Industry Program to Collect Nickel-Cadmium (Ni-Cd) Batteries
by Bette Fishbein, Senior Fellow
This case study looks at one particular example of extended product responsibility: manufacturers taking responsibility for their products after they are discarded and become waste. The manufacturers of nickel-cadmium batteries (Ni-Cds) and products that contain such batteries have launched a national program to collect and recycle these batteries, at industry expense.
Many battery types can pose serious problems when disposed of as municipal waste; their toxic constituents can be released into the environment from municipal landfills and incinerators, causing damaging health effects. These problems can be ameliorated by reducing the amount and/or toxicity of batteries in the wastestream or by recycling them.
One possible strategy would be to reduce the number of battery-powered products used. This is controversial in an economic system predicated on consumption and growth and is beyond the scope of this report. In fact, the battery industry has worked in recent years to reduce the amount and toxicity of batteries in the wastestream in other ways by: 1) redesigning batteries to reduce or eliminate the toxic constituents; 2) substituting batteries with less toxic constituents; and 3) reducing the number of batteries discarded by extending battery life. Now a major program is being launched to increase recycling. Since batteries are not homogeneous with respect to material composition, design or function, different strategies have been appropriate for the different battery types (described in section 6.2).
As will be discussed in this case study, Ni-Cds cannot be redesigned to eliminate cadmium (the toxic constituent), since cadmium is essential to the battery's function. Batteries with less toxic constituents have been substituted for Ni-Cds but this is not technically possible for all applications. Product life of Ni-Cds has already been extended (as compared to conventional single-use batteries) because they are reusable/rechargeable. The Ni-Cd industry is now opting to address the problem its batteries pose in the wastestream by taking back Ni-Cds and recycling them at industry expense.
Legislation mandating industry take-back or the threat of such legislation has spawned numerous recovery systems for packaging, autos, batteries and electronics around the world, particularly in western Europe. In the U.S., some companies have established programs to take back and recycle or reuse their own products, such as Kodak's take-back program for its single- use cameras. The program now being launched for Ni-Cd batteries is the first nationwide take-back program in the U.S. that involves an entire industry, including many companies, and creation of a separate organization to operate and fund the system.
The mechanisms of such a program are of interest because they address key questions pertinent to take-back systems in general such as: who is responsible? what are the logistics of take-back? and how can such a system be funded? Understanding the system to take back Ni-Cd batteries could be useful in considering how to deal with other problem products in the wastestream. For example, experience with Ni-Cds could be informative for those considering take-back programs for other battery types, fluorescent light bulbs, mercury switches/thermostats, paints and pesticides, and consumer electronic goods and appliances.
THE PROBLEM OF BATTERIES IN MUNICIPAL SOLID WASTE
Wet Cell Batteries
There are two major categories of batteries: wet cell and dry cell. Most wet cell batteries are lead-acid batteries primarily used for automotive products. About 80 million automotive batteries are sold in the U.S. each year. Discards of these batteries accounted for 1.7 million tons of municipal solid waste (MSW) in 1994. Although less than one percent of the total of 209 million tons of MSW generated, automotive batteries accounted for about two-thirds of the lead in MSW.
Serious concern about the environmental and health impacts of lead spurred EPA to declare lead-acid batteries a hazardous waste in 1985. The majority of states have legislation to remove these batteries from MSW incinerators and landfills - requiring that the batteries either be recycled or disposed of in hazardous waste facilities. Many states have regulations and deposit systems to encourage return of lead-acid batteries. The recycling rate for battery lead in 1993 was estimated at 95 percent, so it has largely been eliminated from MSW incinerators and landfills.
Dry Cell Batteries
Primary and Rechargeable Batteries
The other major category of batteries is dry cell batteries, also known as non-automotive, or consumer batteries. There are two basic types of dry cell batteries - primary and rechargeable. Most dry cells (almost 90 percent in 1992) are primary batteries that must be replaced once discharged. On the other hand, rechargeables can be used repeatedly because the chemical reaction that creates the energy can be reversed, thereby recharging the battery. Rechargeables initially may be more expensive than primary batteries, and require purchase of a recharger, but each rechargeable may substitute for hundreds of primary batteries and cost less than the primary batteries it replaced over its life. About 80 percent of rechargeable batteries are composed of nickel and cadmium and are known as Ni-Cds. A Ni-Cd battery can be recharged hundreds of times.
In 1993, Rayovac introduced a new mercury-free, alkaline battery that can be recharged. Unlike most other rechargeables, it is non-toxic. Rayovac is marketing this as a "renewable" battery rather than a rechargeable, mainly because the company does not want it to be categorized with the other rechargeables with toxic constituents. This new battery competes for market share both with primary batteries and rechargeables, but it cannot be recharged as many times as a Ni-Cd.
Markets for Dry Cell Batteries Increasing
Publicly available data on battery sales in the U.S. are very limited. Battery manufacturers are in intense competition for market share and do not release their sales data.
A detailed study of batteries, Getting a Charge Out of the Wastestream, estimated that 3.5 billion consumer batteries were sold in the U.S. in 1992 - almost ten percent were Ni-Cds. Figure 6-1 and Table 6-1 show the types of consumer batteries and changes in market share from 1985 to 1992. Table 6-2 shows the types of batteries by units sold and by weight in 1992. Ni-Cd sales in the U.S. were estimated at 326 million units in 1992, or about ten percent of total sales, as shown in Table 6-2. Whereas total consumer battery sales increased about 40 percent between 1985 and 1991, the sales of Ni-Cds increased 60 percent in the same period.
Figure 1: 1992 Sales Percentage of Domestic Household Batteries in the U.S.
|Alkaline||Zinc Carbon||Nickel-cadmium||Zinc Air||Silver oxide||Mercuric oxide||Lithium|
Table 1: Percentage Sales of Domestic Household Batteries in the U.S, 1985-1992
Table 2 Estimated Domestic Household Batteries Sold in the U.S., 1992
|Battery Type||Unit Sold (millions)||Weight (000s pounds)|
Comparable information on battery sales is not publicly available for 1995, but industry estimates indicate that the market for rechargeable batteries is growing faster than the market for non-rechargeable (primary) batteries. About 80 percent of rechargeable batteries are not sold separately but rather are enclosed in products. The remainder are sold directly to consumers, at retail. According to the National Electrical Manufacturers Association (NEMA), the U.S. retail market for rechargeables is growing twice as fast as the retail market for primary batteries, with compound annual growth of nine percent from 1992 - 1994. The Ni-Cd industry estimates that its batteries had double digit annual growth in the 1980s; this slowed to single digit in the 1990s, but is expected to average over six percent per year.
In general, batteries are becoming much more prevalent due to the dramatic increase in items that require their use, such as battery powered toys and tools, small electrical appliances like toothbrushes and shavers, video cameras, cellular phones, and portable computers. Norm England, President of the Portable Rechargeable Battery Association, says that what is driving the sharp increase in rechargeable batteries is the "consumer's wish to be free of a cord."
Substitution for Ni-Cds
As already noted, about 80 percent of rechargeable batteries are Ni-Cds. Other types of rechargeables in use today are lithium-ion, nickel-metal hydride, small sealed lead-acid, and rechargeable alkaline manganese batteries. None of these battery types are included in the data in Figure 6-1 or Tables 6-1 and 6-2 because these batteries were not available in significant amounts in 1992, or earlier.
Markets for rechargeable batteries cover a broad range of power requirements - from low power drain (portable computers) to high power drain (power tools). At present other rechargeables compete with Ni-Cds for low power drain applications. Ni-Cds have rapidly lost market share to nickel-metal hydride and lithium-ion batteries for use in portable computers. But only Ni-Cds can be used for high power drain applications such as power tools. Ni-Cds continue to dominate the markets for such devices and for other products including electric appliances like "dustbusters," cellular phones, and video cameras.
Batteries Contain Hazardous Materials
Four billion consumer batteries translate to about 15 sold for each man, woman, and child in the U.S. each year. About 146,000 tons of consumer batteries are disposed of each year. These accounted for less than 0.1 percent of MSW in 1992, but they are of concern because they contribute a disproportionate percentage of certain toxic heavy metals, primarily mercury and cadmium, to the wastestream.
In 1989, consumer batteries accounted for 88 percent of the mercury and 54 percent of the cadmium in MSW. Due to the increase in Ni-Cd use, batteries are expected to contribute almost 75 percent of the cadmium in the wastestream by 2000. Discards of cadmium in batteries and appliances nationwide are projected to increase from 1,305 tons in 1990 to 2,032 tons by 2000.
Dramatic progress has been made in the U.S. in redesigning batteries to eliminate mercury content, primarily driven by state mandates. In 1992, the battery industry consumed 98.44 percent less mercury than it did in 1984. This has been possible because most mercury was used in batteries as a gas suppressing additive that could be eliminated by design changes. Further reductions in the use of mercury in batteries will result from The Mercury Containing and Rechargeable Battery Management Act, discussed in section 6.3.l.
Cadmium, on the other hand, is used as an electrode material, the power source of the battery. The amount of cadmium in Ni-Cds cannot be reduced because this would cause a proportionate reduction in the energy output of the battery. Cadmium typically accounts for 11 - 15 percent of Ni-Cd battery weight. As discussed earlier, the problem of cadmium in the environment is being addressed by substituting other batteries with less toxic components for Ni-Cds or by assuring that Ni-Cds are recycled and do not enter MSW landfills and incinerators.
The environmental release of cadmium poses potential health threats. Cadmium can accumulate in the environment by leaching into ground water and surface water from landfills, and it can enter the atmosphere through incinerator smokestack emissions. Effective air pollution control equipment at incinerators traps cadmium, which ends up in the ash, causing problems of cadmium in ashfill leachate. Cadmium is toxic to fish and wildlife and can pass to humans through the food chain. It has been associated with numerous human illnesses particularly lung and kidney damage. Once absorbed in the body, cadmium can remain for decades.
Because of the heavy metals they contain, managing batteries as part of the municipal solid wastestream is costly. The costs of diverting batteries can be lower than the back-end costs to the municipal waste system of pollution control devices at incinerators and landfills (such as lime addition at incinerators and double composite liners at landfills). Battery diversion can also decrease costs by reducing the amount of ash from municipal incinerators that must be disposed of as hazardous waste.
DRY CELL BATTERY REGULATIONS AND LEGISLATION
1. The Federal Level
Since batteries often contain hazardous or potentially hazardous materials, the regulatory framework is critical to any take-back program. This determines how the materials must be handled and has major impact on the cost of the program.
Hazardous wastes are regulated by the federal government under the Resource Conservation and Recovery Act of 1976 (RCRA): the regulations are codified in Title 40 of the Code of Federal Regulations (40 CFR). RCRA provides an exemption for residential waste. This means that products such as Ni-Cd batteries that are classified as hazardous under federal criteria are exempted if the waste is generated by the residential sector. If a household discards a Ni-Cd battery, it is not subject to hazardous waste regulations. The same battery, if discarded by a business or institution such as a hospital may be subject to these regulations (depending upon the amount of hazardous waste the entity generates). Since consumer batteries are discarded by households, businesses and institutions, different regulations apply to identical batteries, depending on who generates the waste. Costly hazardous waste regulations have presented a major barrier to the take-back of batteries.
In May 1995 the EPA promulgated the Universal Waste Rule (40 CFR Part 273) intended to encourage reclamation and recycling of certain hazardous wastes by removing some of the regulatory barriers. This rule applies to batteries, thermostats, and pesticides. Under the Universal Waste Rule, batteries recovered and properly managed, regardless of who generates the waste, are exempt from some of the stringent provisions of the hazardous waste regulations. This change has helped facilitate the industry take-back system for Ni-Cd batteries but an obstacle remained. In order for the Universal Waste Rule to take effect in a state, the state had to have incorporated it into its own regulations or policy. Thirty-two states had done so as of May 1996.
For five years, the battery industry sought federal legislation to remove regulatory barriers to the collection and recycling of batteries. Such legislation was finally passed by Congress in April 1996 and signed into law by President Clinton on May 13, 1996. The Mercury Containing and Rechargeable Battery Management Act (P.L. 104-142) makes the provisions of the Universal Waste Rule applicable nationwide thereby obviating the need for adoption by each state. It eliminates barriers to the take-back system caused by hazardous waste laws. It establishes national uniform labelling requirements for rechargeable batteries. Ni-Cd batteries or products containing them will have to be labelled "Ni-Cd" - "BATTERY MUST BE RECYCLED OR DISPOSED OF PROPERLY." In addition, the law mandates that rechargeables be easily removable from consumer products and restricts the sale of mercury-containing batteries. The labelling and removeability requirements apply to rechargeable batteries deemed toxic such as Ni-Cds and sealed lead-acid batteries. They do not apply to alkaline rechargeables which are not toxic and can be disposed of with regular trash.
Earlier versions of the federal battery legislation mandated that industry take back batteries. The legislation, as finally passed, does not mandate take-back, but rather eliminates barriers to encourage a voluntary system.
The cost implications of the Universal Waste Rule and the subsequent federal battery law are significant as they provide relief from cumbersome RCRA transportation, storage, and paperwork requirements. According to Jeff Bagby of the Rechargeable Battery Recycling Corporation (RBRC), the cost of shipping batteries from Iowa to Pennsylvania, the site of the RBRC recycling facility, was $1 per pound when complying with hazardous waste regulations. Under the new rule, the cost is 17 cents per pound, and it is no longer necessary to fill out hazardous waste manifests and to use hazardous waste transporters. The provisions for standardized national labelling and removeability regulations also have cost savings implications for industry which formerly had to deal with a patchwork of inconsistent legislation in different states.
2. The State Level
Starting in 1989 when Connecticut passed its battery law, states have taken the lead on dry cell battery legislation: 13 states have passed legislation regulating battery labelling and removeability, and 8 states (CT, FL, IA, ME, MD, MN, NJ, VT) have take-back requirements that apply to Ni-Cds. While many states have mandated separate collection to keep batteries out of MSW facilities, they often do not specify what should be done with the batteries after they are collected. Exceptions to this are Minnesota and New Jersey where the nation's most far-reaching battery legislation has been passed.
Legislation in Minnesota and New Jersey
Stringent provisions on rechargeable batteries became law in Minnesota in 1990 and in New Jersey in 1992. Both states require that rechargeable batteries be easily removable from products, be labelled as to content and proper disposal, and be banned from the municipal wastestream. In addition, they require manufacturers to take rechargeable batteries back at their own expense for recycling or proper disposal.
Legislation in these states distinguishes between batteries that are recyclable, such as Ni-Cds and those that are not, such as alkaline batteries containing mercury. For recyclable batteries, industry takeback is mandated. For the others, content standards are established to reduce the amount of heavy metals.
While the technology was available in the U.S. to recycle Ni-Cds prior to passage of the Minnesota and New Jersey laws, very few were actually recycled. State legislation spurred the development of a recycling infrastructure. The legislation requiring removeability is important since Ni-Cds must be removed from products in order to separate them for recycling. Eighty percent of Ni-Cds are enclosed in cordless tools and appliances, and most were not accessible before the mandate for removeability was implemented.
Given the increasingly international complexion of markets and global design of many products, concern in Europe about Ni-Cds and the threat of a ban provided additional incentives to industry to develop a system to recover and recycle Ni-Cds.
Since publication of a report, Recharging without Cadmium in 1993, Sweden has pushed for substitution for and even a ban on Ni-Cds. A proposal by the Swedish Ministry for the Environment for a ban on Ni-Cds in all European Union countries is under consideration by the European Union. Sweden also proposed to the Organization for Economic Cooperation and Development (OECD) that Ni-Cds be replaced with nickel-metal hydride batteries - this was voted down. As an alternative, the OECD agreed that industry should work with governments to facilitate Ni-Cd battery collection. This view was included in a formal recommendation to OECD nations. Belgium is targeting batteries with its tax policies: an eco-tax is threatened of 33 cents per battery on types that are not recycled at a rate of 75 percent by 2000.
4. THE RECHARGEABLE BATTERY INDUSTRY ORGANIZES FOR TAKE-BACK
4.1 The Portable Rechargeable Battery Association (PRBA)
As battery legislation was introduced in states across the nation, the producers of rechargeable batteries broke from the trade associations that had traditionally represented the battery industry - the National Electrical Manufacturers Association (NEMA) and the Battery Products Alliance (BPA). In June 1991, a new trade association - the PRBA was formed by the five largest makers of rechargeable batteries worldwide - Sanyo, Panasonic, Gates Energy Products (now Energizer division of Eveready), Saft, and Varta. While four of these are foreign companies, they all have U.S. operating divisions. PRBA members now include over 100 companies involved in the manufacture, assembly, distribution, use, and sale of rechargeable batteries and products powered by rechargeables.
PRBA has addressed issues of government relations, lobbied at the state and federal levels, and worked to develop a take-back system for rechargeable batteries. PRBA originally proposed, and endorsed throughout, the federal battery legislation adopted in May 1996. This legislation reduces barriers to the battery collection and recycling system and avoids the need to deal with inconsistent legislation in different states.
4.2 The Rechargeable Battery Recycling Corporation (RBRC)
In 1995, battery manufacturer members of PRBA set up the RBRC to physically administer the collection and recycling of rechargeable batteries and to license its seal to fund the system. The mission of this non-profit organization is "to perform a public service through the management, collection and recycling of used nickel-cadmium (Ni-Cd) batteries throughout the United States." This includes educating the public on battery recycling, and collecting and recycling batteries for the companies that fund these operations - its licensees.
RBRC has two divisions: 1) the Recycling Division that administers the public education, collection, and recycling programs; and 2) the Finance and Seal Administration Division that licenses and administers the RBRC Seal to raise the funds to finance the system.
This division works through independent contractors. It provides funding to the PRBA to run its education programs. It also negotiates contracts for the collection, storage, transportation, and recycling of Ni-Cds. The responsibilities of the Recycling Division include assuring compliance with federal and state regulations, collecting and maintaining records that track the batteries, obtaining necessary licenses and permits, obtaining certificates of recycling, and selection and purchase of collection containers.
Finance and Seal Administration Division
This division collects the license fees, monitors compliance with the license agreements, and processes refunds. It administers the Seal and will direct audits by a national accounting firm, as needed.
RBRC is providing insurance coverage for its take-back program, which includes coverage for the licensees. The costs of the insurance are built into the fee schedule. Insurance will cover the entire system from collection, through storage, transportation and recycling. Given the potential dangers of handling batteries, such coverage is critical. RBRC is providing $5 million of coverage for storage and recycling facilities and $2 million for transporters. The coverage includes both general liability and contingent pollution liability.
5. THE SYSTEM TO TAKE BACK AND RECYCLE Ni-Cd BATTERIES
RBRC runs the system to collect and recycle Ni-Cds and works with PRBA on the public education campaigns. Unless otherwise noted, all information in this section on the take-back system is from RBRC publications assembled in the document, Recycling America's Rechargeable Batteries: the Program.
5.1 Funding the Program: Fees and Rebates
The collection and recycling system is funded by license fees paid by rechargeable battery and product manufacturers, which allows them to place the RBRC Seal on their products and packaging. A license fee is paid for each cell within a battery or battery pack that displays the RBRC Seal. Fees are paid by companies based on the weight of batteries put on the market during the previous calendar quarter. The fees are set by RBRC. Typical RBRC fees on Ni-Cd batteries are about 10 cents in a portable computer, 4 to 12 cents in a power tool and 5 cents in a cellular phone. Since this is a voluntary program, companies are free to decide whether to join the program and become licensees.
The RBRC budget is negotiated with the largest licensees. Once funds are allocated for the different budget items such as education, collection and recycling and the total is determined, the revenues needed are divided by the amount of batteries placed on the market, to calculate the fees. RBRC is a non-profit corporation, so the fees generated are solely to run the system.
Licensees can apply for rebates on cells not sold in the U.S. market or those exported before final retail sale. They can also apply for partial rebates if they set up their own collection system and ship the batteries directly to an RBRC recycling facility so that double payment is avoided. Appendix A shows the Ni-Cd fee schedule in effect as of July 1996. Appendix B shows the companies that signed license agreements as of July 24, 1996.
5.2 Who Is Responsible?
Determining who is responsible for paying the license fees is complicated. Is it the company that manufactured the battery? The company that assembled the battery pack? Or, the company that inserted the battery or battery pack in its product? These functions may be performed by one company or a number of different companies.
Generally, the owner of the brand name on the battery or battery pack is the licensee and the owner of the brand name on the consumer product is a sub-licensee. The situation is simplest when the same brand name appears on both. The licensee pays the fee to RBRC at the end of the calendar quarter in which the batteries are sold into the U.S. market and places the RBRC seal on the battery or battery pack.
RBRC encourages exhibiting the Seal on packaging and mandates that the Seal be on the package if the brand name on the battery pack is the same as the brand name on the consumer product. Use of the Seal in promotional materials by licensees is also encouraged. Success of the RBRC system is dependent upon getting a sufficient number of companies to sign on to the take-back program. Display and promotion of the Seal is encouraged as a way of inducing companies to join the system. The idea is that battery consumers, be they manufacturers of consumer products, individuals or government procurement officers, will prefer products with the Seal, which indicates collection and recycling has been arranged and paid for.
5.3 The Collection Systems
To deal with batteries generated by many different sources, RBRC has set up four separate collection systems from: 1) retailers; 2) communities; 3) business and public agencies; and 4) licensees. Batteries from the collection systems are transported to three consolidation points across the U.S.: 1) Wade Environmental Industries, Battery Division, Atco, New Jersey; 2) U.S. Filter Recovery Services, Inc., Roseville, Minnesota; and 3) Kinsbursky Brothers Supply, Inc., Anaheim, California. From these consolidation points the batteries are shipped to the International Metals Reclamation Company (INMETCO) in Ellwood City, Pennsylvania, where they are recycled. Small shipments of batteries (under 150 pounds) are transported by the United Parcel Service (UPS), larger ones by national common carriers.
The Retail Collection System
RBRC and PRBA contact retailers who sell rechargeable batteries and products that contain these batteries to enlist their participation in the program. Brochures and videotapes are used to encourage retailer participation.
Retailers agreeing to participate get Battery Recycling Kits from RBRC free of charge. These kits contain collection containers, a plastic zip-loc bag for each used battery, safety instructions, and signs to place in the store. They also contain a Recycling Manual with details on which batteries are eligible for the program and instructions on the role of the retailers. The retail program was operative in 16 states prior to adoption of the federal battery legislation (in May 1996) and expanded to 35 states within two weeks of adoption.
RBRC is distributing containers with a capacity of about 18 pounds that have passed its safety tests. Larger containers are currently under development. The containers are picked up from the retailers by UPS, and they come with pre-addressed, prepaid shipping labels so that retailers incur no shipping costs. UPS picks up the filled containers and delivers them to the designated consolidation point. At the consolidation points, the batteries are bulked into shipments of 10,000 to 40,000 pounds and sent to INMETCO for recycling by a pyrometallurgical process described later. Records are kept by the consolidation points on the weight of the batteries received and by INMETCO on the amounts received and recycled.
Participating in a battery management program is a new endeavor for retailers. RBRC has made an effort to minimize inconvenience and to avoid any out-of-pocket costs to gain retailer cooperation. All transportation, handling, and recycling charges are paid by RBRC and funded through the Seal fees. The responsibility of retailers is putting the containers in place and mailing them to the consolidation points without charge. Insurance coverage is provided by RBRC. Retail collection initially was only taking place in states that adopted the Universal Waste Rule or made other provisions so that retailers would not be classified as hazardous waste handlers. Following the passage of the federal battery law in May 1996, nationwide implementation of the retail collection system began.
An incentive for retailers to cooperate with the program is the service provided by the toll-free telephone number 1 800-8-BATTERY, operated by RBRC. Consumers can call this number to find out what to do with their used batteries. They are given the name of the nearest retailer who will take back Ni-Cds for recycling, which can lead to increased sales for that retailer. Counties and municipalities also publish the names of the retailers participating in the program - another marketing advantage for the retailers.
The Community Collection System
The goals of the collection system are two-fold. The first goal is to get Ni-Cds out of the municipal solid wastestream and send them to recyclers rather than municipal incinerators or landfills; the second goal is to utilize the solid waste collection infrastructure already in place in counties and municipalities to do this. This infrastructure may include curbside collection programs, household hazardous waste collection sites and events, or recycling centers.
Under the RBRC program, the community can use its existing collection system. It then brings the Ni-Cd batteries to one central location where they are consolidated and shipped to one of RBRC's three consolidation points and then on to the recycler. The community must transport the batteries to the central location in the county but RBRC pays all the subsequent shipping costs. The community registers with one of RBRC's consolidation points and calls when a pick-up is needed. Pick-ups will not be more frequent than once per month and are supposed to weigh at least 1,000 pounds.
This collection system requires very large containers. Most communities currently use 55-gallon steel drums. The RBRC program will continue to use these drums and RBRC will pay the drum disposal fees.
Like the system for retailers, RBRC will provide materials to encourage participation as well as a Recycling Manual. Records will be kept of the weight of batteries shipped and recycled.
The RBRC program may impose additional costs on communities, even if they currently have separate battery collection programs, but it also provides benefits. The added costs are due to the need to separate Ni-Cd batteries from the other consumer batteries collected, since RBRC only takes back Ni-Cds. The benefits derive from reduced shipping, recycling and/or disposal costs for used batteries. Such fees can be high.
For example, Putnam County in New York State pays about $10,000 to a contractor to take all the materials (including batteries) that it collects on its annual household hazardous waste collection day. About five tons are collected, so managing this waste costs about $2,000 per ton. The county could send Ni-Cds directly to a battery recycler, but it would have to pay the recycler $1,600 per ton to take the Ni-Cds, and in addition, would have to pay for sorting and transportation. Under the RBRC program, private industry pays the shipping and recycling costs for Ni-Cds, thereby reducing the financial burdens on the counties and municipalities.
For communities that do not currently have separate consumer battery collection, the costs of the RBRC program are greater as they must set up a separate battery collection system and consolidate the batteries at one point. The benefits of doing this would be reduced pollution from incinerators and landfills. A less toxic municipal wastestream should lead to reduced disposal costs as well as improved public health.
The Business and Public Agency Collection System
The business and public agency collection system is aimed at businesses, government agencies and institutions, ranging from auto factories to hospitals and police departments. Most of these generators are currently prohibited from disposing of Ni-Cds in MSW so they generally have programs to send the batteries to recycling or proper disposal facilities. The goal of RBRC's program is to get more of the batteries diverted to recycling rather than disposal, to reduce the incentives for illegal disposal, and to encourage those without a battery management program to become part of one.
Under this program, the entity collects its own Ni-Cds in its own containers and pays to ship them to one of the three RBRC consolidation points. RBRC pays all additional costs of the system, including the container disposal fees. The containers used must meet RBRC specifications. The generator can arrange the shipping or request the consolidation point to arrange it, but in either case the generator pays the shipping costs. UPS handles the shipments under 150 pounds. Common carriers handle the larger shipments that are arranged by the consolidation points.
The rest of the program is the same as the systems for retailers and communities. RBRC provides educational materials, a Recycling Manual, and documents the amount of batteries shipped and recycled.
Many business and public generators already have battery management programs. If they separately collect Ni-Cds, the RBRC program should not impose additional costs. If they do not, they will incur the costs of separating Ni-Cds. Without the RBRC program, these generators must pay the full costs of collection, transportation, and recycling or disposal. Under the RBRC program, they only pay for getting the batteries to the consolidation points. Again there is a shift in responsibility - under the RBRC program, much of the cost of battery management is shifted from the generators of the waste to the manufacturers of the batteries or battery-containing products.
The Licensee Collection System
The goal of the licensee collection system is to encourage companies that are RBRC licensees to develop their own collection system. They are uniquely able to collect batteries from their customers through reverse distribution programs and also from their own service centers or retail outlets. All of this is optional, however: they can be licensees and choose to have their batteries collected under the other three collection systems.
Under the RBRC licensee collection system, the manufacturer collects its own batteries. It pays to ship them in its own containers directly to the recycler. RBRC pays the recycling charges and drum disposal fees. The manufacturer is eligible for a rebate of about 75 percent of the Seal license fees it has already paid. The rebate is currently $0.1746 per pound. In other words, the manufacturer pays the Seal fees when it puts the batteries on the market. If it takes back its own batteries and sends them to the recycler, it gets a rebate on the fees already paid. This is to avoid paying twice.
There are two separate issues for a manufacturer of Ni-Cds or products containing Ni-Cds: 1) whether to become an RBRC licensee; and 2) whether to establish its own take-back system for its Ni-Cds. There can be distinct marketing advantages in being a licensee - a product with hazardous materials that might be outlawed has its collection and recycling arranged and paid for. With respect to take-back, the rebate system enables manufacturers to develop their own Ni-Cd collection systems that they can fund with the rebates received. A company can be a licensee and not have its own take-back program. In that case, the licensee is paying to have the batteries collected from retailers, communities, businesses, and public agencies.
Companies that are not RBRC licensees, such as some computer manufacturers (discussed in section 6.6.3), do not pay the RBRC fees initially and therefore do not get rebates. Their take-back systems are totally apart from the system run by RBRC. They create such systems because their Ni-Cds cannot be sold in some states, such as New Jersey and Minnesota unless the manufacturers take them back for recycling or proper disposal.
5.4 The Recycling System
RBRC has chosen to recycle all of the Ni-Cds it collects. This is not mandated by any state or by the federal government - proper disposal of the batteries as a hazardous waste is permitted. RBRC sends all of the Ni-Cds it collects to International Metals Reclamation Company (INMETCO), a recycler in Pennsylvania, under a five year contract effective January 1, 1995. INMETCO is a subsidiary of The International Nickel Company (INCO) of Toronto. INMETCO was established in 1978 to recycle wastes from stainless steel manufacturing and is located near many of the specialty steel mills in the U.S. It is the only recycler in North America with the high-temperature process necessary to reclaim all raw materials from Ni-Cds - the technology that the EPA has determined to be BDAT (best demonstrated available technology).
INMETCO's process involves draining the batteries, shredding them, and feeding them into a 2300 degree (F) furnace. In the past, nickel, and iron were recovered and used in stainless steel production for products such as sinks, but the cadmium was sent elsewhere for recycling or proper disposal.
Under the RBRC contract, INMETCO had to expand to provide adequate cadmium smelting capacity by the end of 1995. In December 1995, INMETCO announced the installation of its new $5 million cadmium recovery plant. The cadmium, 99.95 percent pure after recovery, will be used in the manufacture of new Ni-Cd batteries. The cost of the cadmium recycling is already built into the RBRC fee schedule. Under this system, RBRC can legitimately claim it has arranged for the collection and recycling of Ni-Cd batteries as only process waste will go to disposal.
6 STATUS OF THE RBRC PROGRAM TO RECOVER Ni-Cd BATTERIES
6.1 The RBRC Program Goes Nationwide
The federal battery legislation signed into law on May 13, 1996 had immediate impact on RBRC's program to collect and recycle Ni-Cd batteries. Previously, the program had been launched on a state-by-state basis contingent on state adoption of the Universal Waste Rule. After passage of the federal legislation, the strategy was changed to a focus on sectors nationwide.
In June 1996, major retailers across the country were targeted to join the program. According to RBRC, retailers began asking for collection bins following passage of the federal battery law. For example, Radio Shack, which had been participating in the state programs, requested bins for its 6,800 stores nationwide. Major retailers such as Sears, Walmart and Best Buy and telephone retailers like Cellular One, Bell Atlantic, Pacific Bell, Bell South, and Ameritech were asked to participate in the retail collection system. Prior to passage of the federal legislation, there were retail bins in 16 states. In the two weeks following passage, this was extended to 35 states. RBRC reports retailers want to be pro-active on the environment and are enthusiastic about joining the system.
The second group targeted, in July 1996, consists of public agencies (police, fire, schools and hospitals) that can participate in the business and public agency collection program. Targeted third, in August 1996, were recycling coordinators across the country who could launch the community collection system.
On May 21, 1996, shortly after President Clinton signed the federal battery legislation into law, RBRC held a press conference to launch its multi-million dollar nationwide battery recycling campaign called "Charge Up to Recycle!", aimed at the general public. Richard Karn, star of the T.V. show "Home Improvement," is RBRC's celebrity spokesperson for the program. He will make personal appearances across the country as well as appear in RBRC public service announcements for TV, radio, and the print media.
6.2 Earlier Education/Outreach Campaigns
In 1994 RBRC launched its education program and began recruiting licensees. The effective date for the License Agreement, use of the Seal, and the contract with INMETCO was January 1, 1995.
The telephone number 1-800-8-BATTERY was established in March 1995 to enable consumers to call and get information on where and how to recycle Ni-Cds. At the end of 1995, approximately 4,500 retailers and 300 county/municipal recycling locations were on the system.
Later in 1995, a fax-back system was launched. The purpose was to make available current information on state battery legislation and regulations, and also specifics of the logistics of the RBRC system. Following adoption of federal legislation, the fax-back system was revised to focus on the four collection systems nationwide. There is a unique fax-back phone number for each of the collection systems. The information is tailored to the type of collection program served. For example, businesses and public agencies or communities can use this system to obtain information on collection locations, regulations/legislation, specifics on how to collect, store and ship Ni-Cds, employee training, and current licensees. Fax-back can also be used by retailers to order replacement collection supplies.
6.3 Signing Up Licensees
A critical hurdle in establishing the take-back system for Ni-Cd batteries was getting a substantial number of companies to agree to be licensees. Without this, the voluntary system could not work. This hurdle has been cleared: according to RBRC "by the end of 1995, over 170 companies representing over 75 percent of the Ni-Cd batteries sold into the U.S. market had signed as RBRC Seal Licensees." All of the major Ni-Cd producers have joined the program. Some cellular telephone manufacturers had not become licensees as of May 1996 but are expected to join the system in the future.
A number of computer manufacturers such as such as Compaq, Digital Equipment, and IBM have not become licensees. As noted earlier, some computer companies are phasing out the use of Ni-Cd batteries in their products and replacing them with nickel-metal hydride or lithium ion batteries; some have their own battery take-back programs. Other computer manufacturers such as Tandy, NEC, and Toshiba are RBRC licensees.
Compaq, for example, has chosen to operate its own battery take-back program rather than join the one run by RBRC. Compaq believes all rechargeable batteries should be collected and recycled and objects to RBRC taking back Ni-Cds only. Compaq believes its program is "more user friendly" than RBRC's and does not anticipate significant numbers of Compaq batteries entering the RBRC program. Compaq says that, on occasion, RBRC batteries enter its recycling program, and that it has recycled these batteries without charge to RBRC.
6.4 Battery Recovery and Expansion Plans
RBRC says it recovered 15 percent of discarded Ni-Cd batteries nationwide in 1995. These primarily came from the commercial sector, with less than 25 percent from households. RBRC's goal is to collect 70 percent by 2001.
Table 6-3 shows the RBRC estimates of the amounts of Ni-Cds sold,
discarded, and recycled. These data are for batteries processed through the
RBRC program and do not include batteries shipped overseas for recycling or
those disposed of in hazardous waste landfills.
Table 6-3: Ni-Cd Recycling Rates in the U.S. (thousands of pounds of batteries)
RBRC expanded its program into Canada as of January 1997. Expansion into other countries is under consideration, with Australia and Mexico heading the list. RBRC also is considering expanding its program to collect other battery types, beginning with pilots to collect nickel-metal hydride batteries in the U.S.
6.5 Battery Recycling
INMETCO can recycle 3,000 tons of spent batteries per year. Its facility is designed to expand to 10,000 tons once national battery collection programs are fully operative. Ni-Cd recycling at INMETCO increased from 50 tons per year in 1989 to 1,200 tons in 1992. INMETCO estimates it recycled 2,500 tons of Ni-Cds in 1995 from RBRC and other sources.
In addition to Ni-Cds, INMETCO recycles other battery types such as nickel-iron, nickel-metal hydride, and zinc carbon. It has considered licensing its technology abroad. In 1996, INMETCO was the only recycler of Ni-Cds in the U.S. - other facilities are located in France and Sweden.
6.6 Costs of the RBRC Program
Questions often raised about take-back programs are: what is the cost? and will this increase the price of the product? RBRC estimates that its costs of $5.5 million are one percent of Ni-Cd sales prices. (Table 6-4 shows the breakdown of RBRC's estimated 1996 costs.) The percentage is an average and can vary with Ni-Cd size and configuration. In fact, RBRC expects to recycle 5,131,000 pounds of batteries in 1996, or about 2,500 tons. At a total cost of $5.5 million, this is about $2,000 per ton - very similar to the current costs to communities of disposing of hazardous waste, as described in section 6.5.3.
Table 6-4: Estimated RBRC Costs for 1996
|Public Education, Collection, and Recycling||4.7||85|
The RBRC costs are paid by manufacturers of Ni-Cds and products that contain Ni-Cds. If the increase is passed on to consumers, it could amount to a one percent price increase for the battery. Since an overwhelming proportion of Ni-Cds are contained within products, the price increase would be far smaller than one percent for the product. This is not necessarily a net increase in costs to society but rather a shift in costs. Shifting the costs of collection and recycling to manufacturers may decrease the costs local government must pay to manage batteries disposed of by households. This includes the direct costs of collecting, recycling and disposing as well as costs of pollution prevention equipment at disposal facilities. So internalizing the costs into battery prices means that consumers may pay higher prices for batteries but lower municipal taxes.
There is a different scenario for the batteries RBRC collects from the commercial sector. Commercial users typically pay to manage their battery waste. The RBRC program reduces the costs these companies would pay at the end of battery life and shifts them to manufacturers who may internalize the costs into the price of the batteries. Commercial users still pay but in a different way - they are likely to pay the collection and recycling costs for Ni-Cds when they purchase the batteries, not when they dispose of them.
6.7 State Pilot Programs
Prior to adoption of federal battery legislation in May 1996, RBRC was introducing its program on a state-by-state basis. In 1995, RBRC took over existing Ni-Cd recycling programs from PRBA in Minnesota and New Jersey.
Minnesota legislation requires that manufacturers establish a program to recover 90 percent of Ni-Cd and small sealed lead-acid (SSLA) rechargeable batteries, statewide, beginning September 20, 1995. Prior to that date only pilot projects were required. PRBA began a pilot program to take back rechargeable batteries in Minnesota at the end of 1992. Responsibility for the take-back of Ni-Cds was transferred to RBRC in 1995, with PRBA still responsible for the SSLAs.
Data on battery collection is fragmentary at this time, due in part to the transfer of responsibility from PRBA to RBRC and also to the fact that the program is relatively new. According to a report of October 1, 1995, submitted by PRBA in conjunction with RBRC (PRBA/RBRC report), these two organizations collected approximately 91,793 pounds of used
Ni-Cds and SSLAs in Minnesota from October 1, 1994 through September 20, 1995. The report does not provide separate data for each battery type, leading Minnesota officials to question whether most of these are Ni-Cds. Inclusion of batteries collected by PRBA prior to October 1, 1994, brings the total collected in Minnesota to 232,190 pounds since the program's inception in 1992.
U.S. Filter Recovery Services, Inc., the consolidation point in Minnesota, has a contract with RBRC to sort batteries by chemistry and ship them to appropriate recyclers. U.S. Filter reports receiving 80,984 pounds of Ni-Cds between October 1994 and September 1995. Retail stores sent 3,040 pounds; 15,277 pounds came from counties; and the remaining 62,667 pounds came from businesses and public agencies. U.S. Filter reports contamination has not been a major problem: if some other battery types are found in the Ni-Cd bins, U.S. Filter sorts them out and sends them to appropriate recyclers or back to the generators.
Retail collection of Ni-Cds in Minnesota was based on the system described in section 6.5.3 - with free battery collection boxes and shipping by UPS funded by RBRC. In 1995, about 300 retailers were participating in the Minnesota program - mostly Radio Shack and hardware stores.
According to the Minnesota Pollution Control Agency (MPCA), retail collection of used batteries is more promising than community collections. Retailers are more accessible to consumers than county drop-off points or household hazardous waste collection sites. The program will eventually include the large retailers like Target, Walmart, and Kmart. Minnesota county officials are telling people to bring batteries back to the retailers. So far, contamination has not been a big problem in the retail program - people have understood the difference between Ni-Cds and other batteries and are depositing them correctly.
It is too early to judge the effectiveness of the battery take-back program in Minnesota but, according to PRBA, removeability has been accomplished - "Most PRBA member companies have redesigned their rechargeable products so that the batteries can be easily removed, and substantially all covered products now meet this requirement."
Since the mandate (as of September 20, 1995) is for 90 percent recovery, the MPCA is developing a measurement methodology to estimate battery recovery rates so it can determine progress toward meeting the goal. This will put far more pressure on PRBA and RBRC which up to now just had to demonstrate they had some operative pilot projects. The MPCA says the Ni-Cd program is impressive and aggressive but the SSLA program is disappointing.
The New Jersey Program
Like Minnesota, New Jersey also has legislation (adopted in 1992) that requires manufacturers to take responsibility for used rechargeable batteries and either recycle or dispose of them in an environmentally sound manner. In New Jersey, where Ni-Cd collection started in
May 1993, the Department of Environmental Protection (DEP) estimates a recovery rate of about 10 to 12 percent.
New Jersey law requires that battery recovery rates be reported to the New Jersey DEP every six months. PRBA and RBRC filed a joint report on results of the rechargeable battery program in New Jersey for the first six months of 1995. RBRC filed the report alone for the second half of 1995, because it had assumed full responsibility for the program. Table 6-5 is based on data from these reports unless otherwise noted.
Table 6-5: Collection (in pounds) of Ni-Cd Batteries in New Jersey, 1995
|Collection System||1st Half||2nd Half||Total 1995|
|Business & Public Agency (including licensees)||16,166||26,592||42,758|
As shown in Table 6-5, the collection of Ni-Cds in New Jersey during the second half of 1995 represented an increase of over 60 percent from the first half of 1995. This was all accounted for by the commercial sector. Separate community collection data were not available for the first half of 1995. The New Jersey DEP notes that despite initial enthusiasm for the program, retailers tend to drop out unless the education program is sustained. The national publicity campaign, noted in section 6.6.1, was designed to focus attention on retailers.
New Jersey depends heavily on incineration (for 30 percent of its waste) and is focussed on getting heavy metals out of its wastestream for both economic and environmental reasons. The New Jersey DEP estimates that it costs $17 million a year to control cadmium, lead, and mercury (from discarded products) in municipal incinerators. In addition, the costs of landfilling incinerator ash are about $30 to $45 million per year because of heavy metal concentrations. The New Jersey DEP concludes that counties with municipal waste incinerators could save $40 to $60 per household per year with programs focussed on getting products with heavy metals out of the municipal wastestream.
6.8 Experience with Retailers
Radio Shack says the RBRC program for Ni-Cd batteries has been well received in both Minnesota and New Jersey. Radio Shack reports having bins in its stores (as of January 1996) in those states and also in Connecticut, Florida, Iowa, Massachusetts, Michigan, North Dakota, New Hampshire, New York, South Dakota, and Vermont. According to Radio Shack, all of its stores do not have bins in all of these states and "the amounts collected are not known." Radio Shack plans to adopt the Ni-Cd collection program nationwide.
Radio Shack notes that participating retailers have the benefit of RBRC promotion including their business being identified when customers in their area call the toll free RBRC number for recycling information. Company officials confirm RBRC's assertion that there is no cost of participation for retailers and no need to generate shipping documents or maintain elaborate records. Contamination (consumers putting other battery types in the Nid-Cd bins) has not been a problem.
7 LESSONS FROM THE RBRC EXPERIENCE
7.1 Collection/Recycling Results
The RBRC system is very new, and it is not yet known whether it will recover a substantial portion of discarded Ni-Cd batteries. While no national target has been legislated, RBRC's goal of recovering 70 percent by 2001 is an ambitious one and, if met, will be a significant achievement. The reported increase in recycling of Ni-Cds from 2 percent in 1993 to 15 percent in 1995 is impressive. A thorough and complex system is being put in place, but an outstanding question is to what extent will battery users cooperate?
Industry cooperation is already evident since RBRC claims 75 percent of Ni-Cds now being sold are under license and bear the RBRC Seal. An exception are certain computer manufacturers who either have or expect to phase out the use of Ni-Cds in their products.
A major education campaign will be required to get consumer cooperation in placing Ni-Cds in the proper bins at retailers or community collection sites. Many consumers may not understand the importance of separating Ni-Cd batteries even though the federal battery law requires a clear label stating the batteries must be recycled or disposed of properly. As of 1995 or even earlier, most Ni-Cds carried an identifying label in accordance with state laws, so consumers should be able to distinguish them from other battery types even before the federal law takes effect.
It will still remain easy for consumers to throw their Ni-Cds in their regular garbage pails and there is no financial incentive for them to do otherwise. Even if Ni-Cds are banned from the wastestream by states or localities, how will this be enforced? Success of the program will depend on extensive consumer education and commitment of individuals to manage waste batteries properly as well as easily accessible and identifiable drop-off locations. If this voluntary approach does not work, deposits could be mandated for Ni-Cds by some states to provide consumers with an incentive to bring them back. RBRC is counting on consumer support for recycling and says that consumers have separated items such as newspapers and bottles and will be willing to do the same for batteries.
Sweden's experience with Ni-Cds gives cause for concern. To avoid take-back legislation, the battery industry in 1993 concluded a voluntary agreement with the Swedish government to collect 90 percent of Ni-Cds by the summer of 1995. Industry only achieved a collection rate of 35 percent. The Swedish environment ministry is now seeking a ban on Ni-Cds.
Recycling developments in the U.S. have been positive so far. The amount of Ni-Cds recycled has been steadily increasing. The RBRC program led INMETCO to invest in a new cadmium recycling facility. The cadmium recycling is "closed-loop" - the type of system long advocated by environmentalists - with the cadmium recovered being used to make new Ni-Cd batteries. INMETCO's new cadmium facility demonstrates that manufacturers taking responsibility for their products after they become waste can stimulate the development of new recycling capacity.
7.2 Measuring Results
The data on Ni-Cd collection and recycling are limited at this time. This is understandable since the program is new and responsibility for it has recently been transferred to RBRC.
There will be no way to evaluate the program in the future unless more complete data are available. The consolidators and the recycler are required to keep track of the batteries they handle. The program is dealing with a homogeneous wastestream and four collection systems. In the future, it should not be difficult to document the amount of batteries collected and recycled, by collection system. Hopefully this can be done on a state and a national basis. Such information can be very helpful in identifying the parts of the program that are working well and those that need improvement.
7.3 Federal Regulatory/Legislative Support
Some interesting lessons have already been learned from the RBRC experience. One relates to impediments to such a system. Implementation of the RBRC program was contingent on adoption of the Universal Waste Rule which relieved participants in the system of the burdens and costs of complying with hazardous waste regulations. This took five years and delayed implementation of the system. Failure to pass this rule could have permanently doomed the RBRC system. Even after adoption of the Universal Waste Rule, the program was hampered by the need to get adoption by each state - a slow and cumbersome process. Passage of the federal battery law is a major step forward in encouraging industry to extend responsibility for its products. Similar legislation may be needed in order for take-back systems to be implemented for other products potentially subject to hazardous waste regulations since the federal battery law applies solely to batteries.
Shifting responsibility for products at the end of their life to private industry involves issues of liability and compliance. There are also possible anti-trust concerns with respect to take-back systems dependent on competing companies working together to set fees. Government can encourage industry to voluntarily take more responsibility for its products by enacting regulations that are necessary to facilitate such programs or by removing regulatory barriers as it did in the Universal Waste Rule.
7.4 Role of States
Battery legislation in states such as New Jersey and Minnesota was a driving force behind the RBRC program. In the absence of federal legislation, states can play a major role in spurring industry initiatives to extend responsibility for products. It is far more efficient to have a single national program to collect and recycle Ni-Cds rather than different requirements and programs in different states. But without legislation at the state level, it is doubtful that a national program to recycle Ni-Cds would have been implemented. Conflicting state laws on labelling and mandatory collection actually led the battery industry to encourage federal legislation. States are in a strategic position to stimulate industry to extend responsibility for products, either through state legislation or cooperative, voluntary agreements with industry.
Many "voluntary" EPR initiatives in the U.S. and abroad have been created to pre-empt anticipated legislation. The RBRC take-back system enabled industry to comply with the mandatory take-back requirements already legislated in some states and to pre-empt legislation in other states.
7.5 Value of Green Marketing
Green marketing was another factor that motivated manufacturers to take back and recycle Ni-Cds. The environmental impact of batteries has been of concern to government and to consumers. Rechargeable batteries have been promoted as "green" products because of their reusability (rechargeability). Since each one can replace hundreds of non-rechargeable batteries, rechargeables clearly can reduce the amount of batteries entering the wastestream. The problem is that cadmium is a hazardous material. If industry takes back the batteries and recycles them, it can mitigate the problems Ni-Cds can cause if they are in the municipal wastestream and discourage efforts by governments to ban them. While rechargeable batteries may be "green" in comparison with single use batteries, the claim needs to be reevaluated when they are used in products as an alternative to manual or electrical power.
Recycling is a marketing tool with respect to retaining current market share and acquiring market share in new industries. For example, there is intense research taking place on fuel cell and battery technologies for electric vehicles. Ni-Cds are in contention in this emerging market. If batteries are to be used in electric vehicles, the availability of recycling technology will be a factor in determining what type of batteries are chosen. This will be true for other battery markets as well.
7.6 Avoiding "Free Riders"
Voluntary systems frequently have a "free rider" problem. This occurs when companies benefit from the program but do not pay the fees. This has been a major problem in implementing the "green dot" system for packaging in Germany. RBRC has said it would take back all Ni-Cd batteries even if they do not carry its Seal. This means a company can have its batteries recovered by RBRC but not pay for the program.
So far, 75 percent of the batteries being put on the market in 1996 have the Seal. It will be important to maintain a high licensee participation rate. It will also be important to enforce the fee system. In Germany, shortly after the "green dot" program was implemented, 90 percent of the packages had a green dot but fees had only been paid for 60 percent. Companies were printing the dot without paying the fees, or underestimating the amount of fees owed. RBRC may have less of a problem since it is dealing with under 200 licensees, but it will need an effective enforcement system to assure proper payment of the fees. Non-licensee computer manufacturers are possible "free riders" on the RBRC system. Even if they have their own take-back systems, their batteries may end up in the RBRC bins. This will become less of an issue in the future as Ni-Cd use in computers is phased out.
One way to address the "free rider" problem is for states to enforce their legislation. As noted in section 6.3.2, the sale of Ni-Cd batteries are banned in many states unless the manufacturers take them back and either recycle or properly dispose of them. Strict enforcement of such provisions would encourage all manufacturers selling Ni-Cds in these states to either become RBRC licensees or to set up their own take-back programs.
Government (federal, state, and local) can also provide encouragement by using procurement guidelines to support industry efforts. If government would buy rechargeable batteries or products containing them that are part of a take-back program, companies would have a greater incentive to become and to remain licensees. This would be true of any product take-back system funded by the licensing of a trademark.
The Netherlands has developed a policy to deal with the "free rider" problem. The Dutch national waste law provides that a substantial number of companies in an industry can request national legislation. If a majority of companies in an industry sign a voluntary agreement with the government to meet environmental objectives, these companies can request that the government pass a law making the program mandatory for all companies in that industry. So far this has not been invoked, but it is a backup tool that could be invoked if "free riders" become a problem.
7.7 Definitions/Classifications and Terminology
Another lesson from the RBRC experience is the importance of definitions/classifications and terminology. For example, retailers are willing to participate in the take-back of Ni-Cd batteries only if the batteries are not considered a hazardous waste. The classification affects costs of the system and also liability.
Companies are also more willing to institute take-back systems if the items taken back are defined as "products" not as "waste." According to the New Jersey DEP, lawyers advise companies not to become waste managers. If the company is taking back a "product" it does not have to deal with all the permits and regulations that apply when taking back "waste." When Panasonic expressed interest in taking back computers and demanufacturing them, the New Jersey DEP responded that if the company takes responsibility, DEP would not regulate the computers as "waste" and would instead consider them "products." Companies prefer to take back products and to call the program "asset recovery." Shifting responsibility for waste may be accurate terminology but new programs are more likely to be implemented if they are called "asset recovery." This is not just an issue of semantics - there are substantive consequences to the terminology used.
Other companies or industries interested in establishing a collection and recycling system for their products will have much to learn from the RBRC experience. The program described in this case study may emerge as a model in the U.S. for take-back programs that involve many companies and are handled by a third party.
The structure of RBRC and its licensing system could be adapted to other industries. In multi-company take-back systems, license fees can provide a method of allocating financial responsibility when it is not feasible for each company to take-back only its own products. The licensing arrangements provide a mechanism for allocating the costs across many companies in an equitable and efficient manner.
Take-back programs require the development of new logistical systems. The collection system for Ni-Cd batteries described in this report is one such system. Obviously systems will be different for different products - taking back batteries is different from taking back automobiles or computers. A major distinction is whether companies take back only their own products or whether a third party takes back products for a large number of producers. In addition to providing information about third-party systems generally, the RBRC experience will indicate the level of cooperation that might be expected from households, institutions, and the commercial sector.
The RBRC system represents a shift in responsibility for used batteries, from municipal government to private industry. This focusses company attention on the end of life of batteries and internalizes the costs of collecting and recycling used batteries into the price of the product. If these costs are excessive, the companies have an incentive to develop alternative batteries with lower collection and recycling costs or less environmental impact. The technology challenge rests with private industry, which is much better able to address it than municipal government. The assumption of this responsibility by industry is likely to drive innovation in battery design, recycling technologies, and collection systems; to lessen adverse environmental impacts of batteries; and to provide industry with new marketing opportunities.
RBRC is already considering expanding its system to additional rechargeable battery types and to other countries. Pilots to take back nickel-metal hydride batteries will be conducted in the U.S. in late 1996. As noted earlier, RBRC will expand its system into Canada in 1997 and is considering operating programs in Australia and Mexico. Take-back systems are far more advanced in many other countries, particularly in Europe, than in the U.S. but they have not been developed specifically for Ni-Cd batteries. The RBRC program gives U.S. industry an opportunity to provide international leadership in this specific application of extended product responsibility.
The RBRC effort to collect and recycle Ni-Cd batteries is an important one. It is the first multi-company attempt on such a large scale in the U.S. Success will be contingent upon meeting the ambitious targets set by the producers of Ni-Cds. If the program is successful, it can help in the future marketing of Ni-Cds, reduce costs of MSW management, reduce environmental impacts and increase the efficiency of material use. The nickel and cadmium recovered in this program will have a new life in new Ni-Cds and stainless steel products rather than requiring disposal in incinerators and landfills.