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Rubbish thinking is good business sense

Hong Kong’s waste management landscape is changing, and TPB’s Business Development Lead, Fiona Donnelly, reveals how giving garbage more attention can bring new opportunities.

Sadly, the topic of waste is not a crowning glory of Asia’s World City.

Despite being such a wealthy territory and compact place, it’s surprising that we are in the dumps around waste. Hong Kong’s waste per capita per day has now risen to 1.45kg according to EPD’s 2017 reports and compares unfavourably with other developed Asian metropolises such as Tokyo, Seoul and Taipei where the same figures are below 1kg.

Unpeel the onion (and obviously throw the layers in the composter), some of the challenges of handling waste become apparent very quickly.

For example, as a >90% service economy, Hong Kong manufactures very little and imports virtually all the food, drink and goods it consumes.  So we suffer from phenomena like ‘one-way container’ syndrome ie the containers that we buy things in can all too easily become waste, due to the absence of manufacturing and bottling plants to feed them back into, and limited other recycling facilities.

Per Environment Protection Department waste statistics, Hong Kong deploys a very typical for Hong Kong solution for its recyclables – in 2017, 97% were exported, generating HK$4.2billion in revenue. But Hong Kong’s biggest waste export market, Mainland China (among several others in the region), has since 2013 imposed increasingly exacting standards per their Operation Green Fence programme, so that it will only accept the purest forms of recyclables. This is causing back-ups in the flow and handling of the items further upstream.

Add to this, the fact the territory’s landfills are already almost full, we are in a proper mess, that is accumulating through every consumers’ behaviour every single day.

But put on a VERY optimistic hat, reframe the problem, it becomes an opportunity… not only for systemic changes like economic diversification for building recycling processing plants that take local waste streams as feed stock, but also for other aspects that all consumers can affect now – like changes in behaviour. And that’s where a few market developments play a role to financially incentivise and penalise how we handle waste…

 

Free money to grow Hong Kong’s recycling industry!

Launched in October 2015, the HK$1 billion Recycling Fund is intended to support the sustainable development of the territory’s recycling industry.

If you have an idea to support a particular enterprise or the industry more broadly, the good news is there is, as of mid-July 2019 almost HK$850 million left in the fund, despite many and various projects already being supported under the various schemes.

The other good news is there are proposals to extend the application period of the fund for two more years to October 2022, and the overall operational period of the fund to 2026.

Applications are considered in batches at various times during the year. To borrow the lyric, these programmes are “things that make you go hmmmmm”…. how could you benefit from this fund to bring about improvements to recycling in Hong Kong?

 

Dump less, save more

This is the campaign tagline for the territory wide regime to financially incentivise people to change their behaviour to recycle more and put fewer kg in mixed rubbish.

Aligned to the ‘polluter-pays’ principle, the proposal is that the more waste you create, the higher the amount you will be charged. Citizens will have to purchase and use pre-paid “designated garbage bags” from retail outlets, to wrap their waste properly before disposal. Other items like large or irregular shape commercial and industrial waste will not escape the charge – they will be billed through a gate-fee determined by the weight of waste collected and disposed of by private waste collectors.

This new revenue stream for the Government will be invested to provide additional recurrent resources to strengthen waste reduction and recycling – and hopefully bringing about more jobs, more opportunities to develop/apply of innovative waste handling techniques and more. So even if Hong Kong residents (individuals and corporates) are slow to improve behaviour and are required to pay fees, there should be a positive and sustainable environmental return and more for the greater good of the territory, on that financial penalty to us.

Progress through Legislative Council (LegCo) is notoriously hard to predict at the best of times, but social unrest and other emerging priorities may add a further dimension of unpredictability to when LegCo will consider this plan, including pricing. What we do know is that the Municipal Solid Waste (MSW) Charging Amendment Bill was introduced into LegCo on 14 November 2018. Once the bill is ultimately passed, there will be a preparatory period of 12-18 months to result in full implementation, and a subsequent phasing in period of 6 months resulting in strict enforcement. To put it another way, the MSW may not be strictly applied until up to 24 months after the amendment bill is passed, so realistically that’s likely to be 2021 at the earliest. For the sake of the planet, let’s all review and improve our waste handling now, and avoid ever having to pay the financial penalty.

 

Round-up on the Producer Responsibility Schemes

Back in 2008, Hong Kong enacted the Product Eco-responsibility Ordinance (Cap.603) which comprises the core elements of all the PRSs and the fundamental regulatory requirements. Subsidiary to that, separate legislation is being developed and passed to support better behaviour, financial incentives and handling of different items/commodities. Here’s our quick round up of where things are at:

  • Plastic bag levy became fully effective in 2015, with consumers having to pay a levy in shops for each plastic shopping bag (PSB) that is requested. Estimates vary but suffice to say millions of PSBs have been avoided. That said, many PSBs continue to be ‘bought’ so levy fees are still collected by the retailers. The PSB charging adopted the “retention” approach whereby retailers are able to retain the PSB charge without the need of remitting to the Government. Retailers are encouraged to donate the income generated from the PSB charge to support suitable environmental causes. It would be great to celebrate how this PSB money is being used.
  • Next up was the Producer Responsibility Scheme on Waste Electrical and Electronic Equipment (WEEE PRS or WPRS) covering regulated electrical equipment (REE) (i.e. air-conditioners, refrigerators, washing machines, televisions, computers, printers, scanners and monitors) which was fully implemented in 2018. The WPRS provides a convenient means for recycling and also facilitates the proper treatment of abandoned REE, turning waste into resources.  Businesses and households can use the helplines such as weee.com.hk to arrange for the free collection of old regulated WEEE.
  • The third contract for the Glass Management Contractors was appointed in May 2018, so every part of the territory has a glass bottle collector to turn to. The network of glass bottle collection bins is becoming more comprehensive.  Learn more here.
    As the downstream sustainable processing of the glass bottles collected is bedding down, the subsidiary legislation regarding the container recycling levy that will be collected by such as those involved in importing wine/beer/water and those filling products into glass containers in Hong Kong, has yet to be passed. So we don’t know if that amount will be the widely speculated HK$1/litre and when its collection will commence.  Stay tuned for the latest from LegCo, and collectors of the levy, get ready to manage, collect and remit the levy.
  • The Government of Hong Kong SAR is now looking at plastic beverage containers, the starting point being the dumping of an estimated 5.2 million plastic bottles per day. Early indications are that Hong Kong will favour a “similar arrangement to that of “deposit-refund system” implemented in other jurisdictions by providing an economic incentive to encourage public to return used plastic beverage containers for recycling, and to explore the application of Reverse Vending Machine (RVM) to enhance the recovery efficiency of plastic beverage containers”.

 

TPB can help you navigate the changing waste landscape and develop waste management solutions that help your company and the environment. Contact us for an informal chat.

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