Resourceful Thinking

At the 2008 Bureau of International Recycling (BIR) World Convention in Monte Carlo, Paris-Dauphine University economics professor Philippe Chalmin provided an overview of a commodities market that was at that time (May of 2008) still in the midst of a sustained bull market.

Chalmin, who also is part of CyclOpe, a research institute that focuses on the areas of raw materials and commodity markets, has most recently collaborated with CyclOpe’s Catherine Gaillochet to co-author From Waste to Resource: World Waste Survey 2009.

The 450-page book was sponsored in part by Veolia Environmental Services. In a foreword to the book, Veolia Environmental Services CEO Denis Gasquet writes, “Our objective is to reconcile the scarcity of our natural resources with the almost ‘infinite’ quantities of waste produced by our towns, cities and industries—waste which we must unfailingly and assiduously recover.”

Co-author Chalmin was again on the speaker roster at the 2010 BIR World Convention. He offered comments at the General Assembly session taking place in Istanbul the afternoon of Tuesday, June 1.

A GREATER FRACTION

When asked by Recycling Today Global Edition what major trends or surprises were unveiled by the research conducted for From Waste to Resource, Chalmin comments, “Our evaluation of world waste that is produced arrived at a figure of up to 4 billion (metric) tons. When you put recycling, composting and waste-to-energy together, you get 1 billion (metric) tons that are really exploited—but 3 billion (metric) tons of waste that is wasted.”

The figures are intended to include both recycled and disposed of material generated as municipal waste as well as materials generated from manufacturing, agricultural and mining activity. (Chalmin notes compiling global figures was challenging and the estimates are inexact. “It is dangerous to claim this is precise—as an economist, when you are very precise with figures, you are probably wrong,” he quips.)

Chalmin takes the view that “waste is a resource” and thus, “it’s clear we have a huge scope of development” for that resource.

CyclOpe’s research demonstrated that nations with developed economies have generally made greater strides toward identifying and recycling the parts of that stream that have a commodity value. “If you look at some areas like paper, with recycling rates reaching 60 percent and beyond, we can’t go very much further,” says Chalmin.

Market incentives caused by surging commodity prices and laws and directives (in the European Union in particular) have combined to increase recycling rates for metals, paper, plastics and some other materials in both developed and emerging economies.

Recycling directives in the European Union, says Chalmin, have been “very, very important. Our directives have caused us to take notice in the 27 EU countries.”

Chalmin says how well those directives are carried out can vary greatly “in, say, parts of Italy compared to, say, Westphalia in Germany.” For an example of the directives enacting change, Chalmin cites the United Kingdom. “The changes in Britain are dramatic; they formerly had a culture of burying waste,” he says.

In the From Waste to Resource chapter devoted to the United Kingdom, the text notes, “The trend is in favour of material recovery, increasingly rapidly and resulting in a recycling rate of 27 percent in 2006 [and] a recovery rate of 41 percent” in 2007.

That recovery rate also includes waste-to-energy activity, which Chalmin says is likely to be an important, ongoing way to recover value from the portion of the waste stream that does not have significant commodity value.

INDIRECT VALUE

Recycling scrap materials back into secondary commodities is sensibly a high priority when addressing the waste stream, says Chalmin. “A first objective is recycling, which is of course a good solution—but it can’t be the only solution,” he adds.

It may not be economically viable to separate, clean and process lower value materials, but the global demand for energy creates a secondary resource recovery option, says Chalmin.

“It is clear to me that modern techniques of incineration or energy recovery do not carry the [health] risks that they used to,” according to Chalmin. He also notes, however, that, “In France, construction of incinerators is more or less blocked—ecological organizations are interested in blocking all such initiatives here.”

Co-authors Chalmin and Gaillochet write in the text of From Waste to Resource, “The EU has set a target of 20 percent for the renewable energy share in all energy and electricity production by 2020.”

Biomass is proposed as one way to reach this target. It currently supplies just 2 percent of the EU’s electricity. It is defined by the EU as the “biodegradable fraction of products, waste and residues from biological origin from agriculture (including vegetable and animal substances), forestry and related industries [and] the biodegradable fraction of industrial and municipal waste.” Chalmin says that for “some of the things [waste management companies] handle that are not interesting to recycle, it is better to use them in energy-related applications.”

In a world where nations and global corporations are all competing to find new energy sources, tapping the full energy value of the waste and residue stream seems increasingly logical in Chalmin’s view. “Too many people look at waste as a problem when, instead, it’s a solution.”

GLOBAL GROWTH INDUSTRY

The challenges of recycling and recovering a greater portion of the waste stream are present not only in Europe but throughout the world, notes Chalmin. “Waste management in developing countries is a very complicated thing.”

Approaches vary from China’s central-government goals and plans to nations where “they are trying to integrate an informal sector into the formal economy,” he says.

In developing nations, the challenges can include confronting organized crime rings with a heavy presence in the waste industry to being sensitive to not displacing the current means of income for people and families who live near landfills and who make their living scavenging for recyclable items there.

“In cities like Mumbai and Calcutta, you have whole ‘corporations’ of scavengers that are doing a very efficient job,” says Chalmin. “We must be cautious not to arrive with our Western ideas and insist that we are going to develop a new system from scratch.”

The challenge of maximizing recycling and energy recovery values in cities that are centuries old is countered by circumstances in China, where small cities and towns that once had several thousand people rapidly developed and now have populations of 1 million or more people. “There, waste management systems have to be built from scratch because some of these cities barely existed before,” says Chalmin.

His research into commodity markets and the world’s waste management industry has convinced Chalmin that the recycling and waste sector is one that will continue to grow in importance.

“I tell my students waste and recycling is a growth area,” says Chalmin. “They may be considering finance and Wall Street, but if you look at the future of mankind, the person working for Veolia is more important than the trader with Goldman Sachs,” he declares.

The author, editor-in-chief of Recycling Today, can be contacted at btaylor@gie.net. This feature originally ran in the May/June issue of Recycling Today’s sister publication Recycling Today Global Edition.