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Innovation, AI and the Tech Driving Changes in Recycling

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During a December 10 virtual event, “How AI and Robotics are Transforming Recycling,” industry experts provided insight into how rapidly-evolving technologies are helping companies transform into more sustainable businesses.

Speakers included Monique Oxender, chief sustainability officer, Keurig Dr. Pepper; Matanya Horowitz, founder & CEO, AMP Robotics; Michael Delucia, principal, Sidewalk Infrastructure Partners; and Brent Hildebrand, vice president, Recycling U.S. Operations, GFL Environmental – led by John Davies, vice president & senior analyst of GreenBiz Group.

Here is a look at the key topics covered and what the presenters had to say.

On the Drivers of Innovation…

Monique Oxender:  A big driver for us is the consumer. Consumers want responsible, environmentally friendly products and packaging, and they want it to be easy. And they want real solutions. In the case of recycling, that means accessible infrastructure that's going to collect and effectively sort of recycle. And when you look at what the consumers are asking, and how we internalize that as a company, it translates into company commitments like our commitment, transition to a recyclable format for the coffee pods. And that commitment has really driven innovation both up and down our supply chain, which results in a product design that is more sustainable.

But design isn't enough. We need to expand to a value chain perspective and look to both levels of partnership and investment that are going to fully deliver on that innovation. And I think a perfect example, [as a company] we've invested about $30 million in infrastructure improvements since 2014. A trend that we've seen in these investments and partnerships over time, is moving from general improve- the-system goals, to more specific material-focused efforts, like the Every Bottle Back initiative.

Brent Hildebrand: The driver of innovation has a lot of variables to it. It's just a little different from the processing side. One of the drivers would be rising costs on all fronts to operate these facilities. And part of those rising cost is rising labor costs. Then, on top of that, it's just finding labor for these sites. So, that's a that's a pretty massive draw to the innovation side for us when we partnered with AMP for the very first robot in North America at our Denver site. And it was really fun to watch that transition with Matanya’s group and how they grew and made robotics a true alternative.

Manufacturers have done a better job of using materials better. So, that changes the dynamics for what we can produce from a volume standpoint. Aluminum has been a similar situation. Cans over the years have gotten [thinner]. That evolving ton is another driver of innovation - trying to utilize artificial intelligence, to understand the stream better on the inbound and outbound side. If we understand that inbound side better than that helps us make decisions for equipment that we put in our system.

On Technology Adoption…

Matanya Horowitz: The recycling industry is constantly going through this change around the material stream. New materials are being introduced different macro changes, whether it's coded and labor supply, and things like that. And all of these create different challenges to really the fundamental operation of a recycling facility.

What's fortunate is the recycling industry has been looking for ways to sort of innovate their way out of these problems. And we tend to look at kind of two main influences. One is technology is moving very quickly. In artificial intelligence and robotics, we see a lot of this, whether it's in facial recognition or autonomous cars and things like that, but also in material science and in a lot of other domains. As a technology company, we look at many of these different trends and try to find ways to help solve meaningful problems in the recycling industry using these tools and hopefully come up with a couple of our own. When it comes to sort of how we're going to deploy this technology, we're really focused on where we can create the most value in the industry and a lot of that comes down to unlocking the value that's present in the material stream.

With artificial intelligence, you sort of have this core capability that you can then take advantage of in different ways. Sorting with robots is one of them. But another one is the ability to have precise control and a precise sense of what's going on. So, what you tend to find in the industry is more specific – if you can control the sort of chemistry of the commodities that you're producing, the more value they have. What we see ourselves doing with robots and artificial intelligence is sort of unlocking that value. So, producing higher-purity material streams.

On Investing Strategies…

Michael Delucia: In trying to promote a more circular economy, what we have noticed is that there are some great companies like GFL who are doing a great job in the areas in which they're located. And they're expanding, but there's a lot of MRFs and reclaimers out there that do not have enough access to capital in order to run their facilities super efficiently, in order to be able to buy as many robots as they'd like to, in order to get the benefits that we're talking about. So, there's a real challenge to get additional capital into the sector.

I think a lot of the benefits that this new technology brings is the ability to generate data for the first time that can then subsequently be used to provide better underwriting quality to folks that do want to invest and even for the facilities themselves that want to be able to improve their own operations. They'll have better data points to understand the value that can be created. Because I think, for any investor, on the one hand, we're trying to understand on some level, predictable basis, what things like our return on our investment and our payback period are going to be when we look at opportunities in the circular economy.

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