dECYCLI
T
he quantity of waste discarded into the environment has increased substantially in past decades both in the United States and worldwide. The generation of m u n i c i p a l solid waste (MSW) in the United States increased from 2.7 lb per capita per day in 1960 to 4.3 lb in 1990 ( I ) . In 1990,the United States generated about 200 million tons of MSW, of which one-third was product packaging. The quantity of hazardous waste h a s a l s o i n creased b e c a u s e of greater use of toxic elements, increased production of synthetic organic chemicals, and expanding economic activity worldwide. This increased waste has contributed to public perceptions that: The United States is using up nonrenewable reso;rces such as petroleum and high-quality ores and, as a result, our children will not have equal access to these deposits ( 2 , 3). The environment has gotten more polluted, particularly with highly toxic pollutants such as carcinogens ( 4 ) . Surveys of toxic releases such as the 8.8 billion lb of toxic chemicals discharged into the U S . environment in 1988 are widely reported (5). Because landfills are a major environmental problem, and the United States is running out of space in them (1,6),we cannot continue to use them. As Senator Max Baucus said, “We are overwhelming ourselves with garbage and we are running out of safe and secure places in which to place it” (7). Waste disposal through incineration is unsafe and leads to significant air pollution problems (8). The United States is leaving a legacy of toxic waste dumps that threaten our health now and will do so for many generations (9, 10). For example, the number of hazardous waste remediation (CERCLA) sites increased from 8000 in 1980 to 37,598in 1992 ( I ) . Although these perceptions have some substantive foundation, the situation is not as bad as they imply. For example, researchers have shown that raw materials prices have been falling in real terms for more than a century, suggesting that materials are not scarce ( 1 1 , 12).Industrial solid waste disposal decreased from 138
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million short tons in 1975 to 90 million in 1983 ( 1 3 ) . EPA reported that total toxic discharges fell from 7.0 billion tons in 1967 to 4.8 billion in 1989 (1). There is no shortage of technically acceptable sites for landfills, although getting public approval for new sites is difficult (14). In this paper we explore the facts and perceptions regarding recycling, what can be done to make products “greener,” and how to think about recycling decisions in a more helpful way. Government action is needed t o lower discharges into the environment. One mechanism to achieve this goal is centralized prohibitions of particular substances or actions. This approach may be useful in some instances, but we argue that recycling can be encouraged best h-7 motivating changes product design and idping to develop the
I
secondary recycling market. Setting a sensible recycling policy is complicated (15). Uninformed recycling programs can waste large amounts of energy and resources. For example, in 1993 the city of Philadelphia realized that its municipal recycling program was too expensive and discontinued it (16).The German recycling authority reported a loss of $300 million as a result of higher than expected volumes of package material returns (17). The energy and pollution costs of collecting and transporting small amounts of materials to be recycled can exceed any environmental benefits. Society needs to recognize the problems of the past and weigh the actual benefits and costs of proposals for recycling. What is recycling? Is refilling a plastic soft drink bottle better than melting it and making a new container? Is making polystyrene cups into park benches better than burning them to produce electricity? When a product is no longer useful to the consumer, it can be handled in any of the following ways: 1.discarded into the environment: 2. placed in a permitted landfill: 3. burned within a permitted waste-to-energy incinerator, producing electricity:
CHRIS HENDRICKSON
F R A N C I S C. M c M l C H A E L
Carnegie Mellon University, Pittsburgh, PA 15213 0013-936W94/0927-18A$04.00/0 0 1993 American Chemical Society
Environ. Sci. Technol., Vol. 28, No. 1. 1994 18 A
4. put to a low-value use, sometimes after breaking it down into its components (e.g., polystyrene cups can be made into park benches, 727 aircraft can be used as reefs); 5 . put to high-value use (e.g., aluminum cans can be melted to make new ones); 6. rebuilt, with some components discarded, and reused, as with automobile water pumps; or 7. reused, as with returnable, refillable beverage bottles. Categories 1 and 2 are not recycling; categories 5 to 7 generally are regarded as recycling. Categories 3 and 4 are ambiguous: they don’t create litter, but they don’t use materials for a high-value product. Moreover, ash disposal may damage the environment, and weathering or biochemical decomposition may release toxic substances. However, incineration might be thought of as “borrowing” petroleum molecules destined to generate electricity. If these hydrocarbon molecules are transformed into plastic, they can yield valuable services and then be burned to produce electricity. Assuming the environmental damage from burning the plastic is not significantly worse than that from burning oil, the former uses the petroleum much more intensively than burning it as oil to generate electricity. Our seven categories can be compared with a four-part hierarchy suggested by EPA for handling MSW: source reduction, recycling, incineration, and landfilling. Even simpler, “green” labels introduce a two-level definition of desirable versus undesirable products (18). Should a company practicing category 7 (e.g., reusing beverage bottles) be praised more than one doing category 5 (remaking aluminum cans)?The higher the category number, the greater the value of the materials and the fewer virgin materials will be required. No matter how many categories are introduced, however, this one-dimensional view of recycling is too simplistic. Recycling decisions should not only decrease the use of virgin material, they should also reduce energy use, environmental loadings, and labor while improving product quality. For example, no one would be happy to purchase an automobile made from recycled components that were unsafe or unreliable. Similarly, shipping empty bottles of Tsingtao beer to China from Chicago for refilling uses much more energy than it saves. Collecting, 20 A
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transporting, and sorting material to be recycled can use so much energy and effort that recycling damages the economy and environment. Also, this one-dimensional view ignores opportunities for increasing the economic life of products and thereby reducing overall material demands. Returning beverage containers for refilling can make sense in terms of energy and materials if the containers are easy to collect, sterilize, and transport to the bottler. Unfortunately, the most common form of polyethylene beverage containers are too difficult to sterilize (these thermoplastics deform at sterilization temperature). Thus, category 7 isn’t always the best solution. Similarly, category 6 works only in some cases. Rebuilding an old automobile can be so difficult and expensive that it is better to shred the hulk, separate the materials, and start afresh. Rebuilding a 1947 Studebaker water pump is worthwhile only if there is demand for it. Innovation would be impeded by requiring all new products to use rebuilt components. Slowing innovation is too great a price for recycling. Categories 3-5 are not always more desirable than a lower level activity. Imagine the difficulty and cost of sorting fragments of clear, brown, and green glass for recycling. At some point, a lower category of recycling action is more desirable. Use of virgin materials and energy, environmental loadings, safety, reliability, and cost are all relevant in evaluating a recycling program. Society desires high-value recycling but only when the energy, environmental, and labor costs make these solutions attractive.
The evolution of legislation Environmental legislation and regulations at the federal and state levels have been subjects of intense congressional activity since 1968. The emphasis has been evolving from end-of-pipe control of existing processes (e.g., the 1970 Clean Air Act and the 1972 Clean Water Act) to pollution prevention and waste reduction. For example, the Superfund Amendment and Reauthorization Act (SARA) of 1986 gave priority to waste disposal that eliminates the toxicant rather than placing it in a landfill where it could become a problem. Companies such as Monsanto and 3M report success in changing production processes and materials to reduce waste genera-
tion (19, 20). Ford Motor Company refuses to accept supplied materials containing cadmium unless explicitly required in the original material specification (21). Public concern has led virtually all states to require or to encourage recycling of MSW ( 2 2 ) . Several states have legislation or voluntary agreements to increase recycling to 2 5 % for packaging materials. In 1991, Congress required states to use recycled rubber in at least 20% of their asphalt roadway repaving jobs by 1997 (23). Congress has considered mandatory recycling that far exceeds the current national goal Of
25%.
There is no scientific foundation for any particular recycling goal. Indeed, the three principal objectives advanced for recycling can be contradictory (24): minimization of wastes; protection of the environment; and conservation of resources, including materials, land, and labor. The first step in an environmental program is to decide on general goals. The second step is to translate the general goals into desired actions and then to provide incentives to implement them. The 1970s environmental legislation created havoc for some firms and industries; the regulations forced them to abate pollution, pay fines, or shut down. Now, companies with “green” technologies or products have a competitive advantage over their rivals. In the extreme, they have a monopoly because their rivals are forced to cease production. For example, the displacement of chlorofluorocarbons (CFCs) by hydrochlorofluorocarbons (HCFCs) creates potential monopoly profits; products designed to use only CFCs will be forced out of the market by 1996 or sooner. If most firms do not react to public pressure, there is likely to be a spasm of legislative action that produces needlessly costly regulations or, in the extreme, costs without benefits.
Benefits and costs of recycling Some people focus on long-term goals and assume that innovation will not solve the fundamental issues. They see pollution abatement, recycling, and the curtailment of fossil fuel use as necessary no matter what the cost (3). This “longterm, pessimistic” view implicitly assumes that society will not receive sufficient warning or that adjustment will be impossible or impossibly costly.
A contrasting view holds that society can and must evaluate the benefits and costs of proposed actions in order to decide what is in the public interest. Innovation and exploration are likely to solve current problems (11). This “optimistic-optimizing’’ view implicitly assumes that environmental a n d resource problems will allow ample time to adjust. We adopt this view, recognizing that some environmental issues will not be so forgiving. Environmental regulations create costs and significant benefits. Existing environmental regulations have been estimated to cost the United States about $115 billion in 1990, 2.1% of GNP (25).Regulations result in environmental cleanup and create business opportunities by stimulating new technology and products. For example, organic additives for plastics have been developed to avoid reliance on heavy metals such as cadmium. Radical technologies such as solid state coolers are being tried in response to regulations (26). EPA’s tighter standards for the discharge and use of lead are forcing companies to scrutinize their production process and designs. Between 1950 and 1980, the plastics content of telecommunications cables increased to more than 35% while the lead content dropped to less than 1%. Had this change not occurred, ATBT’s lead requirements might have approached a billion pounds annually (18). According to the “optimisticoptimizing” view, the social benefit of recycling is the value of the recycled material plus lower overall disposal costs minus the costs of collection and processing. These costs are difficult to estimate, but certain fundamental concepts are universal. Figure 1 illustrates the diminishing returns to recycling. Substantial benefits and low costs can be obtained for recycled steel and aluminum products. For example, used aluminum beverage cans sell for $600 per ton, easily justifying their separation cost. Unfortunately, such cans make up less than 2% of the MSW stream nationally. Recycling smaller items, such as nails, or lower value materials, such as newsprint, increases net costs because the material must be identified, transported, and separated at the same time that revenue per ton declines. For example, searching for bits of aluminum foil among MSW is not cost-effective, but separating aluminum cans is. The diminishing
Get prices
nunicipal solid waste (MSW) components
3.0I
L.”
- -30
10
20
20
40
120
600
Market price ($ per ton) returns to recycling illustrated in Figure 1are also associated with increasing collection and separation costs. Because only tiny amounts of the highly valued materials are in the stream, they are expensive to separate. For some materials, techniques such as magnetism can sort cheaply. Nonetheless, the costs of an ambitious effort to separate metals, glass, newspapers, and plastic from the waste stream would be much greater than the benefits. Twenty-nine percent of the aluminum in MSW was recovered and recycled in 1984, compared to only 1%of plastics (27).Polyethylene in grocery bags or polyethylene terephthalate in soda bottles can be recycled profitably today, in contrast to polystyrene in automobile parts. If markets were developed for other components of the stream, the economics of recycling could get a large boost. As regulation forces more recycling, the net benefit diminishes. For an “optimistic-optimizer,” forcing ever higher levels of recycling results in net social costs rather than benefits. Although the longterm pessimists favor an admittedly arbitrary goal, such as 100% or even 50% recycling, the optimists find that such goals make no current economic or environmental sense. Assuming the goal is to use fewer nonrenewable resources, less energy, and impose less environmental load, recycling is a valuable tool in some cases and a harmful one in
others. Careful analysis is needed to distinguish the cases. Increasing costs with increased levels of recycling are evident in many MSW recycling efforts. For example, Pittsburgh, PA, obtained a bid from a recycling firm of $2.18 per ton in revenue to the city to accept commingled aluminum cans, ferrous metals, glass, and certain kinds of plastics. This combination of materials represented roughly 3% of the MSW stream by weight. If newspapers were added to the recyclable material, then the city had to pay the recycling firm $8.39 per ton. The tipping fee at a landfill was then $21.42 per ton. Although recycling newspapers was cheaper than depositing them in a landfill, increasing the fraction of MSW recycling substantially reduced the revenue received (28.29). Nearly half of all newsprint is recycled in the United States. Increasing this fraction substantially would impose significant collection and transportation costs on outlying areas. The source of virgin newsprint-trees grown as a crop-is a renewable resource, so the environmental benefits from additional recycling msy be small (301.Municip a l recycling programs m u s t balance revenues from material sales, disposal costs (including savings in landfill tipping fees), and the costs of collection and separation for different amounts of recycling. The extent to which particular materials or products can be cost efEnviron. Sci. Technol.. Val. 28, NO. 1, 1994 21 A
fil environmentalists‘ dreams and result in extensive recycling, so far it has been an economic disaster and created environmental prohlems. New legislation to require take-hack and recycling of automobiles and other products threatens further havoc. Manufacturers worldwide have avoided some desirable materials because of their cost. For example, gold contacts in electronic products are highly desirable but expensive. When products are reLease rather than sell turned, the gold is returned. The In Germany, proposed legislation initial price of the product is less requires that manufacturers of prod- relevant than the ultimate price ucts such as personal computers over the lifetime of the product. and automobiles take them back We predict that in the future price when consumers are finishec‘ -.-‘A ‘ists will st-’- -.ot on’-- e initial them 117. 181. (Germanv
fectively recycled will vary as new technologies and market prices vary. Certainly, research and development coupled with new technology or education can make recycling much more effective. Relatively little attention has been placed on research to shift the distribution in Figure 1 to achieve higher net revenues (31). In the following sections, we suggest mechanisms by which recycling can he fostered.
tailers-and kanufacturei take back their plasti wrapping material). Thi “take-back’’ recyclin permits a radically ne1 perspective toward dt sign. Rather than bein sold to the consumei each product would b “leased” from the mam facturer. What might seem to b a headache for the man1 facturers could be a sif nificant business oppoi tunity. Products can be redesigned to reduce costs if the company knows they will be returned in a few years. For example, Audi is remanufacturing old components and selling them at high prices, resulting in cost savings as well as lower environmental loadings. C u r r e n t p r o d u c t s being “leased” include Xerox copiers, which include remanufactured parts, and “disposable” cameras. Kodak has designed the cameras for easy disassembly and remanufacturing. Such “green design” is possible for many products. Producer take-hack should be subjected to a benefit-cost test. For example, the German “green dot” program for returning packaging materials has exceeded all expectations for the amount of material presented for recycling. Indeed, the quantity has overwhelmed recycling capacity in Germany a n d neighboring countries. Rather than selling the collected material, the German government has s p e n t much more than initial estimates to subsidize recyclers and others to take the material. Although the German program eventually might ful-
likely to he at a competitive advantage as environmental regulations become more stringent. Creating markets In a highly competitive market with full information, buyers would arise for any valuable material. However, real markets are constrained by environmental regulations, incomplete information, difficulties in locating new facilities, and reluctance to invest in a plant until both the supply of input material and the market for the output material are assured. For example, although many areas have instituted newspaper recycling programs, the supply of used newspapers is far greater than demand: the price paid for used newspaper has declined precipitously (35). As the German green dot program illustrates, companies that must take back u s e d p r o d u c t s should be careful to ensure that markets are ready to absorb the components and materials that they will be selling. One important step is an honest technical assessment of the attributes of virgin versus recycled materials. For some uses, myriad impediments to recycling hamper current efforts. For example, US. government regulations far too often forbid the use of recycled material. The Federal Recycling and Procurement Policy (Executive Order 127801,which requires agencies to increase the use of recycled materials, is a positive step. Recycling is a dirty, unromantic business. Companies that operate municipal recycling facilities and automobile shredders try to cover their costs; they don’t see themselves as environmental idealists. Instead, they try to figure out how to make a profit from the consumer waste that is their raw material. For example, automobiles currently can be recycled by disassembling them into reusable components and materials or by shredding them and separating the component materials. Scrap merchants unbolt the pumps and other valuable components, then shred the car and separate the ferrous and nonferrous materials. Shredder operators make decisions almost daily on how much copper and other nonferrous metals to separate on the basis of
Society desires higl value recycling but only when the energy, environmental, and labor costs make these solutions attractive.
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price of products, but also the value of the returned product and the annual cost. The resulting pricing structure would encourage manufacturers to add materials and quality improvements that previously were excluded because of the “sticker shock” on initial prices. Concern for green design highlights the importance of excellence in industrial design processes. A National Research Council report estimates that 70% or more of the overall costs of product manufacture and use are determined during the initial design stages (32). The NRC report details the myriad goals and constraints that product designers face, including consumer appeal, low cost, safety, manufacturability, durability, timeliness, and maintenance as well as minimal environmental impact. Research in material properties, required tolerances, and environmental loadings is needed for many recycling decisions (33, 34). Computer aids can help the designer by allowing evaluation of more options. Companies with an excellent design process are
scrap prices. Much more can be done at the design stage to make materials more valuable for recycling. Transport and collection costs are a major impediment for some recycled products. Recycled material generally has a low value per ton. For MSW, recycling programs typically require a separate collection crew and vehicle. With low value products, recyclers cannot afford to pay substantial transport and collection costs. The separation of materials for recycling is expensive and can impose health risks on workers. Some materials are not labeled and so make recycling impossible or too expensive. Metal alloys, like plastics, should be labeled. Batteries are an important example of the value of reuse. The leadacid battery in an automobile typically contains about 18 lb of lead. Roughly 26 million of these batteries reach the end of their economic life each year in the United States. If even a small fraction of 500 million lb of lead were discarded into the environment each year, the consequences would be deleterious for human health and the environment. In this case, the market has worked well. When cars are junked, the used batteries generally are sold to recyclers.
Disposal taxes A decentralized way of promoting green design is through the use of “disposal charges.” These disposal charges would be added to the materials price to reflect the damage that would result if a pound of this material were released into the environment. The risks to health, ecology, and aesthetics would be reflected in the charge. For example, mercury and lead are neurotoxins that are reconcentrated biologically in the environment. If a product designer is planning to use either material in, for example, consumer batteries, the disposal charge would alert the designer to the damage that might result from their use. Following Congress’s initiative in imposing the fee directly on the manufacture of CFCs, we propose placing the fee on manufacture of toxic materials, with a refund for the amount of material that gets recycled. Because permissible levels of mercury in water are 2 5 times lower than permissible levels of lead, as a first approximation the disposal charge for mercury should be about 25 times greater than the charge for lead based on these maximum con-
tainment levels. A disposal charge of this magnitude would prompt designers to search for cheaper materials or better recycling programs. For general toxic materials (including products containing toxic materials), a charge of $0.18 per pound has been suggested as representing the cost of safe disposal (36). For comparison, a proposed Michigan bill would ban the nickel-cadmium battery after 1995 and, between 1993 and 1995, would impose a surcharge of $O.O2/g ($9/lb) on nickel and cadmium (37). Of course, any toxic material charge can only imperfectly indicate the environmental burden actually imposed by the material because the actual disposal of the material is not known in advance. Nevertheless, efforts to assess commensurable hazards of different materials are under way (38). A significant disposal charge would motivate the manufacturer to organize a campaign to recover the lead or mercury from the batteries. For example, there might be a large deposit on each battery, and collection groups would be attracted to the market. If the designer (and collection organization) could demonstrate that a program could get old batteries returned, the disposal charge to the designer could be reduced. These disposal charges would motivate designers to choose less toxic materials and motivate companies to recover their used products and utilize the raw material (39). Society doesn’t desire to prohibit the use of mercury, lead, and cadmium; that is impossible. The disposal charges allow a graded response rather than a simple permitted-or-forbidden response. However, if one company or one country doesn’t have to pay the disposal charges, it will have an unfair advantage. All U.S. firms could be subject to the charges, but not all nations are likely to a d o p t s u c h charges. If the United States excluded goods made in countries that didn’t have disposal charges, we would be imposing a substantial nontariff barrier to trade. If we didn’t worry about the effect of our disposal charges, some products would be at a substantial disadvantage i n competing with foreign products, both in the United States and abroad.
Conclusions and first steps Manufacturers m u s t a d d r e s s green design issues now or they will face a legislative-regulatory spasm
that will be uninformed or even punitive. Green design, manufacturing, use, and product retirement involve a radically different way of thinking about products and services. Adding another layer to reviewing a design or manufacturing process is not a productive path. Faced with the challenge of having to take products back from consumers, manufacturers need to think in a radically new way about the choice of materials, design, product concept, and manufacturing and service processes. This requirement can be seen as a challenge to manufacturers to improve product design to satisfy many goals. We suggest the following ways of conceptualizing these issues: “Recycling” should be defined by the amount of virgin material, capital, labor, and energy used and by the environmental loadings, rather than by some arbitrary goal. Arbitrary recycling goals can be more harmful to the environment and future generations than systems with a lower recycling score. Recycling is subject to diminishing returns: the higher value, easily collected, and easily separated materials are worth recycling, in contrast to materials that are less valuable, more difficult to collect, or more difficult to separate. If products are returned to the manufacturer for disposal, we predict that manufacturers will begin to t h i n k of p r o d u c t s as being “leased” rather than sold, and begin to design to minimize the full annual cost of a product. A particularly useful idea is that of “green taxes,” which would reflect the environmental damage from discharging a material to the environment. The designer would be charged for each gram of material going into the environment, with the charge reduced or refunded for material that is recycled. The hard task is to calculate the values that are associated with each of the stages of reuseldisposal of a product a n d to c a l c u l a t e t h e d i s p o s a l charges. The next step is to demonstrate that the charges encourage designers and manufacturers to build products that are desirable to consumers and consistent with green goals. For the economy as a whole, Congress might set the price level for materials discharged into the environment based on their toxicity, persistence, bioaccumulation, and SO forth. The total fees collected would be a measure of total envi-
Environ. Sci. Technol., Vol. 28, No. 1, 1994 23 A
ronmental d i s c h a r g e s , toxicity weighted. The change in these total fees over time would tell Americans what was happening to this aspect of environmental quality. Acknowledgments We thank Scott Farrow. Indira Nair, our reviewers, a n d other colleagues for
helpful comments. Financial support in the preparation of this paper From the CMU Product Design for the Environment Consortium. the American Plastics Council, and IBM is also gratefully acknowledged.
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Lester B. Love is Universitv Professor a t Cornegie Mellon University and holds the Higgins Choir in economics and finance a t the Graduate School of Industrial Administration. He olso h a s opp o i n t m e n t s i n t h e D e p a r t m e n t of Engineering and Public Policy and in the Heinz School.
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Chris Hendrickson is education director of the NSF Engineering Design Research Center. associate dean of the Carnegie I n s t i t u t e of Technology, and professor in the Department of Civil Engineering, Carnegie Mellon University.
Fmncis C. McMichoel is director of the
Centerfor Solid Waste Management Research a n d the M'. Blenko Professor of Environmental Engineering a t Carnegie Mellon University. 24 A
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