Montréal's Recycling Problem: a Take on the Current Business Model and Societal Impact

Quebec’s recycling facilities are closing as the current company, Solides Canadiens, has said that its operations are no longer financially profitable. Despite this decision, the government responded stating that recycling collection services will continue, leaving the glaringly obvious question of where the enormous and growing amount of waste material will be stored. 

Solides Canadiens has four locations in Quebec, all operated solely by the company. Two of these locations are responsible specifically for Montréal’s waste material, where the city owned both buildings but only one of two sets of the equipment. The annual processing level at these two locations averages around 160,000 tonnes, with Montréal residents in 2018 producing on average 465kg of waste per person. Following China’s market import ban on recycled paper material and the consequential financial loss due to a cut of 60% in revenue streams, Montréal spent a whopping $30 million in 2018 to bail out Solides Canadiens. 

The problem with the current business model 

This crisis situation is primarily a consequence of recycling facilities operating on a purely financial, rather than sustainable, model for a service that is largely for social benefit. It begs the question: instead of spending such a large bailout on a for-profit company, why did Montréal not look at the opportunity to seek out the development of a non-profit organization? A non-profit business model would suit the service type and financial environment that Canada’s recycling industry is currently in. Instead of injecting money into a failing company, the government could have developed a more sustainable model that allowed for a much more efficient and cost-effective service.  

Currently, the financial market for selling recycled material is experiencing severe financial loss due to the new market barriers. By establishing a non-profit recycling organization, operations would focus on ensuring revenues covered costs rather than maximizing profit; as due to the low industrial demand, there is little potential profitable gain available anyways. Revenues could be reinvested into the organization to develop more efficient recycling technology and improve upon citizen waste education and awareness, therefore improving efficiency. It also provides the opportunity for Montréal to develop a leading role in innovating the incredibly costly process of recycling.  

In terms of the value, waste management is a social service. Proper waste management assists in reducing healthcare costs by reducing both waste and environmental pollution. By recycling material, we are reducing the amount of waste pollution as well as limiting the amount of new man-made materials being produced. The Environmental Protection Agency has done thorough research that outlines the benefits of recycling materials. Rather than producing anything new, recycling saves energy and raw materials while limiting the amount of toxic waste produced. This all translates to a healthier environment that assists in minimizing social costs.  

The problem at the individual level 

The residents of Montréal also play a part in this issue. Taking a step back, it is interesting to note that the reason for the Chinese market import ban was in part due to the fact that most recycling material sent over by Canada was not sorted and was contaminated. Despite all of Montréal’s efforts towards sustainability and in general a strong history of environmental progress, it is shocking to see such lack of advancement in recycling and food waste compost services. The model was simply not built to last well. Residents are not expected to sort their recycling by material but instead are encouraged to throw everything into their recycling bin, suggesting an emphasis on quantity rather than quality. Moreover, the lack of communication regarding the necessity for rinsing or cleaning material has resulted in contaminated materials that can clog machines or prevent material salvage. Guidelines of what can and cannot be recycled are inconsistent and are also not widely communicated. Unfortunately, there are no universal recycling metrics, and what items can or cannot be recycled differs from region to region. For example, as a citizen living in the City of Hamilton, residents are limited to the number of garbage bags they are allowed to put out per week and all recycling is to be separated by plastics and paper. However, not all municipalities in Ontario operate this same way. There is a significant inconsistency in recycling across Canada, and unfortunately Montréal is one of the most lacking municipalities in this regard. 

While the city decides how they are going to approach this the recycling issue, everyone living in Montréal can do their part to help. Step number one: reduce your waste. Canada is one of the largest consumers in the world. While the focus of climate change mitigation is on reducing emissions, we often neglect to recognize other forms of environmental damage such as plastic pollution, which is primarily due to our over dependency on convenience. We all need to make an effort to stop buying over-packaged foods, reduce food delivery service usage, and more broadly be mindful about our purchases and behaviour. One of the largest eco-marketing failures was the 3R “Reduce-Reuse-Recycle” campaign. It has been communicated as a “pick-one” option, when in actual fact it was meant to show us the order of priorities: most importantly: reduce, next best: reuse, and last resort: recycle. Now more than ever, the first two ‘Rs’ of reduce and reuse must be the focus, rather than heavily relying on energy intensive recycling operations. 

The overall situation is not good. It is relieving that the government will not consider dumping the recycling into landfills, but alternative business models that focus on the service offering and current financial market need to be seriously considered. In the future, there is the potential that if Montréal were to focus on a non-profit business model now and improve the quality and recycling rate, there could be a move towards a for-profit business model, such as a social enterprise. However, currently there is not the financial market or the resources required to make this work now.  More importantly, as the source of this waste, consumers need to take a significant step back and critically acknowledge our own impact.