NACo presentation1.1

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National Association of Counties MSW Mgmt forum in Fort Lauderdale...

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NACo presentation1.1

  1. 1. Getting the Max out of your MRF:Strategies for Increasing Revenuesfrom Materials Recovery Facilities Contracts 2012 County Forum on Innovative Waste Management, May 25th 2012 Phil Bresee, Broward County Recycling Program Manager
  2. 2. Recent MSW and Recycling Trends in Broward County* WTE = Gross amount combusted 2
  3. 3. Broward County’s Recycling Services:MRF Contract• Cities provide for “municipal solid waste” (MSW) and recycling collection services – All 31 Broward cities provide some level of residential recycling service• County assists 26 partner cities’ curbside recycling through management of Materials Recovery Facility (MRF) contract• Single-Stream since 2009• 75,000 tons in FY 2012• 1.2 million tons of County recyclables since FY 1994• County rebates cities 3
  4. 4. A History of MRFs… Single-stream Birth of modern MRF… MRFs begin to state legislative actions emerge…China and local government becomes major initiatives… buyer… re-1980s ate 1980s 990s 2000 012Managed source-separated material Transitions to dual-streams...Scrap dealers & vertically stream…driven byintegrated companies (Weyerhauser, collectionsAlcoa, Anheuser Bush)… efficiencies, need for more through-putLimited involvement from MSWindustry…
  5. 5. The Evolution of Curbside Recycling…Photo courtesy City of Minneapolis
  6. 6. Single-Stream Recycling: Keep it Simple... Single-Stream Tonnage Increases from Select Cities• Single-stream invariably results in / Counties (in %)* increased recyclables collections… 140% 120%• Increased participation through resident 100% / customer convenience; no sorting of 80% program recyclables required. 60% 40%• Cart and added capacity 20%• Outreach and promotion 0% d. ty ty I o. Fl M W un• un ,C Initially driven by: , ., rt , Co on Co Co r ua ve is e St er s en ad ad e lli rg D i-D M – Improvements in MRF processing Co eo m G ia e M nc systems and technology. i Pr – Movement towards automated MSW and recycling collections. – Demand for recovered paper by Asian markets in last 10-years.
  7. 7. Single-Stream MRF Technology• MRFs use a wide range of technologies• Recyclables processed using screens, trommels, optical sorting, air knifes, eddy currents, etc.• Speed and angles of processing lines calibrated…• Residue rates decreasing (<10%)…
  8. 8. Recyclables are Commodities… Broward County’s Recyclables Average Market Value
  9. 9. MRF Services Contracting Evolution…• “All-in”, included with recyclables • Increasing private sector dominance collections (part of per HH fee) (~70%);“DBO” contracts less• Mid 1990s MRF services split from frequent… collections • Public ownership-private• Processing fees along with ownership? revenue share becomes more – Public ownership/private common operations• Contracts adjusted pricing/revenue annually (one-year lags)• Multiple variables: – Processing price paid to vendor – Residue allowance – Revenue share
  10. 10. Revenue Sharing 101Advantages Disadvantages More risk generally equalsAllows for jurisdiction Volatile recyclables greater revenue share…to realize benefits of commodity marketsstrong markets (2008-09)Financial incentives to Unpredictable; moreincrease quantity challenging to budget forFinancial incentives to Increasedincrease quality administration costsRevenues can helpoffset program costsEnhances avoideddisposal fee benefit
  11. 11. Revenue Share Mechanisms• Fixed $ per ton• Revenues based on contractor’s sales (vendor must open books…)• Market index approach based on % of average market value (AMV) of program recyclables – Waste & Recycling News (containers) – Official Board Markets – “Yellow Sheet” (paper and cardboard)• Threshold-based (x% share at x tons)• Host fees…
  12. 12. What are Your RecyclablesWorth? = $128.79 per ton
  13. 13. Know YourRecyclablesStream• Packaging trends need to be monitored…• MRFs of the future will manage a different recyclables stream• New materials will be targeted for diversion (mixed plastics, film, scrap metals, etc.)• Some commodities may morph into one (ONP, mixed paper)• Materials can be culled from residue
  14. 14. Know What’s in Your Garbage Also know what’s in your MRF residue… 14
  15. 15. Carts are Key…• Wheels make it easier to recycle• New carts have RFID tags for future recycling rewards program (e.g. RecycleBank™)• Carts (64 or 96 gal.) hold 2-3 x more recyclables than two 18 gallon recycling bins• Footprint of carts similar to two 18 gallon bins• Lids keep materials dry and prevent litter• More than 200,000 homes with carts by 2013• Broward cities with carts are collecting an average of 35% more recyclables
  16. 16. Other MRF Contracting Strategies forConsideration…• Consider long-term contracts (10 • Allow contractor to accept 3rd party years +) tons – MRF price tags can be ~$20 • Structure contract terms that help million weather storms (floor prices) – Longer contract allows vendor • Be assertive at negotiations table to depreciate equipment – big MRF players typically – “Mega-MRFs” way of the future receive more $ per ton than• Allow for options, including transfer indexed prices… sites • …but be flexible (e.g. fuel prices)• Establish residue % thresholds• Be realistic – revenue share must be attractive to MRF operator too…
  17. 17. Thank you and Q & A philbresee@broward.org

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