When China banned the import of 24 types of solid waste last year, the action disrupted $5.6 billion in exports from the U.S. The ban also jumpstarted innovation in the U.S. waste management industry.
Stan Chen launched RecycleGo, a Blockchain startup, last year to provide Uber-like service to haulers. It helps waste managers reduce costs by optimizing routes and dispatch schedules for haulers. At the same time, all recycling activities are recorded on the company’s public, immutable ledger, providing verification of recycling. RecycleGo was built on the premise that customers concerned about the environment will be more likely to sign up when solid proof of recycling exists.
RecycleGo aims to decrease the pain of the Chinese policy, which also lowered the contamination threshold to 0.5%. As a result, China’s plastic waste imports were reduced by 99%, leading to garbage piling up in the U.S. Some municipalities reduced or even eliminated recycling programs because of the rising costs – now the least-recyclable plastic products are being sent to landfills.
“A lot of materials are going to landfill right now because there is no processing capacity that can handle the volume that the U.S. is generating,” Chen told Karma in an interview, adding that some national waste-management companies don’t have an incentive to recycle. They can profit from the increased demand for landfills as that’s part of their integrated business.
RecycleGo is seeking seed money now, CEO Chen said. He created RecycleGo after his family’s 22-year-old recycling company, United Metal, in New Jersey was denied permission to ship U.S. recyclables to a facility in Guangzhou, China.
New Jersey is home to another company trying to stem the impact of China’s policy. TerraCycle in May launched a reusable shopping delivery system called Loop. Customers can have goods delivered in reusable containers by UPS. When the goods are used up, the containers get picked up for free and replenished. Consumers can buy goods such as ice cream, shampoo and spices from brands including P&G, Unilever, PepsiCo, Mondelez International, Nestlé, and Danone.
TerraCycle scored $25 million in series A funding in 2018.
“I hope that (Loop) can get some traction and success,” said Chen, adding that he has signed up for the Loop program. “I think we are at the beginning of a very large fundamental shift in consumer behavior.”