M E M O / N O T E D E S E R V I C E

To / Destinataire

Chair and Members of the Planning and Environment Committee / Président et membres du Comité de l’urbanisme et de l’environement

File/N° de fichier:

ACS2007-PWS-UTL-0003-IPD

From / Expéditeur

Deputy City Manager, Public Works and

Services

Directeur municipal adjoint, Services et Travaux Publics

Subject / Objet

Ontario Deposit-Return Program

Date: 29 January 2007

The Ontario government, in conjunction with the Liquor Control Board of Ontario (LCBO), will be implementing a deposit-return system for all LCBO containers effective February 5^th, 2007. This memo is to provide information to Council of the related impacts this will have on the Citys' residential Blue Box recycling program.

BACKGROUND

Deposit-return for LCBO containers has been the requested method of handling LCBO containers proposed by certain municipalities and Ottawa for at least 9 years, as indicated by the following:

May 26, 1998: Regional Planning and Environment Committee directive (no. P&E - 3(98)) requested: “That staff report back with recommendations on how glass Liquor Control Board of Ontario (LCBO) bottles and soft drink containers can be returned instead of recycled”;

December 1998: Staff presented the report entitled “Details on Provincial Waste Diversion Funding and Response to motion no P&E - 3(98)”. At that time, the Minister of the Environment indicated that deposit-return would not be implemented in Ontario in the near future;

July 2006: The Association of Municipalities of Ontario (AMO) and Association of Municipal Recycling Coordinators (AMRC) issued a position paper to the Province entitled “AMO’s proposal for a Provincial Integrated Waste Strategy” which called for, among other things, deposit-return for wine and liquor containers;

September 5, 2006: Ontario Environmental Commissioner tells a legislative committee that Ontario should have deposit-return for wine and liquor containers;

September 7, 2006: Premier McGuinty confirms the Province is considering the idea;

September 10, 2006: The Premier announces Ontario deposit-return will happen for LCBO containers effective February 5^th, 2007.

DISCUSSION

The Ontario deposit-return program will mean that all containers greater than 100 ml. in size will be eligible for a refund, if returned to any deposit-return partner designated by the Province and LCBO. A complete list of these partners is available at www.bagitback.ca, but initially focuses all Beer Store outlets in Ontario. Deposit amounts are $0.10 for containers up to 630 ml. in size, or for cans up to 1 litre in size. Containers larger than these sizes will be refunded $0.20 each on return.

In 2005, the City of Ottawa’s split stream Blue and Black Box recycling program marketed 16,003 tonnes of Blue Box materials and 50,307 tonnes of fibre materials (Black Box) for a total of 66,310 tonnes of recyclables. Approximately 10,075 tonnes or 63% of the container stream Blue Box was made up of glass bottles and jars. Based on the 2005 waste characterization study, 67% or 6,757 tonnes of that Blue Box glass originated from the LCBO.

Environmentally, deposit-return is a clear winner over the Blue Box recycling program due to the fact that over 90% of the glass can be either reused or recycled into other glass products, with the deposit-return system. Ottawa’s Blue Box program recycles about 7.5% (775 tonnes) into other glass products while the remaining 9,300 tonnes is used as aggregate for road beds. The deposit-return program will collect intact containers, which are colour sorted on return, thereby making them more desirable to glass reuse and recycling markets.

This LCBO deposit-return program is expected to achieve much higher capture rates (after a ramp up period) than the Blue Box Programs. The average Blue Box capture rate of LCBO containers in Ontario was 68% in 2005. By comparison, British Columbia captures 91% of wine and spirit bottles, Alberta 89%, Nova Scotia 86%, through deposit-return systems. The Ontario Beer Store captures 98% of its beer bottle containers due to the financial incentive of deposits on the return of the empty containers.

FINANCIAL IMPLICATIONS

The LCBO was contributing $476,000 annually to the City of Ottawa recycling program through Waste Diversion Ontario’s Blue Box finding program while the net cost to manage this material in the Blue Box Program was $1.8M. The projected savings for Ottawa with the removal of LCBO glass from the Blue Box is expected to be $650,000 in 2007.

Savings of $650,000 for 2007 is being projected in the 2007 Operating Budget.
Annual funding through WDO of $476,000 will continue until 2008.

ENVIRONMENTAL IMPLICATIONS

Deposit-return will result in an expected LCBO container capture rate of 85%;
Energy savings of 65% will result from the reuse and recycling of glass rather than the current market as aggregate;
For every 10% increase in the use of recycled glass in the manufacturing process:

20% reduction in carbon dioxide emitted to the atmosphere
6% reduction in Nitrous Oxides emitted to the atmosphere
40% less residual going to landfill from small particles of glass too small to sort in material recycling facility

Expected greater co-operation between stewards and markets for development of markets for all packaging (i.e. tetra-paks, and other non-glass, non-metal containers).

CONSULTATION

The Provincial government and LCBO have launched the Ontario Deposit–Return Program web site www.bagitback.ca to provide information to the residents and businesses of Ontario.

The LCBO is planning to insert bag stuffers (notices), informing customers of this new program.

POLICY IMPLICATIONS

The Department is in full support of this Ontario Deposit-Return LCBO Program, as a product stewardship initiative, and will expect and encourage full participation from Ottawa residents to eliminate LCBO glass from the Blue Box Program.

The removal of LCBO glass from the Blue Box Program was anticipated by the Solid Waste Division and included as a price option in the latest Recycling collection and processing contracts. This will allow the City to exercise this collection cost option in the new Collection contracts allowing for a smooth transition of this material out of the Blue Box. The City will negotiate changes to the existing Blue Box processing/separation contract reflecting this reduction in Blue Box content.

The Solid Waste Bylaw will require a minor modification to list LCBO glass as no longer recyclable in the Blue Box Program. A Bylaw amendment report will be brought forward to Committee and Council in the near future.

A Blue Box drop notice is being developed by the City to complement LCBO notification to ensure Ottawa residents are aware of this initiative and understand the impact on the Blue Box Program in Ottawa. Opportunities to participate with or complement the LCBO communications will be pursued and leveraged wherever possible.

Original signed by

R.G. Hewitt

Deputy City Manager, Public Works and Services

cc: Kent Kirkpatrick, City Manager

Sharron Ellis, Chief Communications Officer

Kenneth J. Brothers, Director, Utility Services Branch
Monique Beauregard, Coordinator, Planning and Environment Committee