ALL around the world, OECD countries are promoting profitable disassembly and material recovery industries, but not Australia.
The few disassembly companies that exist in Australia export much of what they recover, because there is such a limited market for it locally.
The invisible hand of the market has been morbidly slow in promoting an Australian recycling and remanufacturing industry. Policymakers on the other hand, have shown a reluctance to legislate for product stewardship.
Close observers of international remanufacturing and recycling trends warn that Australia is not only likely to lose entry to valuable export markets, but is passing a vital opportunity to boost the local manufacturing sector and birth a successful new tier of industry.
Professor Hartmut Kaebernick is Head of the School of Mechanical and Manufacturing Engineering at the University of New South Wales. The school is currently involved in a number of reuse and recycling projects, including the lifetime testing of Electrolux appliances, and the disassembly of components with a potential second life.
Professor Kaebernick believes there are three things Australia needs in order to kick-start a reuse and recycling industry. First of these, is “government policies that support reuse and recycling.” Second, is “companies to disassemble products.” Third, is “the redesign of products, in order to make them suitable for disassembly.”
Government policies
Extended Producer Responsibility (EPR) legislation has helped make reuse and recycling economically viable overseas, according to Professor Kaebernick.
“In Europe and Japan, there is legislation in place that supports reuse and recycling. The customer pays a certain amount of money to recycle a washing machine or television set, and that money goes to the company that disassembles the product. That makes it economically viable. Such legislation does not exist in Australia and so neither do these companies,” Kaebernick told FEN.
Under Japan’s Home Appliance Recycling Law (HARL) manufacturers take responsibility for the recycling of end-of-life appliances, through fees collected from consumers at the time of purchase. There is also a similar Construction Material Recycling Law and an End of Life Vehicle (ELV) Recycling Law.
The EU’s Waste Electrical and Electronic Equipment Directive (WEEE Directive) is more comprehensive than HARL, targeting 81 products in 10 sectors. The EU also offers an incentive in the Design for Environment (DfE) guidelines, whereby compliant manufacturers gain a product certification label.
William LeMessurier is director of MRI in Melbourne, one of the few Australian companies engaged in product disassembly for reuse. MRI is involved in a European-based project called the Promise Project, which is working on embedded intelligence and RFID tags to tell who made a product, where it was made, how it was made, whether there is any demand for its reuse and whether it has any hazardous properties affecting disassembly. LeMessurier is critical that while Europe has a big focus on environmental matters, “Australia doesn’t, at virtually any level.”
“You go to most of the OECD countries — Korea, Japan, the US, Europe, New Zealand — and they all have quite harsh laws on product take back, but we don’t in this country,” LeMessurier told FEN.
“It’s a big potential loss of market for Australian manufacturers, because as soon as these countries tighten up their regulations a bit further, they’re out,” LeMessurier said.
LeMessurier believes Australian companies are willing to engage in product stewardship, but like Kaebernick agrees that many companies want security, in the form of legislation.
“There needs to be much better coordination from government, showing a leadership role and introducing legislation. There’s a great reluctance by government, both state and federal, to introduce enabling legislation to make product stewardship initiatives a requirement, rather than an option. I think manufacturers by and large, are prepared to follow that, but they need security in some form or another, like legislation, so that they don’t compete on an uneven playing field,” LeMessurier said.
A disassembly industry
While metal crushing and recycling are practiced in Australia, disassembly is very rare, Kaebernick explained:
“What we don’t have in Australia is a proper material recycling industry. The material sorting and shredding that we do in Australia is extremely basic, and it produces materials that do not have a good quality. The technologies exist in Europe and Japan and America, but they are not here.”
MRI is one exception to this circumstance. When the company started in the 1980s it was involved in recovering gold and precious metals from electronic waste and silver from photographics. Now, the company’s main work is the collection, disassembly, remanufacture and reuse of end-of-life computers. Parts that cannot be incorporated into a rebuilt computer are converted into other forms. For instance, plastics are sent to Australian Composite Technologies in Victoria, to be remanufactured into fence posts and pallets. Recovered copper metal is sent to the Perth mint, to make master alloy for sterling silver. In this way, approximately 98% of all product is diverted away from landfill.
The hardest part of MRI’s work is finding a potential customer to reuse their disassembled components. This results from two main factors, according to LeMessurier.
Firstly, quality concerns.
“Australia has a relatively high barrier to reuse of secondary products because there is a question over quality. The quality assurance customers seek cannot be given in many instances,” LeMessurier said.
Secondly, there is the issue of cost.
“I’d love to be able to re-use the screws out of a computer — there’s nothing wrong with those. But there’s not a demand for them because it’s cheaper to manufacture a primary product in many instances,” LeMessurier said.
“That’s a problem we have in society. We don’t fully cost in the pollution and the energy use and the global warming into the product properly. Primary product is often cheaper, but if you properly cost the product it has a significantly higher cost.
Ironically, if there were more companies like MRI the market for disassembled goods could be sufficiently large to be cost effective, Kaebernick thinks.
“If we had more companies like MRI, we could attract more used products and establish a market for the outcome of disassembly. In my personal opinion, that will come, it is just a matter of time. Today we have a few promising point solutions, which will hopefully grow, but overall we are, as usual, ten years behind the rest of the world.”
Product redesign (where you can make a difference, now)
With the approval of its Japanese parent company, Fuji Xerox Australia started remanufacturing its products in Sydney in 1993. More recently, a significant number of products have been sent to Fuji Xerox Remanufacturing Centre in Thailand. One reason for this is that a much greater volume could be processed at a regional centre in Thailand, which handles the Asia Pacific region. Another is that the nature of the work is mostly manual, and hence, lower-cost labour is preferred.
Julius Dhanu is operations manager at Fuji Xerox’s eco-manufacturing centre in Australia. He explained how it works.
“We recover as much as possible of our parts and consumables from our Australian customers, and send them back to our Eco Manufacturing Centre in Zetland, Sydney, where they are processed. Some of them will be sent to our recycling and remanufacturing centre in Thailand. Others will be remanufactured in Zetland. There’s also a small quantity that we recycle in Zetland, in the sense that we disassemble and stream the various materials to different recycling companies,” Dhanu told FEN.
Everything Fuji Xerox Australia remanufactures is covered with the same warranty as a brand new product.
Fuji Xerox’s product stewardship program impacts the design of equipment, from how parts are attached, to the selection of materials. Dhanu outlined a few of the design choices Fuji Xerox has made, which other manufacturing companies could also consider. These might be divided into “design for disassembly” and “design for environment” choices.
“If you use screws, use less of them, or maybe clip one side, and secure the other with just a few screws. That way, it’s designed for easy disassembly,” Dhanu said.
In terms of “design for environment”, Dhanu urged companies to look for materials that are recyclable.
“Certain plastics are not recyclable. For instance, plastics with fire retardant properties are difficult to recycle so look at different types of materials that can be recycled more easily,” Dhanu said.
Modularity, an aspect that many companies are already factoring into their products, is another way manufacturers can design for disassembly, LeMessurier explained:
“So often in electronics, design people will put a different voltage on something. If we could make engineers use a standard profile, one power supply could be used in billions of products instead of thousands.”
Though the level playing field is yet to be established in policy, the imperative for research and development into design for remanufacture is strong. There might not be much initial reward for Australian companies who take up the challenge, but there are opportunities to carve out niche markets for the future, which is without a doubt, going greener. The more unanimous the goal of remanufacturing becomes, and the more quickly this translates into product design changes, the sooner the benefits will be experienced by all Australian manufacturers.
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