July 4, 2005

Study confirms UOMA as a world leader in stewardship programs

Western Canada's industry-led stewardship program for used oil management is a world leader, concludes a program review study conducted by BearingPoint LP. The Used Oil Management Association (UOMA) model, it says, is a leader in program design, collection and compensation scheme compared to 14 other global used oil management programs. The Canadian model is also world leader in maximizing used oil collection rates (over 75%) and re-refining rates (30%), adds the study, which was released June 21 at the first joint annual general meeting of the four provincial used oil recycling associations that make up UOMA.

The provincial associations operating under this successful industry-led stewardship model include: the British Columbia Used Oil Management Association (BCUOMA); the Alberta Used Oil Management Association (AUOMA); the Saskatchewan Association for Resource Recovery Corp (SARRC); and the Manitoba Association for Resource Recovery Corp (MARRC). A similar program launched in Quebec last December, SOGHU (La Société de gestion des huiles usagées), was not part of this study.

The comprehensive survey, carried out last fall, generated a 30% response rate from the nearly 400 program stakeholders invited to participate. More than 2,000 telephone interviews were conducted, and the UOMA programs were benchmarked against 14 leading European and North American programs.

"The good news is the stakeholder survey results are very positive, with the four programs comparing very favourably to all other programs benchmarked," said Charlie Meredith, Manager, BearingPoint, Edmonton and lead on the project. "As well, the public survey shows that recycling attitudes and behaviours are constantly changing for the better."

Of 14 benchmarked programs, only four (including UOMA) collected filters and containers as well as used oil, and only three programs recycled used oil filters in an environmentally safe way. Two programs were able to provide collection rate figures for oil filters: UOMA (79% of total filter sales) and Florida (65%).

The UOMA program facilitates the collection of used oil, used oil filters and used plastic oil containers (up to 30 litres in size) for recycling, first by establishing a network of return collection points. The program is funded by an environmental handling charge (EHC) remitted by all wholesale suppliers (first sellers) on lubricating products, including filters and plastic containers- not by a government tax. The EHC is remitted to the association(s) in the province(s) in which the wholesaler does business.

A return incentive (RI) is then paid to private-sector collectors and processors to pick up and deliver used oil materials to government-approved recycling facilities where the materials are processed into new products. Any collector or processor properly licensed or permitted by the government is eligible for registration under the program.

The provincial associations are responsible only for ensuring that all collected materials are delivered to government-approved receiver/processors in order to be eligible for the RI. This model ensures that normal market forces determine the flow of product. In western Canada, it has led to a growing secondary recycling/processing sector.

The survey found that UOMA's collection rate, at 75%, ranked second only to that of the U.K. and unlike most of the other programs examined, it has both a high collection and a high re-refining rate for used oil. Its EHC of five cents per litre of oil sold was found to be slightly higher than the North American average but well below the average for all benchmarked programs, while its RI (ranging from eight to 17 cents per litre) is higher than that of other programs.

Based on stakeholders' responses, the survey reported that UOMA has increased both used oil material collection rates in western Canada and awarenss of the importance of recovering used oil in an environmentally sound manner. In addition, UOMA's rising collection rates serve to confirm a change in public behaviour, with more people recycling their used oil materials. All of these results show that UOMA is realizing high recovery rates and low program costs.

"When you consider that one litre of used oil can contaminate one million litres of fresh water, then everyone understands the importance of the proper collection and recycling of used oil materials," noted Ron Benson, executive director of the Manitoba Association for Resource Recovery Corp (MARRC). "Over the past seven years, millions of litres of used oil and kilograms of plastic containers, and millions of filters have been collected, recycled and re-used through this program. None of the material collected goes to landfills or to road oiling," he added.

A full copy the UOMA Program Review is available on www.usedoilrecycling.com. More information is available from Charlie Meredith at Bearing Point, 780/429-5859, E-mail Charles.Meredith@bearingpoint.com.

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