APSRG calls for government to boost remanufacturing

Caroline Spelman MP introducing the APSRG report earlier today

The All-Party Parliamentary Sustainable Resource Group (APSRG) is calling on government to boost remanufacturing practices after finding that the UK is ‘failing to capitalise on huge potential economic and environmental advantages presented by improved remanufacturing standards and practices’.

The calls come in a new independent report published by APSRG today (26 March) following a three-month inquiry chaired by former Environment Secretary Caroline Spelman MP (pictured above).

Officially launched at an event at the House of Commons this morning, the ‘Remanufacturing: Towards a Resource Efficient Economy’ report calls on government to take ‘urgent steps’ to improve UK remanufacturing, including the adoption of an agreed definition, the setting of key criteria for analysing remanufacturing potential across different UK industries, and the establishment of a government fund to explore currently under-remanufactured industries.

It further calls for the removal of key regulatory barriers preventing remanufacturing uptake, including amendments to its guidance on the legal definition of waste, to distinguish a product that is due to be remanufactured as being exempt from those products considered as waste.

Speaking ahead of the launch, Spelman said: “The renaissance of British manufacturing has created an outstanding opportunity for remanufacturing in the UK. But the full potential has not yet nearly been realised. The government must act now to ensure the UK does not lag further behind in the rapidly growing global remanufacturing industry.

“This report lays out clear guidelines for how government can put remanufacturing firmly on a growth trajectory... We urge the government to do more to exploit the huge economic and environmental potential that remanufacturing presents.”

Report details

APSRG highlights the economic benefits of increasing remanufacturing, pointing to a 2010 report by environmental consultancy Oakdene Hollins, in which the value of remanufacturing in the UK was estimated to be £2.4 billion, and a 2013 report by Next Manufacturing Revolution, which estimated that remanufacturing could see an extra £5 billion of profits created, alongside 300,000 new jobs.

Aside from the economic potential of increasing remanufacturing, the report also touches on the environmental savings remanufacturing can realise.

It reads: ‘Complementing the economic and employment opportunities [are] the environmental benefits related to remanufacturing. Remanufacturing typically uses 85 per cent less energy than manufacturing. Studies conducted  at the Fraunhofer Institute in Stuttgart, Germany have estimated that the energy savings by remanufacturing worldwide [equal] the electricity generated by five nuclear power plants… [It also estimated] that raw materials saved by remanufacturing worldwide each year could fill 155,000 railroad cars forming a train 1,100 miles long.’

However, the report identifies that ‘the opportunity still exists for the UK to make more of its remanufacturing potential’.

APSRG found that barriers to remanufacturing include:

• the lack of a commonly accepted global definition of remanufacturing;
• the fact that design briefs ‘do not always allow for innovative design for remanufacture’;
• poor communication between different supply chain companies;
• little legislative clarification as to whether a product at the end of its life, but before it is remanufactured, is classified as ‘waste’;
• few opportunities for consumers to bring end-of-life products to the remanufacturer; and
• the relatively high costs of training a new or existing workforce in remanufacturing.

The group also identifies that remanufacturing would not necessarily benefit all products, as for ‘fast-moving consumer goods where fashion is highly relevant and technology moves quickly’, it may be better to ‘encourage other strategies such as recycling or reuse’.

It outlines that the products that lend themselves ‘more naturally to remanufacturing’ usually have:

• a high value;
• high durability;
• technology and trends/fashions that ‘do not change quickly’;
• the ability to be easily disassembled; and
• the opportunity to be leased or delivered as a service instead of hardware.

APSRG also identifies that there are ‘many examples of areas that fit these criteria but are as yet unexplored’, for example wind turbines.

Recommendations

The report recommends that government take the following actions to boost remanufacturing:

• adopt a definition of remanufacturing to provide clarity to business on what it deems as remanufacturing versus other aspects of the circular economy (such as refurbishment and reuse); 
• consider implementing a tax break for remanufacturers;
• consider the potential of a certified mark for remanufacturing to demonstrate that products have been tested and fully comply with those standards of a new product;
• adopt whole life costing to incentivise the purchase of remanufactured goods;
• identify areas where the UK has the best potential to explore remanufacturing and develop a fund to optimise the development of remanufacturing in these areas;
• amend its guidance on the legal definition of waste to distinguish a product that is due to be remanufactured as being exempt from those products considered as waste;
• amend the Freedom of Information Act to include the requirement that a designer is compelled to state, upon request from a manufacturer or remanufacturer, the components of a product to enable easier remanufacturing; and
• set up a centre of excellence – linked to a ‘leading UK university’ – to identify products that have the ‘most potential’ for remanufacturing in the UK (for example engines) and ‘stimulate greater knowledge transfer and understanding about the practical application and potential of remanufacturing in the UK’; and
• establish a cross-departmental committee, led by BIS and supported by Defra, to ensure there is ‘a cross-departmental collaboration when considering those policy areas where remanufacturing plays a key role’.

The report concludes: ‘[B]arriers need to be overcome if remanufacturing is to become a more dominant part of UK manufacturing. Leadership is vital to achieve this. A number of regulatory impediments must be addressed on a cross-departmental basis, whilst improving consumer confidence.

‘Finally, incentives are needed to encourage those smaller businesses that cannot rely initially on a ‘leap of faith’ approach and better education is needed through the creation of a new centre of excellence for UK remanufacturing.

‘Considered and tackled together, the issues outlined in this paper could provide the UK with the opportunity to make the most out of its remanufacturing potential and become a world leader in this field.’

Speaking at the event at Portcullis House in Westminster this morning, Spelman said: "Getting a legal definition of remanufacturing on a global level is key to boosting confidence. We need to help the public understand what remanufacturing is, and we need to help identify that remanufacturing is not about handling waste products, but products with value."

Laura Sandys MP, added that "we have to see remanufacturing not as second-hand goods, but as innovative goods", and suggested that Defra introduce 'light/lite licenses' (such as those currently offered by Ofgem) for those collecting materials/products for remanufacture, to ease the financial and regulatory burden of having to apply for a waste carrier license (as is required currently).

Read the ‘Remanufacturing: Towards a Resource Efficient Economy’ report.