1. eWaste Collection and Recycling in Australia AIIA ENVIRONMENTAL ACTIVITIES WITSA Presentation May 2007

2. Agenda Overview eWaste AIIA Role Proposed Industry Scheme –Policy Framework –Product Flow –Financial Flow Questions

3. Overview The new world order: an environmentally sustainable future Gartner found global IT and communications industry produces as much carbon emissions as the global airline industry. Source: GreenerComputing.com Corporate Responsibility: According to Simon Mongay, Gartner’s Research Vice President, ‘with media coverage of climate change "making environmentalists out of millions of people worldwide," consumer demand for greener IT and communications is growing, and will soon force the global IT industry to take environmental concerns seriously.’ Producers must think holistically about their products’ lifecycles as the onus has shifted from the consumer to the company to be more responsible for their products. Enforcement of EPR is an increasing issue.

4. Overview What is eWaste? Electronic products used for DP, T/com or entertainment in households and businesses that are now obsolete, broken, or irreparable (Wikipedia) Key issue is the disposal of e-waste in landfill Three kinds of waste – Historical, Current and Future eWaste is a source for secondary raw materials Who’s Responsible: Vendors think holistically about their product lifecycles Governments try to shift responsibility from consumer to vendor AIIA position is responsibility shared by all involved in product lifecycle. Consumers, producers and governments have a role to play in the process. Need to handle collection, recycling and disposal that is equitable for vendors, consumers and environment. AIIA “Go Green” dialogue - ICT is a green enabler to reduce carbon footprint and solve environmental issues.

5. Overview Market Trends –Consumers purchasing more laptops and smaller portable printers –EU standards (WEEE and ROHS) for environment becoming pervasive –Companies focusing on designing products for the environment –Convergence - integration of computers and other electronic devices –Approximately 40 million tonnes of eWaste generated worldwide each year –Greenpeace claim that it is more likely to be 50 million tonnes –2006 the EU generated approximately 8.5 million tonnes of eWaste –2006 EU collected only 0.5 tonnes of energy-intensive precious metals (Source: Step - http://www.step-initiative.org/http://www.step-initiative.org/ –Increased competition: cheaper goods, tighter margins –Not just cost shift exercise

6. Overview Australia Specific –Federated Model – 9 jurisdictions (Federal, States & Territories) constitutionally empowered jurisdiction over the environment –30 million PC’s since 1980’s – presume 80% in landfill (Meinhardt Report) If this correct then $150m liability for industry to take back If not correct impost much greater –OEM Branded vs “White Box 60/40 split –Meets environmental objectives at lowest cost for industry and consumers –Simple solution for consumers/end user –Educate all stakeholders (consumers, industry and government)

7. AIIA Role Major OEMs are members –40 to 45% of total market in sales for PCs and printers/MFPs Special Interest Group Take the lead to collect EOL IT equipment* for environmentally responsible disposal and recycling (offering the community an alternative to landfill) Reinforce benefits of Governments adopting a streamlined national scheme –Model underpinned by concept of ‘Shared Responsibility’ including: industry, consumers and government (all stakeholders are involved in the chain of responsibility). –Generate solution-oriented dialogue between government and industry –Develop national ‘staged approach’ –Co-regulatory approach, no “free riders” –Capitalise on existing public infrastructure (simple and lower cost) Recognition and reward for brand leadership

8. Each manufacturer responsible for own products User pays (included in cost) Jointly address the issue of historic waste Registration at point of import (narrowest point and addresses everybody) Scaleable for national coverage, can co-exist with other take-back schemes Establish PRO Proposed Industry Scheme

9. Policy Framework ElementsOutcomesOperation Shared responsibilityFair distribution of costCosts covered by either registered importer or brand owner Legislation, including IPRLevel playing field, allow IPRCompliance on Importers, brand owners (OEM & WB) and retailers (safety net) Legislation EnforcementCompliance enforcementNo product to be sold without (importer or manufacturer) being registered. Participation IncentivesProcurement recognition Legal requirement Scheme compliance triggers eligibility for government procurement preference Open Market Economies of scale Competition based framework Lowest costAny brand owner or importer can opt to operate own take-back program in accordance with NEPM.

10. Product imported to Australia Product 1)Collected and taken to recycling / consolidation point 2)Allocated to the different schemes National registry Importer and manufacturer register with the national registry Receive a registration number Financial guarantee and take-back scheme are prerequisite for the registration Product flow Product manufactured in Australia Importer / manufacturer registered Importer / manufacturer not registered Product cannot be placed into the market until registration done Collection Once EOL product returned to designated collection point by the consumer Importer / manufacturer registered Product can be placed into the market Product sold to consumer PRO 1Individual companyPRO 2 Recycler 1)Recycles the products according to agreed standard 2)Invoices the manufacturer / importer or the PRO based on the waste arising data Product flow

11. Fee for registration Recycling costs form part of cost of sale of new product Financial flow Registered Brands Cost allocated based on actual waste arisings White box, orphan and non- registered brands Cost allocated to importers in proportion to their import market share Financial guarantee to prevent future orphan product issues National Registry Product sold to consumer Registered manufacturerRegistered Importer EOL product collected and allocated to individual manufacturer / PROs for recycling Financial flow Product flow

12. Go Green - Questions Equitable participation for all industry Shared responsibility framework Trial to test model for participation Develop sustainable solution based on participants Find sustainable funding solution Show net environmental benefits