New Definition of ‘Sham Recycling’
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Sham recycling refers to claims by a hazardous waste generator that the waste is being recycled when it is in fact being discarded. A new definition at 40 CFR 261.2(g) codifies EPA’s concept of sham recycling:
“A hazardous secondary material found to be sham recycled is considered discarded and a solid waste. Sham recycling is recycling that is not legitimate recycling as defined in 40 CFR 260.43.”
This explicit prohibition of sham recycling applies to all HSMs being recycled and codifies implicit requirements that have been largely implemented through EPA guidance. To the EPA, sham recycling is an activity undertaken by an entity to avoid the requirements of managing an HSM as a hazardous waste. Because of the economic advantages in managing HSMs as recycled materials rather than as hazardous wastes, there is an incentive for some handlers to claim they are recycling when, in fact, they are conducting waste treatment and/or disposal.
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Four Factors
The approach contained in the recent rule requires that four well-known legitimacy criteria or factors be met to demonstrate that HSMs are being recycled and that hazardous waste is not being discarded.
- Useful Contribution
Recycling must involve an HSM that provides a “useful contribution” to the recycling process or intermediate of the recycling process. This means that the HSM must contribute valuable ingredients to a product or intermediate; replace a catalyst or carrier in the recycling process; be the source of a valuable constituent recovered in the recycling process; be recovered or regenerated by the recycling process; or be used as an effective substitute for a commercial product.
- Valuable Product or Intermediate
The recycling process must produce a “valuable product” or “intermediate.” For a product or intermediate to be valuable, it must be either (1) sold to a third party, or (2) used by the recycler or the generator as an effective substitute for a commercial product or as an ingredient or intermediate in an industrial process.
- Managed as a Valuable Commodity
An HSM must be “managed as a valuable commodity” when under the control of a generator or recycler. This means that the HSM must be managed in a manner consistent with how an analogous raw material would be managed (or in an equally protective manner). If there is no analogous raw material, the HSM must be contained (i.e., that HSM storage units must be in good condition, properly labeled, not hold incompatible materials, and address potential risks of fires or explosions).
- Comparable to a Legitimate or Intermediate Product
The product of the recycling process must be “comparable to a legitimate product” or intermediate. The EPA provides several detailed examples of how the recycled product can be comparable to a legitimate or intermediate product depending whether there is an analogous product or intermediate. Note: If the recycled product has levels of hazardous constituents that are not comparable to or lower than those in a legitimate product, the recycled product may not be considered to be legitimately recycled. Elevated levels of hazardous constituents require recyclers to conduct the necessary assessment and prepare documentation to show why the recycling is still legitimate.
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Exceptions
The rule provides some flexibility regarding the obligation to comply with the factors. For example, when there is no analogous product made from raw materials, the product of recycling is still a legitimate product if it meets “widely recognized commodity standards,” applicable, for example, to commodity-grade scrap metal.
Also, for cases in which the product of the recycling process has levels of hazardous constituents not comparable to analogous products, the revised standard includes a process that allows the facility to document and certify that the recycling is still legitimate.