Mr Rick Hindley, Dr Michael Pitts, Mr Will Savage and Mr David Workman

22 JANUARY 2008

  Q260  Baroness Sharp of Guildford: The evidence we have just received on the whole indicated that it was actually easier to design down waste in a situation when it was new process innovation. Equally, it does appear on occasions that the improvement and the management of waste are easier once created rather than at reducing it in the first place. People recognise that it is there when they have created it and then they think about ways of reducing it. What sort of incentives are there to encourage manufacturers to reduce the creation of waste and are they meeting the business needs of both large and small companies?

  Mr Workman: As with any industry, profit is the main driver. The average plant five years ago had a waste cost—this is non-glass waste—of about £120,000 a year. In many cases that has been reduced very significantly. We have one major flat glass manufacturer who over the last five years has reduced waste per employee by a factor of five. There is another manufacturer which my Lord Chairman has been closely associated with over the years who has halved the amount of waste per tonne of product produced in the last five years. The drivers have been commercial as well as environmental but they have had significant benefits. Most major plants now are either operating to, or are likely to become accredited to, ISO 14001, which is the environmental system which we tend to use in our industry, and that is bringing huge benefits.

  Q261  Baroness Sharp of Guildford: Something like ISO 14001 is actually a very effective incentive; it is a sort of voluntary agreement. How important is other regulation? Clearly EU regulation has had a big impact here as well.

  Mr Workman: I think EU legislation has had more of an effect on us in terms of post-consumer waste rather than waste within factories. I think the waste within factories has basically been brought down. If you look at glass waste, the efficiencies within the factories now are running at 90-95 per cent, so there is very little glass waste that comes from the process and that waste, if we do create it, goes straight back into the furnace again. Post-consumer waste is a completely different issue and that is almost entirely driven by EU legislation. We could spend hours talking about that one, but that is the main driver.

  Q262  Baroness Sharp of Guildford: We are focusing here specifically on waste from manufacturers.

  Mr Savage: I would concur with that, my Lord Chairman. In terms of aluminium, the End-of-Life Vehicle regulations will have a major effect on the reduction of waste post-manufacturing.

  Q263  Chairman: Mr Workman, you mentioned my old parliamentary constituency hosted, and still hosts, Owens-Illinois, the major bottle producers. I would imagine your own European position would enable you to tell us how the British glass industry fares in comparison to international comparators because this is something that we are having a little bit of difficulty getting evidence on at the moment, the performance of British manufacturing in relation to our competitors. What has been your experience, either the European one or comparing a company like Owens-Illinois? I know it is an American one and it has a plant in Harlow.

  Mr Workman: This is a bit of a moving feast. The major international companies are very reluctant to give us that sort of information. I am trying to ascertain that information now purely on the basis of energy costs around the world because we tend to find the cost structures vary. If you look at productivity in terms of output per man, the UK and particularly the company you referred to will be very high up on the global ladder. Certainly in flat glass we have one of the most productive sites operating in the UK anywhere in the world. Productivity levels generally are very high in the UK. They have had to become that way because of the increases in costs that we have had to absorb over recent years.

  Q264  Chairman: On waste and energy, at the moment you have not been able to compile satisfactory statistics?

  Mr Workman: Where the continentals, particularly in Europe, benefit is that their post-consumer recycling rates are higher than they are in the UK and there are significant energy and CO2 savings for putting recycled glass into the furnace rather than virgin batch. In Germany and the Netherlands overall glass recycling rates are 90 per cent plus. In the UK we should hit our 60 per cent level this year, but getting hold of what we call cullet, which is post-consumer waste, is becoming a very real issue for us. In fact, some of our manufacturers have to import it from Europe because they cannot get hold of it from the UK.

  Q265  Baroness Platt of Writtle: In days gone by you got tuppence back on a bottle or a can. Why has that gone? Should it come back?

  Mr Workman: Every time I come to the House of Commons or the House of Lords this is the most frequently asked question that I get from Members. The answer is that the infrastructure has changed in the UK. When I was a young lad and I first started out selling in glass almost every town had its own dairy, its own brewery, its own soft drinks company and they used to fill and distribute locally. In today's world, if you take almost any product, like Budweiser or Stella beer, they are only filled in one or two plants in the country, so to build return containers from Aberdeen to London on Budweiser you are looking at huge environmental and commercial costs involved in doing that.

  Q266  Baroness Platt of Writtle: What about if the local authority did it instead of it going straight back to the factory because the good local authorities are doing recycling in a big way?

  Mr Workman: If you are looking at a deposit on packaging that is a slightly different issue than a deposit on a piece of packaging that you take back to the retailer, which is what I certainly remember happened when I was younger. If you get into deposits on packaging then you are getting into the areas of tax, which is something I know that one or two of our continental cousins have looked at and even implemented, but we are not there yet in the UK.

  Mr Hindley: Just picking up on your point about being paid for cans, that still does happen. We have a highly successful Cash for Cans programme where charities and individuals etc collect aluminium cans and they are paid at the intrinsic value of just around a penny each.

  Q267  Baroness Platt of Writtle: That is not very well known, is it?

  Mr Hindley: Sadly, it started in the mid-1980s and at that time a penny a can was quite attractive to collectors, but with the way things have developed in the UK it is not quite as attractive and in the meantime local authorities have developed kerbside collection programmes which are a more convenient option. It still does exist. It is not of the scale that it used to be, but we still do get probably 15 per cent of all the aluminium cans collected in the UK coming through Cash for Cans programmes.

  Q268  Baroness Platt of Writtle: That is a very small percentage when you think that aluminium is infinitely recyclable.

  Mr Hindley: Absolutely. We currently recycle 48 per cent of all of the aluminium cans that are sold in the UK and the vast majority is now coming through kerbside collections by local authorities. The big untapped market is actually from what we call the away from home area where cans are consumed when people are at work or in leisure centres or indeed "on the go", that is about 30,000 tonnes and that is the big untapped market. Some of the things that we have been talking about today will have an impact on encouraging businesses to set up programmes to collect the cans which their workforce use.

  Q269  Lord Methuen: Let us go back to this subject of cullet. In your paper you say about the cullet not being fit for purpose. When we go to our recycling place we have one container for clear glass, brown glass and green glass. I have heard it said that once they leave there they all get tipped into the same lorry and muddled up. Is this the cause of the problem?

  Mr Workman: It is a major issue. The good news is that the overall recycling rate for glass has improved year on year on year over the last ten years, but what is in decline is the amount of glass that is coming back to the glass industry for re-melt and the reason for that is that some local authorities are collecting segregated colours and segregating glass but then the companies who operate the collection systems are then mixing them. The worst examples we have got are the wastes that come out of the MRF, it is pretty terrible. If you talk to any material stream they would say they experience exactly the same problem. The only way that this waste can actually be used is either for it to go into landfill or into aggregates for roads. The CO2 saving for that is zero compared to the CO2 saving for re-melt which is very significant.

  Q270  Chairman: I did not quite catch that word that you said.

  Mr Workman: It is the Materials Recycling Facility, the sorting centre in effect.

  Mr Hindley: From an aluminium point of view, the quality of the material that is collected through post-consumer schemes is a real concern to us. The industry has invested millions in Europe's only dedicated can-to-can facility in Warrington which is run by Novelis and cost £28 million. Much of the material collected in the UK currently through local authority schemes goes to the sorting centres, MRFs, and has to be sorted again before it can be processed through the recycling plant and there are a couple of reasons for that. One is that we do not have sufficient sorting capacity in the UK for all the material that has been collected, so the plants we have are running at over the capacity they were designed for. Secondly, with the way the contracts are set up between the local authority and the waste management company there is no incentive for the waste management company to produce a clean quality product at the end because they make their money out of the tonnage that goes through the front door of the plant. So we have an inherent problem in the way our system has developed which is causing contaminated material and makes it very difficult to recycle.

  Q271  Lord Crickhowell: I still do not quite understand why the performance on the Continent and Germany is so much better than ours. If it is largely because the local authorities are making a bit of a mess of this --- I find it quite extraordinary that they should collect bottles of separate colours and then mix them up again. What action should be taken to eliminate this obvious nonsense and get us up to the same performance as our European competitors?

  Mr Workman: What we have to remember is that the waste legislation, particularly the packaging waste legislation in this country was enacted well before the words climate change dropped off everybody's lips. It was designed clearly to get waste out of landfill. When you meet with local authorities they say, "Yes, we fully understand your problem, but we've got targets to meet. We've got political masters at local level who again are anxious to avoid tax on landfill." Their primary objective is to avoid landfill at all costs. What happens to the waste after that seems to me to be immaterial to them. What needs to change in my view—it is something that was talked about with the last set of witnesses—is that there needs to be some sort of CO2 element put into our Waste Strategy in future. If climate change is as big an issue as we are being led to believe it is, waste itself has the potential to save an awful lot of CO2, particularly in aluminium and in glass because we both have materials which are in theory 100 per cent recyclable.

  Q272  Lord Crickhowell: Waste is only partly addressed rather at the tail end and in specimen trials. We are reaching the final stage of the Climate Change Bill in this House tomorrow when we have got a debate on waste as it happens. This is an issue that you think needs to be pursued and in the field of climate change and the legislation that follows from that?

  Mr Workman: Yes. It has a knock-on effect in terms of our ability to achieve our targets under our Climate Change Agreements. It could have a tremendous knock-on effect in terms of the Emissions Trading System that is coming because we are relying in our forecasts for the future on getting an increased amount of glass back for recycling, not less. There is about a 20 per cent difference in energy usage by melting returned glass as opposed to melting virgin raw material. So there are some bigger issues here that might well affect the future viability of the glass industry in the UK.

  Q273  Lord Crickhowell: I might ask you for an email brief by tomorrow afternoon on that!

  Dr Pitts: I would like to follow up with two points on that. The first one is the difference between us and our European colleagues. For quite a while I lived in Austria and the culture is very different on recycling. There are four different types of recycling bins on the streets everywhere, outside houses; they are very accessible. If you go to Vienna airport and a lot of other airports throughout Europe you will probably have noticed the four different types of colour coded bins for recycling things such as aluminium cans and glass bottles. There is a big difference, as you have heard, in the public attitude and culture. Coming back to the point about resource efficiency, there is a link between climate change and the use of any resource because any resource has some associated—as it is sometimes referred to—"rucksack" with it. You probably know that for every kilogram of aluminium that is processed you need 6 kilograms of bauxite. In other metals it is much, much higher. We are rapidly running out of many of the most important minerals. As a chemist, in 80 to 100 years' time a significant proportion of the Periodic Table will not be available to us unless we start to do a better job of capturing and reusing our resource.

  Q274  Earl of Selborne: Are you confident that this is a robust method of accounting for the carbon or is there still some work to be done to get a standard procedure?

  Mr Hindley: I think we are making good progress. As everybody is probably aware, British Standards and the Carbon Trust have recently published a draft standard which is part of a process. We responded to that and we welcome the creation of a standard because I think comparing carbon as with life-cycle analysis is fraught with danger because there are so many different ways it can be done. We are totally supportive of a standard being developed and that standard should become, in our opinion, a European if not a worldwide standard.

  Q275  Earl of Selborne: But we are not there yet, are we?

  Mr Hindley: No. Work is progressing and we are involved in dialogue on that.

  Q276  Lord Lewis of Newnham: Is there not a subsidiary problem there? Let us make the assumption that you have got a reliable carbon standard that you can apply. It does mean that if you are concerned with substances such as landfill or incineration or something like that you are going to have to have a pretty complete analysis of the material you are actually putting into the landfill. You have got to know what the mixture is so that you can allocate these figures to it and that puts another dimension into the whole disposal procedure either by incineration or by landfill.

  Dr Pitts: This is a huge issue and one of the main issues that we are tackling as a KTN, it is understanding how you measure environmental impact in all its forms up and down supply chains. There are life-cycle analysis standards out there and they are tied to the ISO 14041 standard. We are involved in projects within the European Union to further life-cycle analysis. As in most cases, you have the academics wanting to make it more complicated and more rigorous, therefore more expensive and more time-consuming, and you have the industry saying let us make it simpler and easier to measure this. It is a huge issue up and down the supply chains being able to understand where the hotspots are, a shared responsibility from people who are taking these things out of the ground to the people who are putting it back into the ground at the end in landfill or in burners. Everyone has their part to play. In some cases the consumer is the one who has the largest part of the impact; in other cases it is right at the top end in mining or it could be in the manufacturing. We need to understand where they are and have a shared responsibility in how we tackle this. The big companies do very well at working with their suppliers now. Some of them are working very hard to educate them and gain the shared benefits from that.

  Q277  Lord Methuen: What new sustainable technologies are being developed within your sectors which might help reduce waste?

  Dr Pitts: On behalf of the chemistry using industry, we see chemistry as one of the enabling technologies for solving a lot of the issues, it is underpinning technology. We have many examples on our `roadmap'. We have a sustainable technologies roadmap on the Chemistry Innovation website which lists many different examples in different sectors where sustainable technology or green design principles have been applied. One of the most important considerations when manufacturing a product or running a process is to think about it on a life-cycle basis, think about the feedstocks you are using including what we call "waste" and redesigning the product or process, as it allows one of three Rs at the end-of-life:- to reuse it, recycle it or remanufacture. A good example now is with LCD TVs. There has been a huge boom in them lately which of course means now there is a huge pile of Cathode-ray tube televisions lying around. Within the LCD TVs there are extremely important metals such as indium, which is predicted to run out within 15 years, which is a bit of a shame as indium is an important component for modern solar cells. Also within them, because they need backlighting, are mercury lamps, but because they are toxic they are sealed in inside units so they are very hard to get to, which means for recyclers it is not economical to get these out and recover the mercury within them. One of the ways the chemical industry is tackling this is with organic LED displays. I was pleased to read only at the weekend in Stephen Fry's column that designers are embracing organic LEDs in new mobile phones. Mobile phone manufacturers are often the leaders in technology innovation nowadays, and are starting to incorporate organic LED displays and use them as true objects of beauty, which I think is roughly paraphrasing what Stephen Fry had to say. Within our own industry, solvent use is a huge problem. We spend a lot of money and a lot of energy making very pure solvents, from non-renewable feedstocks in a lot of cases, and at the end of the process burning them, which is not economical and not useful. There are strong drivers to change this, such as the volatile organic compounds legislation. There are a lot of sustainable technologies around such as ionic liquids, supercritical fluids, solvent-free processes and process intensification and they are the kind of things you will see coming on-stream in the chemicals industry in years to come.

  Q278  Lord Lewis of Newnham: Do you not think you are going to be open to legislation? Many of the things you are talking about are not specific; you have alternatives available to you. If you look at many of the instances you have been mentioning here, all right, you may have indium there and it may be a desirable, but there are other ways of dealing with this particular problem. It does strike me that at some stage or other somebody is going to have to sit back and assess what is going to be the long-term priority here and legislate accordingly.

  Dr Pitts: Absolutely. We are going to run out of important minerals and once an element has gone, it is gone, and irreplaceable. We will be increasingly mining our own landfill sites in the future.

  Mr Savage: My Lord Chairman, the question was about sustainable technologies. I just wanted to highlight a very interesting development that has come out of the USA in terms of recycling more aluminium and this is the introduction of de-lacquering plants. Traditionally the aluminium bottle tops of beer bottles have been put to landfill because they are relatively small, a large surface area to smallish volume and they have a plastic component which is part of the seal. There is a very interesting technology now which is being introduced which actually allows for the plastic component of the bottle top, the seal, to be burnt off in the process, providing the heat for the recycling of the aluminium bottle tops. These sorts of technologies are very interesting and should be promoted to our industry.

  Q279  Lord Methuen: Something that has fascinated me is that we are now being asked to recycle our drinks cartons, these tetra packs. I understand that some of them have an aluminium lining. What is the energy balance of recovering the aluminium because presumably you have got to separate the aluminium from the paper of the carton by burning or have you got some other more sophisticated process?

  Mr Hindley: I do not have a great understanding of this. You are quite right, all cartons have a very thin aluminium lining which is a barrier there and that is very, very thin, it is sprayed on. The carton industry is now encouraging people to collect cartons for recycling. Sadly there is not a plant in the UK that can do it. There used to be one up in Scotland which is now closed. The material that is collected in the UK is actually sent to Sweden for reprocessing. The aluminium is not recovered because I understand it is not commercially viable to do so. So the aluminium—and I do not know the process in detail—is removed, landfilled and then the board is then pulped and goes back into the paper processing facility. This is a perfect example of materials which are either composites or laminates so contain a number of different materials that are inherently difficult to recycle. Obviously we sell aluminium into that product, but there are examples of where very simple packaging formats involving metals are potentially going to be substituted by composites and the reason for that has been the desire of retailers, driven through organisations like WRAP, to minimise the weight of their packaging, which is a laudable thing to do, but the weight of packaging is only one element that should be taken into account when considering sustainability. If you are moving from something which is infinitely recyclable, a metal, to something which is a laminate, which is very difficult to recycle, you are having a positive environmental impact potentially by reducing the weight but creating more of a problem by moving into something which is very difficult and energy intensive to recycle. Another example of that can be seen from an aluminium point of view in the aluminium foil container which is used for takeaway meals or, increasingly by supermarkets, for chilled meals. There has been a move away from aluminium into something which is called CPET, which is a form of plastic, because again it is lighter weight. The reality is that the foil container is infinitely recyclable whereas the CPET container is very difficult to recycle. So again something that has been driven by the desire to reduce weight is actually perhaps not having an overall positive impact on the environment. We are very cautious about the approach that has been taken and very keen that a whole series of environmental factors should be taken into account by retailers and others before decisions are made.

  Mr Workman: We are probably more vulnerable than any other packaging material in this regard because we are the heaviest, but we are seeing a move now by the retail trade in the UK to replace glass with all sorts of other types of materials. Glass is 100 per cent infinitely recyclable, not just once, it can be recycled time and time and time again and the infrastructure exists in the UK to handle it. We have been doing it since 1977 and very successfully. You have solved one problem but you then potentially create another one, and this has been an initiative that is being led by the retailers at the moment.

  Mr Savage: On my point about the aluminium content in plastic containers, yes, a lot of it is lost through oxidation, it is a metallurgical fact in incinerators, but there is work being done now to look at the aluminium and other metallic content of fly ash in incinerators and the intrinsic value of aluminium is forcing that situation.

  Lord Crickhowell: Let us move on to challenges that inhibit businesses within the aluminium, glass and chemicals sectors from implementing waste reduction strategies. We have already touched on some of them in the answers we have had to previous questions. I want to pick up one particular one and that was the reference to food packaging being infinitely recyclable, but it is not being recycled. The evidence I have in front of me is that 90,000 tonnes of aluminium packaging is going to landfill. Alupro tell us in the evidence that one of the problems is that we have 400 local authorities all with different policies and we have got back to the weight issue again. I deal with the household rubbish and I put all my bottles in one container and all my paper in the other and quite large quantities of this aluminium goes into the general rubbish bin because nobody is interested in it.

  Baroness Platt of Writtle: Ours is collected with the bottles.