Indiana's low recycling rates pressuring glass, plastic, aluminum beverage containers makers like Verallia, Anchor Glass and O-I; US$35M worth of metal wasted in Indiana, Alcoa executive says

INDIANAPOLIS , May 26, 2012 () – Indiana's low recycling rates are putting the squeeze on makers of glass, plastic and aluminum beverage containers, and companies say the higher manufacturing costs could deter others from moving to the state.

Factories operated by Verallia, Anchor Glass and Owens-Illinois employ more than 1,600 people in Indiana. Their need for discarded glass, known as cullet, far exceeds all 700 million glass containers used in the state annually, said Stephen Segebarth, a senior vice president at glass maker Verallia's Muncie operations.

"There is a robust market for returned glass. We are hungry for all the cullet we can get," he said.

About 65 percent of glass cullet comes from the 10 states with so-called bottle bills: California, Connecticut, Hawaii, Iowa, Maine, Massachusetts, Michigan, New York, Oregon and Vermont. They have glass recovery rates of 64 percent, while states without bottle return requirements, such as Indiana, tend to average about 12 percent, according to the Container Recycling Institute.

Indiana lawmakers last proposed a bottle bill in 2009. The bill, which called for a 10-cent fee, did not get a committee hearing, the Indianapolis Business Journal reported ( http://bit.ly/Kw6BZH ).

Beverage industry representatives say they are dismayed by years of debate in Indiana about container return policy while millions of dollars in valuable feedstock is buried in landfills.

Some manufacturers favor a bottle bill. Others, like Nestle Waters, advocate an approach in which container producers, not municipalities, take responsibility for collection and recycling.

"Recycling can drive our economy in ways people hadn't thought about previously," Segebarth said during the Indiana Recycling Coalition's annual meeting in Indianapolis earlier this month.

Glass isn't the only recyclable in short supply. The demand for returned containers and plastic bottles also is high, yet aluminum cans equivalent to about 1,000 airliners are driven into landfills in Indiana every year.

"It's $35 million worth of metal" wasted in Indiana alone, said Beth Schmitt, director of recycling programs for Alcoa Global packaging. "It's metal that there's a strong market for."

The availability of recyclable feedstock can drive decisions on where to build plants. Late this year, Perpetual Recycling Solutions plans to open a $30 million, 55-employee plant in Richmond. It will transform discarded containers into food-grade plastic flake, which will be sold to container makers.

A study by the Environmental Protection Agency that is expected to be released this summer has found at least 30 manufacturers in Indiana use recycled feedstock and employ more than 6,400 people, said Susan Mooney, chief of EPA Region 5 municipal and industrial materials section.

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