Transportation is the name of the game in end-of-life electronics recycling
The name of the game in recycling end-of-life electronics (EOLE) is transportation, and how to do it as efficiently as possible. “As much as this is an environmental business, the reality is that this is mostly a logistics business,” says Craig Wisehart, executive director, Western Canada, Electronic Products Recycling Association (EPRA).
EPRA, a national, not-for-profit organization created in 2011, operates recycling programs in eight provinces, has over 2,000 collection sites and collects over 100,000 tonnes of EOLE a year. Wisehart runs the British Columbia program.
EOLE recovery in British Columbia begins at three main sources: 49 stores that participate in return to retail programs (R2R); companies participating in the Industrial, Commercial and Institutional (ICI) program; and 173 official depots where consumers can drop off approved EOLE.
From these locations most EOLE is sent, usually in less-than-load (LTL) shipments, to six consolidation centres. Here it is cross-docked and generally moved in full truckloads to four processors. They dismantle and transport the EOLE to companies that specialize in extracting commodities like metals, precious metals and plastics.
Last year EPRA British Columbia collected 22,737 tonnes of EOLE. Its total program costs were $1,004 per tonne, of which transportation accounted for $199 per tonne.
Most EOLE in British Columbia enters the system at the depots, about 125 of which are bottle and can recycling depots run by Encorp Pacific. “We have a very extensive collection network in BC because we piggyback on Encorp Pacific depots,” Wisehart says.
Encorp Pacific negotiates its transportation contracts, palletizes and weighs the EOLE, and bills EPRA. “We rely heavily on Encorp to get the e-waste from the depots to the consolidation centres. Encorp does most of the negotiations, as a shipper, and uses a pretty broad mix of carriers,” Wisehart adds.
Encorp uses around 45 carriers to move its own and EPRA’s recyclables from its depots to the consolidation centres.
Depots do a three-item sort: computer displays, which are shrink-wrapped on skids in neat piles about five feet high; computers and laptops, which are stack and shrink-wrapped on skids; and everything else, which is packed in fibre bags about the footprint of a skid and about three feet high. These bags can be double stacked.
Because much of the trucking is backhaul, it is an important selling point to carriers bidding on these runs that the EOLE is nicely packed. “People look at us and say ‘you give us nice, neat, clean shrink-wrapped, palletized product, rather than loose, overhanging …’” Wisehart explains.
At the big-volume depots, shippers make scheduled pickups. For depots with less volume, pickups are made upon request.
R2R logistics are a little different. Operating outside of the Encorp system, EPRA provides a transportation incentive to audited and approved processors such as eCycle Solutions, which contract with the retailers to make collections.
“We receive approximately 10,000 metric tonnes every year as part of the EPRA BC program. We have about 25 destinations where we ship [recovered elements from the recycling process]. Nothing is shipped LTL. Some ferrous metals or clean glass will be shipped within BC, [some] in open-top bins. Shipments to Asia go in a sea container. Everything else goes in full 53-foot truckloads,” says Alan Ferguson, VP business development, eCycle Solutions.
As for the ICI EOLE collections, Wisehart explains, “If you can put together at least three skids, we will arrange transportation and come get it. We have a similar program for approved processors, an all-encompassing rate, where they go pick up material from businesses.”
“There is no annual [carrier] bid cycle, but EPRA periodically sends out Requests for Quotes. Encorp does too. You can often get a good reset if you do that. For the most part, payment to transporters is on a skid and truckload basis,” Wisehart notes.
There are six consolidation centres: two on Vancouver Island and one each on the Lower Mainland, the Kootenays, the Okanagan Valley, and Prince George. They cross-dock incoming pallets and bags onto full truckloads for shipment to the approved processors: Global Electric Electronic Processing’s Edmonton facility, FMC Recycling and eCycle Solutions on the Lower Mainland and KC Recycling in Trail.
Although the collection fees that EPRA pays the depots are partially for skid storage, storage at the consolidation centres, because of the rapid cross-docking, is a non-issue.
Truckload shipments, at around 11 tonnes, go from the consolidation centres to the processors. “We have optimized the transportation from our consolidation centres to where it goes, to which processors. For any lane, we are doing competitive bids. Once we have got the best transportation bids in various lanes, we go back in and ask ‘what is the optimal ship point for these materials?’” Wisehart says.
What does this mean? Wisehart is a logistics expert with over 30 years of transportation experience, twenty of which were with Canadian Freightways in roles ranging from terminal manager to vice-president of operations. When he joined EPRA in 2012, processing costs, which include transportation, were about $900 a tonne. Analyzing distances, transportation costs and processor fees, for example, with the help of his “Spreadsheet of Fun” he began wringing costs out of the system.
Take Fort St. John, less than 100 kilometres from the Alberta border. EPRA, because of its consolidation mentality, was shipping EOLE 440 km west to the Prince George consolidation centre and then east 740 km to the processor in Edmonton.
“We found it was cheaper to ship LTL from Fort St. John to Edmonton than truckload out of Prince George,” Wisehart says. The direct route east saves EPRA between $5,000 and $6,000 a year. EPRA made the same change out of nearby Dawson Creek.
EPRA made additional savings by changing how it allocates EOLE to the processors. Although EPRA gets competitive bids from processors, it shares the work out to several of them to be sure they maintain a competitive market. EPRA would give, to use an illustrative figure, 40 percent of its business to the lowest bidder. But before Wisehart, this was a province-wide 40 percent that came with a costly transportation bill.
Wisehart changed that to allocating processors EOLE from regions. This reduced transportation costs. “I began looking at transportation as an overall thing; in other words, transport all the material from an area to a lower-cost processor.”
Wisehart further optimized the reverse logistics by looking beyond the pure transportation costs. “The processors quote us different amounts for different EOLE products, so there’s all that to figure out, where you ship them to, the [transportation] cost from each consolidator to which processor, to optimize the process,” Wisehart explains.
“That is how we were able to reduce costs by 30 percent since I came on board. I just came and [asked], “How can I make this more cost effective? That had not been applied in the BC program before,” says Wisehart.
The EOLE program’s success can also have unexpected cost consequences. “In some cases we changed the market. We were shipping one truckload a week from Kelowna to Edmonton. We had some changes in processing practices and [began] shipping five loads a week. We ate up our backhaul capacity and were paying headhaul rates. We had to change our distribution strategy,” Wisehart says.
Wisehart describes EPRA as a fairly small organization, but with strong in-house logistics expertise that is available wherever it is needed. “Dennis Neufeld, our program director, EPRA Manitoba and I help set up the EPRA program in Newfoundland. Dennis is a logistics professional with over 20 years of experience. I did conceptual work in Quebec. Gayleen Creelman, our program director, EPRA Saskatchewan was previously logistics manager with Cargill, and has almost 20 years logistics experience. We get together every two weeks by phone, and periodically in person to discuss issues. As I said, it is a logistics business.”