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

1. Getting the Max out of your MRF:
Strategies for Increasing Revenues
from Materials Recovery Facilities
Contracts
2012 County Forum on Innovative Waste
Management, May 25th 2012
Phil Bresee, Broward County Recycling Program
Manager

2. Recent MSW and Recycling Trends
in Broward County
* WTE = Gross amount combusted
2

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. 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 012
Managed source-separated material Transitions to dual-
streams...Scrap dealers & vertically stream…driven by
integrated companies (Weyerhauser, collections
Alcoa, Anheuser Bush)… efficiencies, need for
more through-put
Limited involvement from MSW
industry…

5. The Evolution of Curbside Recycling…
Photo courtesy City of Minneapolis

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%
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– Improvements in MRF processing
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systems and technology.
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– Movement towards automated
MSW and recycling collections.
– Demand for recovered paper by
Asian markets in last 10-years.

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. Recyclables are Commodities…
Broward County’s Recyclables Average Market Value

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. Revenue Sharing 101
Advantages Disadvantages
More risk generally equals
Allows for jurisdiction Volatile recyclables greater revenue share…
to realize benefits of commodity markets
strong markets (2008-09)
Financial incentives to Unpredictable; more
increase quantity challenging to budget
for
Financial incentives to Increased
increase quality administration costs
Revenues can help
offset program costs
Enhances avoided
disposal fee benefit

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. What are Your Recyclables
Worth?
= $128.79
per ton

13. Know Your
Recyclables
Stream
• 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. Know What’s in Your Garbage
Also know what’s in your MRF residue…
14

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. Other MRF Contracting Strategies for
Consideration…
• 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. Thank you and Q & A
philbresee@broward.org