International meeting on waste electrical and electronic equipment (WEEE) recycling and treatment & extended producer responsibility (EPR) 2017 was convened in Beijing May 24-26, 2017. The meeting brought together industry experts and leading enterprises at home and abroad to share their best practices and explore the future of WEEE recycling and treatment. The 2016 Whitepaper on China’s WEEE Recycling, Treatment and Reuse was released at this meeting.
Fund system needs further refinement
China’s Ministry of Finance, Ministry of Environmental Protection, National Development and Reform Commission, and Ministry of Industry and Information Technology jointly released a set of new subsidy standards for China WEEE’s fund system in Nov 2015. Cutting the subsidies for TVs and microcomputers, the new standards significantly raised the subsidies for air conditioners from 35 RMB/unit to 130 RMB /unit.
This change has made an impact on the category structure of China’s treatment sector. According to the white paper, the disassembled volume of waste TVs has dropped to account for 55% of all disassembled goods in 2016 down from the 70% in 2015, while that of air conditioners has surged by 1127.3% year-on-year to take up 2.7%. Besides, the disassembled volume of washing machines in 2016 has grown by 91.6% to account for 15.9%, that of refrigerators has grown by 75.0% to account for 7.7%, and that of microcomputers has climbed by 8.8% to account for 18.6%. From these statistics, we can see that the new standards have effectively shaken the dominating position of waste TVs and treatment enterprises are looking at new categories.
The five-year implementation of the fund system has efficiently standardized China’s treatment of WEEE, especially waste refrigerators, washing machines, air conditioners, TVs and computers, making a significant social and environmental impact. The assembled WEEE from qualified treatment enterprises posts 75 million units with a total weight of 2.11 million tons, a year-on-year rise of 16%. The treatment sector has entered a steady phase with stable processed volume and industry scale. Estimated statistics from China Household Electrical Appliance Research Institute (CHEARI) suggest that, the reclaimed iron, copper, aluminum and plastics in 2016 posted 460 tons, 100 tons, 54 tons and 446 tons respectively. The overall quantity was slightly beyond that of 2015.
Despite the upsides, the fund system has its issues to face, of which the most emergent one is the payment imbalance. According to the White Paper, the collected fund from producers registers 2.778 billion RMB, 2.715 billion RMB and 2.610 billion RMB in 2014, 2015 and 2016 respectively, yet the allocated subsidy to treatment enterprises posts 3.392 billion RMB, 5.397 billion RMB and 4.714 billion RMB respectively. The big gap has troubled the government as well as the treatment enterprises badly. The adjustment in the new set of standards has lowered the subsidy standards, yet still cannot radically address the payment imbalance issue.
Late payment makes another troubling issue, posing an increasingly large pressure on treatment enterprises. With a long cycle to evaluate disassembled volume and go through regulation procedures, the fund system has long been plagued by inefficiency. An unnamed insider from a treatment enterprise reveals that, “We have paid in advance to recycling enterprises to buy WEEE, but are not sure when the promised subsidy would finally come. This has put enterprises in a dangerous position.” The late payment is dividing treatment enterprises, making the industry more concentrated. Statistics from China’s Ministry of Environmental Protection suggest that, total treatment volume from GEM Co. Ltd, China Recycling Development Corporation Ltd., and Sound Environmental Resources Co., Ltd., accounts for 42.5% of the industry in 2016, meanwhile about 30% of treatment enterprises halted production amid big pressure in 2016.
The product catalog for WEEE treatment revised in Dec 2015 expanded its portfolio from 5 products including refrigerators, washing machines, air conditioners, TVs and computers to 14 products, and kicked in on March 1, 2016. The catalog is considered a preview of the new fund system. However, more than a year after the implementation of the new catalog, the according standards for fund collecting and allocating has not come up yet.
The progress of China’s EPR draws all eyes
Another topic that raises hot discussion at the meeting is China’s extended producer responsibility (EPR) system
China’s EPR plan, published at the end of 2016, requires producers to be responsible in resource consumption and adhere to environmental protection standards throughout the life of the product, rather than just focusing on the manufacturing process. Their responsibilities should be extended to product design, consumption, recycling and waste disposal, according to the plan. The plan was first introduced for electronics, automobiles, lead acid batteries and packing products.
Despite their responsibility to pay the fund for China WEEE project, manufacturers have their extended responsibilities to products throughout their life cycles. China’s EPR plan supports enterprises’ initiatives to establish new recycling systems. According to the EPR plan, the distribution-channel-based recycling system would set pilot stations in commercial districts and transportation hubs, make the best use of China’s “Internet+” explorations to improve efficiency, and strengthen the connection between the garbage collection system and the waste recycling system in residential areas and office areas. Currently, Beijing is establishing its pilot stations.
Recycling has long been a headache of the industry. China Appliance has learned from the meeting that, China’s WEEE recycling system is still heavily dependent on individual recyclers. Though “Internet+”-based recycling systems are flourishing in recent years, the traditional individual recyclers still get most of the wastes with their on-the-go vehicles coming in and out of the residential streets.
“Green consumption plus green recycling” is one of the successfully implemented new recycling modes. An attendee from Beijing Energy Conservation and Environmental Protection Center introduces the progress of the “Energy-saving supermarket” project at the meeting. In year 2015, about 90% of the supermarkets from the project started their recycling work through in-store recycling points, online channels and community channels, of which online channels were the most efficient.
Manufacturers, treatment enterprises and recycling enterprises all have their issues to address
To advance green development in electrical and electronic sector, manufacturers, treatment enterprises and recycling enterprises all have their issues to address.
For manufacturers, their responsibilities are extended to product design, consumption, recycling and waste disposal. According to China’s EPR plan, by 2020, an EPR policy framework should begin to take shape and the waste recycling rate of key categories should reach 40% on average, and by 2025, relevant laws and regulations shall be formed, the waste recycling rate in China should reach 50 percent on average, and the reclaimed materials should account for 20% of materials used in key categories.
For treatment enterprises, they’re exploring their paths. According to an industry insider, treatment enterprises must not live on subsidies, but need to develop new modes to make profits and extend the industry chain.
Recycling enterprises are also exploring new modes. According to the White Paper, this sector is still dominated by individual operators, whose processed quantity accounts for 90% of all. While the recycling enterprises exploring new modes such as online recycling, producers are also joining in this market.