Lessons for the Circular Economy
What goes around, comes around goes the saying. So, one might argue that aluminum cans must enjoy exceptionally good karma. Just in the United States, consumers recycle over 46% of all the aluminum cans after having quaffed their contents. As a result, about 75% of all aluminum ever refined still remains circulation.
In the 1950s, most beer in the US was sold directly to consumers in tin cans or glass bottles. And the Coors Brewing Company was a relatively small, regional beer producer based in a sparsely populated part of the country. Facing the lengthening distribution routes that lay on the brewery’s path to growth, Bill Coors set out to develop a lighter package in a bid to lower shipping costs.
In 1957, Coors had achieved his primary goal. The new, two-piece aluminum can weighed a third of the old tin cans.
There were more advantages: Combining a more malleable yet still strong material with the technology of impact extrusion, the whole cup could be made from a single piece of metal, removing the need for seams that had a tendency to rust, leak, and give the can’s contents a metallic taste. Furthermore, the surface was easier to paint on, opening up new opportunities for on-package branding, which Coors successfully exploited.
Recyclable, by design
A chemical element, aluminum can be infinitely recycled without a loss in quality.
However, at the time, the prevailing attitude among bottlers was overwhelmingly not to take responsibility for discarded cans, with some so-called experts going as far as to say that recycling was contrary to human nature, with predictable consequences for the environment: Littering was rampant.
In the face of industry opposition, Coors pioneered the Cash for Cans recycling program, paying one cent per returned container.
For Coors, the economic rationale for switching from glass and tin to aluminum cans was waterproof. The new material made the cans lighter and thinner, allowing for lower transportation and cooling costs. But the new can’s cost advantage extended beyond just its first use. Manufacturing a can from recycled aluminum required 95% less energy than from virgin material.
Aluminum cans are not only cheaper to transport, they are also cheaper to recycle. This created a viable market for scrapped cans as they were still a valuable resource. And on the back of that valuable resource, Coors had created a viable, fully circular economy.
Becoming the industry standard
Despite the initial resistance it faced in the industry, the aluminum can would soon become the industry standard. The material’s surface allowed for better print-work, resulting in more attractive packaging. It was also sturdier, and did not impart a metallic taste to its contents. Consumers flocked to it.
In addition, the cash for cans program was a success, and consumers embraced recycling, further strengthening the new can’s cost advantage.
Consumers had made their choice, and the aluminum beverage can quickly displaced its tin counterpart, dispatching it into obsolescence.
In 2020, consumer’s recycling rate of aluminum cans in the US landed at 46.1%. This contributed to an overall 73% of recycled content in the production of new cans.
The economics of recycling aluminum cans are currently so viable, that at present, a ton of used cans fetches $1,210, versus the same weight in glass bottles (-$21), or PET ($237).
Lessons for today’s Circular Economy
Before the introduction of the aluminum can, environmentally concerned voices worried about the increase in tin cans littering the landscape. Nowadays, you seldom hear concerns about the environmental impact of aluminum cans. As Bill Coors remarked, no news is good news.
Here are some takeaways from this successful implementation of a Circular Economy:
- Recyclability by design
The choice of material, and the design of distribution and recovery processes had recyclability in mind at the very start of the product’s concept.
- Consumer value of the product
The switch to aluminum as the industry’s standard packaging for beverages took place because consumers chose the superior product. It was a more attractive package that did not impart a metallic taste as tin cans did, and was not as fragile, and protected its contents from light better than glass.
- Value of the material
The value of the scrap material needs to be high enough to sustain the economics of its collection and recycling. This is underpinned by two factors:
First, aluminum can recycling is a true closed-loop economy. Unlike the case of, for example, plastic bottles, as these need to be down-cycled into progressively less valuable products, such carpets or garbage bags, which only delays their fate ending up in landfills. So, it retains its value better.
Second, this value has been further enhanced by investments made in the industrial capacity to economically recycle the discarded cans.
- Creation of a market for recycled material
The intrinsic, or residual value of cans allowed Coors to create a market for the discarded cans, which strongly incentivized consumers to recycle. To this date, aluminum can recycling schemes are among the most successful exemplars of closed-loop production lifecycles.
- Circularity ≠ Higher Cost
In 1959, much of the initial opposition to the introduction of aluminum cans was cost-based. The industry had made significant investments in tin can production lines, and was loath to incur the additional cost of collecting and recycling old cans. But thanks to Bill Coors, we now know that circularity does not necessarily translate into higher costs, but on the contrary, may be a source of not only cost advantage, but of also a superior end product.
It is often said that the most successful technologies become invisible to the society that uses them. As a result, we may be taking the humble aluminum beverage can for granted.
Daunted by the enormity of the environmental challenges ahead, many of us may have been paralyzed into inaction by skepticism about the difference one person or firm can make. History may not repeat itself, but it rhymes. Perhaps we should take a closer look at how the vision of one man, and investments by one firm, changed the practices of whole industries for the better.
Read the original article in Medium.