March/April 2009
Construction and demolition recyclers process wood, drywall, concrete, and dirt in addition to the more traditional scrap metal, paper, and glass. Though the startup costs are significant, those entering this niche see great opportunities for growth.
By Theodore Fischer
For construction and demolition recyclers, a corollary to the law of gravity—what goes up must come down—might be that what comes down must contain vast quantities of recyclable and resalable materials. Much of the detritus consists of dirt, but substantial amounts of marketable wood, metal, corrugated, concrete, and paper—along with somewhat less coveted glass, drywall, and asphalt shingles—are also part of the mix.
How much recyclable material comes out of construction and demolition? Mike Taylor, executive director of the National Demolition Association (Doylestown, Pa.), estimates his industry generates about 115 million tons of demolition debris annually, "and we recycle about 70 percent of that—an amazingly high number," he says. The Construction Materials Recycling Association (Eola, Ill.) estimates that construction and demolition combined produce more than 325 million tons of recoverable materials each year, most of which gets processed and reused.
With increasing interest in green building techniques—and more regulation of what goes into landfills—demand for C&D recycling seems to be growing. Companies that have taken the plunge believe their business has a lock on the future and—despite the difficulties of the current economic climate—that the business of processing what comes down is looking up.
Incentives for Industry Growth
One of several forces motivating the recent interest in C&D recycling is the desire of builders to obtain for their projects the coveted Leadership in Energy and Environmental Design certification from the U.S. Green Building Council (Washington, D.C.). "A lot of our customers wanted LEED-certified waste reduction," says Ben Harvey, executive vice president of E.L. Harvey & Sons (Westborough, Mass.), a 98-year-old family-owned waste hauling, trash transfer, and scrap recycling business. His company saw entering the C&D recycling niche as "a way to acquire new business through the construction industry," Harvey says.
LEED certification "provides independent third-party verification that a building meets the highest green building and performance measures," according to the USGBC. It's a seal of approval that appeals to environmentally conscious builders, property owners, and renters. LEED evaluators rate new construction and major renovation projects according to a 69-point scale, awarding LEED certification to projects that earn between 26 and 32 points and silver, gold, and platinum status to those that earn higher scores. "Construction waste management" factors into the score. Builders earn LEED points if they "divert construction, demolition, and land-clearing debris from disposal in landfills and incinerators": one point for diverting 50 percent of their C&D debris; an additional point if they hit 75 percent.
Another major incentive for C&D recycling is the rising cost of landfill disposal. "I saw landfill prices increasing dramatically in 2004, and they continue to go up," says Kevin Herb, managing partner of Broad Run Construction Waste Recycling (Manassas, Va.). "It's a no-brainer that the higher the disposal fees, the more recycling makes sense." In California and on the East Coast, where tipping fees can reach $50 to $60 a ton, C&D recycling can flourish; in the middle of the country, however, where disposal rates hover around $20 a ton, it makes much less economic sense.
High landfill prices usually go hand in hand with scarcity of landfill space, which leads to another trend: the growth of regulations that ban C&D debris from landfills. Massachusetts took a lead role in regulating C&D material disposal in 2006, when its Department of Environmental Protection (MassDEP) banned the disposal of much C&D debris—brick, concrete, asphalt pavement, metal, and wood—from solid waste facilities throughout the state. (Acknowledging that "as a practical matter, a 100-percent ban is not feasible," MassDEP regulations allow each containerload of material landfilled from a construction or demolition site to contain some of the proscribed materials—up to 20 percent by volume.)
California currently requires localities to recycle at least 50 percent of C&D debris, with the minimum figure rising to 60 percent in 2010, but it lets counties and cities figure out how to reach those targets. In San Francisco, registered transporters must haul all mixed C&D debris off site to registered processing facilities that can divert at least 65 percent of it from the landfill. In San Jose's Construction & Demolition Diversion Deposit Program, builders pay a deposit based on the nature and size of their projects that gets refunded after they demonstrate they have diverted more than 50 percent of their C&D debris. In Pasadena, construction sites that fail to recycle 75 percent of their C&D debris risk having their dumpsters impounded.
At least one Midwestern city has hopped on the bandwagon: In 2007, Chicago upped the percentage of C&D debris that contractors need to recycle from 25 percent to 50 percent. Other cities and states are likely to follow. Wisconsin has no C&D law on the books yet, says Eric Konik, co-owner of City Wide Recycling (Milwaukee), "but we're under the impression that there will be mandates in the future."
The National Demolition Association is under the same impression. As C&D recycling laws spread, the association worries that a patchwork of city, county, and state regulations will make it more difficult for its members to operate. To work toward some standardization or consensus, NDA invited C&D recyclers and government regulators to the first international symposium on the state of C&D recycling, initially scheduled for this October in Chicago. "What we wanted to do was to sit down with the federal, state, and local government agencies; have panel discussions of five, six, seven states; and on the third day we'd know where we're at and what to do next," says Taylor, who hoped the symposium could devise a model for safe, environmentally sensitive, and economically viable C&D recycling. Unfortunately, the economic downturn has led to cutbacks or embargoes on government travel, forcing the NDA to postpone the symposium until October 2010.
In the meantime, though Taylor can't point to one single state or city whose regulations can serve as a model for all the rest, he does believe that the interested parties can—and should—cobble together an acceptable code from four or five states' rules. "We're not saying this should be unregulated," Taylor says. "There has to be a standard of care that protects the public and the nation's environment and at the same time makes market sense for the industry."
Taking the Plunge
Companies offer a variety of reasons for taking on C&D recycling. City Wide Recycling's founders took their business in this direction because they see C&D recycling as the wave of the future. "Sustainability, [being] green, [it's] the right thing to do: It seemed very black-and-white to us that this was the next step for the disposal business," Konik says. "Basically, we started off by pitching the general contractors on it. They realized what was happening all over the country with LEED certification, and they jumped on board."
E.L. Harvey had two main reasons for adding C&D recycling to its menu of services in 2007: "No. 1, we felt it was a way to reduce the volume of waste that our company would then ship out to a third-person disposal site," Harvey says. The second reason was Massachusetts' ban on the disposal of unprocessed C&D material—specifically wood, metal, and aggregate, brick, and concrete. "We would either have had to take it to a third party or do the processing ourselves," he says, and the company chose the latter.
Some state and local governments are providing incentives for companies to enter the C&D recycling business. In Brooklyn Heights, Ohio, a $500,000 grant from the state Department of Natural Resources enabled Kurtz Bros. to convert a 20-acre C&D debris landfill into a 20-acre C&D recycling center. Marpan Recycling (Tallahassee, Fla.) last year opened a $5.5 million material processing facility in a public-private partnership with Leon County, Fla., that recycles an estimated 70 percent of the 500 tons of C&D debris it receives each day. The new facility expects to reduce the volume of material going to one county landfill by 50 percent annually. Along the same lines, when San Diego County (Calif.) found its treasury unequipped to build a C&D debris recycling plant that complied with its own mandates, SANCO Resource Recovery (Lemon Grove, Calif.) constructed a facility that can process 1,000 tons of material a day.
Entering this niche is not a decision to be made lightly. It's very much an ad hoc—and costly—investment that often requires importing processing equipment from abroad. E.L. Harvey paid the Dutch firm Waltec (Gees, Netherlands) about $3 million for a C&D recycling system that first sends ferrous, nonferrous, wood, and fiber construction debris through a trommel screen, then through an air classifier, and finally through a water bath that separates heavies from floatables. The company is contemplating spending an additional $750,000 to $1 million to add a shredder to its front end.
City Wide Recycling paid Sherbrooke OEM (Sherbrooke, Québec) a significant sum for its super-heavy-duty C&D processing equipment. "Everything you [buy] equipmentwise has to be so overbuilt because of what comes off the construction sites: concrete, large wood, heavy stuff, light stuff, fluffy stuff," says co-owner John Hansen. "The equipment has to be able to handle everything on a continuous basis. You get 100 to 200 trucks a day dumping the material, and you cannot have downtime."
Broad Run's Herb spent a couple of years scoping out systems across the United States and working on a permit—"which took about a year and a good $120,000"—before purchasing a system from Sparta Innovations (Notre Dame, New Brunswick). The processing system alone cost about $1.8 million, and the company spent another $600,000 on two Caterpillar material handlers, a bucket loader, and a skid-steer. Then add $2 million to construct the 26,000-square-foot building to house the operation under one roof—as the county's special-use permit required.
The process at Broad Run, as in many C&D recycling facilities nationwide, begins with trucks weighing in via speed-pass technology and then tipping their loads onto the plant floor. A material handler lifts the mixed C&D material onto a Finger-Screen vibratory screener, which separates out small items (under 8 inches) and sends them on to a StarScreen, a system that removes the fines. Overhead magnets extract metals, which go to a de-stoner for the mechanical removal of aggregate. Larger pieces continue onto a manual sorting line, where a dozen pickers sort the material and drop it into the appropriate bunkers. The company bales its OCC and organizes all other materials before they leave the facility. The material is relatively pleasant and easy to work with, Herb says. "It's clean material, it's hand-picked, it's sized properly, it's separated properly—the copper is separate from the brass and aluminum."
C&D Material consumers
Scrap recyclers already know how to find buyers for the metals, glass, and paper that come out of construction and demolition recycling, but they might be less familiar with the markets for the remainder of the 14 separate commodities NDA has identified as recyclable byproducts of the demolition process. Beyond metal and OCC, the easiest commodities to resell, the association says, are concrete, high-quality lumber, and scrap wood.
Broad Run sells two types of wood: green wood—stumps and brush it grinds into mulch—and clean white wood from pallets and 2-by-4s, which it pulverizes for animal bedding or colored mulch or pelletizes to fuel wood stoves. Landfills also pay Broad Run for recycled dirt they can use as alternative daily cover, the 6-inch layer they spread over the trash at the end of each day. The company manages to recycle 75 percent (by weight) of what goes into its dumpsters and sends the rest to a waste-to-energy plant that converts it into electricity for 75,000 Fairfax County, Va., homes.
Some materials previously considered unrecyclable have started to find markets. The Missouri Department of Transportation is mixing asphalt roof shingles with liquid asphalt to produce a durable, rust-resistant paving material for its roads. The Los Angeles Fiber Co. (Vernon, Calif.) has developed technology to convert used carpet into carpet padding and raw material for plastics manufacturers; Tandus, a commercial carpet manufacturer in Dalton, Ga., recycles old carpet into carpet padding and new carpet. Gypsum Recycling America (Holbrooke, Mass.) uses a Danish process to turn wallboard into fine-grade gypsum powder and recyclable paper.
Evaluating the Potential
Unfortunately, the many incentives for C&D recycling and new markets for its products have not protected C&D recyclers from the nationwide economic slump. "The business was going great until the economy melted, but it's a disaster right now," Herb says. In his region, the supply of material has not abated, he notes. "The metal [recycler] we have … knows that every day we have at least one [container] full of scrap metal." But he is seeing the same drops in commodity prices that have hit the rest of the scrap industry: scrap steel falling from $230 a ton last summer to $87 a ton in late January, and corrugated dropping from $120 a ton to $17 a ton. "We have the people to buy," he says, "we just need them to raise the price."
E.L. Harvey & Sons, which focuses on the construction side of C&D recycling, reports a downturn in supply that it hopes is temporary. "The generation of construction work in the Northeast has declined dramatically in terms of new housing starts, new additions, businesses adding new buildings—it's been as flat as a door because of the economy," Harvey says. "We've seen our daily tonnages decline rapidly through the last year—we have a lot more capacity than we have material to put through it."
The current hard times notwithstanding, C&D recyclers all insist that a promising future lies ahead for their industry. It's an exemplar of environmental correctness, and it offers exactly what economic gurus prescribe as the antidote to our current woes—major capital investment and well—paid American jobs—so how can it miss?
Even so, those contemplating entering this niche need to do so with their eyes open. City Wide Recycling, which recycles around 80 percent of the material it obtains from new construction sites, warns would-be entrants they'd better be ready to improvise and evolve. "You can buy a turnkey plant, but this isn't a turnkey business because from one day to the next your commodity market might change," Konik says.
Determine whether C&D recycling makes economic sense for your firm based on its location, Harvey advises. Look at landfill disposal fees in your region and at whether there are customers for the processed commodities. "Scrap metal is probably the easiest, but is there a secondary wood market to ship wood waste? And you need an outlet for [less than 1-inch] fines. You've got to look at your goals, at what you want to remove from the waste stream, and make sure there are outlets and markets for that material." •
Theodore Fischer is a writer based in Silver Spring, Md.
Construction and demolition recyclers process wood, drywall, concrete, and dirt in addition to the more traditional scrap metal, paper, and glass. Though the startup costs are significant, those entering this niche see great opportunities for growth.