Paving the Way

A look at tire recycling in the United States will find 50 different states and almost 50 different levels of government involvement. Some states, such as Florida, have aggressive recycling programs in place while other states are struggling with implementing a basic program. Many of these differences can be attributed to variations in market dynamics across the nation.

But scrap tire end markets do have some things in their favor, including high fossil-fuel costs, making tire-derived fuel (TDF) a more appealing option, and enthusiastic contractors sold on using tires in paving applications. These factors have helped many states build solid tire recycling programs that drive end markets for scrap tires and are consuming a fair number of the some 270 million scrap tires generated each year in the U.S.

PAVING THE WAY FOR MARKETS

“To understand the industry, you have to understand three basic things,” says Michael Blumenthal, executive director of the Scrap Tire Management Council, Washington. “Every part of the country has different market potential and every market has its own set of issues to be dealt with. There are 50 different state programs out there and some states have excellent programs, while others haven’t quite gotten there.”

Blumenthal says the different programs and market conditions in each state make for different market dynamics across the country. “All these different market dynamics make market development a challenge. In some areas of the country there is a challenge finding enough tires to meet demand.”

Doug Carlson, government relations director of the Rubber Pavements Association, Tempe, Ariz., says certain markets have traditionally been larger consumers of scrap tires than others. “The traditional large volume states are Florida, Arizona, Texas and California,” he says. “Florida is going steady, and they do have a policy that every surface of an interstate has a rubberized content.” Florida consumes about three million tires a year, he says. “Florida is unique in that they have 21 million tires they have to get rid of and their legislature was interested in trying to solve the problem. This is a way to handle a chunk of them.”

Florida’s success with using scrap tires could also inspire other states to follow its lead, Carlson says. “It is very likely other states would pick up with Florida’s success, and neighboring states might take a look at it.”

Blumenthal agrees that Florida, as well as Georgia, both have excellent tire recycling programs and markets for the material. “Georgia has cleaned up a high percentage of its tires and has well-established markets through that region. There is a strong pulp and paper market there and a lot of mills are using natural gas. But with the high energy costs, they can buy a ton of tires for a fraction of the cost of natural gas.”

Heading west, Arizona is also a steady user of scrap tires in pavement applications, Carlson says. “About 80% of the state highways are surfaced with asphalt rubber.”

He adds that to have success implementing the use of scrap tires in paving applications, both the state Department of Transportation and the contracting community must be interested as well. “If one of those is negative, then you are missing half the equation.”

Carlson attributes much of Arizona and California’s success to having both willing contractors and departments of transportation. “I think in the Southwestern states, the interest on the part of the departments of transportation was spawned by the contracting community,” Carlson says. “Contractors had this technology available and were using it successfully. Eventually the state department of transportation picked it up.

Lack of education has led to some of the resistance to the use of scrap tires in paving applications. “The big resistance to its development elsewhere is the lack of familiarity and knowledge and what highway agencies use,” Carlson says. “They would have had some bad experiences when the national mandate idea was batted around, and it is likely a lot of states used an unsuccessful material and are now reluctant on that pre-conceived notion that this stuff doesn’t work.”

LOOKING TO ALTERNATIVES

High energy costs, both with electricity and diesel fuel, have plagued manufacturers and forced many to find more efficient ways of conducting business. While this and low commodity prices have plagued recyclers, some good has come out of the situation. The higher energy costs have prompted some mills and facilities to look more closely at using tire-derived fuel (TDF), says Robert Davis, president of GreenMan Technologies Inc., Lynnfield, Mass.

“The energy situation actually has people looking for alternative energy options to lower the price,” Davis says. “Tire chips are a commodity and when other fuel prices go up, people look for alternatives.”

The higher energy costs have many recyclers looking at the less expensive alternative of fuel chips. “We’re seeing strength in demand and seeing some margins increase.” Davis says that companies are now more likely to be burning the maximum amount of chips for which they are permitted. Although the permitting process to use TDF “doesn’t happen overnight,” he says, more people are looking at using the alternative fuel source to save money. “It’s pure economics with natural gas and the coal prices going up, and people are going for the alternatives with a lesser cost.”

Acceptance of alternative sources of energy may come slowly, but once people find the quality can be the same and come at a lower cost, Davis says use will most likely continue. “I think it’s like anything else. Once you make a change and people accept that material, then they will keep using that material.”

The cost of changes made to be able to use TDF is also something that prompts a facility to continue to use it, he says. “Once you put in a feed system and a meter system to meter your chip supply in a power plant, once you get that system you have a tendency to want to keep the door open. This will create more demand in the industry.”

Davis attributes the progressiveness of the Southeast portion of the U.S. and its use of TDF to the fact that most facilities are at least permitted to use the material, which makes it easier to begin use of it. In many cases, the permitting process is not one that occurs quickly.

In areas with heavy industry, the use of TDF can be attractive, especially with the higher energy costs right now, Blumenthal says. Also, an area with strong transportation systems in place could have more success. If a tire shredder has excess material but the closest destination is a significant distance away, transportation costs can diminish profitability in an already low-overhead business.

States such as Michigan, Illinois and Wisconsin all have strong markets for the use of TDF, Blumenthal says. “Once again, you have a good market infrastructure, and state governments that are working on this, so things are looking fairly positive,” he remarks. The pulp industry in New England also lends well to the use of TDF, along with power plants in Connecticut. “There are good markets that certainly can consume the annual generation,” he says. “Demand is decent.”

Heading west, Blumenthal sees Texas as a state with a lot of potential for end markets. California has a strong market infrastructure and Washington is considering more market development. “Texas is a place where market potential is quite high. If they can get legislation and market issues coordinated, they could address what they need to look at.”

“Leveling the playing field” when it comes to scrap tires and their uses is a debated topic, Blumenthal says. Tinkering with the market and restricting uses or the amount of tires used could be catastrophic. “Once you start messing with the marketplace, bad things tend to happen to the tire situation,” he says. “Any state that has tried to skew the marketplace and tries to fine tune the force of economics, has met with disastrous results. On the converse, any state that has enhanced the marketplace, [simply] by limiting tires in landfills, has enjoyed a good marketplace.”

HEADING TO THE MARKETPLACE

Unfortunately for tire recyclers, markets for scrap tires do not share similar attributes from state to state. What works in one area may not be as successful in another, and there is no surefire formula to finding end markets for the commodity. The amount of industry in an area, enforcement of existing dumping laws, energy costs and proximity to end markets all contribute to the success, or downfall, of a commodity.

“End users are critical and people in the business have learned who they are,” says Jim Waldron, Tri-Rinse, St. Louis. “It is definitely an end users game.”

Tri-Rinse cleans up tire piles and has focused mainly on civil engineering applications for scrap tires. “To stay competitive, we shred them as efficiently as possible,” he says. “It’s a small dent, but I think that as it becomes more well known, it’s a great use for it.”

He points out a big issue for the company is finding end users for the tires they clean up. “In some states you find costs of more than $1 per tire just to get rid of the tire, simply because there aren’t enough end users,” says Waldron. “One of the problems we run into is how far we have to truck them to get them used. I think the states, in their recycling programs, need to encourage-whether to a power company or other business-more beneficial uses.” He says that if there are no viable end markets within a reasonable distance, the cost of transportation can make a project’s logistics costs higher than what would have been paid for the product.

Tri-Rinse has been mainly using tire chips in civil engineering applications, such as drainage layers for landfills. The tires replace what would have traditionally been rock or gravel. Up to one million tires can be consumed in one project, depending on the size of the landfill.

Blumenthal also says civil engineering applications can be a successful use of a large number of scrap tires. North and South Carolina, Georgia, Florida and Arkansas are all users of tires in civil engineering applications. Examples of uses include as septic field drain pads with shredded tires, replacing gravel. “Three years ago that market did not exist,” he says. “Now it is growing like kudzu. The market for septic field drain pads has been widely accepted in the industry down there and is growing quite significantly.”

A LESSON IN ECONOMICS

As a commodity, the scrap tire supply remains ahead of demand. But that equation can differ greatly from one state or region to the next. Sometimes demand runs so high in areas that the basic laws of economics and supply and demand are able to drive the marketplace. “The thing you run into in end markets where demand is great is that [scrap tire generators] are very aware there is a limited number [of tires], so they charge us to take it.”

Making a usable end product out of the scrap tires can be where the real money is, Waldron says. He has heard of people paying top dollar for shredded tires to make rubberized mulch. “Once you get it to a sellable state, there is value. It takes time and money to get there.”

Waldron says if each state would help make viable marketplaces for scrap tires, use of the material would really excel. “One of the things each state could do to help the marketplace would be to promote its use through the department of transportation that would require a certain amount of [rubberized] asphalt be used. The crux of the whole thing is it costs more to do. If they could get the cost down, I think you would really see it used extensively.”

To help drive the economics of tire recycling and to promote use of the material, Virginia has an end user reimbursement program in place, says Allan Lassiter, manager of the Virginia Waste Tire Program, Virginia Department of Environmental Quality (DEQ), Richmond, Va. The end user program Virginia has set up stems from the waste tire fund, money collected when consumers purchase new tires and dispose of old ones. Payments from this fund go to the end user who provides end markets. Typical end user applications are civil engineering uses and fuel applications, he says.

The state spends about $2 million per year on the program. The only stipulation in the program is that one must prove the tires came from Virginia to receive payment. “In most cases that is enough to drive the economics to make them want to use [Virginia tires],” Lassiter says. End users receive a payment of $22.50 per ton of tires used.

“The next part of the system, which is very good, is the that the end user has to have the documentation that they are Virginia tires and then documentation of how they are using the tires,” he remarks. “What I end up with is a list of who is using scrap tires and what they are doing with them. One of the best parts is that you know exactly who is using the tires and what they are doing.”

Lassiter says the Virginia program is a good way to promote markets and uses for the scrap tires because it is reimbursing those who actually use the tires. “We like ours because it is so traceable,” he says of the program and its organization.

GRANTING PERMISSION

To encourage use of scrap tires, some states have grant programs to supplement the added cost often associated with using scrap tires in nontraditional applications. The Missouri Department of Natural Resources, Jefferson City, Mo., has a grant program to encourage the use of playground cover made from recycled tires. Grant recipients are required to purchase waste tire material that contains at least 40% Missouri-generated waste tires, says Dan Fester, chief of the department’s waste tire unit.

About $100,000 is available for grants each year. The department has had about 72 applications this year, he says. Most of the applicants are public and private schools and non-profit organizations such as day care centers.

“We are happy with the response,” Fester says. “It has been tremendous. The schools are really excited to have this material and the kids love it.” Fester says several schools have said use of the playground cover has resulted in fewer injuries on the playground, therefore lowering their insurance costs, so the benefit has been double.

He says the grant recipients have a choice of which vendor they purchase the product with, and it must be verified the material is at least 40% Missouri scrap tires. About 235 grants have been awarded over the four-year course of the program. Funds for the grants are generated from the tire collection fee collected when people purchase new tires and dispose of the old ones. The maximum amount of money given is $5,000 for loose fill material, and if “pour and place” material is going to be used, then a maximum of $10,000 can be awarded.

Fester says although the cost for the rubberized mulch or playground cover containing scrap tires may appear to be greater than wood-based mulch up front, it can be more economical in the long term. “Part of it is just educating people, because you have to look at a look at a lot of recycled materials in a life cycle cost to really appreciate what you are buying. In the case of this material, it doesn’t need to be replaced for years. Plus there are indirect things such as insurance rates dropping.”

North Carolina also has a grant program in place that has awarded about $2 million. The grants are for end market development for companies using scrap tires in their products. Awards are done on a competitive basis and money comes from the advance disposal fee paid when new tires are purchased by consumers. “We are very pleased with the projects we have funded,” says Paul Crissman, environmental supervisor, solid waste division, North Carolina Department of Environment and Natural Resources, Raleigh, “and disappointed in that we haven’t had more projects like those. Each of those projects has a common denominator in that they create an ongoing demand for using processed tire materials in a production process.”

CONTINUING EFFORTS

Overall, it appears a fair amount of states have a handle on the scrap tire problem and are in the process of either cleaning up existing piles or have programs in place to help accelerate end uses for the material.

But, as several industry professionals have noted, scrap tires will not fully be a commodity until there are adequate end markets for the material in more regions. The Southwest region of the country appears to have a good handle on this through government guidelines to use tires in applications such as road pavement. The Southeast meanwhile, offers an increasingly established TDF market.

As new uses and technologies emerge, the use of scrap tires will hopefully continue to grow to address the 270 million obsolete tires generated each year. End uses such as civil engineering applications, which can often consume large quantities of tires, appear to have much promise and those uses could continue to spread as more education and technology emerges.

The author is the associate editor of Recycling Today and can be reached at mgoodrich@recyclingtoday.com.