CAER and ISRI answer more questions on proposed federal law

 

CAER and ISRI answer more questions on proposed federal law

By Editorial Staff, Resource Recycling

This year's E-Scrap Conference concluded with a debate on the Responsible Electronics Recycling Act, which would restrict the export of electronic scrap to developing countries. Speaking against the bill was Eric Harris, associate counsel and director of government and international affairs for the Institute of Scrap Recycling Industries (ISRI), and speaking for the bill was Neil Peters-Michaud, CEO of Cascade Asset Management and board member of the Coalition for American Electronics Recycling, which represents 115 companies (including many ISRI members) advocating for the bill's passage. Due to time constraints, Harris and Peters-Michaud were unable to answer many audience questions, and E-Scrap News has offered them the chance to respond here:

 

Question: Is ISRI committed to representing the needs and interests of electronics recyclers, including those that have signed on to CAER? What has ISRI done to hear the concerns of those members? What is the resolution to this current public disagreement?

Eric Harris (EH): Yes, of course. ISRI is a member-driven organization and welcomes and encourages divergent views and healthy debate from all its members. We don’t develop policy in a vacuum. ISRI has a very open and transparent process that all members are encouraged to participate in by coming to meetings, joining committees, and providing input on policies as they are developing. One of the benefits of being active in ISRI’s Electronics Division is that it allows a company, big or small, to provide input, be a thought leader and share their expertise and opinions with others in the division. All members are welcome.

ISRI's position on electronics recycling and exports was developed by the members of ISRI’s Electronics Division in a process open to all ISRI members and voted on unanimously by the ISRI Government Affairs Committee and then the ISRI Board (a member of the CAER Steering Committee participated in the process and did not raise any procedural objections at any point). There were numerous points throughout the process that ISRI members — which include those that participate in CAER — were invited to participate during meetings and conference calls. The position that the membership of ISRI decided upon, and that ISRI has thus been advocating on the Hill and elsewhere, is that exporting UEPs for reuse, recycling or refurbishment should be allowed using specific restrictions — the exporter registers with EPA, provides notification and follows very specific due diligence requirements to ensure the material is handled responsibly — and that such restrictions should apply globally.

ISRI and CAER share many of the same goals- to grow the electronics recycling industry responsibly while creating good paying jobs. One such area that ISRI would like to see the two groups come together is supporting Design for Recycling and the effort to remove focus materials at the design phase rather than when reused or recycled. Another is to develop better collection mechanisms domestically. The U.S. ITC report said only 25 percent of household and residential UEPs are being collected. This could generate another 3 million tons annually for reuse and recycling.

 

Question: Are there testing carve outs for expensive networking equipment or medical equipment that would exempt these devices from RERA? What is CAER's position on these items specifically?

Neil Peters-Michaud (NPM): RERA identifies specific “Covered Electronic Equipment” which would be regulated under RERA (Text of House Resolution 2791, including covered items, available here). If a “Covered Electronic Equipment” contains certain toxic elements, then it is considered a “Restricted Electronic Waste” and cannot be exported. This is to prevent the export of mixed, untested, e-scrap. There are some notable exceptions as to what is deemed “Restricted Electronic Waste” under the legislation to address the concern in the question.

So, to circle back and answer this question, expensive medical equipment and expensive networking equipment may fall outside the scope of RERA because it is not specifically listed as a “Covered Electronic Equipment” and therefore may not be regulated by this legislation at all. There is a rulemaking process that would add or modify the list of Covered Electronic Equipment, so those items could be included at a later time. Still, if these items can be tested and can be demonstrated to be functional and intended for reuse, then their export to any country would be allowed under RERA.

CAER believes this method of dealing with export is fair and meets the intent of the legislation — encourage the export of good, working equipment and clean commodity grade materials.

 

Question: Isn't RERA less about protecting developing countries and more about U.S. companies protecting their market share? Doesn't RERA disproportionately benefit established recyclers in the US?

NPM: During our debate, Eric and I both agree that promoting the electronics recycling industry is a shared value for both CAER and ISRI. For CAER, that means ensuring there’s a level playing field for both new entrants and established firms to succeed in building profitable and sustainable businesses.

Let’s be clear, RERA only restricts the export of certain types of electronics. It does nothing to change domestic solid and hazardous waste laws, or limit the opportunity and process for individuals and firms to collect and process electronics domestically. That is the role of the vast majority of firms in this industry. All those repair shops, local haulers, and demanufacturing firms who manage equipment within the U.S. are not impacted by this bill. This is one way RERA is not disproportionately benefiting established recyclers in the U.S.

When it comes to exports, we’re dealing with much more complex transactions and any firm will need to have some level of sophistication to ensure they are meeting current and future legal and financial requirements. There are already restrictions on the types of technology a U.S. firm can export to certain countries. Right now, all companies, both large and small, need to understand how to comply with these requirements. Companies often "outsource" this responsibility to brokers who manage the export process. The brokers complete customs paperwork, identity themselves as the “exporter of record”, and make all the claims and guarantees necessary to get the equipment over the border. This is where the system can be gamed and unscrupulous brokers or dealers who do nothing to process the electronic equipment can easily send out mixed electronics scrap that would be restricted under RERA.

There’s no reason a new firm who understands export law would be at a disadvantage compared to an established firm. In fact, new firms may not have the legacy systems in place that are difficult to change to comply with a new law. I trust the entrepreneurial spirit of Americans and believe that over the 2 year phase in period established under HR 2791, there will be enough new and established firms prepared to meet the requirements of this legislation.

I feel that during the debate Eric raised the specter of some ulterior motive of CAER members to lock out others by passing RERA. That’s a preposterous idea. All you need to do is look at the wide range of support for this legislation from large and small companies, non-profit organizations, environmental organizations, and other industry groups. It would be better to ask what is the motive of ISRI and its members who benefit from the unfettered export of all waste? Remember, CAER publicly lists our members and supporters on our website, but ISRI’s membership list is not public.

We believe HR2791 is important to build credibility for our industry, increase the opportunity for all responsible U.S. electronics processors to grow, and to protect the interests and environment of developing countries, consistent with their expressed wishes.

 

Question: Would ISRI agree to sign a joint letter to Rep. Shimkus urging Congress to hold hearings on electronic waste issues, either related to RERA or independent of RERA?

EH: For reasons articulated during the E-Scrap Conference session, HR 2791 is fatally flawed and politically unachievable. The burden is on CAER to demonstrate the need for such a hearing in light of recent reports, such as the U.S. International Trade Commission, International Data Corporation survey, UNU Initiative and the Congressional Research Service, which cast significant doubts on the need for such a bill. It should also be noted that the House Environment and Economy Subcommittee has already held a briefing on the U.S. ITC report this summer giving all members of the committee, including Congressman Green, ample opportunity to question the ITC staff about their findings.

 

Question: The U.S. has recently banned the export of elemental mercury. Why did neither ISRI nor Congress claim this mercury export ban was a trade violation?

EH: The Mercury Export Act, signed into law in 2008, is an entirely different issue and therefore must be analyzed similarly. As with any potential trade violation, the legal analysis is fact specific and based on a case-by-case analysis. As such, one should be very careful when trying to draw comparisons between trade restrictions for elemental mercury and those being posed for used electronics products (UEPs).

 

Question: Eric said only 5 percent of e-waste is exported, while Neil said it was closer to 50 percent. Where are you both getting your numbers? Didn't the ITC report also say that 41 percent of recyclers were unsure whether their material was exported? Isn't it necessary to find sources of reliable, corroborated data before we decide one way or the other what our course of action should be?

EH: The U.S. ITC report is the most comprehensive factual report on the market. Our numbers come from the report itself. Despite claims of uncertainty by some recyclers, the report clearly validates that, by volume, over 80 percent of the 4.4 million tons of UEPs being collected in the U.S. (3.64 million tons) were recycled, reused and refurbished domestically, while only 17.2 percent (.076 million tons) were being sent for export. Of the 17.2 percent being exported, over 70 percent (.052 million tons) is exported as either tested and working UEPs, working UEPs, commodity grade scrap or UEPs moving for warranty repair. So, what’s left? The remaining volume accounts for only 5.1-7.5 percent of the total collected UEPs (approximately .022 million tons). This is what ISRI calls "the sliver," which are exports for recycling or disassembly (non-working and untested UEPs), final disposition, or are unknown. Although these amounts are now proven to be nominal, ISRI strongly believes that recycling, no matter where it is carried out, must be done at a facility that is capable of performing such activities in a manner that is protective of human health and the environment.

It is worth noting that the recent green paper issued by the United Nations University StEP Initiative 2013 confirms how extensive and complex the global movement of used and end-of-life electronic equipment is today. These reports explicitly address how much has changed in the last 10 years and therefore how outmoded the arguments are that call for export bans.

NPM: The U.S. ITC report is 250 pages long and it presents an almanac of data that can be quoted by any interest group to promote its side. The survey and corresponding report is complex and offers a lot to interpret. I would caution anyone from claiming that they own the data of the US ITC report and everyone else is wrong about their interpretation of the data.

That being said, I do want to clarify that I did not say that the ITC reported that 50 percent of all e-waste from the U.S. is exported. If you look at my published presentation (available to conference attendees here), what I said is that of the 1.5 billion pounds of used electronic products purported to be exported in 2011 per the U.S. ITC study, more than 50 percent of these exports included "untested or non-working products, products for disposal or recycling, and other unknown purposes."

CAER doesn’t want to argue over percentages, because there’s no agreement on what goes into the equation to define the percentage of what gets exported. Instead, we believe it is notable 1.5 billion pounds of used electronic products were exported and that more than 50 percent of that amount would more likely be processed in the U.S. under RERA. That’s equipment all our companies would like to process to create more jobs and economic value in the U.S. It is not a small sliver of equipment.

ISRI is not contesting the 1.5 billion pound export number. They focus on the economic value of what gets exported. Please remember that toxic waste, CRT glass, and mixed e-waste scrap weighs a lot, but doesn’t contain much economic value.

So then, is it necessary to find better sources of data before deciding one way or another what our course of action should be, as the individual asked? CAER believes we know enough already and need to act. The fact that there is a significant amount of export of untested, non-working electronics is obvious to any business owner who faces the competitive threat of low cost exporters, or who receive solicitations from overseas buyers and brokers for as-is electronics. There are other studies that recognize there is still a problem with e-waste dumping into developing countries. The widely respected March, 2013 StEP Green Paper wrote, "the people and environments of the global South continue to suffer a disproportionate share of the social, health and environmental costs of e-waste processing and disposal while reaping relatively few of the benefits."

Sometimes, opponents of bills will claim that we need more studies as a way to delay action on obvious problems. In this case, we don’t need any more studies. The preponderance of reports and current anecdotes corroborate that hazardous e-waste continues to be exported from the U.S. to developing countries at a significant rate. It’s similar to saying we need more studies about climate change before we for anything. It would be irresponsible for us to delay action any longer knowing what we now know. We must pass HR 2791 this session!

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