28. Waste Collection as a Service with Joel Tasche from Cleanhub

The economics of waste collection

This is the Pristine Ocean podcast. I’m your host, Peter Hall. In the podcast we talked to people about tackling the problem of marine plastic litter. 

Today we’re talking to a German waste processing professional is also a surfer and ocean evangelist. He is an entrepreneur who believes in the power of technology to create solutions to environmental challenges. 

Joel Tasche from Cleanhub wants to disrupt an industry where the margins are already razor thin. 

In locations of high plastic pollution, his company finances local contractors to collect non recyclable materials that would otherwise land in the environment. 

To pay for these operation, he works with consumer brands who want to offset their plastic footprint. 

The story starts in Lake Constance, in the southwest of Germany, where Joel grew up. 

The fisherman bear complained of too few fish. 

The water is so clean the fish have little to feed on. 

You get the picture: very, very clean. Growing up in an environment like this, it leaves a mark on a person. 

When Joel moved away to study, he ended up spending a lot of time in the water surfing. 

After that he worked for a while at a start-up, gaining the entrepreneurs mindset. But then he hit a bump in the road. A quarter life crisis as he calls it. 

After a surf trip to Portugal, I was hit by quarter life crisis. 

You work your job and everything is perfect around you, but you still have that feeling that you’re not fulfilling your your your true calling or your purpose. And so I sat down and wrote down a couple of things that really mattered to me and. 

It became clear to me that I would like to work something ocean related surrounded by great people. 

I think that’s that’s what drives happiness. Pretty quickly, I ended up in the topic of the Circular Economy and plastic pollution.

Because you know, as a surfer, you literally get in touch with the problem a lot. 

I love travelling and spent a lot of time in South and Southeast Asia and you’re always confronted with the problem. 

And having that startup background, I started to think OK: is there a scalable solution that truly has an impact on this entire topic? And if yes, what can that be? And this is when my entire research started.

I started to schedule it in conferences, on  waste management in general, in my calendar and I just started to attend those conferences and start to talk to experts and did that in all shades of green.

After when I also saw the other side because I went to the European Lobby event of the waste energy industry in Brussels, which kind of reflects a completely different picture of where we stand today in regards of circular economy because this is where still the majority of our waste ends up right in in some incineration process because we don’t live in a circular economy today. 

You’re a startup guy wanting to disrupt the waste industry. 

Were people willing to talk to you? Were they open? 

They were extremely open to talks. These are all family run businesses, mostly in Germany and they invited me to the office and they spent hours and hours explaining me the in’s and outs of the industry because nobody truly cares about waste management from the startup industry. I have the feeling and they are open for innovation, right? They they do want to talk. 

So you were looking at the waste industry with a startup mindset, right? What were you focused on?What were you? What were you looking for? 

One thing that I really wanted to understand is: what are the economics behind the recycling or waste management company? 

Where is money coming from? Where’s money going? How do they make money? What’s the business model really? Of a recycling company? 

These waste handlers, they are the people who collect the household waste, separate it and get money for that, is that very profitable? 

Yes and no. It depends on which material stream you focus on, right? There’s there’s multiple steps in the German waste management system until you get to a point where you can really resell something and there’s different revenue streams. 

That was the biggest learning I had from this entire research. 

You need to really differentiate between recyclables and non-recyclables. 

Recyclables is a commodity right? PET plastic. 

This is recyclable. Everybody wants to have that. You can turn it into yarn container into new model. This is a commodity that’s traded as commodity. 

The other thing is if I collect non-recyclables, this is more of a service, right? Because there’s no buyer for that material, But I’m cleaning something. 

And and you know if if you have someone who’s cleaning your apartment, you’re also paying them by the kilograms of dust that they collect. 

You pay them for the service. When we talk about waste management a you can resell certain materials. 

As a commodity, the other thing is more of a service. 

Where you collect something that really nobody wants to have anymore. 

That is a really big idea. Recyclables are commodity cleaning up. Non recyclables need to be treated as a service. 

Now Germany has a clean image, but it’s probably doing a lot of things wrong. What, in your opinion, does Germany do right? 

In Germany we have something called extended producer responsibility. That means every single company that puts packaging material into the shelves of the supermarket needs to pay a licencing fee for their packaging and with this fee we are paying the waste management industry to collect also the non recyclable stuff right? 

And that was an extremely important thing to understand for me, because you know, everybody knows in Germany knows the green dot. Someone paid for the disposal of the packaging in the end before it was actually disposed of. And there is an extremely crucial instrument of financing that needs to be understood if we want to understand how we can solve plastic waste globally. 

A quick note for listeners outside Germany. In Germany all consumer packaging, with some exceptions, have a green dot. This represents a small fee that the consumer pays at the point of sale. 

This fee then goes into a fund to finance the end of life of that packaging. 

So what happened then? 

And it was around at. 

That point in time when we realised, OK, we can’t really solve the problem here in Germany, because you know, if you look at pollution as a problem, not not circularity, but in a first degree pollution. Pollution occurs, but it’s not really in Europe. 

You know we are sending our waste abroad. No discussions around it. We have things that we need to improve in our own waste management industry, but if it’s really about solving pollution in the first step, making sure that less plastic enters the environment, we need to go where the big leakage happens. And to us the worst in South and Southeast Asia. 

And we boarded a plane again to to India to kind of repeat the entire research that we did in Europe and compare the systems that we know from from Germany to what’s going on in India and she Lanka and Indonesia. 

What did you find out?

When it comes to circular economy that Germany is way behind India.

They by far don’t produce as much waste as we do. That’s awesome, because obviously GDP is lower. 

Reusing is deeply ingrained in the entire culture. You can go on bazaars in India where you can buy anything from an old tired too. 

I don’t know whatever that he can buy as a as a reused thing. These streets go on for 800 metres so they can buy all transmissions and whatever. 

Also, because you know they they don’t live in such an abundance as we do. 

And recycling is then also very important because you know, if you have a. If you have a household income of I don’t know $150 a month. 

You don’t throw anything away that still has value. People will form and collect whatever can be resold again, and what you see in India is that you have a big informal sector that is roaming the streets and. 

Collects everything that has value from. 

Paper, cardboard things that we also recycle right, but also a lot of plastic and they only collect rigid plastics like shampoo bottles, water bottles. 

So for those that are better or worse with the materials HDPPT, all the stuff that is easy to recycle, right and. 

At the same time you see a lot of plastic on the streets, but what you see on the streets is flexible packaging. This multilayer packaging multi layers like chips bags where you have plastic and metal mixed. 

And this stuff is left behind. 

So once you had this realisation, your entrepreneur mind was was turning over what? What ideas were coming up. 

Then we will just ask those people if they would collect this non recyclable material, if you would pay them for it. 

And obviously everybody said yes, right? It’s like great. We can add a new new product to to our business of collectors. 

So let’s say and this material is everywhere and I can very easily collected. However, we had the problem. 

You know now we pay you for it, but we can’t sell that material either because it has no value, so it’s in by itself. Horrible business model. So we started to look for outlets for the waste we we started to see.  

Waste and this is again the big difference between. 

Germany and for example India because we have the infrastructure to deal with the non recyclable waste right? We have waste to energy plans now. We could have discussions at length if waste to energy is good technology or not. 

Can you just say a sentence about what you mean by waste to energy? 

It means that the waste is being burned, incinerated. 

And obviously this process can be done in in a horrible way yet in a proper way where we’re working with filters where we’re making sure that the emissions are are in place. 

Be so I’m hearing that the incineration of the non recyclables is a pragmatic solution from your point of view. 

Yeah, everybody knows, reduce, reuse, recycle and that’s the three “r”s that everybody knows. But there’s more, there’s recover, and that means energy recovery. 

There’s a bit of an alarm bell going off my head when I hear you’re going to pay the people who are the informal waste collectors to collect the non recyclables that for them has otherwise no value. 

I suppose there are two objections there. One is that, would that be sustainable? And the second one? 

Would be is this some European coming and just you know showering money on us? 

It’s extremely good questions and our take on it is we’re not paying the informal sector directly, and so we’re not going to individuals and say like here’s money: please collect waste for us, and that’s not what we do because a it would be exactly as you said. Kind of unsustainable this because it can also never scale. 

Sure that they’re doing the right disposal. I mean, you’re sitting here in Europe there 7 hours playing right away. How do you? How do you do that? 

And this is where software comes in because one thing there was very obvious to us is that we need transparency and there’s something that we wanted to change. 

So, we developed technology that allows them all our partners to completely. 

I can trace them the waste from collection two final recovery with our yeah disposal partners so everyone in the entire disposal chains, let’s say, is working on the same platform that needs to upload proof of work. So we’re getting digital evidence that the waste was collected. 

OK, great so that is that is being verified on on the collection right up to I think to incineration, yeah. 

OK, but yeah you have to pay for all this so, so what’s the what’s the business model behind this? 

Yeah, exactly so. As you say we we have to pay for all this, so we we’re paying the company that collects we’re paying for sorting because we don’t want to have recyclables and the streams that go into incineration. 

We’re paying for transportation and we’re paying for disposal. We’re not getting disposed for free, right? 

And that means that you have a horrible business model. 

This is where we work with some companies that want to become better companies for the planet, right? And what we say to them is like look. 

We understand that we live in a society that relies heavily on plastic, and if you don’t want to go out of business, you need to play the game to a certain degree. 

OK, so these brands have themselves our business model. What’s in it for them? 

Funny enough, when whenever we tried to quantify the return on investment for brands. They they reacted a bit uninterested because a lot of brands really do it because they say we want to do something like we want to use the power as a brand to do something good for the planet, right? 

There’s many, many dimensions to the problem, from education, to infrastructure, to awareness, and all those things. What is your number one focus in in India? 

Our number one focus is to connect as many people to doorstep waste collection service as possible. We want to move away from this thinking. 

That was Joel Tasche from Cleanhub. 

If you’d like to know more about Cleanhub, check out the show notes. 

That’s it for this week. Thanks for listening to the Pristine Ocean podcast. The podcast that speaks to people about projects around the world, tackling the scourge of marine plastic litter. 

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