Buying Electronics Can Pollute Our Future

By Hongqiao Liu 15 December, 2016

Hongqiao Liu wants you to think twice before buying that new electronic device with high pollution costs for China

How does your wallet survive Taobao’s Global Shopping Day and Black Friday? What about Cyber Monday on Amazon?
Jack Ma claimed that on Singles’ Day – an artificial festival on November 11th in China – the Alibaba Group generated RMB120.7 billion (USD 17.8 billion) of Gross Merchandise Volume (GMV) within 24 hours. Household appliances and smart phones topped sales with 20.4% and 12.1% respectively, adding up to a third of the total GMV. Given this we decided to take a look at what the tremendous promotion for electronics in the Chinese market means for the environment, current business model flaws and of course, implications to “Beautiful China”.

Rare Earths, the “vitamins of industry”, are hardly recycled from Waste Electrical and Electronic Equipment (WEEE)

From wind turbines to rechargeable batteries to smart phones to LCD screens, rare earths are widely embedded in household appliances and smart personal devices. Despite being a critical and strategic resource, hardly any rare earths in such applications are recycled. It’s important to note that there are no substitutes for some of these elements. Globally, UNEP documented less than a 1% recycle rate for rare earths overall; a majority of which is contributed by Light Rare Earths (LREEs) recycled from energy saving lighting bulbs instead of more scarce Heavy Rare Earths (HREEs) used in high-value-add electronic products like smart phones.
Let’s not forget, as we showed in our Rare Earth Report earlier this year, China being the dominant supplier of rare earths in the last two decades has suffered great resource depletion. The country’s State Council claimed that China’s HREEs deposits could only run another 15 years. Moreover, from the EU Commission to the U.S. Department of Energy, leading government institutions have all predicted a global short-supply of rare earths, particularly HREEs, for both the short and long term. But how come no actions are being taken to facilitate recycling? Or, are we confident that we can get enough rare earths from Greenland or the deep sea?

China is the dominant supplier of rare earths but deposits will run out in 15 years…
…global recycling rates are <1%

It’s not just rare earths in WEEE we should be concerned about but also many critical raw materials 

Worryingly, rare earths are not the only critical raw materials that companies/brands need to handle carefully, there are so many more like Antimony, Cobalt, Niobium and the list goes on. In 2014, the EU Critical Raw Material Initiative identified 20 most critical raw materials to clean development and their major supply countries.

China is also the main supplier of other critical raw materials for electronics
e.g. 86% of magnesium

 While the U.S., Russia, South Africa, DRC and Brazil add up to 41% of global supply, China alone is responsible for 49% of the most critical raw materials. The amount varies depending on the material, like 69% of natural graphite, a key component of high-efficiency rechargeable batteries. Tungsten, also known as one of the conflict minerals sometimes from the Congo Basin (widely used in lighting, radiation shielding and military), turns out to be mostly sourced from China with 85% of the market share (see table below).
 

Recycling, regeneration & reuse rates of critical WEEE raw materials are unknown

As you can see from the table above, the list goes on; 87% of Antimony, 86% of Magnesium, 69% of Gallium and Magnesite and over half of Silicon Metal and Fluorspar are produced in China – all have significant applications in household appliances, smart phones and clean productions like efficient lighting, high-performance magnets, CPUs and more; basically key solutions towards our clean and smart future. How many of these critical raw materials in WEEE are recycled, regenerated and reused? We hardly know, as data on this is very limited.

Clean products, but not a clean supply chain

What we do know is that the supply chain of these critical raw materials in China is not as clean as their applications.

Cleaning up rare earth pollution in Ganzhou to cost RMB38 bn…
…millions of villager’s water sources have been polluted

Rare earth mining in China has been an issue for the government for years. Scientists have warned that millions of tonnes of radioactive slurry lying in Baotou city of Inner Mongolia (also known as the “Capital of Rare Earths” which supplied over half of global LREEs in the last two decades) could be a “time bomb” for Yellow River. In Ganzhou city of Jiangxi province – “the Kingdom of Rare Earths” – environmental pollution and degradation may cost the country RMB38 billion (~USD 5.6 billion) to clean-up, with millions of villagers’ drinking water sources polluted. Then there is the sizeable black market filled with more pollution, corruption and environmental crimes.
Recent Washington Post coverage featured air and water pollution caused by natural graphite mining in northeast China, whist major end-users including Apple, General Motors, LG, Samsung and Toyota, turned a blind-eye to the pollution years after their promises on preventing pollution on the supply chain globally.
Our earlier report has found out that major river basins in China, including the three largest rivers – the Yangtze, the Yellow and the Pearl – are under exposure of water pollution relating to rare earth mining, separation and processing. What will the picture look like if we overlap all the other critical raw materials that are “dug-in-China”?

Built-In-Obsolescence must go, as must excessive consumption 

The Built-In-Obsolescence business aspect of the fast growing ICT sector has created an emerging market for the recycling industry in China. Traditionally, only recycling of big household applications like washing machines and television sets were regulated as WEEE by Chinese authorities; but the trend today is focusing on much smaller and more valuable applications like smart phones.

Regulations for WEEE in China is increasing…
…but issues remain, incl. the 8mn tonnes of e-waste smuggled into China/year

Just a year ago, the National Reform and Development Council with the Ministry of Finance, Ministry of Industry and Information Technology, General Administration of Customs and State Administration of Taxation, renewed the “Directory of Waste Electrical and Electronic Equipment (WEEE) Treatment (2014)”. Additional products were added including mobile phones, telephones, copy machines and six more categories of WEEE.
In 2015, 76.25 million WEEE devices were disassembled, with year-on-year growth of 8.2%, according to MEP’s annual report on “Environmental Pollution Prevention and Control in Large and Middle-Sized Cities on Solid Waste”. However, we do not know how much of the 76.25 million are smartphones. Additionally, as very limited brands carry out “Producer Extended Responsibility (PER)”, it’s hard to trace how many older smartphones are recycled and to what extent, and then whether done so in China or shipped to India or other countries that are deeply troubled with illegal WEEE imports. Let’s not forget – each year about 8 million tonnes of e-waste, valued at USD3 billion, is smuggled in to China, accounting for around 80% of the illicit market in East Asia, according to UNODC. Most of them find their way to small-scale illegal disassemble workshops in villages, polluting water, air, soil with toxic chemicals.
Everyone has a role to play. Let’s face it – you may stick with your old-fashioned washing machine for another five years, but for your iPhone 7s or Samsung Galaxy s8, my best bet is it will only run another two years at most before you replace it with the newest model – bigger screens, brighter colors and faster CPUs, all you need to play cool with. But do we need that many functions? Have you considered the environmental impacts of your abandoned phones? What about their packaging? Are you comfortable with the fact that to produce the rare earths in your smartphone, villagers have to drink from polluted water and the disassembling of your old phone may contribute to child cancer in Guiyu or Bombay? Think twice for your next shopping day.

Further Reading

• Dear Santa, Less Stuff Please – This Christmas China Water Risk’s Dawn McGregor draws attention to the trails of waste left by our gifts, made worse with low-recycling rates & increasing e-commerce orders. She wants less stuff but that doesn’t mean no presents
• 5 Years On – Have We Made A Difference? – As China Water Risk turns five years old, Debra Tan reflects on its journey & milestones. Have we made a difference? What next for the coming five years?
• Water In: Beer, Crisps & Chocolate – Food & drink help create a festive atmosphere in Christmas but how much water do they use? China Water Risk’s Woody Chan looks into the water footprints of beer, chocolate & crisps, the impact on China & potential solutions
• Playing With Trees At Christmas – Trees can play a key role in protecting water.  With this is mind China Water Risk’s Hubert Thieriot tests out a new ‘toy’, the World Resources Institutue’s Global Forest Watch map, on China. See what he finds

• Can We Build A Clean & Smart Future On Toxic Rare Earths? – Almost all smart, green & clean tech need rare earths to work, but mining & processing these are highly polluting. Lead author Liu of China Water Risk’s new report:  “Rare Earths: Shades Of Grey” explores this paradox. It is time to rethink our clean & smart future
• Rare Earth Black Market: An Open Dirty Secret – The black market exacerbates environmental pollution from rare earth mining in China. With low prices, depleted reserves and contaminated drinking water, find out if your smartphone, tablet or electric car is party to this. Hongqiao Liu expands
• E-Waste: Downside to the Tech Revolution – China is one of the largest producers of e-waste globally. Faced with mountains of toxic e-waste, Green Initiatives launched the [WE] Project in Shanghai. Co-founder, Nitin Dani on this easy, safe & scalable way to recycle phones, home appliances & more
• Yangtze Flows: Pollution & Heavy Metals – Areas along the Yangtze River dominate Chinese production but at what cost? With Grade V+ water in its tributaries, rapid growth in upstream wastewater plus concerns over a disproportionately large share of the nation’s heavy metals discharge, can the Yangtze River Economic Belt still flourish? CWR’s Hu takes a closer look