SCV NEWSMAKER OF THE WEEK:
Roy Brown, President, Knowaste

Interview by Leon Worden
Signal City Editor

Sunday, September 21, 2003
(Television interview conducted Sept. 11, 2003)

Roy Brown     "Newsmaker of the Week" is presented by the SCV Press Club and Comcast, and hosted by Signal City Editor Leon Worden. The half-hour program premieres every Wednesday at 9:30 p.m. on SCVTV Channel 20, repeating Sundays at 8:30 a.m.
    This week's newsmaker is Roy Brown, president of Canada-based Knowaste, the proponent of diaper recycling in Santa Clarita. On Tuesday the City Council is scheduled to decide whether to scrap its pilot diaper-recycling program or roll it out citywide.
    The following interview was taped Sept. 11. Questions are paraphrased and some answers are abbreviated for length.

Signal: Why should the residents of Santa Clarita pay a little extra so we can start recycling diapers?

Brown: I think the real question is, What is the value of ensuring diapers don't go to landfill? When you're talking about diapers, you're talking about urine, and you're talking about feces, and you're talking about air space — valuable air space. And certainly in Southern California, you're looking at a real problem with landfills and the permitting of new landfills. If we can be part of the solution to keeping the life of the (existing) landfill a little bit longer, then I think that's a worthwhile cause. Keeping the urine and feces out of the landfill is also important. And frankly, there are pulp and plastic recyclables that can come out of there, and I want to tell you that if the city of Santa Clarita did in fact have a citywide program, that they would save 5,000 trees per year and about 3.5 million gallons of water. That's a significant amount and I think it's worthwhile.

Signal: You're the president of Knowaste, a Canadian company. What does Knowaste do?

Brown: We're not a Canadian company. We're an American company. We just happen to have our head office in Toronto. Our main operations are in Arnhem in The Netherlands, where we have a 50,000-square-foot facility that can do up to 100,000 tons of diapers per year. We focus mostly in Europe on adult incontinent diapers. Of that 100,000 diapers that could be processed at that plant, that could produce upwards of 20,000 tons of pulp (and) in the neighborhood of 10,000 to 14,000 tons of plastic — a significant amount of recyclables.

Signal: Knowaste has a patent on a chemical process and processing machine?

Brown: Yes. Our patent is actually related to the deactivation of the super-absorbent polymers. If you take a diaper ... you've got the outer shell, which is a plastic polyethylene-polypropylene mix. Inside the diaper you've got pulp, and within the pulp you've got super-absorbent polymers, and we call this sap. That's what absorbs the moisture, absorbs urine. What our technology does is deactivate the super-absorbent polymers. It turns it back into a crystal form. It allows us to separate that from the pulp, in order to now make that pulp recyclable. With the sap and the grit in the pulp, it's garbage. It's not worthwhile. So our technology — we have patents in Europe, Canada, the United States, Japan and Korea.

Signal: Where in the United States are diapers recycled now?

Brown: Nowhere. We're a very new company, a very new technology. Our patent was only issued in the late 90s, although we have been doing research and development on this for many, many years. It sounds like a simple process (but) it's very technical. It has taken a lot of years and millions of dollars of research to get to the stage where we can become commercial. And we frankly only became commercial in 97, and we focused on Europe to begin with, and we're just, now that our facility there is up and operating and doing well, we want to be relevant in our own back yard, which is North America.

Signal: Not just your company — nobody else is currently recycling diapers in the U.S.?

Brown: That's true.

Signal: Why Santa Clarita?

Brown: First of all, we made a conscious decision to come to California. I think the big reason is, if you look historically at all the recycling initiatives, California was the leader. They started with all of the bottles, cans, all the programs started out here and migrated east. So we recognized, for us to be relevant in the North American market, we really needed to start here. The fact is, this particular community is known for having some vision in recycling. They're willing to take chances. They have taken chances. Certainly when we made our proposition to them, they were very open to listen, and have given us the chance through this pilot program for the last number of months, to prove the technology, that it works, and I think everybody has recognized that it in fact does work, and to be part of the overall solution. We do have in Santa Clarita some trash issues. We do have some issues with meeting the recycling mandates. And we think we can be part of that solution.

Signal: The city of Santa Clarita, despite earlier recycling efforts, failed the last few years to meet the state requirement to divert from landfills 50 percent of the waste stream by 2000, increasing to 75 percent in time. How much landfill space do diapers take up? How much are we talking about diverting?

Brown: The EPA statistics have said that approximately 2 percent of the total waste in the United States is represented by incontinence material and diaper material. That's a significant amount of waste. In the city of Santa Clarita it is our company's estimate that it is in the neighborhood of 1,800 tons per year, and to give you visual of that, you take a football field, end zone to end zone, and you fill it with diapers three feet high, that is what this community generates each year. And that's what we can help divert from landfills.

Signal: What do you make out of recycled diapers?

Brown: "We" don't make anything out of it. We separate them out and we facilitate selling it into the recycling market. What has been made out of (the plastic) is numerous things, everything from plastic shingles, plastic woods, booms for oil spills. It's left to your imagination, the imagination of the recycling industry, what you can do with it. On the pulp side, again a variety of things. We've been involved in selling to shoe insole manufacturers, to oil filter companies, and also for packing. So there's a variety of things that can be done with it. It can also be used back into the pulp industry to make stationery. The fiber that comes out of a diaper is a very long fiber, and that's what actually gives it value. When you take recycled paper ... and you recycle it and it gets pulped up, it actually is quite short and quite fragile. The diaper pulp that we can recover is actually quite long and strong, and the recyclers love this because they can take it and weave it in with (recycled paper) material and make a stronger and new product. So, as I said, in this community, if we had a citywide program here, we could save 5,000 trees a year that didn't need to be cut down to make pulp.

Signal: At the beginning of the year, your company convinced the Santa Clarita City Council to test your process. How does the program work?

Brown: We worked in partnership with the city. We produced a brochure which we gave to the city, and they picked certain communities within Santa Clarita. What happened was, we did a partnership with the city and with the local waste hauler, Blue Barrel. And we sat down with them and Blue Barrel and the city decided what day they wanted to pick up, and that dictated what neighborhoods were going to be selected. And then what was sent out was a flier to those neighborhoods, and people who responded to that flier, and I think they sent out roughly around 4,000 fliers, and around 230 people responded, saying, We have babies and we would like to participate.' And they've been very good. The set-out rate on a weekly basis has been very high, and we've been very pleased with that.

Signal: About 230 families participate? So Blue Barrel goes out on trash collection day and does what?

Brown: There is a separate tote that was provided to each resident that's involved in the program. We also provided bags for them. So they (take) the bags, put them in the tote and wheel it to the corner on garbage day. And Blue Barrel would come in a separate truck and pick it up and then bring it to the KDP (Knowaste Diaper Processor) - a machine that the city owns.

Signal: So it's your machine that you sold to the city of Santa Clarita.

Brown: Correct. And we're working in partnership, this is all a partnership. We're running the machine, we're paying all the costs associated with it.

Signal: The city owns a diaper recycling machine.

Brown: They own the machine.

Signal: That cost $500,000.

Brown: That cost $500,000. (Of which) $250,000 came from the state and $250,000 came from the city, and I will tell you that that was below our cost because we're a part of this partnership. We want to see this thing work, and we're committed to the city of Santa Clarita, long-term. And so we wanted to do everything that we could to be part of this, and as a result we continue to operate this machine for them at no cost to them.

Signal: This machine sits physically where?

Brown: It sits in Sun Valley because there wasn't a location here in Santa Clarita, unfortunately. It sits on the BFI site, who also kindly asked to participate and be part of this little partnership that we have going, and so for no cost to us, and no cost to the city of Santa Clarita, BFI is housing the KDP II machine.

Signal: The pilot program doesn't cost the city, but it costs somebody.

Brown: Yes. It costs Blue Barrel and it costs Knowaste during this pilot program.

Signal: And if it's rolled out citywide, it's going to cost every resident — something.

Brown: Like all recycling programs, they are funded by all the residents. (For example) take a bottle program. You may not generate a bottle for recycling, but (your) bill includes that. It's the same concept for this as any other recyclable. The RFP that's just come out here in Santa Clarita for a new hauling contract includes diaper recycling, so that will be part of hopefully when a new hauler is selected.

Signal: How much extra will residents be paying if indeed the City Council does authorize a citywide diaper recycling program?

Brown: As I understand it right now, the cost is approximately $22 for all your garbage collection and recycling and everything, per household, per month. My understanding is, from what I hear, that the new quotes are going to be in the $15-$17 range, so a significant savings from what we're at right now. And that will include a number of enhancements to the existing recycling program, including diaper recycling. So in fact you're going to get a number of recycling initiatives that are significantly less, probably in the neighborhood of $4 or $5 less than you're paying right now. So in fact people are going to save money under this new contract.
    In some of these bids that came in from the haulers — and the city is looking at Blue Barrel, Consolidated and Burrtec — those haulers estimated that the cost of the program for residents each month would be between 66 and 81 cents, according to a city staff report.

Signal: So we're talking about residents spending an extra $7 a year for diaper recycling.

Brown: For diverting urine and feces from the landfill, saving trees, saving water. I have to tell you, my understanding is, from the latest staff report, that at least one of these waste haulers have in fact revised their quote for diaper recycling significantly down. ... I believe that number is about 31 cents right now. So I think it's significantly lower than the initial estimates.

Signal: The Aug. 26 staff report acknowledges that the machine works, and that the number of people who participated in the pilot program did meet the city's goals. But it says that the expectation of how many tons of diapers were recycled missed that one.

Brown: I think there's two elements to that. The first one was something that we pointed out to the city early on. Our experience around the world is that a post-consumer diaper, or a dirty diaper, weighs on average 0.36 of a pound. For whatever reason, the staff consultants (who) were hired insisted that a baby diaper weighs 0.75 of a pound. And we were quite happy to bring lots of diapers and weight them individually. They decided that a diaper weighed three-quarters of a pound and based all their calculations on that basis. In fact it's about half of that. And with the 8 months of experience that we've had with Santa Clarita, it absolutely proves that a dirty diaper weighs 0.36 of a pound. And that's great information to have, isn't it?

Signal: Glad to know that.

Brown: So when you extrapolate that information out, right away, we're going to be half of what they would have expected. But I also think that the staff looked at the extrapolation of what a citywide program would create, based on the pilot. They said, OK, if 4,000 fliers went out and 230 people responded, and that created 1 ton of diapers per week, which is what it did, then if you extrapolate that out, that would come up, in the staff report, as something like 600 (tons).
    There's a number of perhaps problems with that. First of all, that assumes that of the 4,000 people that were given the flier, that there were in fact only 230 people that had babies in there. That probably isn't the case. But what we have tried to share with staff is that there are numerous other communities who have done waste audits, or waste characterization studies, that specifically targeted diapers. Our own experience in doing pilots and projects with other communities, and we've been able to take a variety of different methods, including EPA statistics and demographic statistics, and triangulate, just trying different ways — and we're always coming in a very narrow band, a very narrow target area, of say on average around 1,800 tons. And for a community of this size of approximately 160,000 people, with the demographics that the city of Santa Clarita has and the number of babies born here, that number makes sense.

Signal: Staff is recommending that the City Council kill the program.

Brown: Yes they are.

Signal: How do you intend to convince the council otherwise, and how do you intend to convince people that whether 31 or 81 cents a month, that's a price people should pay?

Brown: There's two issues here. First of all there's the public policy issue. I think everyone has to ask themselves, if you can divert diapers from landfills, should you? And I think almost everyone will say yes. If you can divert them, what are you doing with them? Is there a technology out there that can effectively recycle them? And I think we've proven that, and no one's arguing that point. ... So the public policy perspective of ensuring that diapers and urine and feces don't go into landfill has a value. I think the next issue becomes the whole concept of recycling. In this community, you've got a diversion target of 50 percent; my understanding is, Santa Clarita isn't there. We believe that this represents approximately 2 percent of the total waste stream; if we can divert it, we're helping them get to our goal. We're not the only solution to all the issues on trash in Santa Clarita. But we can be an effective partner as part of the solution.

Signal: The staff report essentially says there are other things that can be done, other than diaper recycling, like education and other programs, that could result in a better diversion rate. The city staff report suggests that not 2 percent, but that diaper recycling would improve the diversion by only 0.22 percent.

Brown: And it comes down to looking at what I believe is a flawed approach, strictly from this pilot program, of taking 4,000 homes and 230 respondents, and then saying there are 40,000 (single-family) homes in this community, and therefore that would generate only X number of respondents that would only generate 600 tons per year. We believe that that's flawed, and there are just so many other communities in California — Sunnyvale, Calif., also did a waste characterization study that showed their percentage was much higher. The EPA statistics show that on a national average, diapers are 2 percent of the waste stream. We see it in other communities that we've worked with, and so we think that the number of 0.22 percent is off by a significant order of magnitude. In fact we think it's about 2 percent. And I'll also back it up from a real macro perspective: If you look in North America, the diaper manufacturers — Procter & Gamble, Kimberly Clark and all the private-label guys, produce approximately 20 billion diapers per year for the market. Well those diapers don't sit in inventory. Those diapers are being used. ... We know what they weigh; we know what the total waste stream is; it backs up that 2 percent again. So I think the 2 percent is a fair number. I think we can prove it six ways to Sunday, and I think staff has chosen, and I believe they think their mandate is to strictly look at results from this particular pilot, and just pull the data as they see it. I also want to share with you, if I may: Those 230 respondents — we surveyed them very recently, in the last month, and said to them, OK, we've been doing this for a number of months; what do you people think? And out of 230 people who participate, 118 responded, and 84 of that 118 actually wrote comments down, the vast majority of which were quite favorable.

Signal: We're not just talking about Santa Clarita here. You intimated that as goes California, so goes the nation.

Brown: Yes.

Signal: The eyes of Sacramento are on Santa Clarita. You went this last year to Senate Majority Leader Don Perata up in the Bay Area and lobbied for passage of a bill that would place a quarter-cent sales tax on diapers. And now the makers of Huggies and Luvs and Pampers and Depend have your number.

Brown: They do.

Signal: What do you say to their argument that it would be wrong to tax one disposable product and not others?

Brown: What we're trying to do is to recognize, as a public policy issue, that it is a good thing to divert dirty diapers from landfill. How do we pay for it? There's a lot of different mechanisms, from the program here in Santa Clarita to maybe a broader statewide program where other communities could also participate. We looked at that, we gave it some time to see if that would play. It didn't play. We recognize that. The manufacturers have, I believe, when we run around and say that we have a solution, that implies that there's a problem. The diaper manufacturers do not accept that their product creates a problem and are quite happy to see those diapers go to landfill. That's the end of their problem. But there is an issue of product stewardship in my view. And product stewardship means cradle-to-grave responsibility for your product. And they should be participating if, we believe, diapers shouldn't be in landfill and urine and feces shouldn't be in landfill, then they should be part of the solution. It shouldn't be, in my view, just the users; it should be a group of the municipality, being the residents, the diaper manufacturers, and it should be all of us participating in this. They consistently would prefer not to, and I understand that.

Signal: This quarter-cent sales tax would have gone to establish diaper recycling programs throughout the state, and so ultimately municipalities would be buying your patented equipment, so we're talking about a quarter-cent tax on diapers that benefits one company.

Brown: That was an argument that we didn't see coming because I have to tell you, where we are actively and economically operating (in other countries), we have lots of competition. We fight composting companies, incinerating companies, other diaper recycling technologies. There's a diaper recycling technology in Germany, there's one in Israel. And as we have raised the profile of diaper recycling and people are starting to recognize what a significant stream it is, more and more people are getting involved. We didn't see it as simply a benefit to us. And we also recognize, if there was money, more and more people were going to get involved and there would be more and more solutions to it. And there are lots of other alternatives. We think we're the best alternative. We think we're the most cost-efficient alternative. But there are other alternatives. And we think we're the most environmentally sound alternative. But there are alternatives, and the minute money is available, entrepreneurs will look at this problem, see that it is a significant problem and go after it.

    See this interview in its entirety today at 8:30 a.m. and watch for another "Newsmaker of the Week" on Wednesday at 9:30 p.m. on SCVTV Channel 20, available to Comcast and Time Warner Cable subscribers throughout the Santa Clarita Valley.


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