Analysis of the EPA’s New Solid Waste Recycling Exclusion

The Environmental Protection Agency (“EPA”) recently issued a final rule that revises the definition of "solid waste," as regulated under the Resource Conservation and Recovery Act (“RCRA”). The final rule, which becomes effective on December 6, 2008, codifies an exclusion from RCRA's “cradle to grave” hazardous waste regulatory framework for "recycled" hazardous waste.

Under RCRA, EPA has promulgated a series of stringent rules governing the treatment, storage, and disposal of hazardous wastes. Compliance is time-consuming and expensive, and the ability to recycle materials rather than follow the detailed disposal regulations can be a boon to many commercial manufacturers and mineral processors. The new rule excludes from the definition of "solid waste" certain secondary materials – hazardous, toxic, or waste byproducts under RCRA, such as sludges, spent materials, and other listed wastes – that are “legitimately reclaimed,” under the control of the generator, within the United States. Once finalized, it will be a significant means of clarifying EPA’s stance on the recycling of materials that might otherwise be classified as hazardous wastes.

One of the most important terms within the RCRA regulatory framework is the definition of solid waste. Any materials that are construed as solid waste may further be classified as hazardous wastes, and then subject to the stringent controls, monitoring, and management requirements imposed by EPA's RCRA regulations. The statute, however, does not define “solid waste” to embrace recycling; it states (in part) that solid waste means “any garbage, refuse, sludge from a waste treatment plant, water supply treatment plant, or air pollution control facility and other discarded materials, including solid, liquid, semisolid, or contained gaseous material resulting from industrial, commercial, mining and agricultural operations….” 42 USC § 6903(27) (emphasis added). The new recycling rule will remove from the regulatory definition of solid waste materials that might otherwise meet the requirements for being classified as solid waste, on the basis that they are not being discarded -- thereby removing them from the scope of RCRA requirements.

Specifically, subject to some categorical exceptions, the new rule delineates the requirements for certain secondary materials to qualify for RCRA’s recycling exclusion. For example, the material must provide a useful contribution to the recycling process or product, and the recycling process must produce a valuable product or intermediate material. The recycling should take place in a continuous industrial process or create a finished result in which the recycled materials are indistinguishable from the product. These requirements are being put in place to prevent “sham recycling.” Among the eligible materials that may be excluded on this basis are spent sulfuric acid; closed loop recycling materials; coke byproduct wastes; recovered oil from petroleum refining operations; scrap metal; circuit boards; and certain mineral processing materials.

The new rule sets forth many administrative requirements for excluding a material as recycled. First, a waste generator and potential recycler must send an initial notification of its intent to recycle to an EPA district office (and update that notification every other year). Second, the recycled material must be stored in a non-land based facility such as a tank or other contained storage unit. (Any surface impoundments or piles of the material on the land will disqualify it from the recycling exclusion.) Third, the operator or generator attempting to qualify materials as recycled must also abide by the other steps in the newly-created formal administrative review process, by which the agency determines qualified recyclers in advance, based on applications submitted to an EPA district office.

In the preamble to the final rule, EPA noted that the motivation behind the rule is to “encourage safe, environmentally sound recycling and resource conservation,” one of the main aims of the statute and the agency itself. More specifically, the rule constitutes a response to several different interpretations of “solid waste” found in decisions issued by the Court of Appeals for the District of Columbia Circuit, and stems from a recognition of the need to legitimize the waste recycling concept. In addition to creating the concept of "legitimate recycling" under the RCRA solid waste framework, EPA believes that its new definition of “solid waste” is consistent with the D.C. Circuit Court’s plain language interpretation of the term “discard;” if discarding means "disposing, abandoning, or throwing away,” then the rule’s attempt to clarify the term “recycling” as involving a material that is "meaningfully reused" seems perfectly reasonable.

This rule and its interpretation should assist many operators, manufacturers, and processors in myriad industries to cost-effectively and efficiently recycle hazardous materials. While the rule does not include materials that are inherently waste-like as being a part of the recycling exclusion , mining and related industries may certainly benefit from this rule. Many processes that would otherwise be subject to the burdens of RCRA coverage because of the unclear definitions of “solid waste” and “disposal” may now more clearly fit under the recycling exclusion, including those that produce mineral processing spent materials and coking byproducts.