CIRCULAR REFERENCE ERROR: DO WE UNDERSTAND THE CIRCULAR ECONOMY. PT. 2 – Will a Voluntary Approach Work For Food & Organic Resources?
By Peter Hargreave and Paul van der Werf
To contact Paul: @allfoodisfood
To contact Peter: @phargreave
How do we find ways to promote an economy that circulates materials and nutrients as productive inputs? That is the question Ontario is currently grappling with as our current economy instead incents both high consumption and disposal, a combination that has far reaching consequences from climate change to resource security.
Ontarians currently send more than 2 million tonnes of food and organic resources to landfill every year. Landfill gas collection systems, where in-place, assuage some of the impacts of decomposing food and organic wastes, but they are imperfect systems and still do release methane, a powerful greenhouse gas contributor. In addition, the nutrient value, resources, and energy associated with creating the food and organic resources that were disposed are generally all lost. The consequences have a negative rippling effect across our environment, economy and social fabric.
The Province understands the impact of this issue and is seeking to consult on what is the right approach to affect fundamental changes. Governments have a plethora of tools by which to address issues such as this. Typically, these tools fall into two major categories: voluntary and mandatory. The voluntary approach uses public education and/or incentives to request or stimulate the desired behaviour change. The mandatory approach involves prescribing regulations that require certain actions / behaviours. This can also be accompanied by financial disincentives.
In the case of food and organic wastes, are voluntary measures enough?
To date the diversion of food and organic waste in Ontario has largely been voluntary with the exception of the requirement for certain municipalities to have leaf and yard recycling programs. Municipalities have led the way by promoting backyard composting and implementing green bin programs.
Minimal funds have been offered by the federal and provincial governments to incent these activities. Instead, municipalities have made the decision for a variety of reasons, not least, to address waning landfill capacity.
To date more than 2 million Ontarians, mostly living in single-family households, have access to curbside green bin programs. The vast majority of these programs operate in southern Ontario spanning from Ottawa in the east to Waterloo in the west. These municipalities have made the decision to pay a premium to encourage reduction and to manage food and organic resources in a manner that is more expensive than disposal based on today’s economics. Around 1 million tonnes of food and organic resources are processed annually through these municipal programs and converted into productive outputs, including energy generation and nutrients that support local crops.
The provincial approach on organics diversion has been largely a success story with a more voluntary approach. Yet still half of municipally generated food and organic waste still ends up in landfill and a few larger municipalities are still without green bin programs, likely sheltered by access to relatively plentiful and inexpensive landfill capacity.
Business has different drivers and their story is much different. They are governed more by bottom line considerations than political and environmental ones. As one grocery chain articulated:
“Diverting food waste must save us ~30% or we simply will not do it. Going from one container to two containers is added work for our stores. Anything we do needs to be easy for our employees and cost effective for our business.”
Business also has the ability to take a more out of sight, out of mind approach. Unlike municipalities, they do not have to be transparent about how their waste is managed and continue to have access to cheap foreign disposal.
While there are a growing number of businesses with corporate social responsibility (CSR) programs, it is difficult to voluntarily encourage them to pay more. This is likely why despite the growth of CSR, an estimated 75% of all food and organic waste generated by business ends up in landfill, either in Ontario or the US.
This is absolutely not an attempt to paint the entire business sector with one brush. For some businesses, economically it makes sense for them to utilize food banks, farms for animal feed, rendering facilities or to send materials to compost or anaerobic digestion facilities. And some have other rationales to do so. There are thriving niches that have evolved but they are generally the exception rather than the rule. They really are early adopters of the circular economy and serve as an example of how it can be done (and still generate profits).
It does, however, appear a voluntary approach has hit its upward limit on the results that can be achieved. All the easier waste organic streams have been captured. Food processors in Ontario have built synergies with other business that can utilize their wastes. The rendering sector remains a great example of a niche circular economy model. Major grocery chains are also becoming more effective at diverting surplus good quality food to food banks and food waste to animal feed or organic processing facilities.
A voluntary approach will simply not continue to adequately motivate other participants as the cost / reward differentiate is simply too large. Too many economic signals are pushing the majority of materials in the wrong direction.
Whether it be:
- restaurants that lack the economies of scale to ensure food donation;
- apartment dwellers who live in buildings that do not have the appropriate infrastructure to divert materials; or
- retailers or caterers that may be processing back end materials but find it too labour extensive and expensive to deal with more contaminated front of shop organic wastes.
If we are serious about the circular economy, not to mention reducing greenhouse gas emissions, we will need to shift from voluntary to regulatory approaches (just as was done for the blue box and leaf and yard waste). Mandatory action is necessary but it is important to underline that mandatory does not means prescriptive. This is about providing the right economic signals to ultimately spur investment and stimulate creativity in how to more fully deal with food and organic waste. Mechanisms such as organic restrictions or bans, disposal levies and source separation requirements can all achieve this signal. Part 3 of our series will explore these tools and how they could be implemented to help us move towards a circular economy.