Marked by Volatility

Metals recycling is the largest and most successful recycling sector in the U.K., recovering around 15 million metric tons of metal and contributing an estimated £5 billion (nearly $8 billion) to the U.K.’s economy each year. The British Metals Recycling Association (BMRA) represents the views of metals recycling companies across the country, which together employ more than 8,000 people. 2010 has been a volatile year for the

U.K. metals industry, but much of the BMRA’s focus has been around waste permitting issues. The association campaigned against the dismantling of the existing “paragraph 45” exemption, which allowed small metals recyclers to operate under a restricted form of environmental permit in the U.K. BMRA was keen for this exemption to remain since it recognized that the metals recovery and recycling sector differs from the wider “waste” industry while acknowledging the low level of risk posed by metals recycling activity.

OFFERING RESISTANCE

However, the U.K. government went ahead with permitting changes despite BMRA’s recommendations and strong resistance early in 2010. BMRA is persisting on this matter and continues to push the U.K. government to honor its promise to support companies that are now required to apply for an environmental permit for the first time, especially if they are required to apply for planning permission as part of the permitting process.

BMRA also has called for the introduction of a smaller “fit for purpose” permit to reflect the low environmental risks associated with this type of operation, along with a review of the new T9 exemption for small metals recyclers to ensure that this is not being abused. Sites looking to operate under a T9 exemption can store or treat up to 1,000 metric tons of material at any one time and, within that, up to 50 metric tons of cable, which can be stored for up to two years.

Although T9 will allow the continued operation of many smaller, compliant and well-managed companies under an exemption, BMRA believes the very low rate of Environment Agency scrutiny will make it too easy for sites “operating on the margins” to appear to be part of the regulated community. Poorly managed or illegal sites do not employ environmental controls on their operations and threaten the commercial viability and good reputation of legitimate metal recyclers.

Another key objective which remains on the BMRA agenda is the reclassification of certain recycled metal “waste” as a secondary raw material. At the time of this writing, a final decision on this by the European Council of Ministers for iron, steel and aluminum is extremely close. The BMRA, nevertheless, is urging the U.K. government to continue to support a positive decision from the council and to encourage the European Commission to accelerate proposals for other recycled metals to be reclassified as materials.

DEMANDING LEGISLATION

Alongside this, metals recyclers in the U.K. continue to see the rollout of new and more demanding European regulation, including new industrial pollution and prevention controls (IPPC) planned for end-of-life vehicle (ELV) shredders, a recast Waste Electrical and Electronic Equipment (WEEE) Directive as well as raised ELV recovery targets earmarked for 2015.

The new U.K. government has given us some reasons for optimism. While it will not single-handedly stem the tide of EU environmental regulation, it is clearly taking the approach of being resistant to new regulation that threatens to increase the regulatory burden on business.

With this in mind, Defra (Department for Environment, Food and Rural Affairs) and BIS (Department for Business, Innovation and Skills) launched the U.K. government’s review of waste policies in June 2010. The review creates real opportunities for positive change and it has been welcomed by the U.K. metals recycling industry. It also will assess what policies are needed to reduce the amount of waste the U.K. generates while maximizing re-use and recycling and ensuring business can operate safely and efficiently. To be successful, the new waste policies must move away from the existing approach of viewing metal “waste” as a problem and, instead, embrace the material as a valuable resource.

The U.K. government’s review of waste policies is a great opportunity to redefine the core purpose of environmental regulation as it relates to metals recycling and to explore new approaches. Current regulations confuse both protection agency staff and BMRA members. It leads to unintentional non-compliance by the operator and over-zealous or misdirected inspection efforts causing an unnecessary burden without demonstrating environmental benefits.

BMRA urges the introduction of a genuine sector-based approach to regulation, ensuring that those making decisions understand the metals recycling industry and can apply regulation in a considered and appropriate manner. BMRA questions the value of the existing inspection-based regime and urges the U.K. government to consider greater use of self-assessment models, the use of quality management standards and senior level self-certification as an alternative and as a means of ensuring environmental performance becomes more widely recognized as a board-level issue.

ON THE UP AND UP

The BMRA also is calling for the funding rules that hamper the Environment Agency from focusing on those that trade illegally to form part of the review. The metals recycling sector in the U.K. has been, and continues to be, plagued by unlicensed and illegal operators that damage the industry’s reputation, the environment and local communities. Revenue collected by the Environment Agency from legitimate operators can only be used to assess their compliance with the regulatory framework and not to identify and target illegal sites. The balance needs to be redressed so that most of the effort is directed toward non-compliant or illegal operators and not on the majority of well-managed and compliant businesses. BMRA is welcoming a debate on how the Environment Agency’s scarce resources can be best put to use.

Materials recovery targets in the U.K. are set to increase in 2015, and meeting these targets is a real challenge for all concerned, and they are making serious demands on U.K. automobile shredder operators. BMRA members are leading the way in developing new technologies and processes to recover high-value materials from ELV shredder residue. For example, fantastic progress is being made in the recovery of high-grade plastics and rubber from shredder residue. BMRA is confident that by 2015 there will be sufficient capacity to process a high proportion of shredder residue.

However, it is likely the last fraction of the shredder residue will be recovered only as energy, requiring the establishment of dedicated energy-from-waste capacity. At this time, investment decisions are on hold as the U.K. government appears unclear as to how to interpret the European guidance on energy generated from this complex non-municipal waste. Until it can be confirmed that this part of the process will be defined as “recovery” rather than “disposal,” investment decisions will continue to be delayed. It is an issue that requires swift action if the required infrastructure is to be in place to divert this material from landfill and if the U.K.’s 95 percent ELV recovery targets are to be met in 2015.

METALS THEFT

During 2010, metal prices continued to rise, bringing with them the problem of metals theft. Utility and transport companies and their customers have suffered the consequences with interrupted power supplies, loss of telephone services and delayed trains. Metal recycling sites remain in the firing line too, and so the BMRA has worked with the Association of Chief Police Officers (ACPO) to develop a joint code of practice to protect legitimate metals recyclers and to prevent thieves from illegally trading stolen metals. The code gives clear guidelines on how to improve security and what to do if employees are suspicious of any criminal activity.

In addition, the BMRA continues to publish metal theft updates to alert members to specific materials that thieves may try to sell through the legitimate trade. Alongside this the association has worked with the police to increase their understanding of the issues that affect metals recycling businesses as well as working with ACPO to develop common guidance for local police forces.

CHALLENGES AHEAD

2010 has been a challenging year for U.K. metals recycling, and 2011 promises to be no different. U.K. metals recyclers already achieve a high level of environmental performance, but the BMRA believes that the industry can make an even bigger contribution to the U.K.’s low carbon economy in 2011 despite these challenges. The U.K. government’s waste policies review is a much needed and welcome step toward targeting government resources, and we are embracing this opportunity to reshape the future of environmental regulation. The BMRA will continue to work with its members and partners to address the issues the metals recycling sector faces today while facilitating future business growth in the industry.

The author is director general of the British Metals Recycling Association. More information about the association is available at www.recyclemetals.org.