Future of MRFs: New contract terms, more tech, ongoing stress

December 11, 2018

December 11, 2018


Cole Rosengren of Waste Dive Magazine attended NERC's Fall 2018 Conference In Rocky Hill CT. Here is his account of the many subjects covered in depth. The original article can be found here.


It's well-documented by now how challenging operations have been at U.S. MRFs recently, especially in the wake of China's scrap import restrictions. Last week, at the Northeast Recycling Council's fall conference in Rocky Hill, Connecticut, multiple presentations even went so far as to include images of MRFs getting struck by lightning bolts or being targeted by aircraft bombs. Amid this siege mentality, however, there were still signs of hope for how the industry can move forward.


Under Pressure


Few, if any, areas of the country have been immune to tight commodity markets. The largest publicly-traded players in U.S. recycling have discussed it ad nauseam during earnings callsinterviews and conference appearances since last summer. They touched on many of the usual points during an opening panel, with a few variations on running messages.


  • Susan Robinson, Waste Management's director of federal public affairs, made her signature presentation on the potential emissions benefits of recycling certain materials, noting the current scenario of an inelastic supply chain puts​ MRFs under "extreme stress." She described as unrealistic the concept some have of MRFs being a "black box" that can handle whatever comes their way. “We’re asking them to basically work magic with something that’s a very complex stream coming in the door."
  • Frank Chimera, senior manager of municipal services for Republic Services, delivered his company's own message about why cost expectations need to be adjusted. “We believe strongly that you can’t have sustainability without economic viability," said Chimera. The fact that Republic has invested $1.5 million in new technology at its Seattle MRF was held up as a sign that similar upgrades could be possible elsewhere when contract terms are favorable.
  • Bob Cappadona, vice president of recycling for Casella Waste Systems, described the scrutiny on bale quality as unlike anything he's seen in a 30-plus year career. Cappadona said "we’ve done it all" when it comes to improving quality, motivated in part by the specter of highly expensive container rejection fees. However, he questioned how feasible proposed uniform audit standards would be at large facilities such as the company's Boston MRF, which produces around 1,000 bales per day.


Evolutions and Changes


As all of these recycling cost pressures play out, there have already been numerous changes in the way that industry and local government interact. This has manifested itself in a variety of examples around the country and will continue to do so for months — if not years — to come. Presentations from multiple consultants in the field covered a few key trends currently underway and made the case for no longer thinking about recycling as a purely profit-driven enterprise:


  • Michael Timpane, vice president of process optimization and recovery at RRS, said he was aware of roughly 100 contract conflicts around the U.S. These include multiple instances of force majeure being invoked and ongoing disputes over who should bear various costs. He recommended rethinking single-stream as a "convenience service" and decoupling it from a traditional commodity value mindset.
  • Mitch Kessler of Kessler Consulting agreed that contract structures need to move away from local governments or companies counting on commodity revenue. “It was never meant to be budgeted; it was never meant to be a revenue generator," he said. Kessler also said that blaming long-running trends — such as the evolving ton, changing oil prices and, above all, Chinese trade policy — lacked perspective. "This has been going for a while. We chose to ignore it to some extent."
  • The need to invest significantly in new MRF tech was also a running theme, with multiple speakers saying the industry could do more. Nat Egosi, president of RRT Design & Construction, said counting on revenue alone to cover capital costs wouldn't be sufficient. “Huge investments need to be made, and I mean huge investments," he said. According to Egosi, ideal technology for the "MRF of Tomorrow" will include new OCC screens, auger screens, anti-wrapping screens and more optical sorters.


2019 and Beyond


Now that the industry is more than a year into this new post-China reality, there is a sense of tentative stability and occasionally even cautious optimism about what comes next. Many local governments will continue to struggle with rising costs, but speakers at the NERC event saw reason for hope in the Northeast. They also touched on a few potential changes that have yet to materialize, but are either being discussed or could come up in the years ahead:


  • Multiple speakers urged against suspending or canceling recycling programs. Gregory Anderson, chief of staff at New York's Department of Sanitation, said participation rates suffered for years after the city temporarily cut certain items. “The solution today isn't to to take drastic steps to cut entire products out of our recycling program because of current day situations, unless we’re prepared to never have those products back in our program in the future."
  • Despite a few examples around the country, no one expects to see dual-stream make a big comeback. Convenience and capital costs were listed as key reasons. “You’re going to get a better quality stream out of dual stream, there’s no doubt about it, but the cost to collect is exorbitant," said Chimera, adding that in many areas “those trucks are gone."
  • Eileen Berenyi of Governmental Advisory Associates predicted the industry might see more public-private partnerships, increasing automation and possibly even new mixed waste concepts. Projects by Fiberight in Maine and RePower in Alabama were cited as recent examples. “I really think in the future we’re going to see more attempt to capture the energy component of the waste," she said.
  • Chaz Miller, formerly of NWRA, said he was heartened by the amount of news about recent paper mill investments but expects markets to remain tight for at least the next 24-36 months. “There’s clearly light at the end of the tunnel, but you don’t build these facilities overnight."



NERC welcomes Guest Blog submissions. To inquire about submitting articles contact Megan Schulz-Fontes. Disclaimer: Guest blogs represent the opinion of the writers and may not reflect the policy or position of the Northeast Recycling Council, Inc.

Share Post

By Cole Rosengren October 15, 2025
Stress levels are high for CPG companies and packaging groups as extended producer responsibility programs unfold in multiple states. This was on display at three recent Boston events hosted by the Sustainable Packaging Coalition, How2Recycle and the Northeast Recycling Council, with questions flying about costs, policy harmonization and relationships with regulators. Paul Nowak, executive director of GreenBlue, adopted the role of support group leader for a room full of representatives from many of the world’s largest CPG companies in his opening talk at SPC Advance. He reminded them that “you are not alone” and urged them to take the long view on this major industry shift. “What you see at the end of the change is not what you see during the change,” said Nowak, drawing on examples from prior industry shifts as well as other major life events. “You are in this uncomfortable period right now where it’s not moving as rapidly as you would think and you don’t have the historic perspective yet of where it could go.” Sticker shock While CPGs are familiar with EPR costs from programs in other countries, the complexity and scale of the U.S. rollout in seven states is presenting its own unique challenges. Oregon is the only state that’s begun collecting fees, and already the costs are high. Circular Action Alliance, the producer responsibility organization selected for the majority of state programs to date, estimates a budget of $188 million in the program’s first year, with that figure growing in the years ahead. Charlie Schwarze, board chair for CAA and senior director of packaging stewardship at Keurig Dr Pepper, said the costs are starting to resonate with major companies. KDP, for example, has been working to sort out different aspects of its packaging in terms of licensing arrangements, private label manufacturing partnerships and other factors. This requires a close relationship with the company’s finance, R&D and procurement teams to gather data and make cost projections. “It’s been a bit of a slow-moving process because the dollars, at least in 2025, are not extremely notable. But they’re going to get bigger pretty quickly,” he said, citing Colorado and California’s programs on the horizon. Shane Buckingham, chief of staff at CAA, said it will be months until companies have a better sense of the true costs. The group set initial fees for California, which won’t be invoiced until August 2026, but those fee levels are expected to change once SB 54 regulations are finalized . “Please don’t take our early fee schedule of being indicative of what your cost will be in 2027, it’s just a drop in the bucket,” he said. “The fees are going to go up significantly in California because we have to fund a $500 million [plastic] mitigation fund, we’re going to have system funding to improve recycling, source reduction, reuse, refill.” SPC Director Olga Kachook encouraged attendees to think about these fees as motivation to innovate rather than a burden. In her view, avoided fees through ecomodulation could be viewed as “possible new investment capital” for covering the costs of material switches, R&D, MRF testing, consumer education campaigns and more. “We can innovate to those lower fees by switching to incentivized materials and formats and then we can reinvest the savings back into sustainable materials and infrastructure that seemed out of reach,” she said. Searching for harmony All three events also featured ample discussion about if or how aspects of current EPR programs could be better aligned. While regulators are working to align certain definitions where possible, they also noted that certain state programs were uniquely designed for a reason. David Allaway, senior policy analyst at the Oregon Department of Environmental Quality, said during NERC’s Rethink Resource Use Conference that he sees a potential benefit to harmonizing ecomodulation approaches in some cases. But at the same time, he said, “I fear that the push for harmonization will lead to a race to the bottom” by potentially limiting the ability for states to craft policies based on their respective needs. As for those who critique other unique aspects of Oregon’s law, such as responsible end market requirements , Allaway said “that’s not negotiable for us,” as market issues were a leading motivation for the law in the first place. Allaway said Oregon’s system was established based on specific regional priorities, such as putting an end to exporting certain types of material that led to dumping in other countries. The state’s approach to ecomodulation and life cycle analysis is also informed by years of work on greenhouse gas inventories and consumption-based accounting, which challenges many commonly held assumptions about recyclability . Each state has its own unique factors in terms of collection access and market infrastructure. Colorado, for example, has many areas that will be getting recycling service for the first time. Maine also has many rural areas that previously had access to recycling but lost it in recent years. Meanwhile, in Maryland, collection service may be more common but local end markets are lacking for certain commodities. Jason Bergquist, vice president of consulting firm RecycleMe, said during the NERC event that he hears concerns from clients about where this is all headed. “If we get to a couple years down the road and we’ve got, let’s just pretend, 25 states with EPR, with different deadlines, different [covered material] lists, different definitions, different ecomodulation — my concern as a fan of EPR is that the pushback will be so significant that it could get existential for the producers,” he said, in terms of costs and compliance management. At the same time, Bergquist said the experiences of packaging EPR in Europe and Canada show it may take years to get toward any kind of harmonized system. Back at SPC Advance and the co-located How2Recycle Summit, California loomed large throughout the week when it came to these questions. Karen Kayfetz, chief of CalRecycle’s product stewardship branch, said regulators from different EPR states try to talk to one another as much as possible but in some cases they’re limited by the statutes that created these programs. “We each have our own legal frameworks we have to work within,” she said. “So harmonization starts with the legislatures, and that is not our responsibility, but it is something that we could see change and evolve over the coming years.” As all of these complex questions get worked out, Kayfetz reminded attendees that CalRecycle may currently be “the face” of the program but that’s not the long-term goal. “What would make me the happiest is if you leave here thinking ‘let’s go talk more to CAA.’ Because EPR is a policy mechanism that is meant to be a public-private partnership where the public entity ... is overseeing the PRO,” she said. “They are your partner and we are their police.” In a separate session, CAA’s Buckingham described the work of ramping up different state fee and reporting programs as building a plane while flying it. The group is working to streamline its own reporting processes as much as possible, but they and others anticipate things will only get more complicated in the near term. “2026 will bring with it a new set of EPR laws and recycled content laws,” predicted KDP’s Schwarze, “and they’re going to be different than what we have right now.” Read on Packaging Dive.
September 17, 2025
The City of Medford won the 2025 Environmental Leadership Award for Outstanding Community presented by the Northeast Recycling Council, for its innovative work to reduce waste and create a more sustainable waste collection system through the City’s free curbside composting program. “I'm thankful to our team at City Hall, the Solid Waste Taskforce, our consultants Strategy Zero Waste and our volunteers for working so hard to launch our curbside composting program and making it such a meaningful success for our community,” Mayor Breanna Lungo-Koehn said. “This award shows that the work we’re doing in both composting and recycling is having real, transformative effects on how our community thinks about waste and the steps we’re taking to create a more sustainable environment for the future. We are honored to be recognized by the Northeast Recycling Council for these efforts.” Each year, NERC honors a community, an organization, and an individual for their outstanding contributions to recycling education and innovation. This year will mark the 9th annual Environmental Leadership Awards Ceremony, recognizing individuals and organizations who help further NERC’s waste and recycling goals. “Our committee is wholeheartedly impressed by the work of the City of Medford, and how important and impactful that work is for the community,” said Sophie Leone, Development and Program Manager at NERC. “It is a perfect representation of NERC’s mission to minimize waste, conserve natural resources, and advance a sustainable economy through facilitated collaboration and action and we are very excited to bestow the City of Medford with this award.” You can read more about the Environmental Leadership Awards here . And if you haven’t signed up for Medford’s free curbside composting program, you can do that at medfordcomposts.com . Read on MedfordMA.org.
By Resource Recycling September 10, 2025
In the Northeast, recycled commodity prices continued to decline in April-June, with MRFs experiencing an average decrease of nearly 6% compared to the first quarter of 2025, according to the Northeast Recycling Council’s (NERC) second-quarter MRF Values Survey Report. NERC’s 25th quarterly report analyzed data from 19 MRFs across 12 states, excluding two facilities from the average blended value “because they did not market enough commodities within Q2 to provide a representative comparison with other MRFs.” Compared to the previous quarter, the responding MRFs reported average values per ton for blended recyclables with residuals at $82.68, a decrease of 7.74%, or $96.21 per ton, a 5.99% decline without residuals. Thirteen of the 17 MRFs contributing to the weighted average were single-stream, while four operated on a dual-stream/source-separated basis. In the Northeast, dual-stream facilities reported a blended value of $99.74 without residuals and $86.52 including residuals, experiencing decreases of 7% and 7.16% from the previous quarter, respectively. Single-stream MRFs recorded blended values of $95.08 without residuals, down 5.7%, and $81.28,down 8.3%, with residuals. Factors such as tariffs and weak demand have led major waste haulers to adjust their forecasts, anticipating challenges due to economic uncertainty for the remainder of 2025. This dip in commodity prices was reflected in second-quarter earnings reports, with four companies reporting an average year-over-year decrease of 15% in commodity values. Houston-based WM projected a $15 million decline in earnings before interest, taxes, depreciation, and amortization due to softening demand. However, the emergence of new and upgraded polymer facilities is enhancing processing capabilities, driven by the expectation of high demand for recycled PET. A version of this story appeared in Resource Recycling on Sept 9. Read on Resource Recycling.