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Sustainable Investment Profiles, Uncategorized

A Positive Recycling Story No One Is Talking About

When recycling makes the news at all, it has not recently been for positive reasons. Plastics in particular have a woefully low recycling rate; one study last year put the number well below 5%. Even before China’s infamous ban on importing waste, the number has likely never reached 10%. As we’ve pointed out before, plastics and plastic waste present a uniquely destructive environmental challenge, not least due to the way plastics drive the world’s appetite for oil. (For these reasons, we exclude plastics producers, alongside fossil fuel companies, from investment consideration.)

But despite the persistent failure of plastic recycling, the situation with some other materials is more hopeful. Aluminum recycling rates, for instance, are estimated to be about 70% worldwide, with aluminum made from recycled materials consuming 5% of the energy required for primary aluminum production. The global aluminum scrap recycling industry, valued at $5.6 billion in 2021, is expected to grow to more than $25 billion by 2030. Tire recycling rates in the US were recently estimated at 76%, most of which goes directly into products such as rubber-modified asphalt, automotive items, mulch for landscaping, and tire-derived fuel. The market for tire recycling is expected to grow from over $5 billion in 2021 to over $7 billion in 2031.

Individual companies can have an outsize impact on keeping these materials out of landfills. Trane Technologies reports that in 2021, it sourced 44% recycled input material across the key commodities of steel, cast iron, aluminum, copper, and plastic resin. Water pipe manufacturer Advanced Drainage Systems made the top spot in last year’s Plastics News ranking of US plastics recyclers. In some cases, corporate recycling practices predate the relatively modern conception of curbside pickup by decades.

One such case is Carlisle Company. Carlisle began using recycled rubber, in inner tubes, at the company’s inception more than 100 years ago. Today, Carlisle says its Ultimate RB subsidiary is one of the largest tire recyclers in the world, making products that contain up to 96% post-consumer waste. Overall, Carlisle has returned 620,000 tons of scrap to production since 1999, and with 63,000 tons returned in 2021, that rate is clearly accelerating. Single-ply roofing membranes have made up the largest share of recycled materials over that time, but the company also reground and redensified 4,000 tons of expanded polystyrene building insulation back into their products in 2021, and recycled hundreds of tons of wastepaper into 16 million square feet of facer paper for its insulation boards.

The company’s practical ambitions to use recycled materials have clearly affected its business model and goals in other ways, too. For instance, 18,000 tons of recycled steel purchased in 2021 came from a supplier whose technology creates far less emissions than traditional blast furnaces. Many of Carlisle’s products generate significant energy efficiencies for its customers, including roofing membranes developed 50 years ago that independent analyses still say have the lowest potential to add to climate change of any roofing material. The company also sells roof garden (aka green roof) assemblies, and insulation that can offset its own carbon footprint in 13 months.

Perhaps most ambitious, Carlisle recently set a net zero target for 2050, along with a near-term emissions reduction target. The targets are currently waiting on approval from the Science-Based Targets Initiative, the gold standard for companies that are serious about reducing emissions.

The duration and breadth of Carlisle’s recycling efforts, and the impact this history has clearly had on the company’s approach to climate change, should be an example to manufacturers looking to more aggressively combat waste and warming. While curbside recycling has faced challenges, corporations have the facilities and R&D budgets to make their own advances; likewise, purchasing decisions and product updates can have enormous ripple effects on carbon emissions. If every company adopted a similar sustainability mindset, the world’s approach to the targets we are straining could be rapidly accelerated.

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