September/October 1993
Waste exchanges are springing up all over, bringing together generators and consumers of previously disposed materials. Here's a discussion on how and why they work, as well as a look at their future.
BY KENT KISER
Kent Kiser is associate editor of Scrap Processing and Recycling.
The idea that one company's discards can be another's raw material is nothing new to scrap recyclers. But with rising waste disposal costs, narrowing disposal options, and increased focus on recycling and reuse, that principle has taken on a new meaning. Today, more and more of what might have become industrial waste is recovered based not on the material's intrinsic value but on the potential savings from avoiding disposal.
That's where the so-called waste exchanges come in. Whether they're billed as industrial matchmakers, corporate swap meets, or recycling bulletin boards, these organized clearinghouses are designed to divert as much material from disposal as possible by finding productive uses for it through listings submitted by material generators and consumers.
Their potential is huge. According to the Environmental Protection Agency (EPA), U.S. industry generates 7.6 billion tons of nonhazardous waste and 300 million tons of hazardous waste a year, and it is precisely this vast stream that the exchanges strive to diminish.
How Exchanges Work
The concept of waste exchange originated in Europe in the early 1940s and was first introduced in North America around World War II. Nevertheless, organizations dedicated to exchange activities didn't appear here until the Canadian Waste Materials Exchange (Mississauga, Ontario) opened in 1978, followed closely in the United States by the Southeast Waste Exchange (Charlotte, N.C.), also in 1978, and the Southern Waste Information Exchange (Tallahassee, Fla.) in 1980.
Today, the practice may finally be hitting its stride. Since January of this year, the number of exchanges in North America has more than doubled, rising from 23 to 48, and many more are reportedly being planned. (See page XXX for a list of current exchange operations.) The majority of these exchanges are public nonprofit organizations supported by state governments either directly through their environmental agency or indirectly through universities, chambers of commerce, or industry associations. Still, a few exchanges are private nonprofit or for-profit corporations.
By their nature, all of the exchanges encompass a spectrum of materials—both hazardous and nonhazardous—that are usually grouped into broad categories such as acids and alkalis, organic and inorganic chemicals, glass, leather, metal-bearing sludges, metals, oils, paint, paper, plastics, rubber, solvents, textiles, and wood. "With the exception of nuclear and biomedical wastes, virtually every conceivable material can be listed because there's usually the potential it could be reused or recycled," says Bob Smee, director of the Pacific Materials Exchange (Spokane, Wash.). In addition to "normal" industrially generated materials such as sawdust, fiberglass trimmings, and foundry sand, exchanges can list offbeat items such as feather dust, egg shells, dryer lint, and used banana boxes. "Our listing policy is wide open," says Eugene B. Jones, director of the Southern Waste Information Exchange. "There's no way I can restrict someone from listing anything."
While the exchanges often include listings of traditional scrap materials, such materials may be offered in an unusual form such as steel photographic film canisters, or in a difficult-to-recycle form such as metallic-nonmetallic composites. The exchanges also offer scrap recyclers the potential to develop new market uses for the nontraditional materials that constitute the bulk of exchange listings and can be used to find homes for the residues and fluids they might otherwise dispose of.
In a typical waste exchange, generators and consumers of any material submit classified-type listings for "materials available" and "materials wanted." Each listing identifies the material by name and provides a description noting the material's characteristics—such as dimensions and composition—potential uses, quantity, and geographic location. Each listing is also given a code number, which allows companies to offer or seek materials anonymously. The listings are then published in a catalog, which is mailed to all interested companies and individuals, usually on a bimonthly or quarterly basis. Some exchanges also offer computer on-line directories that contain the same listings as their catalogs and, sometimes, listings from other exchanges.
When a company wants more information about a listing, it contacts the exchange via phone, fax, or computer, using the code number to specify the listing of interest. Inquiries about confidential listings are forwarded to the company that placed the listing, which then chooses the respondents with whom it wishes to negotiate. For nonconfidential listings, the exchange gives contact information to both the donor and the inquirer. After providing this information, the exchange's job is complete, and it is up to the two parties to work out the transfer of materials. In most situations, the material generator either pays the receiver a fee to take the material or pays transportation costs to haul it to the receiver. "Seldom do generators get paid for their material," says Jones. Even so, he adds, generators realize savings because their exchange costs are typically much lower than their disposal costs.
About half of all the exchanges in North America —both public and private—charge some type of fee for their services, ranging from a listing fee, an annual subscription fee for the exchange's catalog and/or access to its on-line data base, or a fee for providing contact information to system users. In addition, at least two exchanges require a commission when successful exchanges are made. While one might think that charging fees would discourage use of the exchanges, companies are usually spending much more to purchase or dispose of materials, which can make the exchange fees a bargain. Also, for many exchanges, charging fees is the only way to make ends meet.
Playing the Numbers Game
According to Smee, the North American exchanges combined list about 10,000 items, representing tens of millions of tons of materials, mostly from small-quantity generators. When it comes to actual exchanges, most operations have a matchmaking success rate in the range of 10 to 30 percent, though some occasionally achieve rates as high as 50 percent. "For some materials, our success rate is 100 percent," says Jones, "but for others it's zero."
The key to the matchmaking is what Smee calls the "law of large numbers"—in other words, the more listings an exchange has and the more widely they are publicized, the better the odds get that it will make matches. "Our success is a function of promoting the system and getting people to use it," he says, noting that one way to improve the success of exchanges is to expand their scope beyond industry to include other potential users of reusable materials, such as charitable and relief organizations.
The recent creation of a national on-line exchange network is one important step toward maximizing the matchmaking rate, Smee asserts. The service, called the National Materials Exchange Network, provides a central data bank of listings from more than 38 local, state, regional, and international exchanges, which can be viewed by area code, state, EPA region, or country. "You can look microcosmically at what's available locally," Smee says, "or you can look macrocosmically." The network, introduced by the Pacific Materials Exchange in late 1992 and funded by a $350,000 EPA grant, charges no fees—provided that users are members of their local, state, or regional exchange—and is available 24 hours a day.
Some exchange directors assert, however, that the material exchanges work best not on the national level but on the local and state level since transportation costs often limit how far material can be shipped. "The small quantities offered in some listings make it difficult to get someone interested outside a certain geographic area," says Jones. "If you can find a local source to use the material, then that's better." Others also point out that most exchange users are small-quantity generators and consumers that often don't have computer modems to access on-line systems.
Reviewing the Pros and Cons
Waste exchanges are proliferating for one main reason—they work. From an economic standpoint, they're a win-win setup for both generators and consumers in that they cost virtually nothing to use (fees usually range between $50 and $150 a year) and they offer cost savings—to generators by reducing their disposal costs and to consumers by providing less-expensive raw materials.
From an environmental standpoint, the exchanges conserve resources, save energy, and reduce reliance on and extend the life of landfills. From an operational perspective, they are low-tech, low-cost, and easy to implement, which is good news for budget-conscious state governments and nonprofit groups.
More important, exchanges provide opportunities for market development, encouraging companies and individuals to devise new uses for potentially waste materials. "Waste exchange has always been on the cutting edge of market and technology development," Smee asserts. Years ago, he notes, waste exchanges used to run listings for solutions containing precious metals, but this material eventually found commercial demand and no longer appears. "Once there's a viable market for a material, people tend not to use waste exchanges anymore," he says. "In a way, we're working ourselves out of a job."
On the negative side, the practice of waste exchange raises the ugly specter of potential environmental liability, not for the waste exchange itself—since it doesn't arrange the actual transfer of materials—but for the exchange partners. "Liability is a reality and exchanges don't remove or assume any responsibility for the proper handling of materials," Smee says.
To protect themselves, companies must determine the environmental standards of their exchange partners and assess the liability risks. "The cradle-to-grave regulations under RCRA say it's the ultimate responsibility of generators to know where their waste is going and how it's being handled," says Jones.
Despite this drawback, it's important to note, Smee emphasizes, that "liability generally applies only to hazardous materials, which represent about 40 percent of waste exchange materials. You can't attach the same paranoia about liability to nonhazardous materials."
Technological obstacles are another factor limiting the success of the exchanges, hearkening back to the old saying that you can't turn a sow's ear into a silk purse. As Smee explains, "A particular material may not be able to be recycled because of technological barriers to processing it, or it may not be cost-effective to add technology to be able to use the material." Such barriers mean that some materials may go begging until recycling options can be advanced.
A Fully Funded Future?
Perhaps the greatest challenge for waste exchanges is securing financial support to not only remain viable, but also to expand their services and, thus, increase their effectiveness. These concerns prompt Smee to ask, "The waste exchange infrastructure is being created, but will it be able to be sustained?"
On the positive side, cities and states striving to preserve their landfills and achieve recycling rate targets may find waste exchanges invaluable in reaching such goals, which could prompt them to devote more funds to the effort. On the negative side, states haven't exactly been pouring money into exchanges so far, leaving them to operate with skeletal staffs—one to three employees is common—limiting their efforts to market the system, and forcing them to raise additional funds by selling ads in their catalogs and soliciting outside sources. "Directors of waste exchanges spend a lot of their time trying to obtain funds rather than exchanging waste," Jones says. Maxie May, director of the Southeast Waste Exchange, agrees, noting that "funding can become a real issue. Receiving financial support on an ongoing basis would take some of the pressure off."
If the waste disposal problem continues to worsen, however, states and industry may have no other choice but to fully support exchange efforts. As Smee states, "Waste exchange is another program that cities and states almost have to have. They're willing to fund it in the short term, but in the long term, we'll have to wait and see."
Despite this element of uncertainty, the number—and, thus, success rate—of these exchanges is sure to grow, enabling them to shrug off their former obscurity, enter the recycling mainstream, and make a larger and larger dent in the industrial stream of discards. "There's certainly political and public pressure to do this," Smee concludes. "The concept of waste exchange is being taken more seriously than at any time in the past." •
North American Waste Exchanges
The following list covers 48 waste exchanges located in 30 states and five Canadian provinces. Because many of them are regional in scope, they represent virtually all states and provinces in North America.
Alabama Waste Materials Exchange
404 Wilson Dam Ave., Sheffield, AL 35660
205/760-4623 or 205/383-5630
Alberta Waste Materials Exchange
c/o Alberta Research Council
6815 8th St. N.E., Third Floor, Calgary, Alberta T2E 7H7
403/297-7505; 403/297-7548 (fax)
Arizona Waste Exchange
4725 E. Sunrise Drive, Suite 215, Tucson, AZ 85718
602/299-7716; 602/299-7716 (fax)
Arkansas Industrial Development Council
1 State Capital Mall, Little Rock, AR 72201
501/682-1370; 501/682-7341 (fax)
Bourse Quebecoise des Matieres Secondaires
14 Place du Commerce, Bureau 350
Le-Des-Squeurs, Quebec H3E 1T5
514/762-9012; 514/873-6542 (fax)
British Columbia Waste Exchange
1525 W. Eighth Ave., Suite 102, Vancouver, British Columbia V6J 1T5
604/731-7222; 604/734-7223 (fax)
Businesses Allied to Recycle Through Exchange and Reuse
2512 Delaware St. S.E., Minneapolis, MN 55414
612/627-6811
California Materials Exchange
8800 Cal Center Drive, Sacramento, CA 95826
916/255-2369; 916/448-8246 (fax)
California Waste Exchange
Department of Toxic Substances Control
P.O. Box 806, Sacramento, CA 95812-0806
916/322-4742; 916/327-4495 (fax)
Canadian Chemical Exchange
P.O. Box 1135, Ste. Adele, Quebec J0R 1L0
514/229-6511 or 800/561-6511; 514/229-5344 (fax)
Canadian Waste Materials Exchange
ORTECH International
2395 Speakman Drive, Mississauga, Ontario L5K 1B3
416/822-4111, ext. 265; 416/823-1446 (fax)
Essex-Windsor Waste Exchange
Essex-Windsor Waste Management Committee
360 Fairview Ave. W., Essex, Ontario N8M 1Y6
519/776-6441; 519/776-4455 (fax)
Hawaii Materials Exchange
P.O. Box 1048, Paia, HI 96779
808/579-9109; 808/579-9109 (fax)
Hudson Valley Materials Exchange and Buy Recycled! Consortium
P.O. Box 550, New Paltz, NY 12561
914/246-6181; 914/255-4084 (fax)
Indiana Waste Exchange
Recycler's Trade Network Inc.
P.O. Box 454, Carmel, IN 46032
317/574-6505; 317/844-8765 (fax)
Industrial Materials Exchange
506 Second Ave., Room 201, Seattle, WA 98104-2311
206/296-4899; 206/296-3997 (fax)
Industrial Material Exchange Service
P.O. Box 19276, Springfield, IL 62794-9276
217/782-0450; 217/782-9142 (fax)
Intercontinental Waste Exchange
5200 Town Center Circle, Suite 303, Boca Raton, FL 33486
800/541-0400; 407/393-6164 (fax)
Iowa Waste Reduction Center
University of Northern Iowa
75 Biology Research Complex, Cedar Falls, IA 50614-0185
319/273-2079 or 800/422-3109; 319/273-2893 (fax)
Kentucky Environmental Protection Department
14 Riley Road, Frankfort, KY 40601
502/564-6716, ext. 232; 502/564-4049 (fax)
Louisiana/Gulf Coast Waste Exchange
1419 CEBA, Baton Rouge, LA 70803
504/388-4594; 504/388-4945 (fax)
Manitoba Waste Exchange
Recycling Council of Manitoba Inc.
1812-330 Portage Ave., Winnipeg, Manitoba R3C 0C4
204/942-7781; 204/942-4207 (fax)
Minnesota Technical Assistance Program
1313 Fifth St. S.E., Suite 207, Minneapolis, MN 55414
612/627-4555 or 800/247-0015; 612/627-4769 (fax)
Missouri Environmental Improvement Authority
325 Jefferson St., Second Floor, Jefferson City, MO 65101
314/751-4919; 314/635-3486 (fax)
Mississippi Technical Assistance Program
P.O. Drawer CN, Mississippi State, MS 39762
601/325-8454; 601/325-2482 (fax); 601/325-8239 (modem)
Montana Industrial Waste Exchange
Montana Chamber of Commerce
P.O. Box 1730, Helena, MT 59624
406/442-2405; 406/442-2409 (fax)
National Materials Exchange Network
1522 N. Washington St., Suite 202, Spokane, WA 99201-2454
509/325-0507; 509/325-2086 (fax); 800/858-6625 (modem)
New Hampshire Waste Exchange
122 N. Main St., Concord, NH 03301
603/224-5388; 603/224-2872 (fax)
New Jersey Industrial Waste Information Exchange
New Jersey Chamber of Commerce
50 W. State St., Suite 1110, Trenton, NJ 08608
609/989-7888; 609/989-9696 (fax)
New Mexico Materials Exchange
Four Corners Recycling
P.O. Box 904, Farmington, NM 87499
505/325-2157; 505/326-0015 (fax)
New York City Sanitation Department
Division of Waste Prevention, Reuse, and Recycling
44 Beaver St., Sixth Floor, New York, NY 10004
212/837-8166; 212/837-8162 (fax)
Northeast Industrial Waste Exchange
620 Erie Blvd. W., Suite 211, Syracuse, NY 13204
315/422-6572; 315/422-4005 (fax)
Oklahoma Waste Exchange Program
Department of Environmental Quality
1000 N.E. 10th St., Oklahoma City, OK 73117-1212
405/271-7353; 405/271-8425 (fax)
Olmsted County Materials Exchange
Olmsted County Public Works
2122 Campus Drive S.E., Rochester, MN 55904
507/285-8231; 507/287-2320 (fax)
Ontario Waste Exchange
ORTECH International
2395 Speakman Drive, Mississauga, Ontario L5K 1B3
416/822-4111, ext. 512; 416/823-1446 (fax)
Pacific Materials Exchange
1522 N. Washington St., Suite 202, Spokane, WA 99201-2454
509/325-0551; 509/325-2086 (fax)
PenCycle
Pennsylvania Resources Council
25 W. Third St., Media, PA 19063
215/892-9940; 215/892-0504 (fax)
Portland Chemical Consortium
Chemistry Department, Portland State University
P.O. Box 751, Portland, OR 97207-0751
503/725-4270; 503/725-3888 (fax)
Resource Exchange Network for Eliminating Waste
Texas Water Commission
P.O. Box 13087, Austin, TX 78711-3087
512/463-7773; 512/475-4599 (fax)
Resource Exchange Services
213 E. Saint Joseph, Lansing, MI 48933
517/371-7171; 517/485-4488 (fax)
Rhode Island Department of Environmental Management
Box 1943, Brown University, Providence, RI 02912
401/863-2715
Rocky Mountain Materials Exchange
1455 Market St.
Denver, CO 80202
303/620-8093; 303/534-3200 (fax)
South Carolina Waste Exchange
Route 1, Box 288A, Prosperity, SC 29127
803/755-3325; 803/755-3833 (fax)
Southeast Minnesota Recycling Exchange
171 W. Third St., Winona, MN 55987
507/457-6460; 507/457-6469 (fax)
Southeast Waste Exchange
Urban Institute
University of North Carolina at Charlotte
Charlotte, NC 28223
704/547-2307; 704/547-3178 (fax)
Southern Waste Information Exchange
P.O. Box 960, Tallahassee, FL 32302
904/644-5516 or 800/441-7949; 904/574-6704 (fax)
Waterloo Waste Exchange
925 Erb St. W., Waterloo, Ontario N2J 3Z4
519/883-5137; 519/747-4944 (fax)
Wisconsin Department of Natural Resources
P.O. Box 7921, Madison, WI 53707-7921
608/267-3763; 608/267-2768 (fax)
Waste exchanges are springing up all over, bringing together generators and consumers of previously disposed materials. Here's a discussion on how and why they work, as well as a look at their future.