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Product stewardship case study for end-of-life tyres

Acknowledgements

Executive Summary

1 Introduction

2 Tyre sector

3 Environmental and social issues arising from current disposal/end-uses

4 Alternative end-uses and barriers to these

5 Overseas review of TyreTrack

6 Overseas experience

7 Scheme alternatives and evaluation

8 Recommendations

9 Appendix A: case study methodology

10 Appendix B: TyreTrack participation and review

11 Appendix C: International research

12 Appendix D: Additional criteria used to evaluate tyre scheme options

13 Appendix E: Evaluation of different project stewardship alternatives

Executive Summary

Study scope

A fully-fledged product stewardship scheme for tyres in New Zealand would be directed at improving environmental performance across tyre manufacture, distribution, use, collection and disposal. Consumers, for example, would be educated regarding the most environmentally responsible use of tyres (increasing tyre life through improved driving techniques) and encouraged to return end-of-life tyres to the retailers. Manufacturers would be encouraged to investigate better 'Design for Environment' options and there would be some evaluation on means to minimise transport/distribution distances. However, this report will only investigate minimising the disposal impacts in the tyre life cycle.

The focus of this evaluation is to review TyreTrack and evaluate how it could be expanded to meet specified government product stewardship policy objectives. Other components of the tyre life cycle cannot be significantly influenced in New Zealand - primarily because of the small size of our market (despite some manufacturing occurring here). Product stewardship, as applied to tyres and in the context of this case study, therefore becomes environmentally responsible reuse and disposal options for tyres. Used tyre imports and the high overall level of car ownership in New Zealand due to lack of public transport are other aspects that can be influenced in New Zealand, but are not covered by the scope of this work.

TyreTrack review

The Ministry for the Environment and members of the tyre sector - including manufacturers and importers - have been aware of the tyre disposal issue for some time. The TyreTrack scheme was established two years ago, as an initial step, primarily to minimise illegal dumping of tyres. The stated objectives of this scheme were to:

• ensure that a high proportion of end-of-life tyres are recycled or disposed of appropriately in sanitary landfills;
• improve rates of tyre recycling and reprocessing by providing good information about volumes of tyres available for disposal.

The TyreTrack scheme was not intended to act as a product stewardship scheme; ie, encouraging environmentally responsible practices across all facets of the tyre life cycle. It was, however, intended as a tracking system that would act as a precursor to more responsible disposal and, hopefully, recycling.

Approximately 40% of the tyre sector have registered for the scheme. There is a perception that registration will generate additional administrative loads without any significant benefits. The registered participants include the retailers owned by the two major tyre manufactures - Bridgestone and South Pacific Tyres, who are committed to responsible tyre disposal. The majority of the 300-600 smaller tyre retailers have not registered. Additionally, it is understood that even the registered retailers don't report on all of the tyre movements. Between 25 to 35% of end-of-life tyres are recorded by TyreTrack. As a result, TyreTrack has only been able to contribute to the stated objectives - ensuring that approximately 30% of tyres are disposed of appropriately and retailers have access to information that could allow for improved recycling. Unfortunately, no evidence was collected during this case study to confirm that recycling rates had actually improved.

Recommendations could be developed to improve the performance of TyreTrack by increasing sector participation to allow widespread tracking of tyre disposal. However, we do not believe that this approach will meet the stated Ministry for the Environment product stewardship policy objectives, in particular, that relating to leading to environmental gains. Therefore, we have taken a broader approach to evaluate the potential for greater reuse of tyres, and developed recommendations to overcome the perceived and actual hurdles arising from tyre reuse.

Current tyre disposal

Nearly four million tyres are disposed of in New Zealand every year. Of these, and on the basis of information collected by TyreTrack, 75% are sent to landfill. The remaining 25% are used for farm silage covers, speedways, playground and other valid alternatives, or disposed of illegally. In most cases, the tyres are quartered or shredded before landfill disposal, although even shredded tyres create problems in landfills in terms of void spaces, their ability to harbour insects and potential for tyre materials to float to the surface of the landfill. Whole tyres create even greater environmental issues.

This is an unacceptable situation from an environmental perspective. In the USA, in 2003, more than 80% of waste tyres were recovered (URS Australia 2005). Similarly, in 2003 the European Union (EU) diverted more than 75% of tyres from landfills. Thirty-five of the USA states have some form of waste disposal levy to actively discourage disposal of tyres at landfills. In the EU, whole tyres have been banned from landfills since 2003, and shredded tyres are to be banned from landfills from July 2006. In many developing countries, for example India, all waste tyres are recovered with no scheme in place - due largely to low labour costs and rubber demand being higher than supply.

Potential tyre reuse

In New Zealand, we have two cement plants and one steel manufacturing plant that could potentially use the bulk of tyres currently being sent to landfill. Tyres would provide an alternative fuel source for the cement plants and an alternative raw material and fuel source for the steel manufacturing process.

In addition to the currently available, larger-scale end-uses, there are a myriad of other alternative end-uses (retaining walls, building foundations, road surfaces, erosion control, moulded products, new tyres) that are either currently small scale with the potential to increase in size, or for which new technologies are being developed. The issue for potential reuse becomes one of ensuring that the inherent value contained within end-of-life tyres is realised and exploited.

Barriers to alternative end-uses

There are both perceived and real barriers to alternative potential end-uses for tyres. These include concerns regarding atmospheric emissions from tyre burning, security of supply and transport logistics and costs. The low cost of landfill disposal is also likely to be a barrier as it makes the alternative uses, by comparison, less economically attractive.

TyreTrack

TyreTrack provides an on-line system to allow tyre retailers to find responsible ways of disposing of their waste tyres. To date, approximately 30% of the tyre sector have registered with TyreTrack.

To the extent that it is able (based on applying to only 30% of the sector), TyreTrack enables better transparency of tyre movements, which encourages the participants to dispose of them in an appropriate way. At the same time there is no mechanism that would ensure that total tyre figures are provided and those wishing to dispose of the tyres in an irresponsible way are not constrained by the scheme.

TyreTrack provides good, regionally based information for a third of waste tyres in New Zealand. It performs better in metropolitan areas, while coverage in rural areas is minimal.

TyreTrack does not stack up particularly well against broader government product stewardship objectives - including environmental and social benefits - because it was not established to achieve these outcomes. Nonetheless, TyreTrack forms an excellent established basis for an active industry forum and there is strong industry support to expand its operations and enforce membership.

Due to a large amount of goodwill that TyreTrack can call upon it provides a good base for development of a wider scheme.

Alternative product stewardship approaches

In light of the restricted nature of TyreTrack three product stewardship approaches were evaluated against the government policy objectives and a broader range of environmental, social and stakeholder criteria.

The three scenarios evaluated were:

• status quo - retain existing TyreTrack system as it is;
• expanded scheme - implement a fully expanded waste management scheme for tyres including regulatory and fiscal interventions;
• business-to-business partnerships - cease all government intervention (including TyreTrack) and leave it to the private sector to arrange sustainable disposal options. This would enable organisations in the private sector to establish partnerships to divert tyres from landfills - for example, between Bridgestone Tyres and Pacific Steel.

The results showed that the government policy objectives and broader social and environmental goals would be best achieved through an expanded scheme. The costs of any expanded scheme will, however, need to be evaluated against the benefits and compared with the approach of leaving the issue of tyre disposal to private sector

Recommendations

We recommend that Ministry for the Environment take leadership on the issue of tyre disposal in New Zealand by developing a scheme which encourages tyre reuse for their highest net resource value. We are currently at risk of leaving an environmentally unacceptable legacy for the next generation as large volumes of tyres accumulate in our landfills. This situation is exacerbated by the reality that feasible alternative end-uses already exist, and more are continually being developed.

More specifically we recommend the following.

1. The Ministry for the Environment apply the currently preferred product stewardship policy to the tyre sector by developing regulatory and fiscal intervention mechanisms to:

• establish mandatory membership of TyreTrack and reporting for all tyre movements;
• establish an advanced disposal fee, to be applied to tyres at point of manufacture and import.

2. The Ministry for the Environment carry out further studies to evaluate the implementation of a waste disposal fee. These studies should:

• further evaluate the scope of the waste disposal fee in terms of the products that it applies to;
• determine the organisational infrastructure requirements to support the waste disposal fee - for example, expanding the jurisdiction of a current body such as the Waste Management Institute;
• quantify the potential "market ramification" risks (for example, exacerbating illegal dumping) and ensuring the scheme is designed to mitigate these.

3. The Ministry for the Environment continue to provide support for local and regional councils to limit the illegal dumping of tyres. Mechanisms for this support include:

• enforcement against illegal tyre dumping through the Resource Management Act;
• evaluating the effectiveness of the currently adopted, Auckland based (Waitakere and North Shore) schemes to register waste collectors and establishing how this could be more broadly applied across the country;
• the use of district plans to restrict the numbers of tyres that might be stored on private properties;
• more effective mechanisms for policing and preventing tyre dumping on public and private property, including tighter penalties under the Litter Act;
• encouraging local councils to use existing district plan provisions and environmental field officers to investigate possible illegal tyre dumps and, where possible, prosecute the offenders.

4. The Ministry for the Environment continue to support development of viable alternative end-uses for tyres. This includes:

• support for regional councils on interpretation of the Resource Management Act to ensure the focus is on environmental effects (including atmospheric emissions) rather than prescribing material and energy inputs to processes (for example, as in the situation at Pacific Steel where new resource consents are required for burning tyres, despite no predicted increase in atmospheric emissions);
• support for additional research into the environmental effects of alternative end-uses, including burning tyres as an energy source;
• evaluating further the potential for ongoing use of tyres on farms as silage pile covers, and therefore the available "resource" for other uses;
• keeping abreast of, and where possible supporting, New Zealand-based developments of alternative end-uses for tyres.

5. The Ministry for the Environment carry out additional investigations into a possible Product Responsibility Authority which could take the form of an expanded Environmental Choice. The role of this body would be to provide umbrella support across all sectors for improving the environmental performance of products over their entire life cycle, including manufacture, use and disposal. It would:

• provide education on all aspects of product environmental performance - for example, the roles of customers, retailers and landfill operators in adopting environmentally responsible tyre disposal methods;
• coordinate information exchange/learnings/best practice amongst the different sector product stewardship schemes (given the common objective to divert waste from landfill there will be significant common ground to be shared amongst participants on what works and what doesn't etc);
• carry out research into life cycle impacts of different products in New Zealand and continue to develop specifications for product environmental labels;
• provide support for both government (Govt³) and private sector product procurement initiatives designed to selectively purchase environmentally preferable products.

6. The Ministry for the Environment continue to work with both private sector and local government landfill operators to develop guidelines for storage and disposal of tyres that are entering landfills.

7. The Ministry for the Environment support environmentally responsible disposal of tyres, through government procurement programmes such as Govt³ which will allow for preferential purchase from tyre retailers who are using TyreTrack.