau of Mines. 1969 Minerals yearbook, v.l.
Washington, U.S. Government Printing Office, 1970.
tEPA analysis of data from Internal Revenue Service.
Statistics of income, 1970. Corporation income tax returns.
Washington, U.S. Government Printing Office, 1973.
tEPA analysis of data from U.S. Congress.. Joint
Economic Committee. The economics of Federal subsidy
programs. Part 1. General study papers. Washington, U.S.
Government Printing Office, May 8, 1972. p.46.
benefits for virgin materials represent a significant
fraction of the cost differential.
-------
EXISTING FEDERAL POLICIES AND THEIR EFFECTS ON VIRGIN AND SECONDARY MATERIAL USE
33
TABLE 25
ESTIMATES OF TAX BENEFITS FOR BAUXITE
(USED FOR ALUMINUM), 1970
Unit value* T°taJ,value
TyPe (dollars/ton)
-------
34
RESOURCE RECOVERY AND SOURCE REDUCTION
TABLE 28
COMPARISON OF VIRGIN MATERIAL TAX BENEFITS AND PRICES
(1)
Product
Timber (used for
paper)
Petroleum
Natural gas
Bauxite (used for
aluminum)
Sand (used for
glass)
Iron ore
Coal
(2)
Tax saving per unit
of production
$0.899 per ton
$0.350 per barrel
$0.022 per 1,000ft3
$1.496 per ton
$0.082 per ton
$0.748 per ton
$0.142 per ton
(3)
Maximum material
price effect of
tax saving*
$1.80 per ton
$0.70 per barrel
$0.044 per 1,000ft3
$3.00 per ton
$0.15 per ton
$1.50 per ton
$0.28 per ton
(4)
Raw material
price (1969-70)
$9.00 per ton
stumpage
$3.90 per barrel
crude oil at
the wellhead
$0.167 per 1,000
ft3 gas at the
wellhead
$14.00 per ton
bauxite
$2.38 per ton at
quarry
$10.84 per ton
at mine
$5.00 per ton at
mine
(5)
(3) * (4)
0.20
.23
.26
.21
.07
.14 ]
.06 J
(6)
Processed
material pricet
(1969-70)
$130.00 per ton
dry pulpt
$4.62 per barrel,
No. 2 fuel oil §
$0.551 per 1,000
ft3 , delivered
to consumer §
$544.00 per ton
aluminum H
$20.00 per ton
molten glass**
1 $41. 00 per ton
molten pig
irontt
(7)
(3)-r(6)
0.01
.15
.08
.04
.01
.06
*Assuming entire saving is reflected in material price and firm is in the 48-percent income tax bracket.
tMost probable point of competition between virgin and secondary materials.
tThe demand and price of timber 1971-1972. Official Board Markets, 1970.
§U.S. Bureau of Mines. 1969 Minerals yearbook, v.l. Washington, U.S. Government Printing Office, 1970.
11 Approximately 8 tons of bauxite are required for 1 ton of aluminum. U.S. Bureau of Mines. Mineral facts and problems.
Washington, U.S. Department of the Interior, 1970.
**Darnay, A., and W. E. Franklin. Salvage markets for materials in solid wastes. Washington, U.S. Government Printing
Office, 1972, 187 p.
ttApproximately 1.6 tons of iron ore and 0.85 ton of coal are required for 1 ton of molten pig iron. Molten pig iron price
from Midwest Research Institute. Economic studies in support of policy formation on resource recovery. Unpublished report to the
Council on Environmental Quality, 1972,
tax subsidies were eliminated, it is necessary to
establish the elasticities of supply and demand for all
the major materials under consideration. This infor-
mation currently does not exist.
While all these factors are significant and introduce
considerable uncertainty into predicting what would
happen if these tax provisions were eliminated, the
fact remains that the virgin material production
sector enjoys a significant benefit of over $2 billion
annually. The value of the benefits for steel, paper,
aluminum, and glass alone amount roughly to $150
million a year not counting the benefit value asso-
ciated with the energy products necessary to produce
these materials. No equivalent tax benefit is provided
to industry to support secondary material processing.
The Rationale for Virgin Material Tax Benefits
Special tax provisions for virgin material industries
result in a reallocation of resources in a manner
different from that which normal market forces
would allow. Such a reallocation might be desirable in
situations where the free market operation would not
lead to overall public benefit or economic efficiency
(e.g., for national defense purposes, in instances where
substantial risks skew resources away from critical
areas, or where there are external costs or external
benefits that are not being realized).
Minerals Industry. Tax benefits for exploration
and development are aimed at reducing the risk of
discovering and developing additional resources, and
assuring adequate virgin material supplies. The deple-
tion allowance enables additional investment by
providing a fast return on capital. The foreign tax
allowances facilitate foreign investment and enable
firms to acquire resources outside the United States.
However, as these measures either increase profits or
reduce material prices, and result in increased produc-
-------
EXISTING FEDERAL POLICIES AND THEIR EFFECTS ON VIRGIN AND SECONDARY MATERIAL USE
35
TABLE 29
COMPARISON OF VIRGIN MATERIAL TAX BENEFITS WITH VIRGIN AND SECONDARY MATERIAL
PRODUCT COST DIFFERENTIAL
Product cost*
Product
Glass
Steel (molten pig iron)t
Paper :§
Linerboard (100 percent virgin fiber compared
with 25 percent secondary paper)
Corrugating medium [85 percent virgin (semi-
chemical) compared with 35 percent
secondary (semichemical)]
Combination boxboard:
100 percent virgin (kraft) compared with
100 percent secondary (newsback)
100 percent virgin (kraft) compared with
100 percent secondary (whiteback)
Printing and writing paper (100 percent virgin
compared with 100 percent secondary)
Using virgin
material
(dollars/ton)
18.50
40.50
78.50
79.50
152.50
152.50
92.00
Using
secondary
material
(dollars/ton)
1 16.00-20.50
43.00
81.00
82.00
155.50
174.50
99.00
Cost
differential
in favor of
virgin material
-1.50-2.00
2.50
2.50
2.50
3.00
22.00
7.00
Tax benefit
as a percent of
virgin and second-
ary material cost
differential
0-8
106
72
72
60
8
26
*Cost at the point in processing where virgin and secondary materials are equivalent inputs. Midwest Research Institute.
Economic studies in support of policy formation on resource recovery. Unpublished report to the Council on Environmental
Quality, 1972.
tCost data modified by EPA analysis of current technology and expected transportation distances.
tlron ore and coal benefits only. (Benefits to limestone, which is also required to produce steel, are excluded.)
§Cost data modified from Franklin, W. E. Paper recycling; the art of the possible. Washington, American Paper Institute,
1973.
tion and consumption of materials, material reserves
could tend to be depleted at a faster rate. Further-
more, by enabling virgin material prices to be
maintained at an artificially low level, the develop-
ment of alternative domestic sources of material and
energy could be inhibited (e.g., recycling and energy
recovery from post-consumer waste). Therefore, there
is some question as to whether these measures lead to
conservative use of resources.
There has been one major attempt to estimate the
impact of the depletion allowance and exploration
and development benefits on the petroleum
industry.' ° This study found that elimination of the
percentage depletion allowance would result in a
long-run decline in oil reserves of about 3 percent,
and the removal of the exploration and development
expensing provision would result in an additional
decline in reserves of about 4 percent. This indicates
that in this industry the Federal Government is
forgoing tax receipts of about $1.6 billion to
maintain reserves that are valued at approximately
$150 million.
Timber Industry. Before 1944, capital gains treat-
ment was only allowed when all timber in a stand was
cut and sold. Continuous production of timber sold
in the ordinary course of business and timber from
property held as a capital asset (e.g., a forest owned
by a sawmill) was taxed at the normal rate. The
rationale for making capital gains treatment available
to all types of forestry was that tax pressures to
liquidate timber holdings would be reduced and
conservative forestry practices such as sustained yield
forestry (e.g., growing trees on a particular property
at the same rate as they are cut) would not be
inhibited. However, a similar argument could have
been made for elimination of capital gains treatment
altogether. The real question is whether the timber
industry would practice optimum forest development
in the absence of special tax provisions. If capital
gains treatment results in lower timber prices and
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36
RESOURCE RECOVERY AND SOURCE REDUCTION
increased wood pulp consumption, a more rapid
depletion of forest resources might result. In addi-
tion, development of alternative (e.g., wastepaper)
supplies might be retarded.
It should also be noted that capital gains treatment
is allowed for timber harvested from leased Govern-
ment lands. In this instance, there is no pressure to
liquidate holdings as a capital investment by the
industries not involved.
In addition to the question of whether virgin
material tax benefits lead to a conservative use of
resources, there is the question of whether the tax
code is the most cost-efficient mechanism for pro-
viding benefits. The U.S. Department of Treasury has
expressed concern over the use of the tax system for
subsidy purposes.
The main objective of the tax system is to raise revenue for
governmental expenditures. Any additional uses should be
few in number and should be selected only after the most
stringent evaluation. Otherwise, the tax system could become
so extensive and so complex that taxpayers would be unduly
burdened with complex rules and the administrative machin-
ery would be extended to many times that at present. If we
use tax credits too lavishly, we could be building a bigger and
bigger tax administration to collect less and less revenue.1'
Conclusions and Recommendations
Special tax provisions that are available to the
virgin material industry provide substantial benefits
to this industry. When expressed on a per ton basis,
the benefits are equivalent to a significant fraction of
the price of virgin raw materials and are an even larger
fraction of the difference in cost of using virgin versus
secondary materials.
Although it is difficult to estimate the quantitative
impact of these measures on material use, they
certainly provide opportunity for and encourage
expansion and investment in the virgin material
sector. To the degree that they are reflected in
reduced virgin material prices, they could result in
overconsumption of virgin resources and act to
inhibit the utilization of materials derived from
secondary sources.
A basic dilemma arises when one considers modifi-
cation or removal of these special tax provisions. The
long-term effect might be the conservation of natural
resources by reducing virgin material consumption
and encouraging the development of materials from
secondary sources. However, if in the short term
virgin material supply activities are curtailed, there
could be serious dislocations and shortages.
Many of these tax provisions were instituted in the
past (e.g., the percentage depletion allowance was-
enacted in 1926) when national emphasis was on
industrial development through exploitation of raw
material supplies. In light of the current national
goals of resource conservation, it is recommended
that consideration be given to reevaluation of these
tax provisions.
REFERENCES
1. An estimation of the distribution of the rail revenue
contribution by commodity group and type of rail
car, 1969. Washington, Office of the Secretary,
U.S. Department of Transportation, Jan. 1973.
2. Moshman Associates, Inc. An analysis of transportation
rates and costs for selected virgin and secondary
commodities. U.S. Environmental Protection
Agency Contract No. 68-01-0790, Sept. 1973.
3. Order of Investigation, Pacific Westbound Conference.
Investigation of rates, rules, and practices per-
taining to the movement of wastepaper and wood
pulp from United States west coast ports to ports
in Japan. Docket 72-35. [Washington], Federal
Maritime Commission, June 20, 1972.
4. Darnay, A., and W. E. Franklin. Salvage, markets for
materials in solid wastes. Washington, U.S. Govern-
ment Printing Office, 1972. 187 p.
5. Regan, W. J., R. W. James, and T. J. McLeer. Identifica-
tion of opportunities for increased recycling of
ferrous solid waste. Washington, U.S. Environ-
mental Protection Agency, 1972. 391 p. (Distrib-
uted by National Technical Information Service,
Springfield, Va., as PB 213 577.)
6. Battelle Memorial Institute. A study to identify oppor-
tunities for increased solid waste utilization, v.l.
General report. Book 2, v.2-7. Aluminum report,
copper report, lead report, zinc report, nickel and
stainless steel report, and precious metals report.
Book 3, v.8-9. Paper report and textile report.
[Washington], U.S. Environmental Protection
Agency, 1972. (Distributed by National Technical
Information Service, Springfield, Va., as PB 212
729 to PB 212 731.)
7. Interstate Commerce Commission. Investigation of rail-
road freight rate structure. Ex Parte No. 270.
(Unpublished data.)
8. Arthur D. Little, Inc. Study of Federal purchasing to
reduce solid waste. U.S. Environmental Protection
Agency Contract No. 68-03-0047, [1973].
(Ongoing study.)
9. Booz-Allen Hamilton, Inc. The effect of the depletion
allowance and other tax incentives on selected
virgin and secondary materials. U.S. Environmental
Protection Agency Contract No. 68-01-0792,
[1973]. (Ongoing study.)
10. U.S. Treasury Department. Tax reform studies and
proposals. Part 3. Joint publication of the Com-
mittee on Ways and Means, House of Representa-
tives, and the Committee on Finance, U.S. Senate.
Washington, U.S. Government Printing Office, Feb.
5, 1969. p.425 and 428.
11. Bailey, M. J., Deputy Assistant Secretary of the Treasury
for Tax Policy. Statement before the U.S. Senate
Committee on Commerce, Subcommittee on Envi-
ronment, July 26, 1973. (To be published as part
of the Committee Hearings.)
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Chapter 3
RECOVERY OF RESOURCES FROM
POST-CONSUMER SOLID WASTE
Since the time of preparation of EPA's First
Annual Report to Congress on Resource Recovery,
the Agency's analyses of various major resource
recovery subjects have made considerable progress,
and activities related to recovery by Government at
all levels, industry, and the public have intensified.
Today the key resource recovery issues are much
better understood than a year ago, and some impor-
tant trends have been identified.
In this chapter an update on resource recovery is
presented, including a discussion of major trends and
the results of EPA analyses. The focus of the chapter
is on the recovery and recycling of materials usually
found in post-consumer waste.
Discussion of resource recovery requires clear
definition of the recoverable components of post-
consumer waste. The waste composition discussed
earlier in this report is instructive in pointing out the
value recovery potentials.
Food and yard wastes and other miscellaneous
combustibles such as plastics, rubber, wood, and
textiles comprise 41 percent of solid waste: Because
of the basic nature, form, or concentration of these
wastes, conversion to energy is the most practical
recovery alternative. A second alternative for most of
these materials is composting; but compost markets
are extremely limited, whereas energy demand is
rising dramatically.
Metal and glass constitute 19 percent of the waste
stream. Recovery of these materials can be accom-
plished in any instance where mixed waste is proc-
essed, regardless of the utilization of the remaining
fraction. The type of waste processing that normally
precedes .energy recovery (shredding and air classifi-
cation) usually provides' an opportunity for recovery
of metal and glass.
Paper constitutes 37 percent of solid waste, and it
is estimated that 30 percent of the paper in solid
waste could be recovered as a fiber source through
separation at the source and separate collection.
Energy recovery from the remaining 70 percent of
this waste is the most feasible recovery option at this
time, although as much as half of this paper could
technically be recovered as fiber through mechanical
separation. The value of paper as a fiber is three to
four times its value as an energy source. Furthermore,
recycled paper can be recovered at a later time as
energy. Thus its resource value is maximized when
paper is recovered as a fiber. .
These conditions suggest the following strategy for
value recovery from post-consumer solid waste: (1)
source separation of certain paper grades and separate
collection for recycling as a fiber source, (2) central-
ized processing of the noncombustible fractions for
recovery of metals and glass, (3) conversion of the
remaining combustible fractions to energy or
recovery of fiber through mechanical separation if
economically feasible.
this recovery strategy will provide the maximum
practical recovery of value from mixed waste. The
following section of this chapter discusses energy
recovery from post-consumer solid waste and is
followed by sections that discuss the recycling of
specific materials in the waste stream.
ENERGY RECOVERY
Emergence of Energy Recovery Technology
Historical Perspective. The present might well be
described as a turning point for energy recovery from
solid. waste. Until recently, steam recovery coupled
with waste incineration was the only energy recovery
technology available. The characteristics of steam
37
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38
RESOURCE RECOVERY AND SOURCE REDUCTION
recovery were not particularly attractive and rela-
tively few cities installed these systems. There are 12
such incinerators known to be in existence at present,
four of which are newer systems. Three new plants
are under construction or in final planning stages. The
fact that steam recovery is as costly as conventional
incineration and, in addition, involves finding markets
for the steam has undoubtedly curtailed interest in it.
Steam is a relatively difficult product to market
because it requires the existence of both a distribu-
tion system (steam pipelines) and steam users in
proximity to the generating facility. There are also
institutional problems associated with municipalities
obtaining purchase agreements with private steam
users who are accustomed to dealing with established
utilities. Steam generated in the existing incinerator
facilities has, in fact, not been sold but has been used
by the generating municipality for heating buildings
or for other purposes.
New Developments. A number of new techno-
logical developments have been underway over the
past few years that are now becoming available as
full-scale systems and that are greatly expanding the
opportunities for energy recovery from mixed mu-
nicipal waste. These systems have generally been
developed by firms in private industry as new
business ventures. Monsanto, Union Carbide, Devco,
Garrett Research and Development (a division of
Occidental Petroleum), Hercules, Black-Clawson,
Horner-Schiffrin, and Combustion Equipment Asso-
ciates have been some of the most active firms.
The major new systems that have been developed
include the following (a more detailed description of
each is presented in Appendix A):
(1) Shredded waste as a fuel. In this system refuse
is shredded and separated into basic light and heavy
fractions. The light fraction can then be used as a fuel
substitute in utility and industrial furnaces.
(2) Pulped waste as a fuel. This entails wet
pulping of refuse followed by a basic separation of
organic and inorganic fractions. The entire organic
fraction can then be burned or a portion of it can be
recovered as fiber.
(3) Pyrolysis to produce oil or gas. Pyrolysis is
chemical decomposition of waste in a high tempera-
ture and low oxygen atmosphere. Proper control of
the operating conditions and further processing of the
products of decomposition produce either oils
(roughly equivalent to No. 6 fuel oil) or gases that
can be used as fuel substances. Processing of the
waste to remove inorganics generally occurs prior to
pyrolysis.
(4) Pyrolysis for steam generation. In this process
waste is pyrolyzed, and the pyrolysis gases are burned
in an afterburner and used to generate steam. Prior
separation of the waste is not required. This option
has the same steam marketing problems associated
with heat recovering incinerators.
(5) Incineration with electricity generation. This
system involves use of gases from high-pressure
incineration to drive a gas turbine electric generator.
Although these systems were developed in
response to perceived market demand; the Federal
Government assumed much of the risk for initial
full-scale operation of the most fully developed
systems by providing funds for demonstration. EPA's
six major resource recovery demonstration projects
are summarized in Table 30.
Economics. The ultimate attractiveness of these
systems to municipalities, assuming the technology
proves feasible and reliable, will depend on the net
cost of the systems compared with conventional
disposal by landfill or incineration. Estimates of
incineration costs vary widely from as low as $7 per
ton to as high as $25 per ton. Landfill costs generally
average $2 per ton to $4 per ton but can be $5 per
ton or higher in particular locations. Landfill costs as
high as $17 per ton have occurred in areas where land
space is scarce.
The current indications are that energy recovery
systems are more economical than incineration and in
many instances are competitive with landfill.
Potential Market for Energy Recovery Systems
Maximum Potential Energy Recovery. The an-
nual energy producing potential of post-consumer
waste from all standard metropolitan statistical areas
(SMSA's) in the United States (which contain about
70 percent of the total population) has been esti-
mated to be approximately one quadrillion
(IX 10'5) British thermal units.1 This is roughly 1.5
percent of the Nation's 1970 energy consumption
and could be a very significant new source of power.
For comparison, this quantity of energy is equivalent
to between 400,000 and 500,000 barrels of oil per
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RECOVERY OF RESOURCES FROM POST-CONSUMER SOLID WASTE
39
TABLE 30
FEDERAL RESOURCE RECOVERY DEMONSTRATION PROJECTS
Location
Process type
Demonstration Projected projected
Resources recovered system size °^ ..I. C net cost
(tons/day) Jj (dollars/ton)
St. Louis, Mo.
Wilmington, Del.
Franklin, Ohio
San Diego County, Calif.
Baltimore, Md.
Lowell, Mass.
Shredded waste as a fuel
Shredding for fuel recovery
and materials separation
Wet pulping for recovery
Pyrolysis to produce fuel
oil
Pyrolysis for steam
generation
Incinerator residue
separation
Shredded combustible waste,
ferrous metals
Humus, humus as fuel,
ferrous metals, alumi-
num, glass
Paper fiber, ferrous metals,
glass, aluminum
Oil, ferrous metals, glass
Steam, ferrous metals, glassy
aggregate
Ferrous metals, glass, alumi-
num, copper/zinc,
aggregate
650 *2.40
500 11.20
150 t8.30
200 2.75
1,000 15.37
250 1.74
4.00
15.24
8.60
5.92
6.15
(*)
*720-ton-per-day plant.
t500-ton-per-day plant.
t Prof it of $0.40 per ton is obtained with a system for separation of incinerator residue only. (Incinerator costs are not included.)
TABLE 31
POTENTIAL FOR RESOURCE RECOVERY PLANT INSTALLATION*
Item
Population of the United States'!"
SMSA's with sufficient population to generate 500
tons/day of refuse: §
Number
Percent of population living in these SMSA's
Cities with sufficient population to generate 500
tons/day of refuse: »
Number
Percent of population living in these cities
1970
£208,212,000
125
62
56
20
1975
216,553,000
148
63
61
21
1980
232,966,000
169
64
80
23
1985
251,271,000
192
66
99
24
*Source: EPA estimates based on data in U.S. Bureau of the Census. 1970 Census of Population. 2 v. Washington, U.S.
Government Printing Office, 1972.
+ Based on a growth rate of 1.25 percent per year.
t-U.S. Department of Commerce Bureau of the Census' Series E population projections.
& An annual increase in per capita waste generation of 3 percent per year was assumed, beginning with 4 pounds per person
per day in 1970. Population increase is assumed to be l'/2 percent per year.
^lAn annual increase in per capita waste generation of 3 percent per year was assumed, beginning with 4 pounds per person
per day in 1970. Population increase is assumed to be 1 percent per year.
day and could have supplied the entire energy needs
of the Nation for residential and commercial lighting
in 1970.
"the potential for installation of energy recovery
plants is limited by the population size required to
support plants of economical scale. Although smaller
plants may be feasible in some instances, a 500-ton-
per-day plant is a reasonably efficient plant scale. At
a waste generation rate of 4 pounds per person per
day, a plant of this size would require a population
center of 250,000 people. Table 31 summarizes the
number of cities and SMSA's that could support a
plant of this scale projected through 1985.
These data show that 125 SMSA's could have
supported a 500-ton-per-day plant in 1970, and that
this number will expand to more than 190 by 1985.
This represents 62 and 66 percent of the total U.S.
population in those years, respectively.
Practical Potential Energy Recovery. A best esti-
mate for total plant potential by 1985 would have to
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40
RESOURCE RECOVERY AND SOURCE REDUCTION
take into account certain practical factors that would
limit potential plant construction. For example, the
large number of political jurisdictions in SMSA's
would require cooperative agreements among these
governing units for utilizing these plants. Such agree-
ments have not been easily developed in the past.
A more reasonable population base, from a feasi-
bility standpoint, would be the single jurisdiction city
population, which would yield a population base
one-third the size of the SMSA base (i.e., about 20
percent of the U.S. population). Logically, the most
reasonable potential for plant construction lies some-
where between that represented by central cities and
that represented by SMSA's.
The second practical consideration is the type of
disposal presently utilized. Locations that can landfill
or dump waste at the lower cost range of $1 per ton
to $3 per ton are likely to continue this practice and
would not find resource recovery an attractive
option. Roughly 30 percent of the waste in cities is
now incinerated, and this could increase to nearly 50
percent by 1985. All waste incinerated could be
channeled to recovery plants.
If the plant potential due to political and jurisdic-
tional considerations is assumed to be midway
between that represented by the plant potential in
SMSA's and central cities, or 40 percent of the U.S.
population, and low-cost landfill is expected to be
available to 50 percent of this population, then 20
percent of the U.S. population could be expected to
find energy recovery an attractive solid waste manage-
ment option within the next 10 to 15 years. This
would require installation of capacity to recover 60
million tons of waste by 1985, the equivalent of 200
plants of 1,000-ton-per-day capacity.
Trends in Solid Waste Energy Recovery
Factors Encouraging Energy Recovery. The rising
cost and decreased availability of energy from con-
ventional sources will tend to make solid waste an
attractive alternative energy source. After a relatively
stable period from 1963 to 1968, the national average
price paid by steam/electric power plants for fuel has
increased dramatically. From 1968 to the third
quarter of 1972, the price of coal increased from
$0.25 to $0.37 per million British thermal units; oil
increased from $0.33 to $0.58 per million British
thermal units; and gas increased from $0.25 to $0.31
per million British thermal units.2"' In the past year
additional increases have occurred, particularly in
natural gas prices.
Energy cost increases are expected to continue.
Some industries are concerned about being able to
obtain sufficient future quantities of energy at almost
any price. The impact of these energy cost increases
on attractiveness of energy recovery could be signifi-
cant. If it is assumed that a doubling of the price of
conventional fuels will also mean a doubling of the
value of waste as a fuel, the net cost per ton of
pyrolysis to produce oil would be cut in half. In the
case of shredded waste as a fuel, the potential fuel
cost saving to utilities would double from $4.20 per
ton of waste used to $8.40 per ton of waste used and
would permit the utilities to double their payments
for the waste fuel.
Costs for conventional waste disposal are also
expected to rise and make energy recovery more
attractive as a waste management option. Accurate
data on trends in waste disposal costs are not
available; however, decreasing land availability for
close-in landfills should tend to push cities toward
more costly disposal methods, such as incineration
and landfill in remote distant locations. More
vigorous regulations of land disposal should take
place as a result of Federal and State efforts, thus
raising the costs of disposal. Standards for air
emissions have already increased the cost of conven-
tional incineration.
Another force acting to enhance the viability of
resource recovery is public opinion. In many urban
areas, a public sensitized to the availability of this
ecologically acceptable option may refuse to support
new municipal solid waste ventures unless resource
recovery is a major component of the proposed
solution.
In summary, it appears that future market pres-
sures in terms of increasing costs of energy and waste
disposal will tend to stimulate increased interest in
resource recovery alternatives. However, the rate of
resource recovery system implementation will depend
on the degree of success in overcoming various
institutional barriers to implementation at the State
and local levels.
Present Activity by Cities and States. New devel-
opments in technology combined with the emergence
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RECOVERY OF RESOURCES FROM POST-CONSUMER SOLID WASTE
41
of the external factors just discussed have resulted in
a number of initiatives at the State and local levels.
EPA is aware of at least 18 cities where energy
-recovery systems are under consideration, with three
facilities already under construction and several
others in late planning stages. At least 20 additional
cities are also known to be evaluating energy recovery
in a preliminary manner. State activities are also
playing an important role in the new activity. A
summary of activities in various States and cities
follows.
Connecticut. A detailed, comprehensive plan has
been developed that calls for statewide processing of
solid waste for use as a fuel substitute. The creation
of the Connecticut Resource Recovery Authority has
been approved by the State legislature. It is charged
with State plan implementation and has been given
$250 million bonding authority for facility construc-
tion. Ten separate facilities are to be constructed by
1985 to process 84 percent of the State's waste. The
first plant is to be operational by mid-1976.
Illinois. The State Solid Waste Office is staffing
up for a grant program of $2 million, part of a $175
million environmental bond issue for solid waste
planning and resource recovery demonstrations.
Minnesota. The State Solid Waste Division is
preparing regulations for a law effective March 1974
that levies a $0.15-per-cubic-yard tax on waste
disposed. Ninety percent of the revenue from this law
is to be spent on resource recovery planning and
facilities. It is expected that $3.5 million will be
collected annually.
New York. Grants totaling $175 million out of a
$1.1 billion environmental bond issue are to be given
to local communities for resource recovery facility
construction. The State legislature has already appro-
priated $62 million for resource recovery projects in
nine communities. Several other communities are
currently preparing' grant applications. Some systems
will be operational by late 1975 or early 1976.
Vermont. The State solid waste plan calls for
mandatory separation of wastes by the householder
for recycling and the construction of four regional
resource recovery facilities. The proposed legislation
to put this plan into effect failed to pass in 1973, but
it will be reintroduced this year. Chittenden County
is planning a pilot implementation of the proposed
plan that should be operational by 1976.
Wisconsin. The Governor's Recycling Task Force
has produced a State plan calling for a Solid Waste
Recycling Authority. Legislation to create such an
authority has been introduced. According to the plan,
regional recycling facilities will begin operation in
1976.
Bridgeport, Connecticut. This is the first com-
munity to build a resource recovery facility under the
Connecticut solid waste plan. Its facility is to produce
solid waste as a supplementary fuel for the Northeast
Utility boiler and should be operational by 1976.
Chicago, Illinois. Commonwealth Edison and the
city made a joint commitment in August 1973 to a
project to use shredded solid waste as supplementary
fuel in the Commonwealth Edison boiler.
Ames, Iowa. A consultants' report has recom-
mended shredded solid waste as a supplementary fuel
for the city's utility boiler. The city is preparing a
bond issue for financing. A system to provide
shredded solid waste as a fuel for the boiler should be
operational in late 1974.
New Orleans, Louisiana. An agreement has been
reached with National Center Resource Recovery,
Inc., to assist in the construction and operation of a
recovery system to shred wastes and extract ferrous
metals, aluminum, and glass for recycling.
Boston, Massachusetts. A contract award is to be
made in mid-1974 to a private contractor to finance,
design, construct, and operate a 1,200-ton-per-day (or
larger) waterwall incinerator to generate steam for
Boston Edison's utility steam distribution system.
Plans call for the facility to be operational in late
1976.
Brockton, Massachusetts. Combustion Equip-
ment Associates is to build an Eco-fuel (shredded
solid waste) production facility. Its output is to be
marketed locally.
Saugus, Massachusetts. Construction has begun
by RESCO, Inc., to build a 1,200-ton-per-day steam
generating incinerator. Steam is to be sold to the
General Electric Company plant in Lynn, Massachu-
setts, when operation begins in mid-1975.
Detroit, Michigan. A project has been proposed
to the City Council to build a 2,000-ton-per-day plant
to burn pulped solid waste to produce steam for
downtown heating and cooling.
-------
42
RESOURCE RECOVERY AND SOURCE REDUCTION
Albany, New York. A commitment has been
made to develop a system to use solid waste as a fuel
supplement. Market study is underway to determine
potential users of the solid waste fuel supplement.
Candidate markets are Niagara Mohawk, General
Electric Company, and New York State government
office buildings. The system is to be operational by
1977.
Hempstead, New York. Bids are being solicited
on a 20-year contract to operate a facility for wet
pulping of solid waste to produce supplemental fuel.
Monroe County, New York. Plans are being made
for the design, construction, and operation of a
facility to provide shredded solid waste as fuel for the
Rochester Gas and Electric Company and to extract
paper for resale. The State has appropriated $9
million for a grant as its 50 percent share in the
project.
New York, New York. Engineering design is
underway to retrofit the Consolidated Edison boiler
to handle shredded solid waste as a fuel supplement.
A study is also being made of the feasibility of
designing a new boiler that will burn 50 percent solid
waste. The State has appropriated $21 million for a
grant as its 50 percent share in the project.
Akron, Ohio. The City Council has approved use
of revenue-sharing funds to conduct a detailed engi-
neering study for the development of a waterwall
incinerator with steam production for.the central
business district and B. F. Goodrich. Bids for major
equipment are due in June 1975.
Memphis, Tennessee. The city and the Tennessee
Valley Authority are planning to develop a
facility for wet pulping of solid waste to produce
supplemental fuel for the Tennessee Valley Authority
boiler. Financing is being sought by the city.
Nashville, Tennessee. A waterwall incinerator to
produce steam for downtown building heating and air
conditioning is under construction and should be
operational in summer of 1974.
Cowlitz County, Washington. The coufity in
cooperation with the Weyerhaeuser Company is
planning to build and operate a plant. to generate
steam from refuse and wood waste.
Grays Harbour County, Washington. Design is
underway to develop a facility to generate steam
from refuse and wood wastes.
South Charleston, West Virginia. A 200-ton-per-
day pyrolysis plant to produce fuel gas is being built
by Union Carbide.
While there has been increased interest in resource
recovery, the rate of projected plant installations over
the next few years is expected to be only a fraction
of the practical potential. Over the next 6 years, it is
projected that energy recovery will be implemented
in about 20 metropolitan areas. (Recovery of approxi-
mately 70 trillion British thermal units per year, or
the equivalent of twenty 1000-ton-per-day capacity
plants, is anticipated.)
The rate of progress is constrained by a series of
economic, marketing, management, legal, and organi-
zational barriers that inhibit implementation includ-
ing-
(1) Technical and economic uncertainty. Many
resource recovery systems have just recently been
developed, and there is a lack of comprehensive
economic and engineering data. System reliability is a
major concern to many potential users.
(2) Lack of management and operational exper-
tise at the local level. Resource recovery systems
require sophisticated technological expertise and spe-
cialized business talents that are generally not avail-
able in municipal governments. Most public works
operations employ simple technology and operate in
a protected business environment. Resource recovery
involves the marketing of products in a competitive
revenue producing business and requires flexibility to
respond to changing market conditions. Many munici-
palities cannot provide this orientation and flexibility
and are further constrained by civil service personnel
requirements and municipal budgeting processes.
(3) Uncertain return on investment. Many of the
factors mentioned above could be reduced if the
private sector was involved in construction and
ownership of recovery plants. However, the potential
return on investment to private industry must be high
enough to compensate for the risks associated with
these new and untried business ventures.
Federal Stimulation of Energy Recovery
Energy recovery is emerging as a low-cost method
for achieving large-scale value recovery from solid
waste in the next 5 to 10 years. It is thus extremely
important that the energy recovery activities and
-------
RECOVERY OF RESOURCES FROM POST-CONSUMER SOLID WASTE
43
initiatives that are developing be encouraged, sus-
tained, and accelerated. The basic options for pro-
viding stimulation are technical assistance; research,
.development, and demonstration; and fiscal incen-
tives.
Technical Assistance. The need for the provision
of Federal technical assistance/technology transfer
and aid in the resolution of marketing and institu-
tional problems is well established. At present the
Federal Government is the focal point of information
on technology, economics, markets, and institutional
aspects of recovery system implementation although
the capabilities of States and the consulting com-
munity are rapidly growing. EPA, through its demon-
stration programs; its evaluations and analysis of
systems and markets; and its many contacts with
States, cities, and industry, is ideally suited to be a
"third party" to transfer know-how and to ensure
efficient and rapid implementation of recovery
systems on a national basis.
Especially today, with growing interest in resource
recovery and rapidly emerging technology, some
information is inaccurate and misleading. Systems,
economics, market situations, financing, and other
aspects of implementation are in some cases repre-
sented in ways that are either too optimistic or too
pessimistic. Because of the proprietary nature of a
number of systems, potential buyers often have no
objective third party to turn to for advice on the
feasibility and desirability of specific systems.
Perhaps most important at this early stage in
energy recovery is that implementation of energy
recovery systems typically will require fairly complex
institutional arrangements combining one or several
communities (to obtain large-scale economies), State
agencies, systems developers, and utilities or other
fuel buyers; a public utility commission; and buyers
for metals and minerals. Direct Federal involvement
in the largest and most promising of such ventures
can frequently help ensure that a project will move
forward rather than stagnate in jurisdictional or other
disputes.
EPA has an active technical assistance program in
this area to spur the adoption of energy recovery
systems in the near future.
Research, Development, and Demonstra-
tion. Research and development activity in resource
recovery has been carried out predominately by
private corporations at their own initiative and with
corporate funds. EPA has also participated in research
and development through the use of contracts and
grants. The best-known example of Federal research
and development in this area is the development of
the CPU-400, a fluid bed incinerator generating
high-pressure gases to be used for driving a turbine,
which in turn would drive a generator to produce
electricity (under contract to the Combustion Power
Company).
In light of strong private sector activity in this
area-exemplified by the work of Monsanto, Garrett
Research, Union Carbide, and others-there does not
appear to be need at this time for Federal research
and development aimed at new system development,
particularly in the area of pilot plant scale develop-
ment efforts. On the other hand, Federal research and
development aimed at product improvement, environ-
mental testing of systems, development and evalua-
tion of new concepts, technology assessment, and the
completion of already committed development effort
is needed to support the general thrust to improve
today's technical tools and to enlarge the number of
resource recovery options available.
The program of Federal demonstration of new
technologies at full scale has already yielded prom-
ising results and should continue to provide useful
results. Most of the current interest in energy
recovery stems directly from EPA demonstrations,
especially the dry fuel preparation system in St.
Louis.
Risks are usually associated with enlarging pilot-
sized systems to full scale. Whether the benefits are
worth the costs to an entity partially influences
whether the demonstration is undertaken and who
does it. In many, but not all, cases, the benefits to one
local government acting alone may not be worth the
risks. States may not have much more incentive when
benefits may accrue not only to their own communi-
ties but also to others in the country. Corporations
are most likely to carry the risk if they can benefit
from successful demonstrations by States in many
parts of the Nation. The risks can be reduced for
individual communities, States, and companies by
Federal assumption of some of the costs.
-------
44
RESOURCE RECOVERY AND SOURCE REDUCTION
Although at present most technical options are in
demonstration stages, and a high level of additional
expenditure on additional demonstrations is neither
necessary nor justifiable, EPA's demonstration effort
in municipal waste recovery should and is being
continued on an "as-needed" basis.
Fiscal Incentives. The need for Federal fiscal
stimulation of energy recovery is far less clear. One
basis for fiscal stimulation would be to provide
capital that would otherwise not be available. A study
recently completed for EPA found that the present
capital markets are capable of supplying municipal
capital needs for all types of solid waste expendi-
tures.4 The study notes, however, that some methods
of acquiring capital are not well understood by many
officials. In addition to the traditional general obliga-
tion and revenue bonds, the study lists bank loans,
leasing, and private financing as alternative methods.
Also, special organizations can be established to raise
capital, such as public authorities, public/private
corporations, and multicommunity cooperatives.
Private financing may be particularly attractive to
municipalities. Several companies that have developed
resource recovery systems can be expected to build
the plants with their own capital and then operate the
facilities for a fixed fee. Such offers have already
been made by some systems developers in several
instances, and others are known to be studying this
approach. Many cities are more willing to accept such
agreements because it not only relieves them of the
responsibility for raising capital but also puts them a
step away from the waste disposal obligation. One
impediment to this approach is the inability of many
cities to draw up long-term service contracts because
their contracting authority extends only to the
elective term of their officers. However, as such
financing is offered, statutory change is likely to
remove this barrier. In New York State, where such a
package is contemplated by the city of Hempstead,
the State law has been changed to allow communities
to enter into long-term contracts.
States will also be able to increase municipal
capital availability by using a variety of methods to
obtain capital, which will then be channeled to
municipalities. The funding programs of New York,
Connecticut, and Minnesota are examples that may
be followed by other States as well.
A second justification would be to improve the
economics of the systems so that they become'
attractive relative to conventional disposal options.
However, several of the systems already offer net
costs lower than those for disposal. Trends in energy
and disposal costs will tend to make energy recovery
systems even more attractive in the future.
A third purpose of a Federal fiscal incentive could
be to focus attention on the development of energy
and material recovery from solid waste. In this regard,
an incentive should be viewed more as a symbol of
Federal leadership and direction rather than as a
subsidy of plant costs or construction. Such a
measure could be used in connection with a technical
assistance program aimed at overcoming institutional
barriers and could be tailored to stimulate increased
private sector involvement in resource recovery imple-
mentation.
Future consideration of fiscal incentives will
depend on whether the projected trends toward
energy recovery develop as projected and at the
projected rate and whether such fiscal incentives, on
the whole, are socially desirable.
The basic Federal requirement at present is to
monitor the emerging trend; to use technical assist-
ance and other efforts to actively promote accelera-
tion of this trend; and to determine, after additional
experience has been gained, whether the additional
benefits to be gained by society by further accelera-
tion of this trend through fiscal stimulus would
justify the cost involved.
As part of its general analytical effort in this area,
EPA has evaluated the probable cost and recycling
impact of three types of incentives for fiscal stimula-
tion. The incentives evaluated were (1) construction
grants-direct payments to municipalities covering a
portion of the capital cost of recovery facilities; (2)
loans-direct low-interest Federal loans or loan
interest payments to the public or private sector to
finance recovery facilities; (3) operating subsidies-
cash payments to the owner or operator of a recovery
facility equal to a percent of the market value (sale
price) of plant outputs or," alternatively, equal to a
fixed amount per unit quantity of output.
Data relating to the costs and potential effective-
ness of three measures are presented in Tables 32 and
33. The measures are a 75-percent construction grant
-------
RECOVERY OF RESOURCES FROM POST-CONSUMER SOLID WASTE
45
TABLE 32
IMPACT OF SELECTED INCENTIVES ON THE ECONOMICS OF MUNICIPALLY OWNED
RESOURCE RECOVERY PLANTS*
Net plant cost (dollars/ton)
Type of incentive
None
75-percent construction grant
75-percent loan interest subsidy
30-percent cash subsidy
Fuel
recovery
2.70
1.46
2.09
1.78
Materials
recovery
4.77
2.86
3.84
3.45
Pyrolysis
5.42
3.40
4.42
3.76
Incineration
with residue
recovery
7.18
5.33
6.33
6.64
Incineration
with steam
recovery
7.05
5.15
6.12
6.05
Incineration
with
electricity
recovery
8.97
5.95
7.75
6.99
*Source: EPA calculation based on data in Midwest Research Institute. Resource recovery; the state of technology.
Washington, U.S. Government Printing Office, Feb. 1973.
program, a payment of 75 percent of the interest (at
a 5-percent interest rate) on loans taken to build
recovery facilities (equaling a direct loan at 1.25
percent interest), and a 30-percent cash subsidy based
on the sale price of materials to be sold from resource
recovery facilities. The impact of the three incentives
on the net costs of operating six types of facilities is
shown in Table 32. An estimate of the effectiveness
and costs of the three measures is presented in Table
33.
Conclusions and Recommendations
Technology for energy recovery has emerged and
appears to be a promising alternative to conventional
disposal-lower in cost in many large urban areas
while also providing important energy and material
resources to the economy.
State and local activity has increased and includes
active planning and implementation of systems with
State and private capital funding support.
Solid waste material occurring in urban areas
(SMSA's), and hence readily available for recovery,
could satisfy roughly 1 percent of the Nation's energy
requirements, a significant proportion considering
that waste is a new fuel source.
The Federal role assumed in the past 3 years
appears to be well suited to the implementation of
resource recovery from urban wastes. A strong,
active, and expanded technical assistance/technology
transfer effort is seen as essential. A research and
development and demonstration effort,, aimed primar-
ily at product improvement and incremental system
improvements, is also needed.
PAPER RECYCLING
Sources and Uses of Recycled Paper
Paper recycling involves the collection of discarded
paper and its reuse as a fiber source by the paper
industry. Roughly 40 percent of the paper recycled
today is referred to as "converting" waste and is
generated in industrial operations where paper and
paperboard are fabricated into products. The remain-
ing 60 percent of the paper recycled comes from
discarded post-consumer waste. Corrugated boxes,
mixed office and high-grade papers, and newspapers
account for roughly 35 percent, 35 percent, and 30
percent, respectively, of recovered post-consumer
waste. A large amount of Wastepaper is not recycled
and contributes to the Nation's solid waste problem.
Acquisition of Wastepaper. Post-consumer waste-
paper is recovered from solid waste in two ways:
salvage industry collections of old corrugated boxes
and office papers from industrial and commercial
establishments and municipal or private collection of
old newspapers from residences. Collection of this
source-segregated waste provides a clean, usable mate-
rial for the paper industry. Commercial and industrial
establishments, which would otherwise have to pay
for wastepaper removal and disposal, generally are
willing to separate paper from other materials in
exchange for free collection by the secondary mate-
rials industry.
Separation of newspapers by homeowners is
becoming more widely accepted, and there are more
than 90 cities with active programs. For newspaper
collection, cooperative action by city governments,
-------
TABLE 33
RECYCLING IMPACT OF SELECTED INCENTIVES TO MUNICIPALITIES FOR DEVELOPMENT AND OPERATION
OF RESOURCE RECOVERY PLANTS*
App
Type of incentive numb<
r con
1<
75-percent construc-
tion grant
75-percent loan
interest subsidy
30-percent cash
subsidy
roximate
structed, Heat
J76-85 content
(10"
Btu's)
80 592
55 410
65 485
Total recovery from constructed
plants,* 1976-85
Materials (106 tons)
Ferrous
metals
6.4
4.4
5.3
Total recovery over
the lifetime of _ . ,
, , + Total
the plantsl ,
Heat
MO1 2
Glass Paper Aluminum 1, ,
v Btu's)
4.4
3.0
3.6
3.9
2.8
3.2
0.31 1,813
.22 1,247
.26 1,453
(jove
Materials , .
(106 tons)
46
31
37
.1
.7
.4
cost to
'ederal
rnment
1 lions
ollars)
600
320
440
Federal cost
Windfall* of additional
(percent) recycling 8
(dollars/ ton)
44 2.
64 2.
54 2.
20
60
40
*This assumes a mix of the following 6 plant types: shredded refuse as a fuel, pyrolysis to produce oil, incineration with steam recovery, incineration with electricity
generation, incineration with residue recovery, and wet pulping for materials recovery. As presently envisioned, 4 of these plants recover energy, 4 recover ferrous metals, 3
recover glass, 3 recover aluminum, and 1 recovers paper. It is assumed that plant construction proceeds at a constant annual rate throughout the period.
tThe plants are assumed to have a 20-year life.
tThis example is based on the assumption that 35 plants would be constructed with or without the subsidies.
§This is the total cost to the Federal Government divided by the waste processed at all plants except the 35 that would have been constructed without incentives.
RESOURCE RECOVERY AND SOURCE REDUCTION
-------
RECOVERY OF RESOURCES FROM POST-CONSUMER SOLID WASTE
47
residents, and paper dealers is required. Cities
generally have been able to achieve separate collec-
tion without adding manpower or equipment to
collection services by using existing men and trucks
more efficiently. EPA has conducted a detailed study
of separate collection costs that is near completion/
Another potential method of paper recovery is by
mechanical processing of mixed municipal waste in
large recovery plants. Very little paper recovery
presently takes place using such systems. Both wet
and dry separation techniques are under develop-
ment. The Hydrasposal/Fibreclaim system, a wet
process designed by the Black-Clawson Company, is
presently being demonstrated in Franklin, Ohio, by
EPA. An experimental air separation system is under-
going testing by the Forest Products Laboratory.
Uses of Wastepaper. Recovered paper is con-
sumed by various segments of the paper industry for
use in manufacturing paper and paperboard products.
Table 34 contains a breakdown of wastepaper con-
sumption by various segments of the paper industry.
In general, wastepaper competes with virgin fiber
at the final product stage-products made from
wastepaper compete with similar products made from
virgin fiber. Some substitution of wastepaper occurs
in mills that use primarily virgin wood pulp and vice
versa. In general, however, mills built to use virgin
fiber consume virgin fiber for the bulk of their
outputs, and secondary mills consume wastepaper.
Status and Trends of Paper Recycling
Historical data show that domestic wastepaper
recycling as a percent of consumption has declined
steadily for a number of years, from 27.4 percent in
1950 to 17.7 percent in 1972. (See Table 35.) A
recent study conducted for the American Paper
Institute predicted that in the absence of Federal
policy intervention or significant changes in consumer
demand for products made from wastepaper, industry
fiber input from wastepaper would drop to even
lower levels than that of 1972.6 However, it now
appears that because of a combination of economic
factors, there may be an increase in wastepaper
demand in 1973. These factors include high demand
for paper products and associated full capacity
production by the paper industry; weather conditions
preventing normal logging operations; a rapid increase
in foreign demand for wastepaper exports from the
United States, related in turn to devaluation of the
U.S. dollar and foreign fiber shortages; and increasing
consumer pressure for recycling, reflected in part by
the wastepaper purchase specifications of the General
Services Administration.
A major unknown at this point is whether the
current high level of demand for wastepaper will
continue. If paper production, which has increased at
an annual rate of about 6 percent for the past year,
returns to its historical 3 to 4 percent growth,
pressures for increased use of wastepaper may
TABLE 34
WASTEPAPER UTILIZATION IN PAPER AND PAPERBOARD MANUFACTURE, 1970*
Total II Q
Type of waste consumed
T_l-l
Type of paper paper wastepaper
production consumption
Total for all grades and molded pulp
(103 tons)
Total paper (103 tons):
Newsprint
Printing, writing, and related
Tissue
Other
Total paperboard (103 tons):
Unbleached kraft and solid bleached
Semi chemical
Combination
Construction paper and board, molded
pulp, and other (103 tons)
Distribution (percent)
53,329
23,409
3,345
11,023
3,595
5,446
25,465
15,036
3,460
6,969
4,455
12,021
2,228
371
736
971
150
8,330
285
754
7,291
1,463
100.0
Mixed Corrugated P"lP ^stitutes
paper NewsPaPer paper and high-grade
deinked paper
2,639
33
-
-
7
26
1,766
48
42
1,676
840
22.0
2,235
455
371
-
76
8
1,473
8
28
1,437
307
18.6
4,080
108
-
-
69
39
3,779
162
622
2,995
193
33.9
3,067
1,632
-
736
819
77
1,312
67
62
1,183
123
25.5
*Source: Paper, paperboard, and woodpulp capacity, 1970-1973. Washington, American Paper Institute, 1971.
-------
48
RESOURCE RECOVERY AND SOURCE REDUCTION
TABLE 35
DOMESTIC PAPER CONSUMPTION AND RECYCLING*
Consumption Recycling Recycling
Year (10'toni) (10' tons) as a percent
of consumption
1950
1951
1952
1953
1954
1955
1956
1957
1958
1959
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972
29.0
30.6
29.0
31.4
31.4
34.7
36.5
35.3
35.1
38.7
39.1
40.3
42.2
43.7
46.4
49.1
52.7
51.9
55.1
58.5
57.8
59.1
63.8
8.0
9.9
7.9
8.5
7.9
9.0
8.8
8.5
8.7
9.4
9.0
9.0
9.1
9.6
9.5
10.2
10.6
9.9
10.2
10.9
10.6
11.0
11.3
27.4
29.7
27.2
27.2
25.0
26.0
24.2
24.1
24.7
24.3
23.1
22.4
21.5
22.0
20.5
20.8
20.0
19.4
18.5
18.6
18.3
18.6
17.7
*Source: U.S. Bureau of the Census.
decrease. Foreign wastepaper demand is likely to
continue at relatively high levels into the future but
may not grow as rapidly as in the past year. Exports
account for around 6 percent of wastepaper demand,
and high levels of export can have important impacts
oi) regional wastepaper supplies, especially on the
East and West Coasts. Purchase specifications such as
those of the General Services Administration, which
require inclusion of post-consumer wastepaper in
products, could have significant long-term impacts if
they are widely adopted by cities, States, and
industry. General Services Administration purchases
of paper products (mostly packaging) account for less
than 2 percent of total U.S. paper consumption and
quantitatively are not significant in themselves. How-
ever, they could have a significant indirect impact on
wastepaper consumption because General Services
Administration specifications are widely used by
others.
In the long term, demand for wastepaper will
depend to a large extent on the price and availability
of virgin wood pulp. Timber growth currently
exceeds removal on a national scale; in 1970, net
growth was 18.6 billion cubic feet against removals of
14.0 billion cubic feet. However, softwood timber"
removals, preferred for most uses of timber as well as
wood pulp, were only 1 billion cubic feet less than-
net annual growth (9.62 billion and 10.67 billion
cubic feet, respectively). Estimates by the U.S. Forest
Service and others indicate that in the future the gap
between timber growth and removals is likely to
narrow, increasing the pressure on timber supplies
and price.7'8
New trends in utilization of timber will also
influence pulp wood availability. The use of logs with
smaller diameters to make saw timber for lumber arid
plywood production decreases the availability of
wood for pulping (small diameter logs were formerly
used exclusively for pulpwood). There are also
indications that labor shortages and land protection
regulations may increase the cost of timber harvesting
and cause virgin fiber prices to rise.
Not all of these developments will translate
directly into increased wastepaper demand. Utiliza-
tion of residues from logging and lumber manufac-
turing is expected to increase. In 1970, almost
one-third of the 8.9 billion cubic feet of residues
generated were utilized in making pulp and related
products. Residue use is expected to reach 45 percent
of available tonnage by 1985.9
The net impact of these trends is difficult to
predict. However, even if there is'no shortage of
pulpwood supply in the near future, the cost of pulp
is likely to increase. It is likely that new trends on the
whole will make wastepaper a more attractive raw
material to the paper industry, and the long-term
decline in recycling relative to consumption might be
arrested. Some industry observers feel that a gradual
increase in wastepaper recycling is possible, but none.
of the indications points to an increase in recycling to
anywhere near the maximum potential level discussed
in the following sections.
Paper Recycling PotentiaJ
In 1970, wastepaper recycling of old newspaper,
corrugated paper, and office paper was 7.4 million
tons. (See Table 36.) An estimated 32 million tons of
these materials were discarded into the solid waste
stream in that year. As indicated in Table 36, an
additional 5 to 12 million tons could have been
collected in SMSA's in 1970 and would have in-
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RECOVERY OF RESOURCES FROM POST-CONSUMER SOLID WASTE
49
TABLE 36
WASTEPAPER AVAILABILITY (RECOVERABLE GRADES), 1970*
Paper (106 tons)
Recoverable
Type of paper
Newspaper
Corrugated
Mixed and high grade
(primary office
papers)
Total
Consumed
9.8
13.3
11.1
34.2
Discarded to
waste stream
9.7
13.2
9.1
32.0
Recovered
2.2 (22.4 percent)
2.6 (20.0 percent)
2.6 (23.6 percent)
7.4
Generated
in SMSA's
.7.4
10.0
8.3
25.7
Maximum (75
percent of
that generated
in SMSA's)
5.5
7.5
6.2
19.2
Minimum (50
percent of
that generated
in SMSA's)
3.7
5.0
4.2
12.9
Additional
increment
recoverable
1.5-3.3
2.4-4.9
1.6-3.6
5.5-11.8
*Source: Franklin, W. E. Paper recycling; the art of the possible. Washington, American Paper Institute, 1973.
creased the recycling of these materials by 65 to 160
percent.
An estimated additional 15 million tons of other
paper, primarily packaging materials, were also dis-
carded into the waste stream in 1970. These materials
are difficult to collect for recycling into other paper
products and are generally discarded in combination
with other materials in the mixed municipal waste
stream. As was indicated in previous sections, conver-
sion to energy is currently the most economical way
of recovering value from discarded paper that cannot
be separately collected for recycling.
Barriers to Increased Paper Recycling
Increased wastepaper recycling is inhibited by a
number of factors including consumer preference,
paper manufacturing economics, technology, and raw
material availability. Supply of wastepaper may be an
important constraint in the short term, but as was
indicated previously, there are sufficient quantities of
wastepaper available in the waste stream to increase
consumption significantly. The most important
barrier in the long run is the uncertain demand for
wastepaper, which is related to the economics of
paper and paperboard production.
Wastepaper Demand. Some of the more impor-
tant reasons why wastepaper demand has consistently
fallen short of available paper in waste are as follows:
(1) Customers have shown a preference for
products made from virgin fibers, usually because of
differences in appearance and quality; this has
resulted in loss of a market share by products made
from wastepaper and has necessitated sale of these
products at a discount. Today the market image of
wastepaper is changing, and public preference for
"ecology paper" is a factor in the current supply
shortage, especially for wastepaper grades acceptable
in writing and printing stocks.
(2) The paper industry is vertically integrated into
timber production and owns and manages forest
resources to provide long-term stability and certainty
of raw material supply. In comparison, a high degree
of risk is associated with wastepaper supply. A
company can seldom ensure ownership of wastepaper
resources as it can of forest stands.
(3) Large, concentrated sources of timber have
encouraged large production complexes with econ-
omies of scale located near forests, making wood-
pulp-based mills favored over smaller, less economical
wastepaper-based mills.
(4) Federal tax policy (in particular, the capital
gains treatment of timber) has encouraged the devel-
opment of long-range timber supplies and -the tech-
nology to use these supplies. There is no similar
policy to encourage development of wastepaper
supplies.
Most of these factors add up to economics that favor
use of virgin resources. Estimates have been made of
the comparative economies of wood pulp and waste-
paper use, based on average cost and price conditions
in 1971.10 These estimates, presented in Table 37,
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50
RESOURCE RECOVERY AND SOURCE REDUCTION
TABLE 37
COST BARRIERS TO INCREASED WASTEPAPER RECYCLING*
Mill
status
Wastepaper composition
(percent)
"Virgin" Increased
case recycling case
Linerboard
Corrugating medium
Folding boxboard
Printing and writing
Newsprint
Old
New
Old
New
Old
Old
Old
0
0
0
15
0
0
0
25
25
100
35
100
10
10
Cost differential in favor of virgin materialt
(dollars/ton of product)
Production pmflnrt vfllupt
(approximate)
2.50-6.75
2.50
(2.00)-1.00
(1.00)
3.00-22.00
(8.00)-15.00
(20.00)-(30.00)
0
0
4.50
5.50
9.00
0
10.00
Total
2.50-6.75
2.50
2.50-5.50
4.50
12.00-31.00
(8.00)-15.00
(10.00)-(20.00)
*Source: Franklin, W. E. Paper recycling; the art of the possible. Washington, American Paper Institute, 1973.
tparentheses indicate negative numbers.
t Approximate amount by which the market value of the product of virgin material exceeds that of the product of
wastepaper.
are useful as general indicators of the comparative
economics when conditions exist that are similar to
those assumed in the analysis. The present condition
of the paper industry deviates from these estimates: a
high level of demand exists for both wood pulp and
wastepaper, and the high market prices for paper
products alter this relationship. Although detailed
cost comparisons under present market conditions are
not available, it is believed that the cost penalty of
using wastepaper rather than wood pulp has
decreased.
Wastepaper Supply. An established supply system
for wastepaper exists-the wastepaper segment of the
secondary material industry, which supplies the major
portion of the wastepaper now recycled. The salvage
industry collects old corrugated and office papers
directly from commercial establishments and buys
newspapers from volunteer groups, schools, and cities
that collect them. Recently, the secondary material
industry has experienced difficulties in obtaining
wastepaper supplies to meet increased demand, and
wastepaper prices have risen rapidly. Although it is
believed that this is only a short-term situation, it
appears that there are significant institutional barriers
that impede the rapid increase of supplies. In addi-
tion, there is a lack of experience on the part of many
municipalities in designing and implementing news-
paper collection systems. (This inexperience some-
times includes the function of drafting appropriate
ordinances and contracts with buyers.) Many mu-
nicipal officials are wary of instituting ordinances
requiring residents to separate newspapers from other
waste and fear that demand will dry up, leaving them
with stacks of bundled newspapers and a dis-
appointed, irate public.
Possible increases in collection costs also deter
initiation of newspaper collection programs. How-
ever, several case studies conducted by EPA indicate
that by increasing the efficiency of existing municipal
collection systems (e.g., use of idle equipment and
full employment of underutilized workmen), a city
can generally collect newspaper with little or no
additional expenditure. The ultimate economies
depend on the type of collection system utilized, the
community's disposal cost, and the price received for
the wastepaper.
Fiscal Incentives for Increased Paper
Recycling
Fiscal incentives for paper recycling could take the
form of tax credits or subsidy payments for waste-
paper recycled or payments or credits (e.g., loans,
investment tax credits, or accelerated depreciation
allowances) for equipment used to recycle paper.
Estimates of increased paper recycling that could
result from the application of four types of incentives
have been developed. The incentives studied include a|
cash operating subsidy to wastepaper users equal to|
30 percent of the cost of acquisition of the waste-
paper, payment of 75 percent of the interest on loansa
for construction of new secondary papermills, al
25-percent investment tax credit for new secondary
mills, and a 5-year rapid amortization provision for
new mills. Results of the analysis are presented inp
Table 38.
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RECOVERY OF RESOURCES FROM POST-CONSUMER SOLID WASTE
51
TABLE 38
IMPACT OF SELECTED INCENTIVES FOR PAPER RECYCLING*
Incentive
30-percent operating subsidy
75-percent loan interest
payment
25-percent investment tax
credit
5-year rapid amortization
Additional
recycling,
1976-85
(10' tons)
43.7
29.4
23.0
11.9
Additional recycling
over life of equip-
ment^ (10" tons)
101
68
53
28
Total cost of
incentives
(millions
of dollars)
* 2,981
*734
305
4
Overall cost
to Federal
Government of
additional recycling
(dollars/ton)
14.75
5.40
5.75
2.90
Average
windfall
(percent)
74
68
61
79
*Source: Resource Planning Associates., Study of Federal subsidies to stimulate resource recovery. U.S. Environmental
Protection Agency Contract No. 68-03-0195, [1973]. (Ongoing study.)
tThe subsidy program is assumed to last for 10 years, from 1976 to 1985; and the equipment life is assumed to be 15 years.
The subsidy beyond 1985 is applied only to those obligations made during the 10-year program (i.e., it does not apply to
equipment purchased after 1985).
t Approximately half the cost of this subsidy would be recaptured in tax because this subsidy is treated as ordinary income.
The basis for this analysis was that all post-
consumer grades of wastepaper recycled would be
eligible for the incentives-ongoing recycling as well
as new recycling expressly induced by the incentive.
This provision gives rise to a "windfall" feature of
such a program-payments are made for some re-
cycling or investment that would take place with-
out the incentive. A base-line was constructed by
estimating for the period 1976-85 the level of
recycling that would take place without the incen-
tives, and this base-line recovery level corresponds to
a recycling rate of 18 percent of total paper
consumption.
Net increases in post-consumer paper recycling
above the base-line range from a high of 4.4 million
tons a year for the 30-percent operating incentive to
1.2 million tons a year for the 5-year amortization
measure. Federal expenditures per ton of new recy-
cling range from $14.75 to $2.90. The data indicate
that fiscal incentive measures applicable to all post-
consumer grades of paper are accompanied by a very
high windfall-equivalent to 60 to 80 percent of
program costs.
Conclusions and Recommendations
Paper recovery using separate collection tech-
niques is economically and technically feasible.
Recovery of paper by mechanical separation has been
demonstrated and is economically attractive when
alternative disposal costs are high.
At present, the United States is in a situation of
fiber shortage; the paper industry is operating at
capacity and straining; wastepaper and pulp prices are
up; foreign demand is up; and industry speaks of
supply shortages.
Given this situation, and the considerable uncer-
tainties associated with its probable duration, only a
limited number of conclusions can be drawn with
confidence. It appears clear that for the immediate
future, activities that increase the supply of waste-
paper from post-consumer sources are desirable. The
conclusions of EPA's studies are that wastepaper
supplies can be obtained to meet significant increases
in wastepaper demand, but such supply increases will
call for innovative action on the part of secondary
material dealers, communities, and paper users alike.
Federal actions in this area-in the form of technical
assistance services and planning assistance-appear to
be appropriate at this time. EPA has developed
extensive knowledge and data in this area as a
consequence of detailed contract investigations,
direct technical assistance work with communities,
and interaction with the principal wastepaper con-
suming corporations. In the coming year EPA will
undertake a technical assistance program to aid both
communities and industry in developing and market-
ing wastepaper and supplies.
Given currently strong demand, a fiscal incentive
program for paper recovery is not necessary at this
time. To a significant extent, the use of incentive
measures is predicated on the absence of demand for
wastepaper or very high risks associated with invest-
ments in new wastepaper processing facilities. Today
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52
RESOURCE RECOVERY AND SOURCE REDUCTION
conditions indicate that demand is strong and
growing, although there is no consensus in the field to
indicate that demand will continue at the current
rate.
Therefore, a fiscal incentive program for paper is
not recommended because the risks are too great that
public funds will be expended to support wastepaper
consumption that is expanding for other reasons.
However, there are considerable uncertainties in this
volatile market area, and this recommendation should
be reevaluated in coming months if new information
becomes available. In this regard EPA will continue to
actively monitor the wastepaper situation.
STEEL CAN RECYCLING
Statistical Overview
Ferrous materials constitute roughly 7 percent of
municipal solid waste (excluding automobiles) and
approximately 60 to 80 percent of this fraction is
steel cans. It is estimated that in 1972 approximately
5 million tons of cans entered the solid waste stream.
About 70 percent, or 3.5 million tons, were generated
in SMSA's, where recovery should be possible.1' The
current recovery of cans from municipal solid waste is
small. In 1972 approximately 70,000 tons of cans
were recycled; and of this, 50,000 tons were con-
sumed in one market, copper precipitation, which is
exclusive to the western United States.'2
Of major importance to can recycling is the fact
that the "steel" can is in reality a composite can
consisting of tin-plated steel (thus the term "tin" can)
and possibly lead, organic coatings, and aluminum.
More specifically, of the cans in solid waste, about 63
percent are tin-plated food and nonfood containers
that have lead-soldered side seams. The other 37
percent of the cans are beer and beverage cans,
three-quarters of which are also tin-plated and have
soldered seams. (Roughly 22 percent of steel beverage
containers are tinfree steel.) Most of the beer and
beverage cans have aluminum tops to allow use of the
easy-to-open pulltab. Taken as a composite, this can
fraction contains approximately 92 percent steel, 0.4
percent tin, 1.5 percent lead, 3.7 percent aluminum,
and 1.8 percent organic coatings.13 Nonferrous
residuals as high as these present serious metallurgical
problems for the steel industry and also for certain
other markets. This is the major reason can scrap is
often considered to be "bad scrap.-" However, for
some markets the residuals may be as valuable as the
steel. In particular, the small quantity of tin in the
3.5 million tons of cans available in SMSA's would be
worth almost $60 million, roughly one-half the total
value of the steel in the cans.
Markets for Post-Consumer Cans
There are three major potential markets for old
cans: the steel industry, the detinning industry, and
the copper precipitation industry. (The detinning
industry is really an intermediate processor,
extracting tin from the cans and selling the detinned
scrap to the steel industry.)
Steel Industry. Several steel mills have made
promising and energetic efforts toward can recycling
over the past 2 years. However, in 1972 the steel
industry only consumed an estimated 11,000 tons of
old cans.11 This is a small amount relative to that
industry's raw material inputs. Old cans have not
been considered a desirable raw material by the steel
industry in the past because of tin, aluminum, and
lead residuals. These contaminants can cause either
quality loss in the steel product and/or refractory
damage to the melting furnace.
For steelmaking, tin is probably the most serious
contaminant. Although specific estimates differ, it is
generally accepted that extremely small quantities of
tin on the order of 0.01 percent, 0.03 percent, and
0.05 percent should be the maximum quantity of tin
allowable in medium-grade steel, plate steel, and
reinforcing bars, respectively. Therefore, the maxi-
mum consumption of old cans by the steel industry
on a national basis would be between 1.5 and 7.2
million tons per year because the furnace charge
could contain only a small quantity of old cans.
However, suitable supply arrangements and logistics
would be required to achieve even this level of use.
Widespread acceptance and consumption of old can
scrap by the steel industry is possible but severely
limited by a host of problems. Consumption is
expected to grow, but at a very slow pace, over the
next 10 years.
This situation is completely changed if the cans
have first been processed through a detinning plant to
remove (and recover) the tin. Detinned can scrap is
readily marketed to the steel industry at or near the
price of No. 1 heavy melting scrap. !
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RECOVERY OF RESOURCES FROM POST-CONSUMER SOLID WASTE
53
Detinning Industry. Detinners chemically process
tin plate to remove and recover tin. Detinned ferrous
scrap is readily marketed to the steel industry. The
tin, valued at about $4,000 per ton. contributes
about one-third of the detinners' revenue, and the
steel scrap sold accounts for the other two-thirds.
The detinning industry is not large. Two
companies represent over 90 percent of the industry's
sales. The industry presently processes a negligible
quantity of post-consumer cans, obtaining most of its
raw materials from can manufacturing scrap. In 1971,
752,000 gross, fpns of tip pjate were processed,
essentially the same as iji 1950-'4
The reason that more old can scrap has not been
processed by detinners is largely because of contami-
nants. Entrapped organics, labels, paper, and plastics
are all troublesome, as is lead. Aluminum (from
bimetal cans) is by far the most serious contaminant
and is the major deterrent to use of old cans by
detinners. Aluminum can be removed by an addi-
tional processing step in the detinning qperation, but
it has been estimated that this would increase
processing costs roughly $10 to $15 per ton. Thus,
coping with the aluminum in cans is ultimately more
of an economic than a technological problem.
Despite this added cost, it appears that detinning
plants might still be able to expand capacity to
handle post-consumer cans if supplies could be made
available at $10 to $20 per ton, depending upon the
market price for No. 1 bundles. To date, supplies of
post-consumer cans have been difficult to obtain
from municipalities, which do not generally attempt
to recover and market these items.
It is also significant that Altering the design of cans
to eliminate the aluminum top would essentially
alleviate the problem of detinning post-consumer
cans. Chapter 4 presents 3 discussion of product
control measures pf this sort.
. Copper Precipitation. Copper precipitation
accounted for 50.0QO of tjie 70,000 tons of recycled
cans in 1972. Old cans represented approximately 10
percent of the 500,000 tons of scrap consumed by
the industry in 1972.'s This scrap was consumed in
facilities in Montana, Nevada, Arizona, Utah, and
New Mexico. These markets are obviously remote
from major centers of waste generation in the
midwestern and eastern United States. The market
for "precipitation iron," as jt is called by the
industry, is expected to nearly double over the next
15 years; but the use of old cans in this context will
be largely dependent upon getting supplies to these
markets. Although it is a desirable outlet for old cans,
copper precipitation js a very different form of can
recycling. The steel is not actually recovered but is
used in a chemical displacement reaction to precipi-
tate copper. The potential for increased old can
"recycling" in the copper industry is considered
good, but moving very slowly.
Based on a recent study cpnducted for EPA, a
subsidy of $6 per ton of post-consumer cans to the
steel, detinning, and copper precipitation industries
would result in a 9-million ton increase in the
recycling of cans from 1976 to 1985.l6 (Extending
the subsidy to the steel and copper precipitation
industries would be virtually ineffective compared to
its application to detinning and would have no
predictable cost-effective benefits.)
The cost of this subsidy to the Federal Govern-
ment would average about $6.5 million per year.
Windfall, based on present levels of post-consumer
can recycling, would be about 30 percent.
Supply of Post-Consumer Cans
Ferrous materials are relatively easy to extract
from waste because they can be separated magneti-
cally. However, there is presently very little post-
consumer can scrap being extracted from solid waste.
In 1972, the American Iron and Steel Institute
published a list of 17 cities magnetically separating
ferrous material. However, many of these installations
have not been successful, and many others are
operating far below capacity, largely because of
design problems. Shredding is required prior to
ferrous material extraction, but shredders were often
not properly designed for maximum efficiency, or the
ferrous material was shredded in such a configuration
that it was not acceptable for the local market. In
many cases the ferrous product was dirty or con-
taminated, and thus not marketable.
It appears that shredding of waste for ferrous
material extraction alone is not economical. At $20
per ton for cans and $12 for other miscellaneous
ferrous materials, revenue from ferrous material
extraction would total less than $1.25 per ton of
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54
RESOURCE RECOVERY AND SOURCE REDUCTION
refuse processed, hardly enough to cover shredding
costs in almost any size facility.
However, refuse shredding is often justified in
itself by virtue of densification for improved landfill
efficiency or increased freight payloads where
transfer stations are involved. In these instances, the
incremental costs of ferrous material extraction
should be easily covered by the revenues.
An excellent opportunity for ferrous material
extraction is to be found in energy recovery or other
types of comprehensive recovery facilities that are
emerging. In all instances, shredding of waste is
required; and in most of the energy recovery facil-
ities, organics must be separated from inorganics to
maximize burning efficiency. Ferrous material extrac-
tion is easily justified in these instances.
The fact that shredding is becoming more common
as an element of solid waste disposal or recovery will
lead to increasing potential opportunities for ferrous
material extraction. If the planned systems are
actually put into operation, there will be a marked
increase in can supplies, which could exceed demand.
This would occur if the cans were not properly
shredded and prepared to meet the needs of
particular markets, if markets for cans were not
stimulated to some degree, and if buyers and sellers
were not brought together. If demand did not rise to
meet supply, the long-run impact would be a
phasing-out of some can extraction operations.
Conclusions and Recommendations
The barriers to steel can recycling include both
demand and supply constraints. The technological
barriers to use of undetinned cans by the steel
industry are obvious and will undoubtedly work to
limit recycling through this channel even if price or
cost relationships are altered or more abundant
supplies are made available. Higher consumption in
copper precipitation is promising, but limited by the
location of the markets and the difficulty of trans-
porting supplies to those market areas.
Detinning offers potential for steel can recycling.
It upgrades the can scrap into a form of high-grade
steel scrap and recovers a valuable resource, tin,
which would otherwise be considered a contaminant.
Also, the economies of scale of detinning plants are
such that UHW small-scale plants could be built near
cities 01 resource recovery plants where cans are
generated.
Aluminum contamination is the major significant
economic barrier to detinning of old cans. However,
the present difficulty of obtaining reliable supplies is
also an important consideration. Major expansion of-
the detinning industry will probably require that the
economic burden of dealing with aluminum (or the
aluminum top itself) be reduced and that new
supplies of properly prepared scrap be made available.
Recommendations to stimulate steel can recovery,
to the extent appropriate, must obviously respond to
the barriers just discussed. One obvious need is to
ensure adequate supplies of properly extracted and
processed cans where markets exist. More and better
information is needed by municipalities on the
configuration and economics of optimum techniques
for recovering cans from the waste stream, the
necessary form and quality of the scrap to ensure its
suitability for available markets, and appropriate
means of establishing contacts with these markets. To
a large degree, these needs could be met through
proper communication between industry and
municipalities. Bringing the supply and demand
sectors together is believed to be an appropriate
application of a Federal technical assistance and
information dissemination program, and EPA will
continue efforts in this direction in the future.
The type of action needed to stimulate demand is
somewhat less clear. Some increased recycling
through the steel, detinning, and copper precipitation
industries could be expected to result from availa-
bility of a broader supply base even with no demand
stimulation. However, the real key to long-term
increases in can recycling is expansion of the de-
tinning industry. It is presently questionable whether
this industry would significantly expand capacity in
the face of the additional $10 to $15 processing cost
required to remove aluminum contaminants. Possible
Federal actions for encouraging detinning expansion
range from providing direct subsidies to offset the
cost of removing the aluminum contaminant to
establishing product controls to eliminate aluminum
tops on beverage cans.
The ultimate decision of whether the Federal
Government should consider such measures hinges
primarily on two issues, both of which are difficult to
resolve at present. One is the degree to which can (
recycling might increase with supply creation through
a technical assistance effoit. If <\ significant increase
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RECOVERY OF RESOURCES FROM POST-CONSUMER SOLID WASTE
55
in recycling could be achieved by such a technical
assistance effort, the added value of a subsidy would
be small. The other major issue is the question of
beverage container legislation. State programs such as
Oregon's beverage container deposit law (see Chapter
5) could have the ultimate effect of sharply reducing
the quantity of cans and other nonreturnable bever-
age containers in waste. This would eliminate the
aluminum content of steel cans (because food cans do
not contain aluminum) and make detinning of old
cans more attractive. Beverage container and product
control issues are discussed in detail later in the
report.
GLASS, ALUMINUM, AND PLASTICS
RECYCLING
Glass
Glass constitutes about 10 percent by weight of
municipal solid waste and totaled approximately 11.6
million tons in 1971. Virtually all of this glass
consisted of discarded containers and packaging.
Beverage containers account for about half the total.
According to estimates of the Glass Container
Manufacturers' Institute, in 1972 nearly 225,000 tons
of post-consumer glass were recycled as the result of
volunteer collection efforts, particularly community
recycling centers. Other glass cullet consumed by the
industry was primarily in-plant manufacturing scrap
and cullet from bottling operations.
In terms of market suitability and potential
demand, glass is an inherently recyclable waste
material. Clean, color-sorted glass is an attractive raw
material to the glass industry, and demand exists at
prices comparable to virgin materials. No major
process changes are required to utilize even very large
quantities of waste glass (cullet) in glass manufac-
turing. Because use of cullet reduces fuel consump-
tion and refractory wear, glass cullet is to some
degree preferable to virgin materials.
Glass recycling is limited by supply. Glass is not
easily removed from municipal waste. Home separa-
tion and separate collection of glass are possible and
have been practiced, but only on a limited scale.
. The best opportunity for removal of glass from
waste is through mechanical separation in recovery
facilities where waste is already undergoing shredding,
air classification, or other types of separation. The
separation of glass in such instances can generally be
achieved, but the glass must also be color sorted to
make it marketable. The technology for extracting
and color-sorting glass is being developed and is
currently in early stages of demonstration in conjunc-
tion with the EPA demonstration of the Black-
Clawson Co. wet separation system in Franklin, Ohio.
The economic attractiveness of glass recovery is
still not clear and may vary considerably depending
on the type of processing employed in the recovery
system. Recovery of glass is usually not based on an
independent investment decision; separation of glass
may be required to produce a clean organic waste fuel
or may be undertaken to obtain aluminum, with a
glass fraction occurring as a by-product. In the
Franklin, Ohio, demonstration, for example, the
projected economics of the combined aluminum and
glass recovery look attractive, but primarily because
of the value of the aluminum extracted with the glass.
However, the small additional investment to color
sort the glass after this initial processing also appears
justified.
The proximity of markets is also an important
influence on glass recovery economics. Glass recov-
ered at a site more than 200 miles from a glass plant
is unlikely to yield sufficient revenue to justify
recycling.
Glass can also be used as a road-paving material or
a component of building products. Such new uses are
now being tested by various researchers. As a rule,
however, the value of glass in such applications is
much lower than its value as cullet.
The most reasonable conclusion to draw at this
time is that glass recovery in some form will
accompany at least the larger installations of energy
recovery or other mixed waste processing systems.
Measures that would eliminate nonreturnable bever-
age bottles could considerably alter the necessity or
desirability of glass recovery.
Aluminum
Aluminum constitutes less than 1 percent by
weight of municipal solid waste but comprises the
bulk of nonferrous metals. The estimated quantity of
aluminum in municipal waste is 800,000 tons a year.
Current recovery of aluminum is estimated to be
80,000 tons. Most of this is being recovered in
industry programs of separate collection through
recycling centers.
Aluminum, like glass, is a valuable and desirable
material for recycling from the standpoint of the
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56
RESOURCE RECOVERY AND SOURCE REDUCTION
user, in this case secondary aluminum smelters. The
market price for secondary aluminum is $200 per
ton, 10 times that of many other materials in mixed
municipal waste. For this reason, aluminum recovery
would make an important contribution to the
revenue of a resource recovery system.
The major constraint to aluminum recycling is
supply. Recovery through consumer separation
efforts has been successful in some instances and after
some years of such practice, it appears that these
efforts are becoming institutionalized and will con-
tinue. Aluminum recovery has been considered in
most large-scale recovery systems under development,
but the actual separation process (heavy media
separation in most instances) has not yet been
demonstrated.
Aluminum recovery will be tested a» a part of
some of the resource recovery systems EPA is
sponsoring. Aluminum recovery could also be signifi-
cantly affected by beverage container measures
eliminating the beverage can or the pulltab top.
Developments in this area will be closely monitored.
PJastfcs
Plastics presently constitute approximately 3.8
percent of municipal solid waste, but plastic con-
sumption is growing rapidly. Essentially no recovery
of plastics as a material from mixed waste now takes
place.
Of all the materials in mixed waste, plastics are
probably the most difficult to extract. Recycling of
certain plastic wastes from fabrication plants is
practiced. In industrial plants it is possible to keep
different types of plastics (e.g., polyethylene, poly-
styrene, and polyvinyl chloride) separated at the
source. Once plastics have entered use, and especially
after they have been discarded into the waste stream,
they are extremely difficult to separate.
Supply of waste plastics is simply not possible
with existing technology because plastics cannot be
separated from paper and other materials in mixed
waste with similar physical characteristics. Experi-
ments have been conducted with new separation
techniques but are a long way from full-scale applica-
tion.
Significant value may be recovered from plastics in
energy recovery systems. Plastics have the highest
British thermal unit content of any of the materials in
mixed waste and thus make a valuable contribution
to the heat value of the waste. The heat content of
plastics is about 11,000 British thermal units per
pound, approximately the equivalent of coal.
The only potential difficulty with recovery of
energy from plastics is the presence of polyvinyl
chloride, a small proportion of total plastic produc-
tion (13 percent) and hence an even smaller propor-
tion of solid waste (0.42 percent). However, when
burned, it emits hydrogen chloride, a toxic gas. When
this gas is combined with moisture, as in the wet
scrubbing sections of incinerator emission controls,
hydrochloric acid is formed, which will corrode the
metal parts of the control equipment and other metal
incinerator parts, resulting in increased maintenance
costs and potentially increased air pollution emis-
sions. In addition, the water discharged from these
scrubbing systems has a low pH and would present a
threat to natural waters if not properly treated.
Conclusions and Recommendations
The major barriers to aluminum and glass recovery
are related to the economical extraction of these
materials from mixed municipal wastes. Once
extracted, there is sufficient demand to facilitate ,
significant increases in recycling of these materials.
Technology is under development for aluminum and
glass recovery but has not proven to be economically
feasible to date. Beverage container control legislation
could significantly impact on the need or prospects
for aluminum and glass recovery in the future. EPA
will continue to monitor developments in this area
and will provide technical assistance and information. i
The most logical approach to plastics recovery is as
an energy source because currently it is not tech- j
nically feasible to separate plastics from mixed wastes
in an economical manner. However, the polyvinyl
chloride fraction could pose significant environmental
problems, especially if this fraction grows signifi-
cantly in the future. EPA will continue to monitor
trends in this area and make recommendations as
necessary to insure the prospects for environmentally
sound energy recovery.
REFERENCES
1. International Research & Technology Corporation. Strat-
egies to increase recovery of resources from
combustible solid wastes. U.S. Environmental Pro- :
tection Agency Contract No. 68-03-0060, 1972.
(Unpublished data.)
-------
RECOVERY OF RESOURCES FROM POST-CQNSUMER SOLID WASTE
57
2. Steam electric plant factors. Washington, National Coal
Association, 1969.
3. A staff report on the monthly report of cost and quality
of fuels for steam-electric plants. Washington,
Bureau of Power, Federal Power Commission, Feb.
1973.
4. Resource Planning Associates, Inc. Assessment of alter-
native methods of financing capital facilities. U.S.
Environmental Protection Agency Contract No.
68-01-0448, [1973]. (Unpublished data.)
5. SCS Engineers, Inc. Cost analysis of source separation
and separate collection of solid waste. U.S. Envi-
ronmental Protection Agency Contract No.
68-01-0789, [19731. (Ongoing study.)
6. Franklin, W. E. Paper recycling; the art of the possible.
Washington, American Paper institute, 1973. p.39.
7. Outlook for meeting future timber demands. Current
Information Report. Washington, Forest Service,
U.S. Department of Agriculture, 1972. p. 10.
8. Franklin, Paper recycling, p.38-43.
9. Franklin, Paper recycling, p.48.
10. Franklin, Paper recycling, p.84, 86, 91, 93, 101, 114.
11. Hill, G. .A. Steel can study. Washington, U.S. Environ-
mental Protection Agency, 1973. p.3. (Unpub-
lished data.)
12. Hill, Steel can study, p.40.
13. Hill, Steel can study, p.5.
14. Hill, Steel can study, p.9.
15. Hill, Steel can study, p.79.
16. Resource Planning Associates. A study of Federal sub-
sidies to stimulate resource recovery. U.S. Environ-
mental Protection Agency Contract No.
68-03-0195, [1972]. (Unpublisheddata.)
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Chapter 4
PRODUCT CONTROLS
The term "product control" may be defined
broadly to include any public policy measure directed
at regulating either the volume of sales (quantity) or
the physical design characteristics* (quality) of
specific products or groups of products supplied for
domestic consumption. (As used here, the term
"product" can apply either to a final item of
manufacture, such as an Automobile or a beverage
container, or to an intermediate product, such as a
refined metal.) Historically, U.S. experience with
product controls has been most extensive in the fields
of foreign trade (i.e., import tariffs and quotas) and
product health and safety regulation (e.g., food,
drugs, flammable materials, and automobiles). Recent
examples in the field of environmental protection
include Federal regulations on the production and use
of pesticides, Federal product noise standards, and
State standards on the maximum sulfur content of
fossil fuels.
In the specific context of solid waste policy a wide
variety of product control proposals have been made.
Some of the more significant of these include a (1)
weight-based tax (e.g., penny-a-pound tax) on con-
sumer goods, (2) taxes and/or bans on specific types
of plastics (e.g., polyvinyl chloride), (3) bans on
pulltab beverage cans, (4) bans on bimetallic cans, (5)
restrictions on the use of copper in automobiles, (6)
development of standards for durability of consumer
appliances, (7) bans or taxes on throwaway con-
venience items, (8) environmental degradability
standards for certain goods, (9) regulations governing
*Appendix B presents a conceptual discussion of the
significance, technical feasibility, and potential impact of a
wide variety of product design modifications for source
reduction, resource recovery, and waste disposal purposes.
the minimum recycled material content of products
(typically paper products), (10) mandatory deposit
requirements for beverage containers.*
Even within the solid waste field, the list of all
possible product controls that might be conceived is
almost infinite because there are a great many
product attributes that might be targeted for regula-
tion, and there are also usually a large number of
alternative policy tools for achieving given objectives.
Thus, the field is extremely complex, and the present
chapter can provide only a cursory introduction to a
subject that has only recently come under close
investigation.
As with other forms of intervention into the
private market system, product control policy draws
its theoretical justification from the failure of private
market decisions to achieve maximum social welfare.
Economists have long argued that "overconsump-
tion" of particular materials and products will result
whenever the full social costs of production are not
internalized in the market price of products. While
some economic incentives exist to conserve resources
(e.g., rising material and energy costs), it has been
suggested that the social costs of pollution and other
environmental damages (associated with various
stages of product production, consumption, and
post-consumer waste disposal) represent evidence of
private market failure to adequately reflect and
balance social priorities. A basic question is whether
private market processes can be relied upon to
systematically evolve socially optimal product
designs, including adequate consideration of such
factors as product durability, repairability, waste
^Mandatory deposit laws are in effect in both Oregon
and Vermont. See Chapter 5 for further discussion.
59
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60
RESOURCE RECOVERY AND SOURCE REDUCTION
disposal costs, and ease of material recovery from
obsolete or discarded items. Little or no theoretical
or empirical economic analysis exists on the subject
of the social efficiency of product design. General
observations raise some questions regarding product
design from a solid waste generation/disposal/
recovery perspective; and these provide evidence of
need for more detailed consideration of product
control possibilities.
In this chapter, product controls are considered in
the two separate but related contexts of "source
reduction and resource recovery. Source reduction is
concerned with reducing the generation of solid waste
by such means as reducing the material intensivity of
products; increasing product durability, lifetime, or
reuse; and possibly banning or reducing the volume of
consumption of certain products. Product controls to
achieve resource recovery can involve improving the
recyclability or increasing secondary material content
of products to enhance both technical and economic
feasibility of recovery.
Two general categories of policy tools are appli-
cable in the product control area: direct regulatory
measures and fiscal approaches. These tools can be
used for both source reduction or resource recovery
purposes. Source reduction regulations, for example,
might include setting standards for minimum product
lifetime or banning the manufacture of throwaway
products. Regulations for resource recovery might
include bans on the bimetallic can to improve steel
recycling or setting recycled material content specifi-
cations for paper products to increase secondary fiber
demand. Fiscal measures also apply to source reduc-
tion, such as discriminatory taxes on certain products
or materials. Fiscal measures to encourage resource
recovery include monetary incentives for the use of
secondary materials, as discussed in Chapter 3.
The major implementation options available are
(1) to institute broad-based taxes or other
financial incentives designed to internalize waste
management costs,* letting the market system make
the appropriate adjustments; (2) to tax or impose
deposits on specific products having a significant
source reduction or resource recovery potential; (3)
*Appendix C presents a discussion of a specific
product control designed to internalize the costs of solid
waste management.
to regulate directly certain physical characteristics of
all products; (4) to regulate selected products or
material components having potentially significant
source reduction or resource recovery benefits; (5) to
combine regulatory and fiscal measures into a com-
prehensive source reduction/resource recovery
approach.
The selection of a strategic product control option
has important consequences in that it establishes the
philosophical basis of the approach. Selective
approaches, where intervention is by exception, are
designed to solve a particular recognized problem and
do not attempt to resolve general problems that are
reflected in many products. Selective regulations or
incentives are relatively easy to implement because
they single out a particular problem as it occurs in
relation to a specific product. Broad approaches, on
the other hand, are directed toward the resolution of
issues affecting most or all manufactured products,
such as the possible undervaluation by the private
market system of virgin raw materials because of the
failure of supply prices to include the full social costs
of material extraction and processing. Because of
their breadth, they are far more cumbersome to
implement or are less precise in their effects. They
rely either on market forces, which may be poorly
understood, or they necessitate a large, unwieldy
administrative structure to implement.
PRODUCT CONTROLS FOR SOURCE
REDUCTION
Source reduction has been defined as the reduc-
tion of post-6onsumer solid waste generation either
by altering the basic design, lifetime, or use pattern of
particular consumer goods or by changing the
composition of sales in such a way as to reduce the
waste volume associated with a given level of aggre-
gate consumer demand. Thus defined, source reduc-
tion could conceivably be achieved by methods other
than product controls. These might include educating
or persuading consumers to change their fundamental
consumption habits or imposing waste disposal
charges at the point of waste generation as an indirect
means of influencing consumer purchase and product
use decisions. EPA studies to date have been directed
toward possible product control options for achieving
source reduction objectives. One of the main reasons
for this choice is that a very large number of product
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PRODUCT CONTROLS
61
control proposals are currently under consideration
by Federal and State legislatures. This section dis-
cusses the products -that may be selected for source
reduction purposes and the mechanisms that may be
utilized for achieving source reduction goals.
Selection of Products for Source Reduction
Substantial difficulties arise in evaluating and
selecting products for source reduction. One such
difficulty concerns the level of specificity at which
the product control should be placed. Should such a ,
control encompass all nondurable products, a specific
product class (e.g., packaging), or an individual
product (e.g., beverage containers and paper towels).
The greater the level of detail, the more manageable
the individual control measure and the more clear are
the effectiveness and costs of particular actions. But
focusing on particular products raises equity issiies
when other products possess similar characteristics
and makes the overall job harder because many more
separate judgments have to be made.
In evaluating products for source reduction, the
following criteria appear relevant:
(1) If a product is composed of scarce material,
consider the substitution of a product composed of
abundantly available materials.
(2) If a product causes difficulties in disposal,
consider the substitution of a product the disposal of
which would be less difficult.
(3) If a product has a short lifetime, consider the
substitution of a product with a longer lifetime.
(4) If a product is not reused, consider the
substitution .of a reusable product.
(5) If a product's material consumption has grown
without corresponding growth in the service the
product delivers, consider the substitution of a .less
material-intensive product.
(6) If product manufacture is energy or pollution
intensive, consider the substitution of a product that
is less energy or pollution intensive.
In all cases, in application of these criteria; considera-
tion should be made as to whether market prices'
currently reflect-full social costs 'and whether other
social control options may not be able to achieve the
same ends in a more efficient and/or equitable
manner. Care must also be taken to avoid the
unnecessary introduction of other undesirable market
distortions into the market decision processes. A
major research effort is currently underway that will
attempt to analyze all major products in solid waste
in relation to all or some of these criteria.
Mechanisms To Achieve Source Reduction
There are four major types of mechanisms appli-
cable to source reduction: taxes or charges, deposits,
bans or quotas, and design regulation. Evaluation of
these options requires analysis of the ability of the
option to achieve a desired end result, analysis of the
economic impacts on producers and consumers,
analysis of environmental and social impacts, and a
determination and assessment of overall costs and
benefits.
Product Taxds or Charges. Product taxes or
charges could be used for source reduction purposes
in several ways. For example, product charges based
on the weight of a product (in order to provide an
incentive for weight reduction) have been suggested.
(See Appendix C.) Other examples include charges
based on product lifetime or charges on a particular
use of a material. These are fairly broad-based
measures applicable to wide classes of products.
Therefore, determining the appropriate level of the
charge and predicting effectiveness and impacts are
complex and difficult tasks.
Deposits. Deposits, designed to encourage
product reuse, may be effective source reduction
measures; however, they are only of value when a
reuse or return system exists. Thus, deposits may
apply in the beverage container area where reusable
containers are available or for tires when retreading
could take place. Deposit measures are thus limited in
scope and may be viewed as viable measures only
where reusable products are available. A detailed
discussion of beverage container deposit systems is
provided in Chapter 5.
Bans. Bans could be used as product controls for
source reduction if material or product substitutions
were desirable. They could generally be applied only
if alternative materials and products exist. For
example, bans on polyvinyl chloride containers could
be instituted only if other containers are available.
This mechanism, like the deposit, is thus also some-
what limited in scope and could only be used on a
selective basis.
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62
RESOURCE RECOVERY AND SOURCE REDUCTION
Design Regulation. From a source reduction
perspective, design regulation could be applicable to
the extension of the lifetime of specific products as
well as to the design of products for reuse or
decreased resource intensivity. This mechanism
implies that a regulatory authority would specify the
design parameters for specific products. This would
require extensive research into product design and a
fairly extensive bureaucracy for administration.
To further analyze product control mechanisms
for source reduction, two studies are currently being
undertaken. In the first of these, product-by-product
regulatory approaches relating to existing Federal
programs in product health and safety are being
analyzed to assess the administrative requirements
and potential effectiveness of direct product regula-
tion. A second study to determine the demand
elasticities of major products in the solid waste
stream is expected to provide data on the potential
effectiveness of fiscal measures for source reduction.
These studies should assist in the evaluation of
product control measures to reduce resource con-
sumption and waste generation.
PRODUCT CONTROLS FOR RESOURCE
RECOVERY
Product control approaches for resource recovery
could increase the recyclability of products by
making it easier (less costly) to separate and recover
high-quality secondary materials and could establish
product specifications requiring the use of secondary
material inputs. As in the case of source reduction
product controls, two issues are raised: selection of
the products to be controlled and the types of
mechanisms that might be utilized.
Product controls for recyclability are concerned
with eliminating materials or product configurations
that inhibit recycling or increase the cost of resource
recovery. Cases where recyclability is a particular
issue include the bimetallic (steel-aluminum) can;
rubber tires with tungsten studs, which do not
separate by magnetic means; aluminum rings around
glass bottles; and copper content of automobile scrap.
With respect to product controls for secondary
material content, all major products could be theoret-
ically considered for control. However, there are
technological limitations (for example, in plastics
recycling), material supply problems, and product
performance considerations that constrain this
approach.
There are two major types of regulatory mech-
anisms applicable to resource recovery product
controls: bans and standards. Fiscal incentive
approaches are discussed in Chapter 3. Bans could be
utilized to remove nonrecyclable product configura-
tions from the marketplace or eliminate virgin
material use in particular products. Standards could
be utilized to set minimum secondary material use
specifications. In the form of a general mandate
covering all products, this latter mechanism would
require analysis of all products to determine compo-
nent material and design potentials. Such an analysis
would be an extremely complex project. Enforce-
ment of such standards would require establishment
of a large administrative structure. If the standards
were selective, on the other hand, administrative
problems would diminish substantially but equity
problems might arise.
The current experience of the General Services
Administration is significant in a discussion of this
type of product control. (See Chapter 2.) The
General Services Administration experience with
secondary fiber specifications in paper products has
been very valuable in establishing the requirements
and procedures for product controls for recycled
material content.
CONCLUSIONS AND RECOMMENDATIONS
The concept of product controls to conserve
resources, reduce environmental damage, and reduce
the burden of disposing of solid wastes is one that
should be carefully considered. There could be
important benefits derived from product controls
that impact on producers and consumers in an
equitable manner (i.e., in proportion to their contri-
bution to environmental problems) and result in
increased overall efficiency of resource utilization,
pollution control, and waste management.
On the other hand, product controls could have
profound impacts on the market system because they
involve direct control of product design or consump-
tion levels. The effect of these measures is difficult to
predict, and hasty action could result in significant
economic dislocations. For these reasons, it is impor-
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PRODUCT CONTROLS 63
tant to proceed very cautiously in this area and to appropriate recommendations to the Congress in this
consider options that are reasonable, fair, and area, it is recommended that EPA, as part of its
equitable. research and analysis program, continue to study
At present, there is insufficient information to product controls for resource recovery and source
evaluate the necessity or desirability of product reduction purposes. Several such studies are currently
control measures. Therefore, to be able to make underway. i
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Chapter 5
STUDIES OF RESOURCE RECOVERY
AND SOURCE REDUCTION OF SPECIAL WASTES
EPA has been conducting special investigations of
the disposal, recovery, and source reduction of
particular products that enter the solid waste stream.
This chapter presents a review of the status of these
studies for four products: automobiles, packaging,
beverage containers, and tires. These products were
selected for study for the following reasons:
(1) .Automobiles. Obsolete automobiles generally
never enter the mixed municipal waste stream and are
processed, discarded, and recycled separately from
other products. A significant number of automobiles
are discarded in an uncontrolled manner-abandoned.
Therefore, special studies of strategies for preventing
abandonment and increasing recycling of automobile
scrap were undertaken.
(2) Packaging. Packaging waste represents the
largest single product class in the municipal waste
stream (34 percent), and packaging material con-
sumption has been growing at a rapid rate. Therefore,
evaluation of various source reduction measures for
controlling packaging waste was considered appro-
priate.
(3) Beverage containers. Soft drink and beer con-
tainers were singled out from other packaging
products for special analysis for several reasons. First,
many beverage containers are discarded in an uncon-
trolled manner; such containers represent a substan-
tial fraction of roadside litter. Second, the refillable
bottle represents an existing technical option for
achieving source reduction of beverage containers.
Therefore, various approaches to reduce beverage
container litter and institute refillable container
systems were studied.
(4) Tires. Although automobile tires only repre-
sent a small percentage of municipal solid waste, they
are difficult to dispose of either by incineration or
landfill. In addition, many tires are not discarded
with other wastes but are accumulated at tire retailers
and disposed of separately. Rubber tire recycling and
retreading are a few of the options that are being
studied for dealing with this special waste.
Because EPA's studies in these areas are still
underway, the conclusions and program directions
that are presented in the following sections are of a
preliminary nature.
AUTOMOBILES
Disposition of obsolete automobiles can take
several forms as indicated in Figure 1. The auto-
mobile wrecking industry acquires discarded vehicles
for spare part value and sells the stripped hulks to
scrap processors. Most retired vehicles that enter the
scrap cycle follow this route. A small percentage of
vehicles that are very old, or have no part value, are
conveyed directly to scrap processors by their final
owners. Some cities designate disposal sites where
obsolete vehicles are accumulated prior to shipment
to wrecker, or processor, or where vehicles are
disposed of by landfill.
Obsolete vehicles are abandoned when the owner
does not know another means of disposal or if he is
unwilling to incur the cost of delivering the vehicle to
a disposal site, automobile wrecker, or scrap proces-
sor. Automobiles that are abandoned on public
roadways are generally collected because they present
traffic problems or hazards. Vehicles that are aban-
doned in remote locations or in locations with
difficult access are generally not collected.
There are three basic environmental and social
problems that result from improper disposition of
obsolete automobiles:
(1) The degradation of the aesthetic quality of the
physical environment caused by abandoned vehicles
(This is essentially a litter problem causing consider-
able public annoyance.)
65
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66
RESOURCE RECOVERY AND SOURCE REDUCTION
Figure 1. An obsolete automobile may follow one of several paths on the way to becoming processed scrap.
(2) The financial burden imposed on the general
public for collection of abandonments (This is an
inequitable situation because the collection costs are
not borne by the abandoner.)
(3) The aesthetic, resource consumption, and
environmental consequences of the failure to recycle
obsolete automobiles (This is an aesthetic problem in
that vehicles that are not recycled accumulate in
automobile wrecker yards or storage sites that are
popularly referred to as "auto graveyards." In addi-
tion, such vehicles also represent an untapped
resource that if recycled would reduce consumption
of virgin resources and reduce the environmental
damages caused by virgin material mining and
processing.)
In the following sections automobile recycling and
abandonment problems will be discussed in more
quantitative terms, barriers that impede automobile
recycling will be identified, and measures to prevent
abandonment and facilitate recycling will be eval-
uated.
Automobile Recycling
Table 39 presents the metals recoverable from
obsolete automobiles. Steel is the primary compo-
nent. Steel scrap can be processed in three different
ways prior to recycling; it can be (1) baled into No. 2
bundles (removal of the engine, seats, and gas tank
and compression of the hulk into a block), (2)
slabbed (slicing flattened automobile bundles into
slabs), (3) shredded (shredding of automobile hulks
and magnetic separation of ferrous fraction).
The first two processes produce a low-value
contaminated steel scrap, while the third process
generally results in a high-value material for which
there is considerable demand. It is estimated that in
1972 approximately 4.4 million tons of bundled
automobile scrap and 3.3 million tons of shredded
automobile scrap were processed in the United
States.'
Figure 2 shows two estimates of the historical
consumption (domestic plus exports) of processed
automobile hulks (the difference in these estimates is
due to various assumptions made concerning the
composition of automobiles and the percentage of
automobile scrap in total bundled steel scrap). Also
plotted on Figure 2 is an estimate of the annual
automobile retirements. The difference between the
retired and processed vehicle figures represents the
vehicles that were not processed through the scrap
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STUDIES OF RESOURCE RECOVERY AND SOURCE REDUCTION OF SPECIAL WASTES
67
TABLE 39
VALUE OF RECOVERABLE METALS IN COMPOSITE AUTOMOBILE, 1972
Metal
Steel
Cast iron
Copper:
Radiator stock
No. 2 heavy and wire
Yellow brass solids
Zinc, die castings
Aluminum, cast, etc.
Lead:
Battery
Battery cable dumps
Total
Weight*
(Ib)
2,614.0
429.3
15.4
13.8
2.7
54.2
50.6
20.0
.4
Pricet
(dollars)
25.00-38.00t (per ton)
55.00 (per ton)
0.25 (per pound)
0.32 (per pound)
0.23 (per pound)
0.04 (per pound)
0.12 (per pound)
1.40 (per battery)
0.11 (per pound)
Value
(dollars)
32.68-49.67
11.81
3.85
4.42
.62
2.17
6.07
1.40
.04
63.06-80.05
*Dean, K. C., and J. W. Steiner. Dismantling a typical junk automobile to produce quality scrap. U.S. Bureau of Mines
Report of Investigations 7350. [Washington], U.S. Department of the Interior, Dec. 1969. p.17.
tTypical secondary material prices from Secondary Raw Materials, 10(10):123-125, Oct. 1972.
£$25.00 per ton is the price as a No. 2 bundle (crushed flattened hulk); $38.00 per ton is an estimate of the price of
shredded and magnetically separated automobile steelcomparable to No. 1 heavy melting scrap.
cycle in a particular year. Estimates of the accumula-
tion of these vehicles (in wrecker yards, storage sites,
and uncollected abandonments) are presented in
Figure 3.
One striking feature of Figure 3 is the range of
estimates for the accumulation of unprocessed
vehicles, from 8 to 19 million in 1970. This indicates
that there is considerable uncertainty as to the
magnitude of the unprocessed vehicle problem and
the rate of growth. The average backlog of un-
processed vehicles was 12.75 million in 1970. Appli-
cation of the Bureau of Mines estimate of the
distribution of unprocessed vehicles yields a distribu-
tion for 1970 of 9.9 million vehicles in the automo-
bile wrecking vehicle inventory and 2.85 million
vehicles in the inventory of uncollected
abandonments.2
Any consideration of the magnitude of raw mate-
rial value forgone in unprocessed automobiles must
be considered relative to overall steel production. In
1970, total raw steel production was 131.5 million
net tons, ahd the total steel content in the estimated
uncollected abandoned automobile backlog as of
1970 would amount to less than 3 percent of raw
steel production. If automobile wrecker inventories
are included, this percentage increases to around 13
percent.
In addition to steel, there are other raw material
resources to be realized from recycling automobiles.
Table 39 presents those estimated quantities and values
at 1972 prices. If the steel value is calculated on the
basis of No. 2 bundled steel at $25 per ton, a value of
$32.68 per automobile results. This would make the
total value of recoverable resources $63.06. Shredded
automobile scrap sells at a price comparable to No. 1
heavy melting scrap ($38 per ton) and results in a
vehicle metallic value of $80.05. Because of the
higher value of shredded scrap (as compared to No. 2
bundles), the significant growth in automobile recy-
cling has taken place in this form. To evaluate the
barriers to increased steel recycling, the current
market structure of the wrecker and shredder indus-
tries will be discussed.
Automobile Wrecking Industry. There are pres-
ently about 15,600 automobile wreckers in the
United States that are the depository for 80 percent
of the retired vehicles. The majority acquire and
inventory automobiles for their spare part value if the
cost of acquisiton is less than the value of spare parts
contained in that automobile. After recovery of the
parts, the hulk becomes dead inventory and even-
tually is sold to a scrap processor.
The wrecker's decision to sell the dismantled
hulks, and often hulks that have some spare part
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68
RESOURCE RECOVERY AND SOURCE REDUCTION
CARS TAKEN
OUT OF
SERVICE
z
o
_l
c/i
u
-I
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STUDIES OF RESOURCE RECOVERY AND SOURCE REDUCTION OF SPECIAL WASTES
69
20
18
16
14
12
10
en
VIRGINIA STUDY
(13.5 MILLION)
MARYLAND STUDY
(9.9 MILLION)
BUREAU OF MINES
STUDY
(5.9 MILLION)
I
I
1958
1959 1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
YEAR
Figure 3. The estimates of the accumulation of retired vehicles not processed into scrap vary considerably. The three data
points represent surveys in Virginia and Maryland and a survey in selected cities by the Bureau of Mines that has been scaled up to
national proportions. [Source: Booz-Allen Applied Research, Inc. An analysis of the abandoned automobile problem. U.S.
Environmental Protection Agency Contract No. 68-03-0046, June 1972. (Unpublished data.)]
value, depends upon the current price being offered
by a processor, the size of the inventories and yard
space requirements, and the location of the processor.
Table 40 shows estimates of the costs to a wrecker to
prepare and sell automobile scrap. These calculations
illustrate that it would be profitable to ship hulks to
processors up to 150 miles away, providing the price
received is at least $25 per hulk, while it would not
be economical to ship the hulks more than 150 miles.
Differences in local transportation costs and prices
will result in different economic transportation
distances across the Nation.
Automobile Shreddersi According to the
Institute of Scrap Iron and Steel, there are over 100
automobile shredders operating in the United States
with a total installed capacity estimated to be over 5
million tons annually. In 1969 there were 69 shredder
plants; this is a growth of more than 45 percent
within 4 years. The national average capacity utiliza-
tion in 1972 was approximately 65 percent.
The map in Figure 4 shows current shredder
locations. Also in this figure an estimate of the
transportation radius for economic shipment of hulks
(150 miles) is indicated, and it can be seen that in the
eastern part of the Nation and on the West Coast
shredders are available. In the midwest and northwest
areas there are few shredders. Automobile registra-
tions in these States constitute a minor portion of
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70
RESOURCE RECOVERY AND SOURCE REDUCTION
TABLE 40
ESTIMATED WRECKER COST TO PREPARE
AND SELL AUTO SCRAP
Item
Distance to processor
(miles)
50
100
150
200
Costs (dollars):
Stripping*
Flatteningt
Transportation!
($0.10
per vehicle per mile)
Total
5
5
5
15
5
5
10
20
5
5
15
25
5
5
20
30
Revenue from sale of hulk§
(dollars)
Profit (dollars)
25
10
25
5
25
0
25
-5
*Special report on the auto wrecking industry. Scrap
Age, 27(2):203, Feb. 1970.
tprivate communication with the president of Mobile
Auto Crusher Company.
^Automobile disposal; a national problem. U.S.
Bureau of Mines Special Publication No, 1-67. Washington,
U.S. Government Printing Office, 1967. 569 p.
§ Price received at processing plant is $1.25 per 100
pounds. Average stripped vehicle weight was assumed to be
2,000 pounds.
total U.S. registrations; however, because of absence
of readily accessible automobile shredders, retired
automobiles could be accumulating in wrecker yards,
and abandonments could lie uncollected. The cumula-
tive effect of many years of automobile retirements
could be substantial.
Table 41 presents the estimated costs of operating
a shredder; the total costs range from $32 to $46 per
hulk. For steel prices in the range of $40 per ton to
$50 per ton, hulk shipments could be received from
long distances, wrecker inventories could be reduced,
and it would be more economical to collect and
transport abandoned vehicles. For steel prices in the
range of $30 per ton to $40 per ton, shipment
distances would be shorter. Therefore, movement of
automobile hulks through the scrap cycle ultimately
depends on maintaining a high price for steel scrap.
There are several developments that could markedly
affect this price:
(1) Technological developments within the steel
industry might alter the overall quantity of scrap
consumed. For example, use of prereduced ores in
scrap-intensive electric furnaces would tend to reduce
the demand for scrap. On the other hand, continuous
casting processes would reduce the amount of home
scrap generated and hence increase demand.
(2) A change in the material composition of
automobiles could affect the value of the discarded
hulk. Fuel shortages and air pollution regulations
could result in a trend toward lighter vehicles and use
of lighter materials (e.g., plastics or aluminum).
(3) Foreign scrap markets could exert strong
influence over scrap prices.
These developments should be closely monitored and
analyses be made to determine their potential effect
upon automobile recycling.
Automobile Abandonment
The Department of Commerce estimated that in
1965. approximately 10 percent of all automobiles
retired annually were abandoned.3 Other studies have
estimated the yearly abandonment rate to be as high
as 15 percent.4 Applying these percents to the 6.1
million automobiles retired in 1970 yields a range of
610,000 to 915,000 abandonments that year. Table
42 presents abandonment projections to 1980.
Not all abandoned automobiles remain uncol-
lected. A study completed by the Bureau of Mines in
1967 estimated that about 20 percent remain un-
collected and contribute to the accumulated backlog
of uncollected abandoned automobiles.5 An EPA
study indicated that the number of these uncollected
automobiles could range up to 30 percent of annual
abandonments.6
With the use of a 25-percent uncollected abandon-
ment figure, it is projected that between 1970 and
1980, approximately 2 million automobiles will be
added to the uncollected backlog. The result will be
approximately 5 million automobiles lying derelict
(Table 43).
Location of Abandoned Vehicles. Limited
empirical data collected by the Department of
Commerce in 1965 indicate that most automobiles
abandoned in the cities are left on public property
and are collected.5 This seems logical because cities
would tend to remove abandoned vehicles that j
interfere with traffic or present hazards to the general '
public. For the most part, then, the backlog asso-
ciated with uncollected abandoned automobiles is I
-------
,
c
;
-
'..
,
-
-
0
.-.
:
'-
-
~
-
0
C
3
z
-
w
:
-
:
-
t
Figure 4. Shredders are currently much more available in the eastern half of the Nation than in either the Midwest or in Northwest
shredders. Shaded areas represent locations within 150 miles of a shredder. (Source: Data provided by the Institute of Scrap Iron and Stei-1.',
'a.s. Dots it-present locations of
-------
72
RESOURCE RECOVERY AND SOURCE REDUCTION
TABLE 41
ESTIMATED SHREDDER COSTS TO PREPARE
AND SELL AUTO SCRAP*
Cost (dollars)
Price paid for hulkt
Transportation
Shredding
Subtotal
Fee (if sold through broker)
Total
Minimum
20.00
5.00
6.00
31.00
1.00
32.00
Maximum
25.00
10.00
10.00
45.00
1.25
46.25
*Source: Private communication with automobile
shredder processors.
tit is assumed hulk is delivered stripped and flattened.
believed to be primarily a problem that occurs in
rural areas and on private property.
Costs to Eliminate Backlog. The costs for picking
up abandoned hulks and transporting them to a
disposal site have been estimated to range from $10
to $25 but could be much higher in particular
instances. Table 44 shows that with collection and
disposal costs ranging from $10 to $25 per auto-
mobile, the total cost to eliminate the backlog in
1970 would be $28 to $72 million. If the backlog is
allowed to accumulate to 1980, the cleanup cost
will be $50 to $125 million.
Strategies To Deal with Abandoned Automo-
biles. There is a variety of actions that can be -
considered to clear up abandoned vehicle backlog or
prevent future abandonments. The following para-
graphs describe some examples.
Punitive Measures. Most States presently have
laws making it illegal to abandon automobiles on
public property, and the threat of a high fine may be
a suitable deterrent. The effectiveness of such an
approach is dependent upon public prosecution of
offenders; if litigation is successful and publicized,
casual abandonment may be prevented. The costs of
such an approach would mostly be administrative
costs to locate and prosecute offenders.
Disposal Certification. With this scheme an owner
taking a vehicle out of service would be denied
registration of another vehicle or required to pay a
fine upon failure to prove that the retired vehicle was
transferred to another individual or disposed of in a
proper manner. The effectiveness of this measure
depends entirely on how well the program is admin-
istered. With rigorous monitoring and with special
provisions to handle out-of-State transfers, this
measure could be very effective in preventing future
abandonments. However, it does not address the
existing uncollected backlog.
TABLE 42
ESTIMATES OF AUTOMOBILE PRODUCTION, RETIREMENT, AND ABANDONMENT, 1970-80*
Automobiles (millions)
Year
1970
1971
1972
1973
1974
1975
1976
1977
1978
1979
1980
Total
Produced
8.2
10.6
10.8
10.9
11.1
11.3
11.5
11.7
11.9
12.1
12.3
122.4
Retired
6.1
6.8
7.0
7.2
8.2
8.4
8.7
9.1
9.3
9.7
9.9
90.4
Minimum
abandoned^
0.610
.680
.700
.720
.820
.840
.870
.910
.930
.970
.990
9.040
Maximum not
abandoned of
those retired^
5.490
6.120
6.300
6.480
7.380
7.560
7.830
8.190
8.370
8.730
8.910
81.360
Maximum
abandoned t
0.915
1.020
1.050
1.080
J..230
1.260
1.305
1.365
1.395
1.455
1.485
13.560
Minimum not
abandoned of
those retired^
5.185
5.780
5.950
6.120
6.970
7.140
7.395
7.735
7.905
8.245
8.415
76.340
*Source: Production and retirement figures from the U.S. Department of Transportation Federal Highway Administration.
t Based on the estimate that 10 percent of the automobiles retired in a given year are abandoned.
t Based on the estimate that 15 percent of the automobiles retired in a given year are abandoned.
-------
STUDIES OF RESOURCE RECOVERY AND SOURCE REDUCTION OF SPECIAL WASTES
73
TABLE 43
INVENTORY OF UNCOLLECTED ABANDONMENTS
Year
1970
1971
1972
1973
1974
1975
1976
1977
1978
1979
1980
Total
Abandonments
(10 percent
abandonment rate)
0.610
.680
.700
.720
.820
.840
.870
.910
.930
.970
.990
9.040
Obsolete automobiles (millions)
Uncollected abandonments*
0.150
.170
.175
.180
.200
.210
.215
.230
.230
.240
.245
2.245
Inventory of
uncollected abandonmentst
2.850
3.020
3.195
3.375
3.575
3.785
4.000
4.230
4.450
4.690
4.935
*Assuming 25 percent of abandonments remain uncollected.
tBased on a 1970 starting inventory of 2.85 million automobiles.
TABLE 44
COST TO ELIMINATE ABANDONED
AUTOMOBILE BACKLOG
Year
1970
1980
Estimated
number of
uncollected
abandoned
automobiles
(millions)
2.85
4.9
Cost per
automobile
(dollars)
10
15
25
10
15
25
Total cleanup
cost (millions
of dollars)
28.5
43
72
49
75
124
The costs of a disposal certification system are all
administrative-estimated at $0.04 to $0.08 per
vehicle registration.7 For 1970 the total national cost
would be $3 to $7 million; for 1980 it would average
$4 to $9 million. Some savings would be realized by
not having to collect abandoned automobiles.
Deposits. With this measure a $25 to $50 deposit
would be included in the selling price of the
automobile and refunded in full to the final owner or
automobile wrecker by the scrap processor. This
measure could be effective in preventing abandon-
ment as the intrinsic value of an automobile would be
increased up to $50-more than most collection and
disposal costs. It would also provide an incentive to
reduce the vehicle inventory stored by automobile
wreckers.
The major disadvantages of this measure are that it
is inequitable in that 100 million automobile owners
would be forced to bear the burden of less than 1
million abandoners and the measure is regressive in
that a relatively greater burden is placed on indi-
viduals with low incomes who tend to purchase
low-priced used cars.
Initial outlay for a national deposit program ($50
per vehicle) in 1970 would have been about $4.5
billion. Annual interest forgone on the deposit would
be about $260 million. In addition, estimated annual
administrative costs to run the program would be $2
to $10 per car or $16 to $80 million for 1970."
Free Disposal Sites. This strategy would establish
free disposal sites where unwanted vehicles would be
accepted for storage prior to transfer to scrap
processors. This could be effective in preventing
abandonment that occurs because there is no alterna-
tive way to dispose of a vehicle. The effectiveness
depends on the number and location of the sites.
However, the cost barrier to transporting a vehicle to
a site would still exist, and the only incentive to use
the sites is the vehicle owners' environmental
awareness and good intentions.
Bounties. This measure would provide a mone-
tary reward either to individuals collecting abandoned
-------
74
RESOURCE RECOVERY AND SOURCE REDUCTION
automobiles or to automobile wreckers and scrap
dealers for all automobiles processed. This differs
from a deposit in that no responsibility for proper
disposals is placed on the abandonee or individual car
owner.
Bounties could be effective in cleaning up the
backlog and preventing future abandonments if the
bounty were set high enough to cover collection
costs. However, it would also subsidize the 80-percent
of retired vehicles that now go into the scrap cycle.
This disadvantage could be avoided if the bounties
were limited to uncollected abandoned automobiles.
However, this would require an administrative
network to determine the exact status of an auto-
mobile and would increase the costs of the program.
The total national costs for 1970 would range
from $30 to $60 million if it were assumed that all
retirements would become eligible for a $5 to $10
bounty. If bounties could be limited to abandoned
automobiles, total annual costs would be around 10
to 15 percent of this amount. In addition, there
would be administrative costs that have not been
estimated. For example, the institution of a bounty
system would require an improved vehicle certifica-
tion system to prevent multiple bounties for a single
vehicle and to avoid paying bounties on stolen
vehicles.
Most of the innovative measures discussed above
have not received wide-scale trial and application,
Although most States have laws prohibiting abandon-
ment, they do not have aggressive statewide programs
to prevent abandonment or to collect abandoned
vehicles. A study completed in 1971 for EPA
determined that 41 percent of the 28 States surveyed
had no statewide abandoned automobile program, or
responsibility had been delegated to county or local
governments. Only six of these States had data on
removals.
Existing Programs To Deal with Abandoned Auto-
mobiles. Several cities and States have recently
initiated more comprehensive programs. Examples of
some of these programs are described in this
subsection.
California. California has recently instituted a
statewide program under the direction of the State
Highway Patrol. Estimates of the number of aban-
doned automobiles run around 200,000. The program
basically consists of funding by the State of up to
$15 per car for the identifying and clearing of the
title of automobile hulks by the cities. The cities then
contract with processors/wreckers for removal of the
hulks. Funds for the program were raised by a
one-time $1 per auto registration fee that generated
$15 million. Of the more than 500 counties and cities
incorporated in California, more than half have
reached an agreement with the State to participate in
the program. Several test counties and cities are being
closely monitored by the State to both validate the
estimate of hulks present and to gather data on the
cost and effectiveness of the program.
Maryland. An $8 bounty is provided to both
automobile wreckers and scrap dealers for each car
processed through their yards. The objective is to
provide an incentive for these processors to accept
vehicles and prevent inventory accumulations. The
vehicle must have been registered in Maryland and
proof submitted that it has been processed. Funds for
the program are derived from vehicle title transactions
($1 per car). In addition, a tax of $5 per vehicle is
levied on automobile wreckers for each vehicle over 8
years old held in inventory over 18 months.
Vermont. Transportation subsidies are provided
to communities for the removal of abandoned auto-
mobiles. Communities must collect a minimum of
200 vehicles at a central site at their own expense.
The State pays independent collectors to crush and
transport the automobiles to a scrap processor.
New York City. In New York City the sanitation
department contracts with automobile wreckers for
the right to collect abandoned vehicles. Wreckers are
required to remove a vehicle within 48 hours of
notification by the city. Wreckers have to store
vehicles for 5 days while an owner search is under-
taken. In 1971, 80,000 abandoned vehicles were
disposed of in this manner. Contracts with auto-
mobile wreckers vary from borough to borough and
range from a cost to the city of $9.75 per car in
Manhattan to an income to the city of $5.00 in
Staten Island. The cost to inspect the car and obtain
release for disposal is borne by the police department
and runs about $10 per car.
Conclusions
There are only very rough estimates of the annual
automobile abandonment rate (700,000 to 1 million
-------
STUDIES OF RESOURCE RECOVERY AND SOURCE REDUCTION OF SPECIAL WASTES
75
vehicles per year in 1972), the abandoned auto-
mobile inventory (3.2 million vehicles in 1972), and
the accumulation of vehicles in automobile wrecker
yards (10 million vehicles in 1972). In addition, there
are not sufficient data available to establish the
growth rates in these figures. Therefore, it is very
difficult to decide upon the scope and extent of a
national program in this area at this time.
There are several strategies that could be employed
to prevent or reduce abandonment, including disposal
certification, deposits, bounties, and provision of
storage or disposal sites. Many of these measures have
not yet been tested.
The continuance of automobile recycling depends
upon maintaining a high price for automobile scrap.
There are several developments that might markedly
affect this price, including changes in automobile
designs, shifts in the steel industry, and changes in
export markets. These developments need to be
monitored and their potential impacts on automobile
scrap recycling need to be evaluated.
PACKAGING
Packaging is the largest and one of the fastest
growing product classes in municipal solid waste.
Because of its predominance in the waste stream, it
has become the focus of a great deal of public
attention in recent years. This section outlines the
resource consumption and waste generation aspects
of packaging activity and provides preliminary data
on the technical approaches being explored to control
packaging waste.
Resource Consumption and Waste Generation
Packaging activity in the United States has been
growing at a rapid rate over the past decade.
Shipments of containers and packaging were valued at
$19.7 billion in 1971, an increase of 5 percent since
1970, and an increase of 82 percent since I960.9
Table 45 shows that in 1958 packaging material
consumption equaled 412 pounds per capita. By
1971 per capita consumption had risen to 591
pounds, a growth rate of 43 percent per capita.
The_xjrowth of packaging consumption has led to
increased consumption of raw materials and energy
(with attendant adverse environmental effects) and an
increased rate of generation of solid waste. Table 46
shows that packaging accounts for approximately 47
percent of all paper production, 14 percent of
aluminum production, 75 percent of glass produc-
tion, more than 8 percent of steel production, and
approximately 29 percent of plastic production.
Total packaging material energy consumption repre-
sented an estimated 5 percent of U.S. industrial
TABLE 45
CONSUMPTION OF PACKAGING MATERIAL*
Total consumption
Type of material
Paper
Glass
Steel
Plastic
Aluminum
Wood and miscellaneous
Total
Weight
1958t
16,552
5,933
6,198
368
97
6,212
35,360
(103 tons)
1971
$27,700
§11,100
H 7,255
§2,900
§757
§10,613
60,325
Change,
1958-71
(percent)
67.3
87.1
17.1
688.0
680.4
84.2
70.6
1958t
193.0
69.2
72.3
4.3
1.1
72.4
412.4
Per capita consumption
Weight (Ib)
1971
$271.3
§108.7
^71.1
§28. 4
§7.4
§103.9
590.8
Change,
1958-71
(percent)
40.6
57.1
-1.7
x 793.0
S72-.7
43.5
43.3
*Paper figures represent paper packaging produced rather than paper packaging consumed. Other material categories reflect
consumption of packaging material.
tDarnay, A., and W. E. Franklin. The role of packaging in solid waste management, 1966 \o 1976. Public Health Service
Publication No. 1855. Washington, U.S. Government Printing Office, 1969. 205 p.
i-The statistics of paper. Washington, American Paper Institute, 1972.
§U.S. Department of Commerce. Containers and Packaging, v.24-25. Washington, U.S. Government Printing Office,
[1971-1972]. (Published quarterly.)
H Shipments of steel products. Washington, American Iron and Steel Institute, 1972.
-------
76
RESOURCE RECOVERY AND SOURCE REDUCTION
TABLE 46
PACKAGING MATERIAL CONSUMPTION IN
RELATION TO TOTAL MATERIAL
CONSUMPTION, 1971
Type of
material
Paper*
Glass
Steel*
Plastic t
Aluminum §>'
Consumption
Packaging
(103 tons)
27,700
11,100
7,255
2,900
757
Total
(103 tons)
58,652
14,900
87,038
10,000
5,074
Packaging as a
percent of total
consumption
47.2
74.5
8.3
29.0
14.1
*The statistics of paper. Washington, American Paper
Institute, 1972.
tshipments of steel products. Washington, American
Iron and Steel Institute, 1972.
t [Arthur D. Little, Inc.] Incentives for recycling and
reuse of plastics; a summary report. [Cincinnati], U.S.
Environmental Protection Agency, 1973. 18 p.
§U.S. Bureau of Mines. Minerals yearbook, aluminum
chapter reprint. Washington, U.S. Department of the Interior,
1973.
H Aluminum statistical review, 1971. New York, Alumi-
num Association, 1972.
energy consumption in 1971.'° Table 47 illustrates
the energy associated with the production of raw
materials for packaging.
Post-consumer solid waste resulting from the
discard of packaging material was estimated at
between 40 and 50 million tons in 1971. Packaging
was thus estimated to be between 30 and 40 percent
TABLE 47
ENERGY CONSUMPTION* ASSOCIATED WITH
PRODUCTION OF RAW MATERIALS FOR
PACKAGING, 197 It
Type of
material
Paper
Glass
Steel
Plastic
Aluminum
Total
Material
consumption
(103 tons)
27,700
11,100
7,255
2,900
757
49,712
Energy
consumption
(103 Btu/ton)
40,800
15,256
29,590
37,088
196,632
319,366
Total energy
consumption
(10* Btu)
1,130,000
169,342
214,675
107,557
148,850
1,770,424
*Energy consumption figures include total electrical
energy fuel input as well as final material production energy.
'''Source: Gordian Associates. Energy consumption for
six basic materials industries. U.S. Environmental Protection
Agency Contract No. 68-01-1105, 1973. (Unpublished data.)
of municipal solid waste, based on the EPA estimate
of 125 million tons of municipal solid waste in 1971
Trends Toward Increased Use of Packaging
The major functional purpose of all packaging is to
protect and preserve the item that is being packaged.
In recent years, however, there has been a trend
toward increased use of consumer packaging for
purposes other than containment or protection. The
high cost of labor, for example, has provided an
incentive for self-service merchandising, which has
resulted in the packaging of products so that they
may be displayed, selected, and purchased in an
efficient, labor-saving manner. In addition, packaging
users have become increasingly aware of the market-
ing value of packaging. This has resulted in the use of
more elaborately designed packaging to attract the
consumer to a particular product. Also, packaging
manufacturers and users have sought to satisfy the
convenience orientation of many consumers. This has
led to a proliferation of package sizes for many
products.
Tables 48 to 52 illustrate recent growth trends in
consumer packaging by material type and end use.
Contrasting these data with the overall packaging
consumption data presented in Table 45, it is
apparent that various categories of consumer
products have experienced far greater packaging
growth than packaging as a whole. All glass pack-
aging, for example, increased by 57 percent per capita
between 1958 and 1971, while beer packaging in glass
increased by 290 percent per capita between 1958
and 1970. Aluminum packaging grew 573 percent per
capita between 1958 and 1971, while aluminum
consumer packaging grew 950 percent per capita
between 1958 and 1970. These data are particularly
meaningful in light of current trends toward the use
of lighter packaging materials (i.e., the substitution of
aluminum and plastic for steel and glass, as well as'
usage of thinner gauges of steel, glass, and aluminum).
Another factor of interest is the growth in product
consumption relative to the growth in packaging
consumption for that particular product. Overall, the
consumption of food in the United States increased
by 2.3 percent by weight on a per capita basis.
between 1963 and 1971.'' During the same period,
however, the tonnage of food packaging increased by
an estimated 33.3 percent per capita, while the
-------
STUDIES OF RESOURCE RECOVERY AND SOURCE REDUCTION OF SPECIAL WASTES
77
TABLE 48
PAPER PACKAGING FOR CONSUMER PRODUCTS*
Total consumption
Type of product
Food:
Dairy
Fresh and cured meat
Prepared beverages
Frozen foods
All other
Subtotal
Household supplies:
Cleaning supplies
All other
Subtotal
Health and beauty aids
Other general merchandise
Tptal
Weight (103
1958
770.9
865.6
108.7
129.8
2,022.0
3,897.0
452.1
168.4
620.5
375.2
1,727.5
6,620.2
tons)
1970
1,026.3
1,415.0
137.4
359.3
2,994.8
5,932.8
547.1
148.9
696.0
399.7
2,342.3
9,370.8
Change,
1958-70
(percent)
33.1
63.5
26.4
176.8
48.1
52.2
21.0
11.6
12.2
6.5 '
35.6
41.5
Per
Weight
1958
9.0
10.1
1.3
1.5
23.6
45.5
5.3
2.0
7.3
4.4
20.1
77.3
capita consumption
(Ib)
1970
10.2
13.9
1.4
3.5
29.3
58.3
5.4
1.5
6.9
3.9
22.9
92.0
Change,
1958-70
(percent)
13.3
37.6
7.7
133.3
24.2
28.1
1.9
-25.0
-5.5
-11.3
13.9
19.0
*Source: Research Triangle Institute. A study to evaluate the effectiveness and impact of a tax or regulatory mechanism
directed toward reducing the quantity of packaging entering the solid waste stream. U.S. Environmental Protection Agency
Contract No. 68-01-0791, [1973J. (Ongoing study.)
TABLE 49
GLASS PACKAGING FOR CONSUMER PRODUCTS*
Total consumption
Type of product
Food:
Beer
Soft drinks
Prepared beverages
All other
Subtotal
Household supplies
Health and beauty aids
Other general merchandise
Total
Weight (103
1958
410.1
359.3
678.6
1,988.7
3,436.7
108.9
1,219.3
304.8
5,069.7
tons)
1970
1,912.5
2,511.3
841.9
2,950.4
8,216.1
40.3
1,244.7
105.2
9,606.3
Change,
1958-70
(percent)
366.3
598.9
24.1
48.4
139.1
-63.0
2.1
-65.5
89.5
Per
Weight
1958
4.8
4.2
7.9
23.2
40.1
1.3
14.2
3.6
59.2
capita consumption
(Ib)
1970
18.7
24.6
8.3
28.9
80.5
.4
12.2
1.0
94.1
Change,
1958-70
(percent)
289.6
485.7
5.1
24.6
100.7
-69.2
-14.1
-72.2
59.0
*Source: Research Triangle Institute. A study to evaluate the effectiveness and impact of a tax or regulatory mechanism
directed toward reducing the quantity of packaging entering the solid waste stream. U.S. Environmental Protection Agency
Contract No. 68-01-0791, [1973]. (Ongoing study.)
number of food packages increased by an estimated
38.8 percent per capita.
2,13
Several specific
examples may be of value here. Between 1958 and
1970, milk consumption decreased by 23.1 percent
by. weight on a per capita basis.14 Milk container
consumption, on the other hand, increased by 26.1
-------
78
RESOURCE RECOVERY AND SOURCE REDUCTION
TABLE 50
STEEL PACKAGING FOR CONSUMER PRODUCTS*
Total consumption
Type of product
Food:
Beer
Soft drinks
Pet foods
All other
Subtotal
Household supplies:
Cleaning supplies
Pesticides
All other
Subtotal
Health and beauty aids
Other general merchandise
Total
Weight (103
1958
896.6
61.6
159.8
2,653.4
3,771.4
3."8
4.7
9.0
17.5
43.0
810.2
4,642.1
tons)
1970
945,7
706.4
245.9
2,389.8
4,287.8
32.0
10.9
36.3
79.2
172.1
612.8
5,151.9
Change,
1958-70
(percent)
5.5
1,046.8
47.6
-9.9
13.7
742.1
131.9
303.3
352.6
300.2
-24.4
11.0
Per capita consumption
Weight
1958
10.5
.7
1.9
30.9
44.0
.04
.05
.10
.19
.5
9.5
54.2
(Ib)
1970
9.3
6.9
2.4
23.4
42.0
.3
.1
.4
.8
1.7
6.0
50.5
Change,
1958-70
(percent)
-11.4
885.7
26.3
-24.3
-.04
650.0
100.0
300.0
321.1
240.0
36.8
-6.8
*Source: Research Triangle Institute. A study to evaluate the effectiveness and impact of a tax or regulatory mechanism
directed toward reducing the quantity of packaging entering the solid waste stream. U.S. Environmental Protection Agency
Contract No. 68-01-0791, [1973]. (Ongoing study.)
TABLE 51
PLASTIC PACKAGING-FOR CONSUMER PRODUCTS*
Total consumption
Type of product
Food:
Baked goods
Produce
Candy and chewing gum
All other
Subtotal
Household supplies:
Cleaning supplies
All other
Subtotal
Health and beauty aids
Other general merchandise
Total
Weight (103
1958
64.2
37.3
33.5
110.0
245.0
2.3
.5
2.8
6.4
83.3
337.5
tons)
1970
100.6
96.1
63.9
387.0
647.6
76.2
23.8
100.0
78.7
633.3
1,459.6
Change,
1958-70
(percent)
56.7
157.6
90.7
251.8
164.3
3,213.0
4,660.0
7,873.0
1,129.7
660.3
332.5
Per
Weight
1958
0.8
.4
.4
1.3
2.9
.020
.006
.026
.07
1.0
4.0
capita consumption
(Ib)
1970
1.0
.9
.6
3.8
6.3
.7
.2
.9
.7
6.2
14.1
Change,
1958-70
(percent)
25.0
125.0
50.0
192.3
117.2
3,400.0
3,233.3
6,633.3
900.0
520.0
252.5'
*Source: Research Triangle Institute. A study to evaluate the effectiveness and impact of a tax or regulatory mechanism
directed toward reducing the quantity of packaging entering the solid waste stream. U.S. Environmental Protection Agency
Contract No. 68-01-0791, [ 1973]. (Ongoing study.)
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STUDIES OF RESOURCE RECOVERY AND SOURCE REDUCTION OF SPECIAL WASTES
79
TABLE 52
ALUMINUM PACKAGING FOR CONSUMER PRODUCTS*
Total consumption
Type of product
Food:
Frozen food
Soft drinks
Beer
Baked goods
All other
Subtotal
Household supplies and health and beauty aids
Other general merchandise
Total
Weight
1958
16.3
_
12.3
24.2
52.8
10.1
12.4
75.3
(103 tons)
1970
52.8
151.9
273.5
34.3
300.3
. 812.8
20.2
31.8
864.8
Change,
1 Q^R 7(1
(percent)
223.9
-
178.9
1,140.9
1,438.8
100.0
156.5
1,048.4
Per capita consumption
Weight
1958
0.2
-
.1
.3
.6
.1
.1
.8
(Ib)
1970
0.5
1.5
2.7
.3
2.9
7.9
.2
.3
8.4
Change,
IQ.CPU 'Q
(percent)
150.0
-
-
200.0
866.7
1,216.7
100.0
200.0
950.0
*Source: Research Triangle Institute. A study to evaluate the effectiveness and impact of a tax or regulatory mechanism
directed toward reducing the quantity of packaging entering the solid waste stream. U.S. Environmental Protection Agency
Contract No. 68-01-0791, [1973]. (Ongoing study.)
percent on a unit per capita basis for the same
period.'5 Other cases may also be cited. The con-
sumption of vegetables in cans increased by 17.8
percent by weight between 1958 and 1970, while the
consumption of cans for vegetables increased by 31.5
percent on a tonnage basis for the same period.'6
Table 53 provides more data on package consumption
changes in relation to product consumption changes.
In all of these cases, packaging consumption has far
outstripped product consumption.
There are three technical approaches that have
been considered to reduce material and resource
utilization and reduce the waste generation resulting
from packaging consumption: using larger containers,
eliminating excess packaging of particular products,
and using reusable containers. The remainder of this
section provides a discussion of these approaches.
Increasing Average Package Size
The trend toward increased use of convenience-
sized containers has been one of the contributing
factors to increased consumption of packaging mate-
rials. Utilization of a greater quantity of smaller
containers to fulfill consumption needs results in
increased resource use and waste generation. It has
been estimated, for example, that elimination of all
tomato juice cans smaller than 32 ounces in 1971
would have resulted in a reduction in steel use of 19.6
TABLE 53
PRODUCT CONSUMPTION IN RELATION TO
PACKAGING CONSUMPTION*
Type of product
Dairy :
Product consumption
Package consumption
Cereals, flour, and related
products:
Product consumption
Package consumption
Produce:
Product consumption
Package consumption
Consumption
(pounds per capita)
1958
398.0
10.6
150.0
.8
90.2
5.3
1970
354.0
13.3
140.0
.9
80.0
7.3
Change,
1958-70
(percent)
-11.1
25.5
-6.0
12.5.
-11.3
37.7
*Source: Food, consumption, prices, expenditures;
supplement for 1971. Supplement to Agricultural Economic
Report No. 138. Washington, Economic Research Service,
U.S. Department of Agriculture, Aug. 1972.
percent for this product. This example illustrates how
use of larger sizes would have significant resource
consumption and solid waste generation implications.
Reduction of the convenience-sized container could
also, however, be attended by impacts on the
consumer, the package manufacturer, and the
product manufacturer.
With respect to the consumer, it is anticipated that
whereas the cost per unit of product will decline
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80
RESOURCE RECOVERY AND SOURCE REDUCTION
under a system of larger sized containers, there would
be a significant reduction in consumer choice and
convenience (the consumer will not have the choice
of different-sized packages to meet his individual
needs).
Industry impacts could be significant. Material
suppliers would be negatively affected as the demand
for packaging material would decrease. Package
fabricators would also be adversely affected as the
number of containers produced would decline. If
product consumption decreased as a result of a shift
in container size, product manufacturers would be
adversely affected. The warehousing and trucking
sectors of the product industries would also experi-
ence some disruption if changes in sizes and product
mixes necessitated changes in storage and delivery
systems.
Eliminating Overpackaging
As packages have come to fulfill more and more
functions beyond product containment and protec-
tion, their complexity has increased. This complexity
has surfaced mainly in multilayer and multimaterial
packaging. Thus many single products are now sold in
two packages, one which may be necessary for
containing the product and one which is utilized to
distinguish and advertise the product. Many premium
wines, for example, are now sold in bottles that have
been placed in sculptured cartons for shelf appeal.'7
Many toiletry containers have also been packaged in
highly elaborate cartons for marketing purposes.
Increases in packaging layers have been accom-
panied by increases in the use of multimaterial
packaging. While packaging manufacturers have
always combined dissimilar materials, the number of
materials suitable for combination has increased
dramatically with the advent of plastic packaging.
Thus steel and glass, which had traditionally been
combined with paper, have now also been combined
with plastic.
Although the particular dimensions of the over-
packaging issue are difficult to quantify in particular
solid waste generation terms, it appears that over-
packaging will be increasing at an extremely rapid
rate as marketing takes a firm place beside protection
and containment as key motives for packaging
consumer products.'8
Reusing Packaging
Approximately 90 percent by weight of all pack-
aging is discarded by the consumer within 1 year of
purchase.19 Most packages are designed for short
lifetimes, with little attention given to the possibil-
ities for reusing the package. There are, however,
positive environmental effects resulting from the
reuse of various container types. These effects include
a decrease in the environmental discharges associated
with production of the packaging (e.g., air pollution
and water pollution), a reduction in material and
energy consumption, and -a decrease in the quantities
of solid waste generated.
Two examples may be cited here to illustrate the
potential environmental effects. In the first, the use
of 1,000 tons of single-use corrugated containers is
compared to the use of reusable corrugated con-
tainers designed to ship an equivalent volume of
product. Each of the reusable containers is assumed
to be used five times. Table 54 provides the data for
the detailed conparison. These data reveal that the
reusable container system utilizes approximately 80
percent, less energy than is used by the single-use
container system, that air pollution decreases by 57,
percent under the reusable system, that water pollu-
tion decreases by approximately 98 percent, and that
solid waste savings of almost 77 percent accrue in the
use of reusable corrugated containers. In the second
example, a refillable bottle system is compared with
four different single-use beverage container systems.
Table 55 provides the data for the detailed compari-
son. The refillable system, for example, provides
resource consumption savings, energy consumption
savings, and air and water pollution reduction.
Although the environmental effects that can be
derived from reusable packaging systems are positive,
there are technological and econpmic issues that are
likely to affect the establishment and implementation
of these systems. A brief discussion of the major
barriers follows.
The Development of Reusable Packages. At the
present time, there are relatively few package types
designed for reuse. In the consumer product sector,
the refillable bottle and the reusable carton are the
only systems in use. In the industrial sector some
drums, pallets, and boxes are designed for reuse.
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STUDIES OF RESOURCE RECOVERY AND SOURCE REDUCTION OF SPECIAL WASTES
81
TABLE 54
COMPARISON OF THE USE OF 1,000 TONS OF SINGLE-USE CORRUGATED CONTAINERS WITH THE
USE OF REUSABLE CORRUGATED CONTAINERS PROVIDING THE SAME DEGREE OF SERVICE*
Environmental impact
Production energy consumption (lO* Btu)
Production air pollution generation (Ib)
Production water pollution generation (Ib)
Post-consumer solid waste generation (tons)
Single-use
container system
25,554.0
38,183.7
849,976.0
1,000.0
Reusable
container system^
5,017.0
11,403.9
18,998.0
1 231.0
Difference (percent)
-80.3
-57.0
-97.8
-76.9
*Source: Gordian Associates. Energy consumption for six basic materials industries. U.S. Environmental Protection Agency
Contract No. 68-01-1105, Task No. 68-01-1111, 1973. (Unpublished data.)
tAssumes that each reusable container is utilized five times prior to discard.
tTo allow for reuse five times, each container has been designed to utilize 25 percent more linerboard than the single-use
container.
TABLE 55
COMPARISON OF FIVE DIFFERENT CONTAINERS* FOR DELIVERING
1,000 GALLONS OF BEVERAGfit
Environmental impact
Energy (10" Btu)
Virgin raw materials (Ib)
Water volume (103 gal)
Waterborne waste (Ib)
Atmospheric emissions (Ib)
Post -consumer solid waste (ft1 )
Industrial solid waste (Ib)
10-trip
returnable
glass i
24
1,538
11
45
111
12
8
All
steel 8
41
2,029
38
349
157
4
71
Bimetallic $
57
1,677
34
335
234
3
61
One-way
glass I
72
7,515
37
68
328
41
32
Aluminum S
91
578
16
249
381
3
29
*A11 containers are 12-ounce beer.
tSource: Preliminary data prepared by the Midwest Research Institute for U.S. Environmental Protection Agency Contract
No. 68-01-1848.
tCapped with steel closures; solid bleached sulfate paperboard carriers are included.
§ Plastic ring-type carriers are included.
The institution of a large number of reusable
packaging systems would therefore require some
product design and development activity.
Systems for Returning Reused Containers. If a
package is to be reusable, it must be obtained from
the ultimate user and returned to the point at which
the container can be refilled. For consumer pack-
i aging, this might involve establishing either a deposit
system that would provide an incentive for the
consumer to return the container to a particular
location where it could be obtained by the filler (as
with the refillable soft drink bottle) or a system in
which containers would be separated by the house-
hold and collected for return to the filler.
With respect to commercial or shipping packaging,
|a system similar to those currently in operation might
be employed. At the present time, for example, the
distributors of commercial packaging to large outlets
often return to collect the used packages for reuse.
This type of system could be employed on a large
scale if reusable packaging became more widespread.
For either commercial or consumer packaging users,
then, it is clear that systems for obtaining and
returning the used containers would have to be
developed and instituted prior to the widespread
acceptance and use of refillable containers.
Economic Impacts. Substantial economic effects
are likely to result from the institution of reusable
packaging systems. These impacts will affect all major
industries from material suppliers to retailers and
might include production and sales volume changes,
employment dislocations, capital investment require-
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82
RESOURCE RECOVERY AND SOURCE REDUCTION
ments, and obsolescence of existing equipment. The
extent of economic dislocation is expected to be
dependent upon the mechanism used to either create
incentives or require the utilization of reusable
containers. The beverage container section of this
report provides considerable detail on the economic
impacts that might occur from a shift to a refillable
beverage container system.
Packaging Control Measures
Both fiscal and regulatory measures could be used
to implement the approaches described to reduce
material and resource utilization and reduce the waste
generation resulting from packaging consumption.
Fiscal measures could be used to provide incentives
for decreasing packaging material consumption,
encouraging the reuse of packaging, or encouraging
the use of recycled material in packaging. Regulatory
mechanism could set standards that require consump-
tion decreases, reuse, or the use of recycled materials
in packaging.
An EPA study is currently underway to assess the
effectiveness and impact of four mechanisms designed
to decrease the generation and increase the recycling
of packaging waste: a tax on package weight, a
packaging weight tax with a rebate for recycled
material use, a packaging unit tax for rigid containers,
and required utilization of recycled material in
packaging.
Although this study is not yet complete, some
tentative findings can be presented a't this time. A tax
on the weight of packaging is likely to have some
source reduction effects because of absolute decreases
in material consumption at the manufacturer level
and shifts in material use for certain products. The
total waste weight reduction for a tax of $20 per ton
of packaging used is not expected to exceed 4 million
tons.20 Energy use reductions could be expected on
the order of 1 to 2 percent of current energy use in
packaging production. A unit tax on rigid containers
is likely to have a slightly greater source reduction
effect. Reductions of packaging waste of 4 to 5
million tons are anticipated from a $0.01 per unit
tax.20
Both of these broad-based fiscal measures are
likely to discriminate against certain packages and
may even result in shifts to materials and packages
that are less desirable from an environmental point of
view. For example, a tax on packaging weight would
discriminate against refillable glass bottles and favor
aluminum beverage cans. With a unit tax, all con.-
tainers would be taxed equally regardless of their
material content or weight.
An alternative to fiscal incentives for packaging
reduction is a comprehensive regulatory program for
all products. Such an approach would be extremely
difficult and cumbersome to administer given the
wide variety of packaging end uses and con-
figurations.
Studies of the tradeoffs between fiscal and regula-
tory approaches to packaging control have not been
completed. Furthermore, it is necessary to evaluate
the environmental benefits and the costs of these
measures before we can confidently provide specific
views on packaging waste reduction.
BEVERAGE CONTAINERS
A great deal of public attention has been focused
on the impact of beer and soft drink containers on
the environment. This concern has centered on the
aesthetic problems associated with beverage container
litter, solid waste generation factors, and the overall
environmental impacts associated with beverage con-
tainer production and use. While these latter aspects
apply to all packaging and, in fact, to all consumer
goods, the litter issue renders beverage containers
somewhat unique. For this reason, beverage con
tainers have become a highly sensitive public issue
and will be discussed separately in this report.
Trends Toward Increased Use of Nonrefillables
Consumption of beer and soft drink containers has
grown and continues to grow faster than population!
growth and the consumption of beverages themselves."
Table 56 illustrates that per capita beverage container
consumption rose from 87 units in 1959 to 230 unit:
in 1969, an increase of 164 percent. In the sarm
period, the per capita consumption of beer and soft
drinks rose 29 percent. In the 1959-69 period, the us<
of refillable bottles decreased as the average numbei
of fillings per container declined from 3.7 to 1.8. In
large part as a consequence of this decline, the to
number of beverage containers consumed rose fro:
15.4 billion units in 1959 to 46.8 billion units in
1969.
1
e|
In
Dta|
orr|
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STUDIES OF RESOURCE RECOVERY AND SOURCE REDUCTION OF SPECIAL WASTES
83
TABLE 56
BEVERAGE CONTAINER CONSUMPTION*
Item
Containers consumed
(billions)
Beverage fillings consumed
(billions)
Average number of fillings
per container
Container consumption
per capita
Beverage fillings consumed
per capita
1959
15.4
58.4
3.7
87
325
1969 Gtowth rate
(percent)
46.8
85.8
1.8
230
420
204
47
-
164
29
*Source: Bingham, T. H., and P. F. Mulligan
[Research Triangle Institute]. The beverage container prob-
lem; analysis and recommendations. Washington, U.S.
Government Printing Office, 1972.
Beverage Containers and the Environment
Litter. Beer and soft drink containers form a
large and highly visible segment of roadside litter. It
has been estimated, for example, that at least 2.2
billion beverage containers became litter in 1969,
from 20 to 32 percent of all roadside litter by item
count.2' Of these containers, it is estimated that 71.3
percent were beer containers, 25.7 percent were soft
drink containers, and approximately 3.0 percent were
wine and liquor bottles.2' By type of container, it is
estimated that 73.1 percent were cans, 17.0 percent
were nonrefillable bottles, and 9.9 percent were
refillable bottles.21
A survey by the Oregon State Highway Division
indicates that by volume, beverage cans and bottles
form approximately 62 percent of the litter along the
State's highways, bottles accounting for 22 percent
and cans, 40 percent.22 Although this is but one
survey, it indicates that beverage containers might
represent a greater visual blight than item counts
would seem to indicate. This is further borne out by a
somewhat limited four-city survey that revealed that
the public thinks beverage containers constitute
nearly 40 percent of all litter.2 3
Resource Use and Solid Waste. In 1972, approxi-
mately 8.8 million tons of beer and soft drink
containers (6.2 million tons of glass, 2 million tons of
steel, and 0.6 million tons of aluminum) were
consumed in the United States. This represents
approximately 20 percent of all packaging waste and
7 percent of total municipal solid waste.
Environmental Impact. With respect to the envi-
ronmental impacts resulting from beverage container
production, data are presented in Table 55 on the
impacts associated with the production of five con-
tainer types. These data reveal that, for the delivery
of equivalent volumes of beverage, a refillable bottle
(assuming usage of each bottle 10 times), as com-
pared to any other type of beverage container
considered, provides a reduction in energy consump-
tion from 41 to 74 percent, a 34- to 87-percent
reduction in waterborne waste, and a reduction in air
effluents from 30 to 71 percent.
Control Measures
There are three major types of strategies that have
been proposed for reversing the trend toward non-
refillable containers and curbing the beverage con-
tainer portions of litter and solid waste: mandatory
deposit systems for all beverage containers, bans on
the production and sale of nonrefillable containers,
and low taxes on beverage containers to be used for
increased litter cleanup. Each of these strategies is to
generate revenues analyzed in this subsection, and
Table 57 summarizes the results of the analysis.
Mandatory Deposit. The mandatory deposit alter-
native selected for analysis would require the retailer
to pay $0.05 for every empty container of beer and
carbonated soft drinks. The retailer would be
required to accept from the consumer any empty
container of the kind, size, and brand sold by that
retail outlet. Retailers, in turn, could return empty
containers to the distributor who would also be
required to pay the $0.05 refund.
Mandatory deposit legislation has been passed at
both the local and State level. (Oregon and Vermont;
Oberlin, Ohio; Bowie, Maryland; and Ann Arbor,
Michigan, have enacted mandatory deposit legisla-
tion.) In these cases, the costs and benefits of the
approach would have to be analyzed on an individual
basis because of varying degrees of littering, industry
intensity, and consumption. The projected costs and
benefits of implementation of this strategy at the
national level follow.
Litter Reduction. It is estimated that implemen-
tation of a $0.05 mandatory deposit is likely to result
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84
RESOURCE RECOVERY AND SOURCE REDUCTION
TABLE 57
PROJECTED BENEFITS AND COSTS OF CONTROL MEASURES
Impact
Mandatory deposit
Ban
Tax
Benefits:
Litter reduction
Solid waste reduction
Environmental impact reduction
Costs:
Sales volume change
Industry dislocation
Employment impact
Tax revenue loss
Beverage price
Consumer choice impact
Consumer convenience impact
Substantial improvement
Some improvement
Substantial improvement
Possible slight decrease
Dislocation, but less than
with a ban
Dislocation, but no net loss
Likely decrease
Lower on average
Some limitation
Higher price for convenience
Substantial improvement
Some improvement
Substantial improvement
Likely decrease
Substantial dislocation
Dislocation, and likely net
loss
Likely decrease
Lower on average
Choice limited
Higher price for convenience
Substantial improvement
No change
No change
No decrease
No dislocation
No dislocation
No decrease
Higher on average
No change
No change
in a reduction in the beverage container portion of
the litter. This would result partly from decreased
littering and partly from increased scavenging. One
estimate of the quantities of beverage container litter
to be reduced is 60 percent.2 3 Preliminary data from
the State of Oregon indicate a reduction of beverage
container litter of from 70 to 75 percent.
Solid Waste Reduction. Beverage container con-
sumption in 1972 equaled 8.8 million tons.24 If a
$0.05 mandatory deposit system resulted in the use
of only refillable beverage containers (each container
to be used 15 times), solid waste reductions of
approximately 6 million tons would occur.
Environmental Impact. Any measure that
resulted in increased usage of the refillable glass
container would also result in significantly decreased
environmental impact. A mandatory deposit system
resulting in a predominately refillable bottle market
(85 to 90 percent refillables), as compared to the
current market mix of containers, would result in (1)
a material use reduction, (2) energy savings, (3) an air
pollution reduction, (4) a water pollution reduction,
(5) reduced mine waste production.
Sales Volume Change. Sales of beverages may
decline slightly under a mandatory deposit system. A
sales decline could result from a decreased number of
sales outlets (e.g., vending machines may decrease in
number) or from a switch to other beverages without
the required deposit (e.g., juice or wine). This decline
has been estimated at from 4 to 8 percent.23
Preliminary experience in Oregon, as will be discussed
later in this section, reveals no decline in sales.
Current growth rate in the industry is estimated at 6
percent a year.24 Thus, the effect could range from
no change in growth to 1 year of no growth and
subsequent years at present growth.
Industry Dislocation. A $0.05 mandatory deposit
that resulted in a switch to refillable bottles would
eliminate a substantial portion of metal beverage cans
and would have significant impacts on that industry
(e.g., a reduction of 75 percent in the use of beverage
cans would be equivalent to a decline of $1.1 billion
worth of shipments in 1971).2S Approximately 2
percent of steel production is currently related to can
manufacture, and this steel use could be totally
eliminated. In the aluminum sector, beverage con-
tainers represent 11 percent of aluminum shipments,
which would be significantly affected. Major disrup-
tions could also occur within the brewing industry,
particularly for the national shipping brewers, if a
switch was made from current beer distribution
methods.
Employment Impact. A mandatory deposit could
result in large reductions in employment in the
container industries (estimated at 60,500 jobs, mostly
in skilled categories) and large additions to employ-
ment in the beverage and distribution industries
(estimated at 60,800, mostly unskilled categories).26
The net effect could be a small increase in jobs and
probable drop in labor income, accompanied by
substantial disruptions in the affected industries.
Tax Revenue Loss. Tax revenues would decline
substantially during a period of transition because of
employment wage decrease and tax writeoffs. An
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STUDIES OF RESOURCE RECOVERY AND SOURCE REDUCTION OF SPECIAL WASTES
85
estimate of the quantity of tax revenue loss is $803
million for the first year (based on the total elimina-
tion of beverage can production and an 8-percent
beverage sales decline).2 7 This figure would be
decreased if beverage sales did not decline substan-
tially and if beverage cans continued to be sold.
Beverage Price. The average price paid by all
consumers for beer and soft drinks should decrease
slightly because the higher priced nonrefillable con-
tainers would only be sold in small quantities.
Increased handling costs (estimated at $0.015 per
container at retail) and costs related to equipment
changes in the brewing and soft drink industries
would likely be passed on to the consumer,
however.28 These costs could result in a rise from the
current price of refillable containers. It is estimated
that the price per unit of beverage is likely to be on
the order of $0.005 per unit lower than the current
nonrefillable price..
Consumer Convenience. A mandatory deposit
system would raise the price of convenience. If a
consumer purchased a container and did not return it
for a refund, he would in effect be paying $0.05 extra
for not returning it.
Consumer Choice. A ban that prohibited the sale
of various types of containers would limit consumer
choice. A mandatory deposit does not directly
prohibit the sale of any container type. However, it
forces the consumer to pay a higher price-equivalent
to the deposit-for the convenience of discarding a
container.
Ban on Nonrefillable Containers. A ban on non-
refillable containers would act in the same way as a
mandatory deposit, as bottlers of beer and soft drinks
would probably place deposits on their refillable
beverage containers to retrieve them for refilling. A
ban on nonrefillables would, therefore, result in
benefits similar to those of a mandatory deposit. The
costs of a ban would be more severe than those of a
deposit, however, because a ban would prohibit
utilization of any container other than one that is
refillable.
Specifically, a ban would completely eliminate the
beverage can manufacturing industry ($1.5 billion in
shipments in 1971) as well as the contract canning
industry. The uses of steel and aluminum for beverage
cans would also be eliminated.
A ban prohibiting the sale of nonrefillables would
limit consumer choice because the only containers
available would be the refillable bottle. If a consumer
discarded rather than returned a refillable container,
he would lose the deposit and, in effect, he would be
paying extra for this convenience.
Litter Tax. The low litter tax selected for analysis
would require that an additional $0.005 per container
be paid on the sale of each container for beer or
carbonated soft drinks. The tax would be imposed at
the point of purchase of the container by the
beverage industry. The projected costs and benefits of
implementation of this measure at the national level
follow. Litter taxes can also be imposed at the State
or local level (the State of Washington has enacted a
low litter tax). Where implemented at the State or
local level, the costs and benefits must be analyzed in
relation to the characteristics of the particular area.
The speqific effects of a litter tax in reducing
beverage container litter are difficult to predict
accurately. Some qualitative comments follow.
Litter Reduction. While a low litter tax probably
would not cause any change in the rate of littering, it
would raise revenue to be used for litter collection. In
1972, a $0.005 per container tax would have raised
approximately $278 million in revenue. If this
amount were applied totally to litter cleanup
activities, it would increase the frequency of litter
collection' by approximately five to six times.29
However, it is possible that once raised, the revenues
might be used to substitute for present funds.
Solid Waste Reduction. A low litter tax would
have no effect on beverage container solid waste.
Environmental Impact. A low litter tax would
have no effect on the environmental impact of
beverage container production and use.
Sales Volume Change. No changes are expected
because a tax of $0.005 per container is not likely to
affect consumption patterns. Studies of the elasticity
of demand for beer and soft drinks indicate that both
are relatively inelastic and that a price increase of
$0.005 per container would not affect demand
substantially.30
Industry Dislocation. A low litter tax is not likely
to cause dislocation in the beverage or container
industries.
-------
86
RESOURCE RECOVERY AND SOURCE REDUCTION
Employment Impact. No employment impact
would be expected as a result of imposition of a low
litter tax.
Tax Revenue Loss. No increase in tax writeoffs
would be likely as a result of a low litter tax as the
tax is not likely to affect beverage or container
consumption.
Beverage Price. A low litter tax would increase
the costs of all container types by the amount of the
tax. If the charges were passed on to the consumer,
the average price of beer and soft drinks would be
increased an average of slightly less than $0.005 per
filling. The price increase for refillables will be less as
the tax can be amortized over several fillings.
Consumer Choice and Convenience. Consumer
choice and convenience would be unaffected by a low
litter tax.
The Oregon Mandatory Deposit Law
Public interest in beverage containers has led to a
large number of legislative proposals to ban, tax, or
impose mandatory deposits. A mandatory deposit law
in Oregon has been in effect since October 1, 1972,
and a similar law in Vermont went into effect
September 1, 1973. The State of Washington is
currently the only State with a low litter tax in
effect. Because Oregon is the only State for which
detailed data are available on the impacts of beverage
container legislation, the effectiveness and impacts of
its law will be discussed in some detail.
Oregon's "Bottle Bill" requires a minimum $0.02
refund to purchasers on the return of "certified"
containers of beer, malt beverages, and carbonated
soft drinks, and a $0.05 refund on the return of all
other beverage containers for those beverages.
Certified containers are defined as containers that are
used by, and that will be accepted for, reuse by more
than one manufacturer. In addition, the law outlaws
the sale of the fliptop or pulltab beverage container.
A publication of EPA has reported the trends
emerging from the experience of the first 6 months
after enactment of the law.3' The remainder of this
subsection summarizes the effects of the law through
June 1973.
Litter. Beverage containers in litter decreased
substantially between winter and spring of 1971-72
(before enactment) and winter and spring of 1972-73
(after enactment). Table 58 illustrates these findings.
Container Usage. Cans for beer and soft drinks
have declined to approximately 2 percent of the
market share, and nonrefillable glass bottles have
been completely eliminated.
Prices and Sates. Sales of beer and soft drinks
have not declined since the law went into effect. A
price rise of up to 1.7 cents per container did occur in
the spring of 1973, although it is not clear as to
whether this can be attributed to the bottle bill,
inflation, or other cost increases.
Employment. Approximately 142 jobs were lost
as a result of the bottle bill, 62 in a canning facility in
Oregon, and 80 in a can manufacturing plant outside
of the State.
TABLE 58
A COMPARISON OF OREGON LITTER DATA BEFORE AND AFTER INSTITUTION
OF THE MANDATORY DEPOSIT ACT*
Type of litter
Winter (October to February)
Spring (March to June)
Average number Average number Average number Average number
of item, per mile of items per mile Decrease of items per ^ of items per mile Decrease
Pe,om,°?->h' PToh' (P6rCent) Per month, 1972 per month, 1973
IV/1 I£ ly/^"/O
Beverage containers
Other litter
Total
269
456
728
51
219
270
74
52
56
103
187
290
19
175
195
-75
5
-25
Beverage containers as a
percent of total litter
37
19
42
36
10
-65
*Source: EPA analysis of data supplied by the Oregon State Highway Department of Litter Surveys.
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STUDIES OF RESOURCE RECOVERY AND SOURCE REDUCTION OF SPECIAL WASTES
87
The State of Oregon will be conducting a more
comprehensive study of the effects of this legislation
and is expected to report results by the end of 1974.
Conclusions
Beverage containers form a significant and visible
portion of roadside litter and a substantial and
increasing percentage of solid waste. This is due in
large measure to the growth of the nonrefillable
container at the expense of the refillable bottle.
There is analytical evidence to indicate that replace-
ment of the existing beverage packaging system with
a refillable bottle system would result in substantive
decreases in air and water pollution and energy and
resource use.
Preliminary data from Oregon indicate that a
mandatory deposit system on all beverage containers
results in the establishment of a predominantly
refillable bottle system and also results in a reduction
in litter. These effects are accompanied by some
unemployment and by adverse economic impacts on
the manufacturers and fillers of nonrefillable con-
tainers. More conclusive data on the impacts of the
Oregon law are expected in the future.
RUBBER TIRES
Consumption and Discard
In 1971, 266 million tires for passenger cars,
trucks, and motorcycles were shipped by domestic
tire manufacturers or imported for consumption in
the United States (Table 59). In that year, tires taken
out of service totaled 240 to 250 million.32
Of the tires taken out of service, approximately 46
million were retreaded, 7 million were consumed by
the rubber reclaiming industry, and roughly 2 million
were consumed by tire splitters.33 The remaining 185
to 200 million tires, weighing approximately 2.4
million tons, were disposed of by retailers, retreaders,
or consumers or were left on discarded vehicles. (See
Table 60 for tire disposal statistics for 1969.) The
most common disposal method is land disposal,
but many tires become litter or are left to accumulate
at various locations.
Disposal Issues
Tires are one of the most difficult consumer
wastes to dispose of properly. In sanitary landfills,
whole tires cannot be effectively compacted and tend
to work their way up to the landfill surface. They
TABLE 59
TIRE SHIPMENTS, 1971
Category of tire
Number
of tires
(millions)
New replacements (passenger cars, motorcycles,
and trucks)
Retread replacements:
Passenger cars
Trucks
Original equipment (passenger cars, motor-
cycles, and trucks)
Exports (passenger cars, motorcycles,
and trucks)
Imports:
Passenger cars and motorcycles,
original equipment
Truck and bus tires, original equipment
*153.4
t36.0
tlO.2
*56.0
*2.0
Total
268.2
*Tire report; statistical highlights, 1971. New York,
Rubber Manufacturers Association, Feb. 1972.
^ Retreading; N.T.D.R.A. marketing guidelines. Wash-
ington, National Tire Dealers and Retreaders Association,
Sept. 1972.
tU.S. Bureau of the Census. U.S. foreign trade.
Imports TSUSA commodity by country; annual 1971.
Consumption and general quantity and value, country.
Report FT 246-71. Washington, U.S. Government Printing
Office, 1972. 621 p.
TABLE 60
TIRE DISPOSAL, 1969*
Point from which final disposal. is made
Retailer
Retreader
Consumer
Discarded vehicle
Number
of tires
(millions)
78.3
64.3
4.0
37.3
Total
183.9
*Source: International Research & Technology Corpo-
ration. Tire recycling and reuse incentives. U.S. Environ-
mental Protection Agency Contract No. CPE-R-70-0047,
1972.
also consume more landfill space per unit weight than
other items and are not biodegradable.
Tires on the surface of landfills or dumps or
littered in urban or rural areas provide nesting places
for rodents, flies, and mosquitoes.
Shredding, splitting, or otherwise reducing the size
of tires overcomes the problem of landfilling to a
large degree. Shredding is the most feasible method of
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88
RESOURCE RECOVERY AND SOURCE REDUCTION
physically altering the tires but is presently employed
only in a few locations. Cost is the primary deterrent,
and neither public nor private entities are likely to
pay the price of processing in the absence of disposal
regulations.
A small number of tires can be combined with
large quantities of refuse in incineration as long as
they do not comprise more than about 5 percent of
the charge. Larger percents of tires result in damage
to furnace walls and also require flue gas
control. Tires represent only about 1.5 percent of the
municipal waste stream but are often delivered to a
disposal site in large batches rather than in an even
day-to-day flow. Shredding of the tires would allow
the percent of tires in the incinerator charge to be
increased above 5 percent if the shredded rubber is
thoroughly mixed with other waste materials.
Recycling Opportunities and Problems
There are three means by which rubber tires are
presently recycled: retreading, conversion by rubber
reclaimers into new products, and physical conversion
by tire splitters into new products.
Retreading. As percents of new tire shipments,
retreaded passenger tires have dropped from 25
percent in 1963 to 17 percent in 1968. Truck tire
retreads dropped from 32 to 28 percent in the same
period.34
Tire performance and consumer preference are
two critical factors inhibiting the expanded usage of
retreads. Poorly constructed retreads do not perform
as well as new tires, especially at high speeds. This is
primarily because the bond between the carcass and
tread can fail, causing the tread to come loose from
the tire. This bond could be improved if the precise
chemistry and carcass dimensions of every retreaded
tire were known. However, tires of various manufac-
tures have slightly different chemistry or size, making
the development of a perfect bonding agent and exact
tread fitting difficult.
Consumers have a preference for new tires because
retreads are felt to be inferior. Manufacturers sell an
increasing variety of low-priced new tires, which in
essence compete with retreads.
A factor that would ultimately restrict retreading
is the technical suitability of old carcasses for
retreading. Only about 35 percent of the discarded
passenger tires are suitable for retreading. This is
largely because consumers allow tires to become too
worn before replacing them and because driving on
underinflated tires weakens the tire carcass.
Better tread bonding, leading to consistent tire
performance, and consumer education and coopera-
tion would be required to increase tire retreading.
Rubber Reclaiming and Tire Splitting. Rubber
reclaiming and tire splitting are limited by the market
potential for the products they produce. Reclaimed
rubber is not technically suitable for making new
tires. The total production of other lower grade
rubber products produced by reclaimers and tire
splitters (e.g., doormats, hoses, and belts) is
extremely small relative to tire discards. In 1969 the
entire output of these industries was only about
290,000 tons.35
New Recycling Opportunities
There is a variety of new potential means of
recycling rubber tires; the most promising include
chemical decomposition, incineration for steam
production, road building, and use as offshore reefs.
Chemical Decomposition. Destructive distillation,
carbonization, and hydrogenization are thermal con-
version processes that may be used to recover the
chemical constituents of tires. The first two processes
are both forms of pyrolysis-thermal decomposition
in a low oxygen atmosphere; hydrogenization is a
process of chemical synthesis involving addition of
hydrogen. The primary product of carbonization
(high-temperature destructive distillation) is carbon
black, a major tire raw material. Lower temperature
destructive distillation yields a mixture of oils, gases,
and carbon residue with significant fuel value. Hydro-
genization yields hydrocarbon products that can be
used in tire manufacturing.
Pilot-plant-scale carbon black processes utilizing
scrap rubber have been tested by some of the major
rubber companies. It was reported that the processes
are feasible but economically unattractive at present,
with costs of about three to four times that of carbon
black production by conventional means from
petroleum.36
Destructive distillation of tires has been examined
by the Bureau of Mines in conjunction with a major
rubber company. The products consist primarily of
heavy oils, light oils, gases, and char. It has been
reported that the value of these products from 100
-------
STUDIES OF RESOURCE RECOVERY AND SOURCE REDUCTION OF SPECIAL WASTES
89
pounds of tires is approximately $1.50 (i.e., $30 per
ton of tires processed). It has been further suggested
that even at this value the process is uneconomical if
shipping, handling, storage, and preparation costs are
included.37
Hydrogenization of the products of destructive
distillation has been examined by the Hydrocarbon
Research Institute at the pilot plant scale, and
preliminary projections were made that such a plant
could operate at a profit if tires could be obtained for
$5 per ton.3 R
Incineration for Steam Generation. Incineration of
tires for steam generation in special furnaces has been
examined by some of the major tire manufacturers
and appears to be a promising disposal and recovery
method. One such plant has been built. When in full
operation, the plant will handle about 1 million tires
per year. The incinerator is reported to be completely
odorless and pollution free. The major drawback
appears to be the high capital cost of the equipment.
Road Building. Road building and repair offers a
large potential outlet for old shredded tires. Rubber
that has been ground into small particles can be
added to asphalt as a binder. The rubber is reported
to enhance the resilience of the road in cool weather
and reduce the flowing characteristics in hot weather.
Rubber can reduce the tendency of asphalt to bleed
to the road surface where it presents a skidding
hazard, and the rubber in the mix allows more asphalt
to be added for better aging and reduced raveling
tendencies.39 However, estimated costs of adding
rubber to asphalt mix (usually in concentrations of 3
to 8 percent) range from $1.50 per ton to $2.50 per
ton of mix.40 The justification for this cost will
depend on whether the cost can be offset by lower
maintenance costs or longer road life. Tests of
rubberized roads to quantify benefits are presently
underway in several locations.
The State of New York is already using reclaimed
rubber with hot asphalt to seal cracks and joints, and
Arizona has laid rubberized asphalt on streets and
airport aprons.
Reef Building. Tires have been used to construct
artificial reefs for fish spawning on the East and Gulf
coasts in response to increasing interest in sports-
fishing. It is reported that water action on the West
coast is too strong for construction of artificial reefs.
EPA does not presently have extensive data on the
economics and long-range potential of this method of
tire reuse.
Conclusions
Motor vehicle tires are relatively difficult to dis-
pose of by landfill and incineration, and many tires are
disposed of inadequately, left as litter, or piled on
open ground. The existing markets for recycling and
reuse of old tires are the retreading industry, the
rubber reclaimers, and the tire splitters. The latter
two markets are very small relative to the quantity of
tires discarded, and the retreading market has been
declining in recent years.
Some research and development of new options
for tire recycling has been carried out by both private
industry and the Federal Government. Most of these
techniques are more costly than disposal (which is
often inadequate from an environmental or aesthetic
point of view). Research and development, demon-
strations, technical assistance, regulations, and fiscal
subsidies are all possible mechanisms for instituting
tire processing or recovery. These mechanisms need
to be evaluated and the technical and economic
feasibility of tire recycling needs to be further
analyzed before recommendations can be made.
REFERENCES
1. Institute of Scrap Iron and Steel. Unpublished data, July
1973.
2. Automobile disposal; a national problem. U.S. Bureau of
Mines Special Publication No. 1-67. Washington,
U.S. Government Printing Office, 1967. 569 p.
3. Derrickson, G. F. Motor vehicle abandonment in U.S.
urban areas. Washington, U.S. Government Printing
Office, Mar. 1967. p.l.
4. Adams, R. L. An economic analysis of the junk
automobile problem. Ph.D. thesis, Urbana, Univer-
sity of Illinois, 1972.
5. Derrickson, Motor vehicle abandonment, p.7.
6. U.S. Environmental Protection Agency. The automobile
cycle: an environmental and resource reclamation
problem. Washington, U.S. Government Printing
Office, 1972. p.20.
7. Booz-Allen Applied Research, Inc. An analysis of the
abandoned automobile problem. U.S. Environ-
mental Protection Agency Contract No.
68-03-0046, June 1972. (Unpublished data.)
8. Booz-Allen, An analysis, p.v-17.
9. Value of packaging materials: 1960-1972. In Modern
Packaging Encyclopedia and Planning Guide, v.45,
no.!2A. New York, McGraw-Hill Book Company,
Inc., Dec. 1972. p.44.
10. Gordian Associates. Energy consumption for six basic
materials industries. U.S. Environmental Protection
Agency Contract No. 68-01-1105, 1973. (Unpub-
lished data.)
-------
90
RESOURCE RECOVERY AND SOURCE REDUCTION
11. Food, consumption, prices, expenditures; supplement
for 1971. Supplement to Agricultural Economic
Report No. 138. Washington, Economic Research
Service, U.S. Department of Agriculture, Aug.
1972. p.15.
12. Darnay, A., and W. E. Franklin. The role of packaging in
solid waste management, 1966 to 1976. Public
Health Service Publication No. 1855. Washington,
U.S. Government Printing Office, 1969. 205 p.
13. U.S. Department of Commerce. Containers and Pack-
aging, v.24-25. Washington, U.S. Government
Printing Office, [1971-1972]. (Published
quarterly.)
14. Food, consumption, prices, expenditures, p.18.
15. 1971 marketing guide. Washington, Paperboard Pack-
aging Council, 1972. p. 38.
16. The almanac of the canning, freezing, and preserving
industries. Washington, E. E. Judge & "Sons, Inc.,
July 1,1972.
17. For shelf distinction: unusual shapes. Modern Packaging,
45(12):22-25, Dec. 1972.
18. Opportunity-making trends in packaging. In Modern
Packaging Encyclopedia and Planning Guide, v.45,
no.!2A. New York, McGraw-Hill Book Company,
Inc., Dec. 1972. p.6.
19. Darnay and Franklin, The role of packaging, p.l 13.
20. Research Triangle Institute. A study to evaluate the
effectiveness and impact of a tax or regulatory
mechanism directed toward reducing the quantity
of packaging entering the solid waste stream. U.S.
Environmental Protection Agency Contract No.
68-01-0791, [1973]. (Ongoing study.)
21. Bingham, T. H., and P. F. Mulligan [Research Triangle
Institute]. The beverage container problem;
analysis and recommendations. Washington, U.S..
Government Printing Office, 1972. p.29-30.
22. News release. Salem, Oregon State Highway Division,
Jan. 4, 1972.
23. Midwest Research Institute. The national economic
impact of a ban on nonrefillable beverage con-
tainers. Washington, U.S. Brewers Association,
June 1971. p.55.
24. Bingham and Mulligan, The beverage container problem,
p.153-155.
25. U.S. Department of Commerce, Bureau of Domestic
Commerce. Unpublished data, 1973.
26. Bingham and Mulligan, The beverage container problem,
p.58.
27. Midwest Research Institute, The national economic
impact of a ban, p.45.
28. Bottle survey 7.1. La Habra, Calif., Alpha Beta Acme
Markets, 1971.
29. Bingham and Mulligan, The beverage container problem,
p.68.
30. Bingham and Mulligan, The beverage container problem,
p.69.
31. Claussen, E. Oregon's bottle bill: the first six months.
U.S. Environmental Protection Agency. Washing-
ton, U.S. Government Printing Office, 1973. 14 p.
32. International Research & Technology Corporation. Tire
recycling and reuse incentives. U.S. Environmental
Protection Agency Contract No. CPE-R-70-0047,
1972. p.l.
33. International Research & Technology Corporation, Tire
recycling, p.S.
34. Markiewicz, W. J., and M. J. Gransky. Rubber reuse and
solid waste management. Part 2. [Public Health
Service Publication No. 2124]. Washington, U.S.
Government Printing Office, 1971. p.67.
35. International Research & Technology Corporation, Tire
recycling, p.60 and 72.
36. International Research & Technology Corporation, Tire
recycling, p.30.
37. Tully, F. R. Paper presented at the Engineering Society
of Detroit, Solid Waste Management Conference,
Mar. 6, 1973.
38. International Research & Technology Corporation, Tire
recycling, p.31.
39. Pennington, D. G. Statement before the Fresno
[California] County Solid Waste Advisory Com-
mittee, Apr. 5, 1973.
40. International Research & Technology Corporation, Tire
recycling, p.43.
-------
Appendix A
DESCRIPTION OF NEWLY DEVELOPED
RESOURCE RECOVERY SYSTEMS UNDER
DEMONSTRATION THROUGH THE EPA GRANT PROGRAM
SHREDDED WASTE AS A COAL
SUBSTITUTE-ST. LOUIS, MISSOURI
The city of St. Louis has operational responsibility
for the waste processing facilities, and the Union
Electric Company has operational responsibility for
the fuel firing facilities. The time and cost schedule
for design, construction, and operation is given in
Table 61.
Incoming residential solid waste is shredded to a
1'/2-inch particle size. The shredded waste is air
classified into two fractions: a "light" combustible
waste fraction containing about 80 percent of the
incoming waste and a "heavy" waste fraction contain-
ing metals, glass, rocks, rubber, and heavy plastics.
Ferrous metals are separated from the heavy waste
fraction. The product outputs are shown in Table 62.
The light combustible waste fraction is trucked 18
miles to Union Electric Company's Meramec Power
Plant. The solid waste fuel is pneumatically fired to
an existing 125-megawatt suspension-fired boiler at a
rate of 15 percent of the boiler's fuel requirements.
The primary boiler fuel is either coal or gas. The
boiler is equipped with electrostatic precipitators for
particulate emission control.
The plant was designed to process 650 tons of
solid waste per day (in a 2-shift operation) and to
produce 520 tons of supplemental fuel per day. Raw,
untreated solid waste has a heat content value of
4,500 to 5,000 British thermal units per pound.
Processing of solid waste to separate the combustible
portion can increase the heating value to approxi-
mately 6,000 British thermal units per pound. In
comparison, coal has a heating value of approxi-
mately 10,000 British thermal units per pound. In
addition to having a comparable heating value,
processed municipal solid waste contains much less
sulfur and produces less ash than coal. The most
dramatic comparison of solid waste to coal is an
economic one. Coal is worth $8 per ton to $15 per
ton. Solid waste represents a negative worth of $2.00
per ton to $25.00 per ton (the range of disposal
costs). Consequently, processed solid waste competes
quite favorably in the energy markets.
It should be noted that about 13 percent by
weight of the incoming waste will require landfilling.
TABLE 61
ST. LOUIS, MISSOURI, SYSTEM TIME AND COST SCHEDULE
Activity
Design and construction
Operation and evaluation
Total
Time period
July 1970 to April 1972
May 1972 to August 1974
Total cost
(dollars)
3,288,544
600,000
*3,888,544
Federal share of cost
(dollars)
2,180,026
400,000
2,580,026
*Union Electric Company is to provide $950,000 and the city of St. Louis is to provide the remaining $358,518 of the non-
Federal share.
91
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92
RESOURCE RECOVERY AND SOURCE REDUCTION
TABLE 62
ST. LOUIS, MISSOURI, SYSTEM OUTPUT
Product
Quantity (tons*) Price (dollars/ton)
Solid waste fuel
Ferrous metal
80
7
t4.20
17.00
*Per 100 tons of solid waste input.
tGross fuel savings to Union Electric Company with-
out recovery of cost.
Boiler exhaust gases will be controlled by an electro-
static precipitator to meet local and Federal
standards. Boiler particulate emissions caused by the
use of solid waste as supplemental fuel are not
expected to be significantly greater than particulate
emissions resulting from firing coal alone. However,
this conjecture is still unconfirmed pending compre-
hensive stack testing. No wastewater will be dis-
charged from the solid waste processing facility. At
the power plant, boiler bottom ash is sluiced to a
settling pond. Because this ash will now contain solid
waste ash, the settling pond effluent will be appro-
priately monitored.
The projected system economics is shown in Table
63.
TABLE 63
ST. LOUIS, MISSOURI, PROJECTED SYSTEM
ECONOMICS*
Item
Capital investment (dollars)
Annual costs (dollars):
Amortization and
interest
Operation and
maintenance
Total
Cost before revenue
Revenues'
Ferrous metal
Fuel savings
Net cost (saving)
St. Louis
2,394,000
227,000
618,000
845,000
ts.oo
tl.OO
t4.00
Union
Electric
Company
600,000
120,000
20,000
140,000
tl.05
*4.20
*(3.15)
*Based on a 2-shift operation, with 1971 actual capital
costs and 1972 estimated operating and maintenance costs.
The assumptions are that 169,000 tons of raw solid waste are
throughput per year, and 135,000 tons of solid waste fuel are
produced per year.
tDollars per ton of input waste.
I Dollars per ton of fuel.
Preliminary data indicate that the project will be
successful. Union Electric Company is considering
adapting other boilers to burn solid waste as supple-
mentary fuel. Other utilities have shown.a significant
interest in experimenting with the concept as well.
SHREDDED WASTE AS A FUEL SUBSTITUTE
OR AS COMPOST-WILMINGTON, DELAWARE
The State of Delaware has operational responsi-
bility for this material and energy recovery facility.
The plant will be designed to process daily 500
tons of municipal solid waste, 15 tons of industrial
waste, and 230 tons of 8 percent solid sewage sludge.
The time and cost schedule for design, construction,
and operation is given in Table 64.
Incoming municipal solid waste will be shredded
to a 6- to 8-inch particle size. The shredded waste will
be air classified into two fractions: a "light" combus-
tible waste fraction containing about 60 to 75
percent of the incoming waste and a "heavy" waste
fraction containing metals, glass, wood, heavy
plastics, textiles, rubber, and rocks.
The light fraction will be shredded again to a 1 - to
2-inch particle size. Most of the light fraction will
then be sent directly to a power plant for use as
supplemental fuel in oil-fired boilers. The remaining
light fraction will be mixed in aerobic digesters with
partially .dewatered sewage sludge for use as supple-
mental power plant fuel or compost or both, depend-
ing upon market conditions.
The heavy fraction will be processed to remove
ferrous metals for recycling. The remaining heavy
materials will be mixed with selected industrial wastes
and pyrolyzed. Heat from the pyrolysis gases will be
used to help dewater the sewage sludge. Aluminum
and glass will be recovered from the pyrolysis residue.
(See Table 65.) The remaining residue will be
landfilled (about 10 percent by weight of the
incoming waste).
Several utilities have shown a significant interest in
implementing the shredded waste as a fuel concept
for oil-fired boilers. Boilers that burn oil can be
adapted to burn solid waste if the boilers were
originally designed to burn coal and have bottom ash
and fly ash (particulate) handling equipment.
Boiler exhaust gases should be monitored and
controlled by an electrostatic precipitator or equiva-
lent device. Although boiler particulate emissions
when burning shredded waste as a supplemental fuel
-------
NEWLY DEVELOPED RESOURCE RECOVERY SYSTEMS
93
TABLE 64
WILMINGTON, DELAWARE, SYSTEM TIME AND COST SCHEDULE
Activity
Design
Construction
Operation and evaluation
Total
Time period
March 1974 to June 1975
July 1975 to May 1977
June 1977 to May 1978
Total cost
(dollars)
1,400,000
10,500,000
1,860,000
13,760,000
Federal share of cost
(dollars)
: 916,560
6,862,640
1,220,800
9,000,000
*The State of Delaware is to provide $4.76 million as its share of the financing.
TABLE 65
WILMINGTON, DELAWARE, SYSTEM OUTPUT
Product
Humus (compost)
Solid waste fuel
Ferrous metal
Nonferrous metal
Glass
Paper
Pyrolysis gas
Quantity (tons*)
16
15
7
1
7
1
11
Value (dollars/ton)
14.70
t6.00
18.00
240.00
7.00
10.00
2.18
*Per 100 tons of solid waste input.
tGross fuel savings without recovery of cost; assumes
waste fuel heat value of 5,000 British thermal units per
pound and cost of fuel oil of $1.00 per 10' British thermal
units.
TABLE 66
WILMINGTON, DELAWARE, PROJECTED SYSTEM
ECONOMICS*
Item
Value
Capital investment (millions of dollars) 11.20
Annual costs (millions of dollars):
Amortization and interest
Operation and maintenance
Total 2.92
Cost before revenue (dollars/ton of input waste) 22.40
Revenues (dollars/ton of input waste):
Humus 2.35
Solid waste fuel .57
Ferrous metal 1.25
Nonferrous metal 2.40
Glass .49
Paper .10
Total 7.16
Net cost (dollars/ton) 15.24
*130,000 tons of raw solid waste are throughput per
year.
may be greater than when oil alone is fired, panicu-
late emissions should be controlled to meet local and
Federal standards. Any process water effluents should
be monitored and controlled to meet local and
Federal standards.
The projected system economics is summarized in
Table 66.
WET PULPING FOR MATERIAL RECOVERY
FRANKLIN, OHIO
The Black-Clawson Company has operational
responsibility for this system. The objective of this
project is to demonstrate a refuse disposal and
resource recovery system capable of processing
municipal refuse and producing metals, color-sorted
glass, and paper fiber in a recyclable form. Non-
recoverable combustible materials are incinerated in a
fluidized bed reactor. The time and cost schedule for
design, construction, and operation is given in Table
67.
The total system, with a design capacity of 150
tons per 24-hour day, contains three subsystems for
solid waste disposal, fiber recovery, and glass
recovery. The disposal system consists of a Hydra-
pulper, a wet grinder that pulps the incoming refuse
except for large objects, which are ejected and passed
through a magnetic separator to recover the ferrous
metal portion. A liquid cyclone takes the pulped
waste from the Hydrapulper and extracts small heavy
objects, mostly glass intermixed with some metals,
wood, and plastic. The remaining pulp passes from
the liquid cyclone into a fiber recovery subsystem,
where the pulp undergoes further cleaning and
dewatering. The final product is a low-grade paper
fiber suitable for recycling. Rejected fibrous material
is piped to a fluidized bed incinerator for disposal.
This fluidized bed incinerator is also being used to
-------
94
RESOURCE RECOVERY AND SOURCE REDUCTION
TABLE 67
FRANKLIN, OHIO, SYSTEM TIME AND COST SCHEDULE
Phase and activity
Hydrasposal and fiber recovery systems:
Design
Construction
Operation and evaluation
Subtotal
Glass and aluminum recovery system:
Design
Construction
Operation and evaluation
Subtotal
Total
Time period
March 1969 to February 1970
March 1970 to June 1971
June 1971 to August 1972
July 1971 to May 1972
May 1972 to July 1973
July 1973 to July 1974
Total cost Federal share of cost
(dollars) '(dollars)
165,000
1,970,000
500,000
2,365,000
20,000
360,000
90,000
470,000
*3,100,000
110,000
1,300,000
350,000
1,960,000
14,000
240,000
60,000
314,000
2,100,000
*The city of Franklin is to provide $500,000, the Black-Clawson Company is to provide $200,000, and the Glass Container
Manufacturers Institute is to provide $150,000 of the non-Federal share.
TABLE 68
FRANKLIN, OHIO, SYSTEM OUTPUT
TABLE 69
FRANKLIN, OHIO, PROJECTED SYSTEM ECONOMICS*
Product
Ferrous metal
Paper fiber
Glass: color sorted
Aluminum
Quantity (tons*)
7
13
5
.4
Price (dollars/ton)
13.50
25.00
12.00
200.00
*Per 100 tons of solid waste input.
dispose of sewage sludge from an adjacent sewage
treatment plant.
Heavy material extracted by the liquid cyclone
will be piped to the glass recovery subsystem. The
subsystem will use magnetic sepi'ration, screening, air
classification, and optical sorting to produce an
aluminum-rich concentrate and color-sorted glass.
Organic rejects may prove useful as a fuel source.
System outputs are shown in Table 68.
It should be noted that about 10 tons of solid
residuals (per 100 tons of solid waste input) must be
landfilled. Air emissions from the fluid bed inciner-
ator have been found to be below the Federal
standards. All water effluents from the plant are
discharged for treatment into the adjacent sewage
treatment plant.
The projected system economics is summarized in
Table 69.
Item
Value
Capital investment (dollars) 8,300,000
Annual costs (dollars):
Amortization and interest 800,000
Operation and maintenance 1,500,000
Total 2,300,000
Cost before revenue (dollars/ton of input
waste) 15.10
Revenues (dollars/ton of input waste):
Ferrous metal .85
Paper fiber 3.75
Glass: color sorted .50
Aluminum .80
Sewage sludge disposal credit .60
Total 6.50
Net cost (dollars/ton) 8.60
*Based on a 3-shift, 500-ton-per-day operation in
which 150,000 tons of raw solid waste are throughput per
year.
PYROLYSIS TO PRODUCE FUEL OIL-
SAN DIEGO COUNTY, CALIFORNIA
The County of San Diego has operational responsi-
bility for this system and will build a 200-ton-per-day
solid waste energy recovery plant (Table 70). Its key
-------
NEWLY DEVELOPED RESOURCE RECOVERY SYSTEMS
95
TABLE 70
SAN DIEGO COUNTY, CALIFORNIA, SYSTEM TIME AND COST SCHEDULE
Activity
Time period
Total cost
(dollars)
Federal share of cost
(dollars)
Design
Construction
Operation and evaluation
Total
April to December 1973
January 1974 to April 1975
May 1975 to April 1976
278,660
2,866,277
867,773
122,244
2,304,693
535,773
*4,012,710
2,962,710
*San Diego County is to provide $600,000, Garrett Research and Development Company is to provide $300,000, and San
Diego Gas and Electric Company is to provide the remaining $150,000 of the non-Federal share.
component will be a flash pyrolysis unit developed by
the Garrett Research and Development Company.
Mixed municipal solid waste will be coarsely shredded
to a 3-inch particle size and then separated mechan-
ically into two fractions: a "light" fraction consisting
of paper and plastic and a "heavy" fraction consisting
of glass, metals, wood, and stones. The light material
will be dried and shredded to a very fine particle size
(practically a powder) prior to flash pyrolysis at a
temperature of about 900° F. An oillike liquid with a
heat value about 75 percent that of No. 6 fuel oil will
be condensed from the pyrolysis gases. The oillike
liquid will be used as supplementary fuel in an
existing San Diego Gas and Electric Company boiler.
The heavy waste fraction will be processed further
to separate ferrous metals and glass. Ferrous metals
will be separated by an electromagnet. Glass will be
separated as a mixed-color glass cullet by a froth
flotation process (Table 71).
TABLE 71
SAN DIEGO COUNTY, CALIFORNIA, SYSTEM OUTPUT
Product
Oil
Ferrous metal
Glass
Quantity*
100 barrels
7 tons
5 tons
Price
$2.27 per barrel
$18 per ton
$6 per ton
*Per 100 tons of solid waste input.
It should be noted that 7 tons of char (per 100
tons of solid waste input) will require landfilling.
Exhaust gases will be monitored and controlled to
meet local and Federal standards, and wastewater will
be discharged into a sanitary sewer.
This system requires no external fuel and produces
a storable, transportable fuel that should have good
national marketability; however, raw waste must be
shredded to a very fine particle size.
The projected system economics is summarized in
Table 72.
PYROLYSIS FOR STEAM GENERATION -
BALTIMORE, MARYLAND
Baltimore will own and operate a 1,000-ton-per-
day solid waste pyrolysis plant developed by Mon-
santo Enviro-Chem Systems, Inc. The LANDGARD
TABLE 72
SAN DIEGO COUNTY, CALIFORNIA,
PROJECTED SYSTEM ECONOMICS*
Item
Value
Capital investment (dollars): 2,748,000
Annual costs (dollars):
Amortization and interest 264,742
Operation and maintenance 420,732
Total 685,474
Cost before revenue (dollars/ton of input
waste) 9.79
Revenues (dollars/ton of input waste):
Oil 2.27
Ferrous metal 1.28
Glass .32
Total 3.87
Net cost (dollars/ton) ts.92
*Based on a 200-ton-per-day operation in which
70,000 tons of raw solid waste are throughput per year.
'A more conservative analysis undertaken by Midwest
Research Institute estimated the net cost per ton for a 1,000-
ton-per-day plant to be $5.42.
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96
RESOURCE RECOVERY AND SOURCE REDUCTION
TABLE 73
BALTIMORE, MARYLAND, SYSTEM TIME AND COST SCHEDULE
Activity
Design and construction
Operation and evaluation
Total
Time period
January 1973 to July 1974
August 1974 to November 1975
Total cost
(dollars)
15,852,000
325,000
*16,177,000
Federal share of cost
(dollars)
6,000,000
0
6,000,000
*Baltimore is to provide $6,177,000 and Maryland Environmental Services is to provide $4 million of the non-Federal share.
system will be designed and constructed by Monsanto
under a turnkey contract with moneyback perform-
ance guarantee provisions. Monsanto is guaranteeing
plant availability at 85 percent, paniculate emissions
to meet local and Federal standards, and the residue
putrescible content to be less than 0.2 percent.
Monsanto's maximum payback liability is $4 million,
about 25 percent of the contract price. The time and
cost schedule for design, construction, and operation
is given in Table 73.
The plant is being designed to handle mixed
municipal solid waste, including tires and white goods.
All incoming waste will be shredded to a 4-inch
particle size and then conveyed to a rotary pyrolysis
kiln. .About 7.1 gallons of No. 2 fuel oil per incoming
ton of waste will be combusted to provide heat for
the pyrolysis reaction. In addition, about 40 percent
of stoichiometric air will be added to the reactor to
allow some of the pyrolysis gases to combust and add
additional heat to the unit. The pyrolysis gases leave
the kiln and will then be combusted in an after-
burner. The hot afterburner exhaust gases will pass
through waste heat boilers that generate 200,000
pounds of steam per hour for sale to the Baltimore
Gas and Electric Company (Table 74). The steam will
be used for downtown heating and cooling. Boiler
exhaust gases will be scrubbed, dehumidified, and
released to the atmosphere.
The pyrolysis residue will be water quenched and
ferrous metals will be separated. Water flotation and
screening processes will separate the char residue,
which must be landfilled (16 tons, with 50 percent
moisture, for every 100 tons of solid waste input),
from a glassy aggregate fraction, which will be used as
aggregate for city asphalt concrete street construc-
tion.
Air emissions will be monitored and controlled to
meet local and Federal standards; there will be no
wastewater discharged.
The technological risk in this system is not great
because of the simplicity of the process and adequate
pilot plant testing. Unfortunately, in general, steam is
TABLE 74
BALTIMORE, MARYLAND, SYSTEM OUTPUT
Product
Steam
Ferrous metal
Glassy aggregate
Quantity (tons*)
240
7
17
Price (dollars/ton)
1.62
7.00
2.00
*Per 100 tons of solid waste input.
TABLE 75
BALTIMORE, MARYLAND, PROJECTED SYSTEM
ECONOMICS*
Item
Value
Capital investment (dollars) 15,371,000
Annual costs (dollars):
Amortization and interest 1,480,000
Operation and maintenance 1,774,000
Total 3,254,000
Cost before revenue (dollars/ton of input
waste) 10.50
Revenues (dollars/ton of input waste):
Steam 3.57
Ferrous metal .44
Glassy aggregate .34
Total 4.35
Net cost (dollars/ton) 6.15
*Based on a 1,000-ton-per-day operation in which
310,000 tons of raw solid waste are throughput per year.
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NEWLY DEVELOPED RESOURCE RECOVERY SYSTEMS
97
TABLE 76
LOWELL, MASSACHUSETTS, SYSTEM TIME AND COST SCHEDULE
Activity
Design
Construction
Operation and evaluation
Total
Time period
February 1973 to March 1974
March to December 1974
January to December 1975
Total cost
(dollars)
430,000
1,912,000
835,000
*3,177,000
Federal share of cost
(dollars)
325,000
1,434,000
625,000
2,384,000
*The State of Massachusetts is to provide $615,000 and the city of Lowell is to provide $178,000 of the non-Federal share.
not an easy product to market because it cannot be
stored or transported for long distances. Another
drawback of this system is its use of about 7.1 gallons
of No. 2 fuel oil per ton of incoming waste. However,
the steam generated will conserve 39.1 gallons of fuel
oil per ton of incoming waste, for a net savings of 32
gallons per ton of waste processed.
The projected system economics is summarized in
Table 75.
INCINERATOR RESIDUE SEPARATION-LOWELL,
MASSACHUSETTS
The principal objective of this project will be to
demonstrate 'that the components of incinerator
residue can be separated and economically recovered.
The city of Lowell will build a full-size processing
plant capable of handling 250 tons of incinerator
residue in 8 hours (Table 76). Raytheon Service
Corporation has the operational responsibility for the
first year; thereafter, responsibility may be trans-
ferred to the city of Lowell. Residue from Lowell and
several neighboring communities will be processed in
the facility. The plant will be designed by the
Raytheon Company using the system piloted by the
U.S. Bureau of Mines at College Park, Maryland.
Using a series of screens, shredders, classifiers, and
other ore beneficiation equipment, the plant will
extract more than 40,000 tons of products-steel,
nohferrous metals, and glass-from the incinerator
residue annually (Table 77). Revenue from the sale of
the products is expected to exceed $700,000 a year
(Table 78). The net profit may be used to offset
increasing incineration costs or air pollution control
costs.
It should be noted that depending on the level of
burnout in the incinerator residue, about 5 tons of
solid residuals (per 100 tons of incinerator residue
input) must be landfilled. There will be no gaseous
pollutants emitted from the processing plant, and
TABLE 77
LOWELL, MASSACHUSETTS, SYSTEM OUTPUT
Product
Ferrous metal
Aluminum
Copper/zinc
Glass
Aggregate
Quantity (tons*)
30
2
1
30
32
Price (dollars/ton)
10
200
330
10
2
*Per 100 tons of incinerator residue input.
TABLE 78
LOWELL, MASSACHUSETTS, PROJECTED SYSTEM
ECONOMICS*
Item
Value
Capital investment (dollars) 1,740,000
Annual costs (dollars):
Amortization and interest 167,000
Operation and maintenance 536,000
Total 703,000
Cost before revenue (dollars/ton of input
waste) 10.80
Revenues (dollars/ton of input waste):
Ferrous metal 2.40
Aluminum 3.00
Copper/zinc 3.30
Glass . 2.00
Aggregate .50
Total 11.20
Net profit (dollars per ton) .40
*Based on a 1-shift, 250-ton-per-day operation in
which 65,000 tons of raw solid waste are throughput per year.
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98
RESOURCE RECOVERY AND SOURCE REDUCTION
process water will be treated in the plant before being
discharged into Lowell's sanitary sewer system.
The reliability and efficiency of the material
separation system must be validated, and product
quality and marketability will be demonstrated.
RESOURCE RECOVERY RESEARCH
Most of the Federal resource recovery research
funds have been expended on the development of an
on-site electrical conversion scheme. The system, the
CPU-400, is being developed by Combustion Power
Company of Menlo Park, California. All of the
funding for the project, which will exceed $6 million
by December 1973, has been provided by the Federal
Government since its beginning in 1967.
The planned conversion of solid waste to elec-
tricity begins with the combustion of the burnable
solid wastes. The exhaust gases of combustion will
directly drive a gas turbine, which in turn will drive
an electrical generator. Before entering the delicate
turbine, the exhaust gases must be thoroughly
cleaned. The cleaning process must produce an
exhaust gas that is at least 10 times as clean as
exhaust allowed by Federal regulations for municipal
solid waste incinerators. The high standard is felt
necessary to protect the turbine blades from erosion
and corrosion.
For several years, cleaning the exhaust gases has
proven to be one of the major technical hurdles.
Another is the ability to control the turboelectric
system. Recent tests have identified a new technical
problem, buildup of deposits on the turbine blades.
RESOURCE RECOVERY COMPONENT
DEVELOPMENT
In addition to development of full-scale demon-
stration systems, the Federal Government has also
sponsored development of components. The major
efforts include the following:
(1) SoJid waste separator. A grant of $135,000
was given to the Franklin Institute in Philadelphia,
Pennsylvania, to develop a ballistic separator that
would mechanically separate shredded refuse. The
system was designed to recover mixed paper fiber for
sale. Matching funds were provided by the Franklin
Institute and Sickson Paper Fibres, Inc. The project
was successfully completed on March 31, 1972.
(2) Classification of nonmagnetic metals. A grant
of $435,481 was given to Vanderbilt University to
develop high-energy electromagnetic separators to
separate nonferrous metals. Several different types of
electromagnetic separators were evaluated. The
project ended on June 30, 1972. Equipment
developed during the project is now being used to
extract chromed zinc from mixed nonferrous metal at
an automobile shredding plant in Nashville,
Tennessee.
-------
Appendix B
PRODUCT DESIGN MODIFICATIONS
FOR RESOURCE RECOVERY, SOURCE REDUCTION,
OR SOLID WASTE MANAGEMENT PURPOSES
The purpose of this appendix is to provide a very
preliminary conceptual review of a number of prod-
uct design considerations that appear to be relevant
to various aspects of solid waste management. The
common element and focus is that of product design,
although it will become readily apparent that aspects
of product utilization by consumers and post-
consumer systems of disposal and/or recovery can
seldom be ignored in analyzing the product attributes
at issue.
The product attributes selected for discussion are
the following: (1) recyclability, (2) recovered (second-
ary) material content, (3) economic durability, (4)
reusability, (5) potential for causing external damage
from disposal, (6) degradability in natural environ-
ments. The first two of these relate primarily to
questions of resource recycling and recovery, the
third and fourth to issues of solid waste source
reduction (aside from recovery possibilities), and the
last two to direct social and/or ecological damage
from disposal.
In the following sections each of these product
design attributes will be defined, and the social
significance, technical feasibility, potential solid
waste management impact, and importance for policy
consideration will be reviewed. It should be stressed
that this is a preliminary attempt to organize and
review these concepts and that the necessity or
desirability of product design changes of this type has
not been established.
It should be recognized that public intervention to
regulate any of the six product attributes could itself
take a wide variety of forms-from direct administra-
tive regulation or the development of product stand-
ards (including bans as a special case) to various
indirect tax or subsidy inducements. This appendix
does not attempt to devise or analyze these specific
control approaches, or to assess the need for such
control, but rather concentrates on the technical and
other issues that need to be better understood prior
to the policy formulation process.
PRODUCT RECYCLABILITY
"Recyclability" is a very general term relating to
the relative technical ease or feasibility of recovering
a particular material from products that would
potentially enter the post-consumer solid waste
stream. This implies the recovery of particular metals
as metals and fiber from paper or paperboard as fiber,
as opposed to extraction of energy values from
combustible material, the conversion of carbonaceous
material into hydrocarbon fuels or compost, or the
conversion of various material combinations into
construction aggregates or other "by-product" mate-
rial use applications.
Recyclability is an inherently relative concept
because ease of recovery depends on a host of factors
relating not only to the existence of specialized
recovery technology but also to conditions of
product disposal as waste, collection systems,
and consumer industry capabilities. It is, therefore,
very difficult to deal with at a general level, even in
purely technological terms, and is also obviously
subject to significant changes in interpretation over
time. The following is a list of some of the ways that
product designs might conceivably be altered to
enhance recyclability: (1) the ease of mechanical
disassembly of complex products (such as auto-
99
-------
100
RESOURCE RECOVERY AND SOURCE REDUCTION
mobiles or appliances) might be increased, (2) the
identifiability of specific chemical compositions of
complex materials might be improved (i.e., some sort
of "tracing" mechanism or material labeling aid might
be incorporated into fabricated materials), (3) mate-
rials might be standardized, (4) the chemical/physical
separability of complex materials might be increased,
(5) products might be made of materials that would
cause smaller contaminant problems (e.g., substitution
of aluminum for copper in automobiles).
Social Significance
Recyclability is broadly related to all the social
concerns regarding the efficiency of material utiliza-
tion including direct costs and environmental impacts
of post-consumer waste disposal, conservation of
particular natural resource supplies, and net environ-
mental impacts of virgin material industries in com-
parison with alternative secondary material recovery
systems.
It would appear that the proximate objectives (or
social benefit values) of increased recyclability relate
to either (or both) decreased cost of secondary
material supply (including especially the costs of
separation and sorting) and improved-quality charac-
teristics of secondary materials from post-consumer
sources. Thus, in particular cases, positive impacts can
occur on both the demand and supply sides of
secondary material markets.
To the extent that scrap values of consumer goods
are increased, there could also be positive secondary
results: diversion of certain items from municipal
collection/disposal systems and possible reduction in
littering (such as of large appliances and auto-
mobiles).
Technical Feasibility
In general, this requires a product-by-product
approach and also a design-item-by-item approach. It
also is apparent that product design for improved
recyclability cannot productively be undertaken in
isolation from knowledge about product utilization
and prospective recovery systems. In other words, the
total product/material cycle must be viewed as an
integrated whole. This is obviously easiest to do in
situations where the consumer of the recycled mate-
rial is also the designer of the product, as might be
expected in the case of glass containers. It seems
greatly complicated, however, in the case of very
long-lived durable goods, where redesigned products
do not appear in the product discard stream in
significant volume until many years (perhaps decades)
later.
It is felt that some technically feasible options for
enhancing recyclability must in all probability exist
for virtually all relevant products. The productivity or
effectiveness of various redesign possibilities in terms
of actually increasing recycling rates will require
broader systems analysis.
Practical Maximum Impact on Problems
Product design to enhance recyclability is relevant
to some extent to the paper, metal, glass, rubber, and
thermoplastic fraction of collected municipal waste,
which together comprise somewhere between 50 and
80 percent of the waste stream according to most
composition estimates. It is also relevant to auto-
mobiles. However, some significant proportions of
each of these materials in waste already occur in
relatively "pure" forms (e.g., glass bottles and news-
print) that are already readily recyclable insofar as
product design aspects are concerned. An initial task
would be to isolate these fractions to determine the
remaining proportions of product/materials for which
design aspects constitute a recycling bottleneck.
It is obviously very difficult to judge or predict the
practical maximum increases in recycling that could
result from product redesign to overcome recycling
bottlenecks. However, as a very crude exercise in
exploring potentials, Table 79 illustrates how one set
of assumptions might translate into reductions in
municipal waste disposal and virgin raw material
commodity consumption.
Thus, if we could design policies for improving
recyclability that could be expected to yield the
increases in actual recycling shown in Table 79, total
municipal waste disposal requirements would be
reduced by about 16 percent on a dry weight basis
(assuming 100 million tons per year as the national
base) or about 13 percent on the alternative wet
weight basis (assuming 150 million tons per year as
the national base). Correspondingly, we can crudely
estimate virgin material demand displacement on the
order of 14 percent of wood fiber, 2 to 3 percent of
refined metals, over 50 percent of virgin rubber
(mostly synthetic hydrocarbons), and 50 percent of
manufactured glass. Clearly the reduction in environ-
-------
TABLE 79
ESTIMATE OF PRACTICAL MAXIMUM IMPACT OF INCREASED MATERIAL RECYCLING ON ANNUAL MUNICIPAL
WASTE DISPOSAL AND VIRGIN MATERIAL DEMAND
Type of material
Paper and board
Metal
Rubber tires
Glass
All other
Total:
Dry
Wet
Weight (dry) in
municipal waste,
1968 (106 tons)
40
12
2
12
34
100
150
Percent by
wet weight of
total municipal
waste, 1968
40
8
1.3
8
44
-
100
Annual U.S.
consumption
of virgin
material
(10" tons)
44
93
3
12
152
Assumed
recycling
Percent of
material
in waste
15
20
80
50
0~
possible
increase
Weight
(106 tons)
6.0
2.4
1.6
6.0
0
16.0
Reduction in total
municipal waste
disposal as a result
of increased re-
cycling (percent)
Dry Wet
6.0 6.0
2.4 1.6
1.6 1.1
6.0 4.0
0 0
16.0
12.7
Reduction in
virgin material
demand as a
result of in-
creased recycling
(percent)
13.6
2.6
53.3
50.0
0
TJ
JO
O
DUCT DESIGN MC
O
5
o
>
H
1
CO
-------
102
RESOURCE RECOVERY AND SOURCE REDUCTION
mental impacts implied by these figures would not be
insignificant.
It is unlikely that there would be any conceivable
impact on littering of packaging material or other
nondurable goods from increasing recyclability. How-
ever, for large items such as automobiles and major
household appliances, it is conceivable that if scrap
values were increased, unregulated dumping on pri-
vate or public property might be measurably reduced.
Importance for Public Policy Consideration
It seems evident that policies for encouraging
increased "recyclability" of products represent an
important and yjable area for further consideration.
To be effective ?and equitable, a product-by-product
approach seems essential. This will require consider-
able technical expertise and awareness of product use
patterns and viable recovery systems as well as of
product production itself.
This may be an area where voluntary industry
action might be capable of achieving much of the
potential benefits without formal regulatory interven-
tion. Given the complexity of regulation in this area
and the potential for making costly mistakes in
policy, good technical research and development and
information programs for evaluating viable options
and making them widely known to industry groups
might be a worthwhile short-term approach. Federal
procurement possibilities could offer a more forceful
approach, short of direct intervention, into specific
product markets. Product redesign to improve the
ease with which recycling may occur, however,
represents only one set of variables in the overall
system determining the viability of recycling. There-
fore, it may be best to consider this as one aspect in
an overall approach to specific industries or products.
RECYCLED CONTENT OF PRODUCTS
For present purposes, the. recycled content of
products is defined broadly to include any secondary
material derived from either post-consumer residuals,
converter-fabrication sources, or other sources, exclu-
sive of "home-scrap" types of residuals recycled
internally in mill operations. The recovered material
may enter the product flow stream at any point from
the basic material processor (e.g., an integrated iron
and steel mill) to the final product or container
manufacture or assembly. The term "products" is
used synonymously with "physical goods" and may
be defined to include either or both final goods or
intermediate (semifinished) goods.
The complexity of potential policy formulation in
this area is illustrated by the following possible
variations in policy design options: (1) degree of
product detail-broadly defined product categories
("construction materials" or "consumer durables") or
narrowly defined items or product components (auto-
mobile engine blocks, book paper, copper wiring,
beverage bottles, or cans); (2) degree of secondary
material substitution specificity-very general
("secondary material," in general, without regard to
type or source) versus very specific (secondary copper
for virgin copper, secondary aluminum for virgin
aluminum, automobile steel scrap for virgin steel, or
.aluminum can scrap for virgin aluminum); (3) speci-
ficity of secondary material source-either, post-
consumer versus converter type, household versus
commercial source, specified geographical area
source, or specified product source (e.g., "paper"
versus newsprint and aluminum versus aluminum
cans).
It goes without saying that any policy that
increases recycling will increase the secondary mate-
rial content of some product(s). We are, therefore,
concerned here with policies that are focused directly
at product producers (either final or intermediate
goods) and, therefore, operate by stimulating the
demand for materials or energy recovered from waste
streams.
SociaJ Significance and Objectives
The principal focus of secondary material content
regulation is on the market demand side of secondary
material utilization. The objective is to increase
resource recovery flows Out of the solid waste stream.
As such, the higher level objectives are those of
resource recovery in general: (1) reduction of direct
budgetary costs of solid waste disposal (and also of
collection attributable to wastes), (2) reduction of
residual environmental damages of solid waste dis-
posal, (3) reduction of environmental damage from
virgin material supply, (4) reduction of present
demands on virgin material natural resources to
increase future availability and/or reduce future
material costs.
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PRODUCT DESIGN MODIFICATIONS
103
Technical Feasibility
Increasing recycled content can refer to both
"pure recycled" ratios for specific materials and the
substitution of secondary materials in nonrecycle-
type uses (e.g., glassphalt and construction materials
from incinerator residues) and substitutions of one
specific recovered material for another specific virgin
material in various product-use applications.
The "maximum" potential is not known or know-
able for the subject as a whole. There are too many
possible variations to explore all technical possibili-
ties. A key aspect in technical feasibility, however, is
the potential material and product performance
attributes that might be affected, the types of
changes that could be considered socially or economi-
cally "acceptable," and the types of constraints that
might be set on allowable degradations in product
quality or performance aspects. This can be an
extremely technical set of issues. It also has a number
of obvious social welfare aspects relating to health
and safety of products, product durability, and
consumer utility.
Practical Maximum Impact
From the solid waste management point of view,
current technology is probably available to utilize
virtually 100 percent of all municipal solid waste in
some kind of product application if we define the
latter broadly to include energy conversion, construc-
tion materials, and "productive" construction land-
fill in addition to the standard (higher value) material
recycled applications. Thus, municipal waste disposal
costs and environmental impacts could be reduced to
zero. All of these uses would involve displacement of
some virgin-based material, but many would not have
high conservation values. Further, many would be
single-use types of material reuse (e.g., energy recov-
ery) as opposed to the multiple reuse potential in
recycling. Total potential for reducing environmental
impacts of virgin material supply would be extremely
difficult to estimateimpossible to estimate until a
detailed specific set of policy targets is postulated.
Litter could be substantially reduced as a side effect
of a maximally imposed policy.
Importance for Public Policy Consideration
This inroad has very significant potentials for
increasing material recovery. It will, however, require
very careful policy design to minimize costs, which
could be significant.
It is accordingly important to realize that most
major industries are likely to be affected, and that
implementation of a regulation' requiring recycled
content could displace certain industrial operations in
specific regions. Marginal virgin material suppliers
could also be forced out as a result of a regulation of
this type.
ECONOMIC DURABILITY OF PRODUCTS
"Economic durability" or "product lifetime"
refers to the length of time household consumer
goods remain in the household sector stock (or
inventory) from time of purchase as new items to
time of final discard to either waste disposal or
material recycling. Lifetime within the household
sector inventory often involves sequential ownership
transfers from original purchaser to second- and
possibly third- and fourth-generation owners. It often
also may involve a nonuse phase following its active
service life during which it is simply held as a standby
item for emergency use, retained as a source of spare
parts, or stored to avoid time and cost of transporting
to a disposal site.
For present purposes discussion is limited to
durable goods only. Household "convenience" items
such as paper towels and paper and plastic throwaway
tableware have been excluded from consideration in
this section as have reusable containers.
Product lifetime is a relatively complex attribute
of durable goods. It is dependent not only on
functional durability aspects of original design but
also on conditions of use and maintenance per-
formed. Furthermore, it is dependent on sociological
and economic factors such as consumer preferences,
stylistic obsolescence, cost of replacement goods,
income differences among households, ease and cost
of repair as an alternative to replacement, household
space limitations, and possibly also cost of disposal.
Social Significance
The primary significance of product lifetime to
issues of solid waste management, resource conserva-
tion, and environmental quality resides generally in
its relationship to the total throughput flow of
materials and products with respect to production
requirements, current stock of service-providing
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RESOURCE RECOVERY AND SOURCE REDUCTION
durable goods, and final disposal flows. However, this
relationship is itself rather complex, and, therefore,
the implications of a change in product lifetime for
the stock flow relationships in question are not
entirely clear-cut or. obvious.
For purposes of illustration, consider a steady
state (non-economic-growth) situation described sche-
matically by
where
P = current annual purchases or production of
a given durable good
S = the stock or inventory of the good
D = the current annual discard flow to disposal
and/or recycling
In equilibrium, the system can be described
mathematically by the following simple relationships:
(1) S is constant over time, as are both P and D.
(2) S = oP where a = the average lifetime of the
product.
(3) P = D = S/a (i.e., current purchases equal
current discards; and if the average lifetime of a
product is, say, 10 years, both P and D will equal
1/10 of the current stock).
Now assume that somehow there occurs an in-
crease in the product's average lifetime by Aa, from
ct] to a2. In principle, there are two possible extreme
adjustment patterns that could be associated with this
change in lifetime:
(1) Consumers could maintain their current pur-
chase flow P and allow their stock to increase by the
maximum quantity of AoP. In this new equilibrium
situation, P and D remain unchanged and S is
increased.
(2) A second extreme case would be where
consumers desire to maintain their same stock level
under the changed lifetime conditions. In this case,
the new equilibrium would find both P and D
reduced by 1 - a, /a2 of their original values.
Apparently, if consumers have the option of
adjusting both S and P, the outcome will be some-
where between the extremes; the most that can be
said is that an increase in average lifetime will lead to
an increase in stocks and a decrease in P and D, by
amounts less than their maximum individual poten-
tials under the changed lifetime assumed. As a
practical matter, this indicates that the prediction of
flow (P and D) implications with respect to a change
in lifetime requires more than simply a priori knowl-
edge of the change in lifetime. The most that one can
argue is that an increase in lifetime should not
increase P and D. The extent to which P and D are
reducible by an increase in lifetime will require
specific knowledge of behavioral adjustment proc-
esses relating to stockholding decisions on the part of
consumers.
The dynamic case involving the growth of popula-
tion and consumer incomes provides a more complex
relationship from a mathematical standpoint, but it
can be modeled. However, the essential conclusions
regarding predictability derived from the steady state
theory remain essentially unchanged.
As a solid waste source reduction contributor,
change in product lifetime could have widely perva-
sive effects on all the objectives of solid waste
management and resource recovery. In general, it is
akin to a decrease in total consumption or economic
growth from the standpoint of material throughput
requirements. Because it can have impacts on both
new goods purchases and discard flows, an increase in
product lifetime could reduce litter rates (durable
goods); solid waste management collection and dis-
posal costs; material availability for resource recovery
industries; demands on natural resources and energy
systems for production of new goods; and environ-
mental impacts of post-consumer waste disposal,
virgin material and converting industries, and second-
ary material recovery industries.
Technical Feasibility
It is technologically possible to redesign products
for increased durability and ease of maintenance and
repair although it is difficult to generalize in this
regard. Some possible ways that product lifetime
might be increased include (1) increased physical
durability obtained through better construction by
means of more material or different material, design
to reduce the number of moving parts, and design to
increase ease and/or decrease cost of maintenance; (2)
increased ease of repair and reduced cost of repair
through design; (3) decreased rate of product design
change (decreased frequency of design change and/or
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PRODUCT DESIGN MODIFICATIONS
105
extent of change) with respect to either or both style
and fashion and performance. Most or all of these
would also tend to enhance the relative position of
second-hand goods vis-a-vis new goods.
Practical Maximum Impact on Problems
All household durable goods currently comprise
probably no more than 10 to 15 percent of collected
solid wastes. Rational Industrial Pollution Control
Council data indicate that major household appli-
ances contributed about 2.2 million tons per year in
1971 to the Nation's solid waste stream. This is less
than 2 percent of municipal waste by tonnage or
compacted volume. It is important to note also that
durability increases will not eliminate but only reduce
waste flows. The effect will also only begin to occur
some years after policy initiation (e.g., the average for
nonrecycled automobile scrap waste would be 5 to 10
years later).
The effect on littering (e.g., abandoned auto-
mobiles and appliances) would be positive, but not
readily measurable.
Resource conservation effects (will be largely post-
poned until the replacement time period for new
goods has elapsed. There could be some short-term
adverse effects to the extent that redesign involves
higher material weight and/or substitution of more
scarce materials to achieve durability. The maximum
impact in the long run could be very important, both
domestically and worldwide.
Public Policy Considerations
Increasing product lifetimes is inherently a long-
term approach; there is not likely to be a short-term
impact, except possibly in second-hand goods or
repair market short-term applications, and only to the
extent that such a measure directly improves the
function of the second-hand goods market. Maximum
potential impacts on resource conservation could be
very significant, and this would probably be its major
impact in terms of social benefits.
This strategy should not be approached in isola-
tion from other product redesign issues and objectives
with respect to durable goods. For example, to the
extent that lifetime increases involve more weight of
product (e.g., automobiles), fuel for operating might
be increased and waste disposal benefits could be
partially offset.
Longer lifetime of durable goods, in general,
implies less flexibility in terms of being able to
influence performance and operating characteristics
of the in-use stock of assets. For example, the
introduction of emission control or fuel energy
economy aspects into automobiles would be easier if
the average lifetime of automobiles were 5 years
instead of 10 years.
PRODUCT REUSABILITY
This topic is concerned with the broad and
increasing category of consumer and producer goods
that are designed for one use only but that, in
principle, could be designed for multiple uses in
serving the same function. Indeed, most of the
products in this category compete currently with
multiple-use substitutes (e.g., paper towels versus
cloth towels and refillable versus nonrefillable con-
tainers).
As is obvious, this category could well be regarded
as a special class within the "economic durability" or
product lifetime subject. We treat it separately to give
special emphasis to the nondurable and semidurable
goods aspects. We do not intend to develop at this
time the further special case of reuse for different
function (e.g., the employment of used automobile
tires as playground equipment or of automobile
bodies in underwater reef construction).
Social Significance
In general, the discussion for economic durability
applies here as well. Essentially, we can regard
single-use commodities as being utilized in "pure
flow" systems, with an in-use stock of service-yielding
assets of virtually zero. In this sense, a doubling of
the number of uses for a given item (from one to
two) will, other things being equal, reduce current
purchases and discards by half. "Number of uses"
thus becomes analogous to "number of years" for
durable goods in the economic lifetime discussion.
The same general implications for solid waste
disposal costs, resource conservation, and environ-
mental protection apply here as well. This topic,
however, has considerably more direct and indirect
relevance to the litter problem.
Technical Feasibility
Design for reusability is obviously only one aspect
of the broader system that determines actual reuse
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RESOURCE RECOVERY AND SOURCE REDUCTION
patterns. The latter includes the behavior of users as
well as the system of incentives that influences
behavior. It also includes industrial organization and
technology relating to reuse cycles outside of house-
holds or primary user establishments (e.g., collection
systems and sorting and cleaning as for refilling
containers.)
Data collected on packaging in general and specifi-
cally beverage containers may be found in Chapter 5.
However, as with some of the other topics in this
series, there appear to be a number of general
possibilities, including: (1) substitution among exist-
ing products (e.g., cloth towels for paper towels and
refillable bottles for nonrefillable bottles and cans),
(2) design of containers to be refillable, (3) product
redesign to increase durability and reusability (e.g.,
reusable paper towels), (4) product redesign explicitly
for reuse (e.g., corrugated shipping containers de-
signed expressly to be easily "taken down" (without
destroying the container) and returned to the shipper
or to an independent wholesaler-such cartons are
currently employed by some moving companies), (5)
design of nonfoldable containers to be stackable as a
means of reducing storage space and return shipping
costs (e.g., wooden fruit baskets).
There are a number of current options that are
demonstrated (by currently available substitutes) to
be technically feasible on the product design side of
the system.
Practical Maximum Impact on Problems
Empirical data have not yet been surveyed and
integrated to get a good quantitative estimate of
impact. The breadth of product categories compli-
cates this task. However, it seems evident on cursory
overview that the potential impact on solid waste
management will be greater for this category than for
the product lifetime category of consumer durable
goods. The major impact will be on paper, paper-
board, glass, and plastics, with some impact also on
metals (steel and aluminum).
Importance for Public Policy Consideration
The reusability approach appears to be a very
significant topic both from solid waste management
and resource conservation viewpoints. Significant
problems may occur in designing optimal policy
strategies and in gaining industry and consumer
acceptance, however.
PRODUCT POTENTIAL FOR DISPOSAL DAMAGES ,
This topic relates to the potentials of various
products for causing economic, human health and
safety, or specific ecological damages under various
disposal conditions. In one way or another, the topic
is concerned with products that are in some sense
"hazardous"-either inherently because of their toxic
material content or their content that can become
hazardous or damaging when disposed of in ways
such as by incineration or by dumping into water.
i
Social Significance
The social objective is to reduce the damages
associated with the waste disposal of the particular
products. The damages may be more or less strictly
economic (e.g., incinerator repair or replacement
costs); they may relate to public health and safety,
with both economic and paraeconomic aspects; or
they may relate to socially perceived damages to
other biological species or ecosystems.
Technical Feasibility
In most instances, either material content substitu-
tions in products or structural product or component
redesign represents viable possibilities for either elimi- ,
nating or significantly reducing problem causes. In
special cases product (or material content) bans may '
be the only feasible means of eliminating a problem,
with other source-reduction-type standards or some
degree of direct regulatory control over use being a '
partial control alternative. The subject has not yet
been sufficiently researched to evaluate technical
feasibility through product redesign.
Practical Maximum Impact on Problems
Particular problems of hazards and other damage
potentials from post-consumer solid waste disposal
need to be defined and evaluated more completely in
terms of their cause-effect relationships and social
significance.
Importance for Public Policy Consideration
This is a rather traditional field for public regula-
tion of particular products and materials. Many
precedents exist in the fields of food and drug '
regulations. It is possible that many of these issues
may be amenable to voluntary industry solution
when well-developed cases can be made in demon-
strating significant health hazards, as long as the
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PRODUCT DESIGN MODIFICATIONS
107
solutions are low cost. The approach discussed in this
section deserves considerable attention.
PRODUCT DEGRADABILITY FOLLOWING
DISPOSAL
"Degradability" relates to the extent to which
materials "decay" or break down over time when
subjected to natural chemical, physical, and biological
processes in the environment. Degradability is an
inherently relative concept because virtually all
known materials are subject to at least some measura-
ble rate of decay under certain environmental condi-
tions. In addition, environmental conditions such as
temperature, moisture, sunlight, wind, land cover
material, and biological communities are subject to
wide geographic variations that can greatly affect the
time rate of degradation of any given material.
The focus of the present discussion is on possibili-
ties for reducing environmental and social damages
from solid waste disposal by somehow increasing
product degradation rates.
Social Significance
Degradability is primarily relevant to the problems
of litter; it may also be relevant to the ecological
aspects of sanitary landfill operations. It is not
directly relevant to the material resource conservation
objective of resource recovery or source reduction.
Litter. In our present conception, the problem
of litter is essentially one of visual aesthetics and,
with very minor exceptions, not one of either public
health or ecological damage significance. From this
perspective, the key variable insofar as product
degradation is concerned is product "disappearance
time." In those areas where litter is subject to
pickup-chiefly major highways, high-density recrea-
tion areas, and some city streets-more rapid product
degradation may conceivably have some implications
for collection costs.
Sanitary Landfill, We do not yet have any
well-established information on the possible implica-
tions for sanitary landfill costs or ecological conse-
quences. Possibly more rapid degradability could
improve volumetric capacities. There could also be
either beneficial or damaging consequences in terms
of leachates. This aspect of degradability has not yet
been developed; but on a priori grounds, chemical
stability or instability seems neither inherently good
nor bad, and the presumption is that answers would
depend on special case circumstances.
Technical Feasibility
There are essentially two broad technical possibili-
ties for increasing the degradability of products at the
design level:
(1) Substitute more degradable materials for less
degradable materials in specific types of products
from among presently available material substitutes
(e.g., steel cans for aluminum cans and paper pack-
aging for plastic packaging).
(2) Develop more rapidly degradable versions of
current materials themselves (e.g., biodegradable plas-
tics, photodegradable plastics or glass, and more
highly water soluble paper coating and filler
materials).
Three additional aspects of technical feasibility
should be discussed: (1) toxicity of end products of
degradation-a potentially undesirable side effect that
would enter as a constraint; (2) functional utility
side effects of material substitution and redesign-to
the extent that products or materials become less
useful or durable in their intended purposes, design
for increased degradability will involve social cost side
effects; (3) implications for recyclability and
reusability-material degradability may often or typi-
cally be antagonistic to material recycling and/or
product reuse possibilities.
Practical Maximum Impact on Problems
Litter. We suggest that there are three ways of
"solving" the litter problem: (1) reduce the littering
rate, (2) maintain and increase litter pickup programs
(very high costs per unit or per unit volume), (3)
increase degradability. Depending on circumstances,
the latter may or may not contribute to a solution.
Consider first the distinction between areas-subject
to regular cleanup versus those subject to no cleanup
(or only very random or sporadic pickup). For areas
subject to regular cleanup (downtown city streets,
high-density recreation areas such as public beaches
and motor-camping areas, and major State highways),
we offer the following general proposition: the more
frequent the cleanup, the less the possible benefit of
increased product degradability (either in terms of
visual aesthetics or cleanup costs). For example, if
pickups occur any more regularly than every few
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RESOURCE RECOVERY AND SOURCE REDUCTION
weeks, there would seem to be no possibility for
degradability to contribute anything to problem
solution because minimum degradability or "dis-
appearance" times are not likely to be that short for
any significant items of litter.
On the other hand, if pickup frequency is on the
order of once or twice per year (the case for some
lower density recreation areas), then degradability
begins to have potential as a contributor to the
solution roughly in proportion to some weighted
average of disappearance times of the items compris-
ing the litter. In this respect, the litter problem is
never completely "solved," but average visual density
is reduced, and total cost of pickup is reduced.
For areas where litter is seldom if ever systemati-
cally collected, degradable products may contribute
significantly (from a visual aesthetic standpoint) in
terms of reducing long-term rates of accumulation.
However, even with respect to the latter two cases
of infrequent or random pickup, technical feasibility
for specific product/material categories is still a point
at issue. No single product/material category alone
comprises more than a relatively small percentage of
the total litter composition. From a technical feasibil-
ity standpoint, the "paper" category should probably
more correctly be viewed as 5 to 10 different
categories, no one of which comprises more than 10
percent or so of total litter. From this it is clear that
even a completely successful product degradation
effort for any single category as defined would have a
relatively small impact on the total problem. Thus,
even in the most unrealistic of all possible cases, if all
plastics could be made to degrade in one day's
exposure to the environment, the 6-percent impact
on the litter problem would probably go unnoticed.
This implies as a practical matter that any signifi-
cant impact on litter from increased product degrada-
tion will require significant decreases in disappearance
times for a great many different product/material
categories simultaneously.
Landfill Impacts. We simply do not yet have
enough technical data at hand to evaluate this aspect
of the degradation issue. Some relevant data no doubt
exist but are not sufficient to form even a tentative
position on policy issues at this time.
Importance for Public Policy Consideration
This is not an area in which one can expect any
degree of short-term success in contributing to any
problem solution. It is also doubtful that benefits to
the litter problem would justify the effort.
If anything, resource recovery would likely be
adversely affected by large-scale production of
degradable materials. It could affect prompt indus-
trial or converter scrap recycling as well as post-
consumer material recovery potentials. If this is true,
then the total material throughput of the economy
could be significantly increased as an unintentional
side effect; and this would have widespread adverse
environmental impacts at primary material extraction
and processing levels.
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Appendix C
AN ANALYSIS OF THE PRODUCT CHARGE
CONCEPT
Actions of both product manufacturers and con-
sumers have an effect upon the solid waste manage-
ment characteristics of a product when discarded.
Producer decisions concerning the amounts and types
of materials used and decisions concerning product
design parameters (e.g., durability, ease of repair, and
styling) affect both the quantities of solid waste
generated and the costs of collection and disposal.
Consumer decisions as to the level of consumption
and the choice of products impact upon solid waste
in a similar manner. However, most solid waste
management considerations are external to the
market transactions that establish the price of
products. Hence, decisions to produce or consume are
made without concern for the economic and environ-
mental consequences associated with the collection
and disposal of the product after discard. This is, in
effect, a market failure that could be corrected by
internalizing solid waste management costs in the
price of products. Such internalization would provide
price signals to producers and consumers that could
stimulate source reduction activities.
Another example of a market failure is the pricing
of solid waste collection and disposal services. Users
of such services generally do not pay in proportion to
the amount of waste generated or in proportion to
the level of service received. Hence, there are no price
signals to the users that would lead to a reduction of
such costs through a more efficient use of these
services. Internalization in this area could be effected
through the imposition of disposal charges at the
discard level. Imposition of both product charges at
the producer level and disposal charges at the discard
level would result in double payment for solid waste
management services. Any product or disposal charge
system should be designed to eliminate or minimize
this double payment.
Product charges are tools for reflecting the desired
internalization of costs in the price of products. They
are essentially a set of charges equivalent to the solid
waste collection and disposal costs of products that
are levied at the time of product sale. The objective
of such charges is to provide incentives at the
producer level to redesign products to reduce solid
waste management costs (e.g., use less material or
lighter material) and to provide incentives at the
consumer level to reduce consumption. There are
several other alternatives to product charges that
could yield similar results including adjustment of
raw material prices, sale taxes, product regulations,
or disposal charges. All such concepts need to be
studied further.
SIZE AND APPLICATION
Ideally the product charges should be set equal to
the costs of collecting and disposing of products as
waste. However, these costs are difficult (if not
impossible) to establish precisely for several reasons:
(1) Solid waste management costs vary signifi-
cantly across the Nation and depend on factors such
as city size, geographic or topological considerations,
type of disposal system used, and the efficiency and
management of local operations.
(2) Solid waste management is often not carried
out in an environmentally acceptable manner. For
example, there are leachate and water pollution from
land disposal, public health and safety impacts of
open dumping and inadequate storage and collection,
and aesthetic effects of litter. In this regard, solid
waste management services are sometimes under-
priced, and use of these costs would not provide the
needed degree of internalization.
(3) There is currently no way of determining how
a single product among other wastes contributes to
the cost of collection and disposal.
109
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RESOURCE RECOVERY AND SOURCE REDUCTION
Therefore, many simplifications, averages, and
assumptions are necessary to design a practical
product charge system.
In Chapter 1, it was estimated that the average
national cost of collection ranges from $18 per ton to
$20 per ton of solid waste, while disposal costs
average about $4 per ton. In a product charge scheme
these figures could be used as a reasonable measure of
the management costs for mixed household and
commercial wastes. Other items such as automobile
hulks and discarded tires are generally collected and
disposed of separately, and a special product charge
would have to be established for these products.
To apply these product charges, it is necessary to
establish a relationship between waste management
costs and some measurable product parameter.
Weight is an obvious choice for a parameter, and a
uniform charge based on weight would be relatively
easy to determine and apply. However, this would
entail certain inequities because heavy products
would be charged more than light products of the
same volume. Product compacted volume is a param-
eter that is probably more representative of disposal
costs (it is a measure of the volume of a product in a
collection truck or landfill), but use of such a
parameter would require analysis of the compacted
volume of all products on a product-by-product basis.
To avoid such administrative complexities, an index
based on product weight is probably preferable.
However, there would have to be special provisions
for products that would be given charges out of all
proportion to their disposal cost and for items the
disposal of which is very costly.
For discussion purposes, consider a product charge
of $20 per ton imposed at the point of sale for all
products that enter the solid waste stream. If passed
on to the consumer, this would represent a $0.01-per-
pound charge on purchased products; such a product
charge is sometimes popularly referred to as a "penny
a pound."
It should be realized that not all products that
flow through the economy are disposed of as solid
waste. For this reason, certain products should be
exempted from the charge (e.g., products that are
consumed, such as fuels, tobacco, and food, and
products that are dispersed, such as aerosols, deter-
gents, and soaps). In addition, recycled materials that
do not incur disposal costs should also be excluded.
Such an exclusion could be implemented by pro-
viding a rebate for the use of recycled materials in
production. It should be realized that this would
provide a substantial incentive for the use of
secondary materials ($20 per ton is much greater than
any of the recycling subsidies evaluated in Chapter 3).
A product charge designed in such a manner would
stimulate resource recovery as well as source
reduction.
It is obvious that the design and application of an
equitable and effective product charge system would
be a formidable task that would require considerable
analysis and administration.
EFFECTIVENESS
Product charges would be expected to have an
effect both at the consumer and producer levels. In
the short term, producers could not fully react to the
charges because of commitments to existing material
supplies, equipment, and operational procedures.
Therefore, initially the product charges would
probably be passed on to the consumer, and the only
effects would result from changes in purchasing
decisions. However, in the long run, in an attempt to
reduce costs, producers would be expected to insti-
tute design changes and alter material utilization
patterns.
The case of packaging will be used to illustrate the
effect of product charges at both levels. Packaging is
the largest single product class in household and '
commercial solid waste. In addition, packaging has a
relatively high weight to value ratio, and, therefore, a
weight-based charge would be expected to be most
significant.
The product sectors that have the highest ratio of
packaging weight to product retail value are listed in
Table 80. From these data it is apparent that the
$0.01-per-pound charge would increase consumer
packaging prices by a relatively small amount-less
than 3 percent. Also, these four categories account
for only 8 percent of all consumer expenditures.
Thus, the general impact on the consumer and, hence,
the expected source reduction effect at this level is
expected to be small. ;
Manufacturers involved in the production of '
packaging would be expected to be most sensitive to
increases in the cost of packaging caused by product
charges. Table 81 shows some of the same product
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AN ANALYSIS OF THE PRODUCT CHARGE
111
TABLE 80
ESTIMATE OF THE EFFECT OF A PRODUCT
CHARGE AT THE CONSUMER LEVEL FOR
SELECTED CATEGORIES OF PACKAGING,
1970*
Packaged product
Soft drinks
Canned food
Beer
Prepared beverages
Packaging
' weight per
$100 of
retail sales
(Ib)
242.70
115.65
114.55
89.78
Product
charge per
$100 of
retail sales t
(dollars)
2.43
1.16
1.15
.90
*Source: Data provided under U.S. Environmental
Protection Agency Contract No. 68-01-0791.
tAssuming a product charge of $0.01 per pound.
TABLE 81
ESTIMATE OF THE EFFECT OF A PRODUCT
CHARGE AT THE PRODUCER LEVEL FOR
SELECTED CATEGORIES OF PACKAGING,
1970*
Packaged product
Soft drinks
Canned food
Beer
Pet food
Packaging
value per
$100 of
retail sales
(dollars)
31.46
23.36
18.21
13.73
Product
charge per
$100 of
retail salest
(dollars)
2.43
1.16
1.15
.55
Product
charge as a
percent of
packaging
value
7.7
5.0
6.3
4.0
*Source: Data provided under U.S. Environmental
Protection Agency Contract No. 68-01-0791.
tAssuming a product charge of $0.01 per pound.
categories impacted from this viewpoint. Several
conclusions can be drawn from this table. First, the
charge impact is greater in terms of percent at the
producer level. The soft drink sector, for example,
would see its packaging costs rise by nearly 8 percent
while consumers would experience only a 2-percent
increase in the costs of soft drinks. Because product
manufacturers are specialized purchasers of pack-
aging, they would be expected to be very sensitive to
these price changes. Producer reaction could entail a
reduction in total packaging or a shift in types of
packaging. It should be noted that no producer would
find his packaging costs rising by more than 8
percent, and, hence, no sudden or dramatic source
reduction effects would be expected.
Newspapers and magazines are other products that
have high weight to value ratios and would be
expected to be sensitive to product charges based on
weight. Small appliances, on the other hand, have
lower weight to value ratios. No analyses have yet
been made on the effect of product charges on these
product classes.
IMPACTS
Environment
Weight-based charges would be expected to induce
some shifts toward lighter weight materials. In par-
ticular, plastic and aluminum might be substituted for
glass and steel, which may increase the consumption
of resources in total and increase the burden on the
environment. For example, on a weight basis, produc-
tion of aluminum is much more energy consumptive
than production of steel. There would also be
differences in air emissions and water discharges
because of the use of different materials and produc-
tion processes.
The refillable beverage container provides another
example of this impact. Refillable glass bottles weigh
nine times more than steel cans and 20 times more
than aluminum cans (for 12-ounce containers). There-
fore, weight-based charges would provide an incentive
to shift away from the use of such bottles (even if a
bottle was reused 15 times, it would be charged more
than an aluminum can). However, as is discussed in
Chapter 5, the refillable bottle has some preferable
environmental attributes as compared to these other
containers. (Its use results in less air and water
pollution and lower energy consumption.)
In summary, product charges based only on solid
waste management costs could clearly result in
negative impacts in other environmental areas. These
effects may be attenuated by the more stringent air
and water pollution regulations and energy conserva-
tion initiatives that are anticipated in future years.
However, a weight-based charge system in itself may
have more negative than positive environmental
impact.
Personal Income
An important feature of the product charge
concept is its impact on various individual income
levels. A study conducted by the University of
Pennsylvania indicates that, with a.,$0.01-per-pound
product charge, individuals earning over $15,000 per
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112
RESOURCE RECOVERY AND SOURCE REDUCTION
year would pay 0.925 percent of their incomes in
addition to their current expenditures, whereas those
earning under $3,000 per year would pay 1.149
percent.1 Thus, the tax would clearly have a
regressive effect.
Disbursement of Revenue Generated
A product charge of $20 per ton would have
generated approximately $1.6 billion in revenue in
1972 (based on 80 million tons of product solid
waste, excluding food and automobiles). These funds
could be used in several ways.
One obvious option would be to distribute the
funds to cities and States to pay for local solid waste
management operations. If this could be accom-
plished effectively, it would eliminate the double tax
aspect of product charges (e.g., consumers pay twice
for solid waste management, through the product
charge and through general taxes for local services).
However, it would be difficult to assure that such
funds displaced consumer expenditures at the local
level. In addition, a significant portion of solid waste
collection is carried out by private haulers. Providing
funds only to municipal agencies would not offset
these costs. Finally, federally provided funds tend to
lead to overcapitalization and inefficient use of
services.
A second option would be to use the funds as an
incentive to implement environmentally acceptable
and efficient solid waste practices. In this case, the
funds would be directly returned to the States (but
not necessarily earmarked for solid waste purposes),
providing there are programs to close open dumps,
implement Federal incinerator guidelines, regionalize
planning, or institute user charges for collection and
disposal. A third option would be return the funds to
States, localities, or private citizens with "no strings
attached" according to a revenue sharing or per-capita
formula.
The manner in which the funds are disbursed does
not affect product charges as source reduction or
internalization measures at the producer or consumer
level. However, it should be clear that there are
administrative difficulties and serious policy implica-
tions with any method of fund disbursement.
SUMMARY
EPA studies in the product charge area are not yet
complete. The tentative findings indicate that a
product charge system is likely to have both positive
and negative effects: positive as it acts to internalize
solid waste costs and reduce the weight of products
in waste, and negative in that it may cause
undesirable material shifts, have regressive effects,
and may cause administrative difficulties in the fund
disbursement area.
Studies on the product charge will continue as will
analysis of other product control mechanisms for
internalizing solid waste management costs and
reducing the generation of product waste.
REFERENCE
1. A systems approach to the problems of solid waste and
litter. Philadelphia, Management and Behavioral
Science Center, University of Pennsylvania, 1971.
p.37.
fiU.S. GOVERNMENT PRINTING OFFICE:1974 546-317/Z88 1-3
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