Response to Zero Waste Committee Chair Brodie

On June 5 we received a letter from Metro Vancouver Zero Waste Committee Chair, and Mayor of Richmond, Malcolm Brodie. In it, Chair Brodie offers a perspective on proposed Metro Vancouver Bylaw 280 – a bylaw which we believe is inextricably linked to Metro Vancouver’s proposed $500 million taxpayer-funded incineration plan, and which serves to protect the incineration plan irrespective of the upstream and downstream costs to residents and businesses.

This is a view that is shared by the BC Chamber of Commerce, Vancouver Board of Trade, Business Council of BC, Landlord BC, BC Restaurant & Foodservices Association, and many others with long-standing experience in recycling and waste management. 

In our response to Chair Brodie, we clearly outline how the proposed bylaw undermines Metro Vancouver’s own provincially-approved Solid Waste Management Plan, how it would lead to increased fees for residents and businesses, and inhibit efforts to increase recycling. We also outline how an alternative to incineration–specifically mixed waste material recovery facilities–could increase recycling in the region, at no additional costs to residents, and with no increase in taxes.

This letter repeats many of the concerns we expressed to the Zero Waste Committee and the Metro Vancouver Board last fall, when proposed Bylaw 280 was rushed through three readings. We include the full text of our response to Chair Brodie below.

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June 10, 2014
Chair Brodie and Directors
Metro Vancouver Zero Waste Committee
4330 Kingsway, Burnaby, BC V5H 4G8

VIA E-MAIL 

Dear Chair Brodie,

Thanks for your June 5, 2014 letter. I have considered it carefully and take this opportunity to respond to your perspectives and concerns. I trust you will include this response with the materials circulated to the Zero Waste Committee for its June 12th meeting so that the Committee members will have a complete understanding of where our views diverge regarding the need for and merits of proposed Bylaw 280.

In summary, while we both would like to see more waste diversion and we both recognize that, at the end of the day, there are residuals that require landfill; we differ in our views of how to achieve higher levels of diversion while creating value in our local economy.

Metro’s course of action would see tipping fees increase materially, extensive public investment in incineration, regulatory entrapment of residents and businesses to pay for that investment, and source separation as the sole permitted option for recycling, as the means of achieving higher levels of diversion. NextUse believes in open market competition, private sector innovation/investment, more consumer choice for recycling, and no taxation increases, as the means of achieving waste diversion rates equal to and even beyond the aspirational goals identified in Metro’s 2011 Integrated Solid Waste and Resource Management Plan (2011 ISWRMP).

As for the elephant in the room, let’s be frank about proposed Bylaw 280. It is evident to those close to this matter that the proposed bylaw and waste disposal by incineration are inextricably linked. To suggest otherwise does a disservice to the residents and businesses in the Region who may not fully understand the issue.

It is also clear that a very important option (mixed waste material recovery) was overlooked by Metro Vancouver when it prepared what ultimately became the 2011 ISWRMP.

In addition to these broad themes, please consider the following, specific comments responding to the points you mention in your June 5th letter (organized per the headings in that document).

1. Flow Control Mechanisms 

NextUse questions Metro’s assertion that Bylaw 181 has no flow control provisions. In fact, Bylaw 181 has significant flow control provisions through the authority it can and does exercise pursuant to the prohibitions set out in Section 2.1:

“… no person shall own or operate within the area of Greater Vancouver Regional District:

(a) a Disposal Facility;
(b) a Transfer Station;
(c) a Material Recovery Facility;
(d) a Storage Facility;
(e) a Brokering Facility; or
(f) a Composting Facility;

unless that person has with respect thereto and strictly complies with a valid and subsisting Licence.”

This discretionary authority—and not solely the $3 per tonne fee—is what has controlled the establishment of private transfer stations. If it were only the fee, there would be many private transfer facilities in the Region today.

Within this context, it is important to clearly understand the two fundamentally different mechanisms by which MSW can flow out of the Region to other disposal options:

1. Consolidation of collection trucks through a transfer facility
2. Geographic proximity to facilities in the Fraser Valley

As noted, the prohibitions in Bylaw 181 effectively deal with the first mechanism, which represents the higher volume ability to transfer material out of the Region. As for the second mechanism being geographic proximity to the Fraser Valley versus the Surrey (Port Kells) Transfer Station, this has been a long-standing reality (with about 50,000 tonnes per year of flow leaving the Region for over a decade). This is also something that can effectively be dealt with through harmonization of facilities (181) and disposal (281) based bylaws between Metro Vancouver and the Fraser Valley Regional District (FVRD) – something which the FVRD has offered in its updated Solid Waste Management Plan.

However, the fact remains that when tipping fees are increased in order to pay for a half billion dollar incinerator, the financial incentive for more leakage will exacerbate. Therein lies the perverseness of proposed Bylaw 280: Metro knows that it is necessary because the natural market response to increased tipping fees would be to take more MSW out of Region by whatever means make the most economical sense. Proposed Bylaw 280 would impose a stringent regulatory regime to trap MSW in-Region because that is the only way to support a second incinerator.

2. Disposal Bans and Flow Control 

Metro’s current regulatory regime (Bylaw 281) gives it authority over in-Region disposal facilities. In light of that fact, it is unclear why Metro has not simply exercised that authority to enforce appropriate disposal bans at the Burnaby incinerator and landfills rather than to seek to impose a wholly new regulatory regime.

Based on its own waste composition studies, Metro has been and is currently allowing the Burnaby incinerator and regional landfills to accept three to four times the amount of recyclable materials permitted under its disposal bans. Furthermore, Metro is promising the proponents vying for the contract to build and operate a new incinerator recourse to these high levels of otherwise recyclable materials given their significance as fuel. So, while Metro promotes separation of recyclables at source, it has not done what it can to enforce or achieve its own disposal bans notwithstanding the mechanisms available to it under Bylaw 281. Metro’s own projections of waste composition for paper, plastics and organics only marginally change between today’s regional waste diversion of 58% and the projected 2020 waste composition at the diversion rate of 80%.

3. Application of Bans and Prohibitions at Mixed Waste Material Recovery Facilities (MRFs) 

We agree with appropriate bans and prohibitions and, as mentioned above, would like to see them enforced at all disposal facilities.

However, after 25 years of investments and progress with source separation, success has been mainly achieved with the single-family sector (now captured through Multi Materials BC). And Metro’s own projections for waste composition at the 80% diversion level show plastics increasing in the waste stream, paper marginally decreasing, and organics composition going from 38% to 28% of the waste stream. Clearly there is and will remain a significant opportunity to draw out this percentage of organics and the last of the recyclables left in the waste stream after residents and businesses have done their best at source-separating. This is what MRFs can achieve.

The fear that mixed waste MRFs will roll back the achievements in recycling or impede advancements in diversion of organics is fabricated and simply wrong. Recycling paper, plastics, and metal containers ultimately will be free; and processing/composting of organics will be well below the tipping fee of a mixed waste MRF.

You state, “beyond the monetary costs of recycling services there are other considerations including effort to source separate along with space and equipment requirements.” If that is the case, why limit the diversion options solely to source separation where these costs and practicalities may be prohibitive? And how is the effort to source separate along with space and equipment requirements not a monetary cost? And, after all these monetary costs have been absorbed by residents and commercial businesses, Metro has no plan to enforce disposal bans beyond “visual” inspections at the transfer stations which do not account for what’s inside the bag. Will this create the even playing field among all users of the system that Metro purports to be striving for? Of course it won’t.

So, proposed Bylaw 280 really isn’t about protecting recycling. Rather, it’s about protecting incineration irrespective of the upstream and downstream costs to residents and businesses.

In that regard, the BC Environmental Management Act does not specify where or how recycling can occur. MRFs are very clearly recycling facilities, not disposal facilities. Yet proposed Bylaw 280 would see MRFs distinguished from among all other types of recycling facilities and, instead, treated as disposal facilities along with landfills and incinerators. There is no logic to this discrimination and it conflicts with the goal hierarchy of the ISWRMP.

4. Efficacy of Mixed Waste MRF 

Following my presentation at the May 12, 2014 City of Port Coquitlam Council meeting where I showed a graphic depicting how mixed waste MRFs can take the Region “conservatively” to 85% diversion after 70% had been achieved through source separation, Councillor Forrest requested clarification on the anticipated performance of NextUse’s MRF. He stated that based on his quick calculations of recycling about 60% of the remaining 30%, that with mixed waste MRFs the Region could go from 70% diversion to “a maximum 88%–under 90% for sure.”

I agreed and agree with Councillor Forrest’s high level understanding of the potential contribution of a MRF. However, I question the source of the data Mayor Greg Moore attributed to me since I have been consistent in both print and presentation, where I conservatively estimate the performance of a mixed waste MRF at 50% diversion of inbound MSW (notwithstanding that more recent performance testing at a US facility indicates a diversion rate closer to 60%).

With respect to your comment regarding the contamination of recyclables with organic material, there are two very important aspects that you may be unaware of:

1. All plastics, irrespective of the amount of washing undertaken at source, go through secondary processing including an industrial wash to remove contamination, labels, and adhesives before granulating or pelletizing.

2. Paper which is contaminated with organics can be processed with the organic fraction and composted, much like the paper used to line your kitchen scraps container at home (recommended by composting proponents to address the “yuk” factor).

As I also made clear in my presentation to the Port Coquitlam Council, it is important to remember that residuals from a mixed waste MRF are inert, with very minimal potential for leachate or methane generation.

Perhaps most importantly, the effect of organic contamination of recyclables would not put Metro’s capital at risk. That risk is assumed by the private-sector investor and I can envisage no better incentive than the avoidance of Regional tipping fees at the back end of a mixed waste MRF to drive innovation and even more diversion and recycling.

Metro’s attempt to control the percentage of recyclable material that may be accepted by a mixed waste MRF would undermine the economic viability of these facilities, as I believe certain factions at Metro fully appreciate and indeed intend in order to ensure the diversion of otherwise recyclable materials to incineration, where it is needed as fuel.

5. Management of Residuals 

You suggest there is some ambiguity about where NextUse might deliver residual waste from its operations. There is none. I have repeatedly stated, and the license application for the NextUse facility likewise provides, that residual waste will go to a facility determined by Metro Vancouver.

This aspect of the NextUse operation seems to be well understood by Metro Vancouver’s permitting staff (as I have received no request for clarification on this particular aspect of the License Application or the Operations Plan). The relevant section of both documents follow:

NextUse MRF License Application, page 3, section 21 (my emphasis): 

The operation will use manual and mechanical processes to separate and recover recyclables products from material delivered to the facility, residual material will be shipped to Regional facilities.

NextUse Operations Plan, page 2, section 1.4 (my emphasis): 

All materials are handled and stored inside an enclosed building. The loading of containers or vehicles with outbound recyclable materials may occur outside the building. The loading of containers containing organic material for composting, alternative daily cover material for composting, and residual material for shipment to Regional Facilities will occur inside the building.

Perhaps your confusion has its source in what is proposed for the handling of “unacceptable materials” as defined in Bylaw 281. Because Regional Facilities cannot receive unacceptable materials, we have referred to the appropriate receiving facilities as “Authorized” (and not “Regional”).

6. Mixed Waste MRF Business Model 

Metro asserts that NextUse’s business model is counter-intuitive because of the risk of private transfer stations being set up in the Region. We disagree.

As noted in the responses above, your assertion is founded on what we suggest is a key misunderstanding of existing Bylaw 181. Specifically, Metro already has a facility-licensing authority in Bylaw 181 and has successfully exercised this authority over the past few decades. The fact that there are no private transfer stations operating in the Region today without a license, nor have there ever been since the inception of Bylaw 181, proves the point. Any attempt to establish an in-Region, unlicensed transfer station has been short-lived, as Metro has successfully prosecuted and fined the entities that have done so.

In concert with Bylaw 181, Metro has also run a cost-effective system (through service agreements with the private sector). As a result, the tipping fee differential between Metro Vancouver and the FVRD has resulted in limited volumes of MSW leaving for the FVRD (it has occurred only where it makes economic and environmental sense due to geographic proximity). This has occurred for over a decade without any material impact to Metro Vancouver. And with an updated plan from FVRD and the harmonization of facilities and disposal based bylaws between Metro and FVRD, I submit the leakage issue will diminish.

As noted above, herein lies the basic difference in how we view recycling and residuals management: our business model is founded on the current authority enshrined in Bylaw 181; open markets that ensure competition, efficiency and consumer choice to achieving diversion; no market distortions resulting from unnecessary expenditures on an incinerator; and stricter enforcement of disposal bans to the existing incinerator and landfills. We believe this provides the right balance between economic and regulatory measures that will incentivize waste flows to stay within the Region as well as incentivize private sector investment and job creation in the area of materials recovery and additional diversion.

In closing, I wish to thank you again for this important exchange. This letter repeats many of the concerns we expressed in letters to your committee and the Board last fall, when proposed Bylaw 280 was rushed through three readings. We continue to contend that the bylaw elements relating to mixed waste MRFs represent some of the deepest flaws of the proposed regulation which, as many others with long-standing experience in recycling and waste management have also expressed, clearly undermines the ISWRMP goals and commitments approved by the Province.

Sincerely,

[original signed]

Russ S. Black, MBA, P.Eng.

Vice President, Corporate Development