3 Business plan for the disposal of used tires by pyrolysis

3 Business plan for the disposal of used tires by pyrolysis

The Balance Small Business

Steps To Start a Tire Shredding Business

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Steps To Start a Tire Shredding Business

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Lars Forsstedt, Getty Images


Tazz Haque
Updated August 31, 2017

For waste management authorities and landfills, worn out tires are among one of the most problematic and largest sources of waste. But tire recycling offers a number of profitable business opportunities as rubber can be reused in different ways.

A Growing Opportunity

For too long, old tires were stockpiled. According to the U.S. Tire Manufacturers Association (USTMA) https://www.ustires.org/scrap-tire-markets, only 11 percent of old tires were “consumed in beneficial end-use markets” in 1990. By 2015, end-use markets consumed 87.9 percent of scrap tire generation.

If you are thinking about what opportunities are available for processed opportunities, USTMA has identified the top end-use markets for scrap tire rubber as follows:

Tire-Derived Fuel (TDF). TDF generates more heat than a similar weight of coal. As such, TDF provides an attractive and cleaner alternative to coal for use in cement kilns, pulp and paper mills, and electric utility boilers. In 2015 the TDF market consumed 117 million scrap tires, over 48 percent of the annual U.S. scrap tire generation.

Ground Rubber Applications: Ground rubber is produced by grinding scrap tires into small pieces of varying sizes. Popular applications include rubber mats, landscaping mulch, rubber products and mats, and rubber-modified asphalt. Ground rubber made use of 62 million scrap tires in 2015, over 25 percent of scrap tire generation.

Civil Engineering: Shredded tires are becoming more popular as a substitute for sand or clay in landfill and road construction, landfill cover, septic tank fields and many construction jobs. Civil engineering applications made use of 17 million of tires in 2015, around 7.7 percent of the total.

Other Markets: Other scrap tire opportunities include powering electric arc furnaces, professionally engineered tire bales, and products punched, stamped or pressed from scrap tires. These activities account for about another 7 percent of production.

To read the complete U.S. Scrap Tire Management Summary, click here .

Major Steps in Starting the Business

1. Find Sources and Markets for Your Output

As a first step in exploring the opportunity to start a tire shredding business, you first need to identify local opportunities to source old tires, and for customers to purchase your processed scrap. It pays to “follow the old tires” in order to understand what happens to them. Are they being regularly picked up? Where do they go? Check out the ongoing scrap tire businesses in your area. If you see tire accumulations, are there unfulfilled needs for old tire removal, or customers interested in purchasing the processed material?

2. Identify Potential Site Locations

The optimal site location depends on several variables. Some of them are predicated on minimizing freight costs related to bringing in scrap tires and shipping out processed material. And while tire source and markets are of critical importance, it goes without saying that other business location factors must be considered such as zoning and permits, environmental considerations, adequate space for storage, unloading and loading, as well as road access.

3. Prepare a Complete Business Plan

Not preparing a complete business plan can create problems after starting your business. So, try finding similar businesses, or talking to entrepreneurs or tire recycling equipment vendors, know what it takes to start a shredding business and prepare a complete business plan. You may be able to find tire recycling business plans online for free , or available for purchase. Another prudent step might be to first seek work in the tire recycling industry to gain a better understanding, if your timeline permits, or perhaps creating at first a smaller, related business such as an old tire hauling service.

Depending on the desired size of your business, you will have to buy dumpers, conveyors and other material handling equipment. Prepare for a minimum investment in equipment of at least $100,000.

4. Start Shopping For Tire Shredding Solutions

Once you have a complete business plan, including a financial strategy, you are ready to set up shop in terms of renting a property, if necessary, as well as acquiring the machinery necessary for a tire recycling business. As you already inquired for prices need equipment at the time of preparing your business plan, you have some confidence as you go about the business of acquiring machinery.

5. Setup Business and Hire Employees

When you have bought and installed your equipment, you can start operation of your business.  Hire an adequate number of employees to collect, transport, clean and shred old, worn out tires and for conversion into a saleable material.​

Final Word

In the steps above I have outlined in a very simple fashion the rudimentary steps necessary to embark on a tire recycling business. Of course, there are numerous challenges and financial risks involved in any entrepreneurial venture of this nature, and anyone considering such a venture should undertake thorough due diligence. To explore the opportunity in more detail during your business plan development, consider attending the Scrap Tire Research and Education Foundation’s Scrap to Profit Conference  or subscribe to industry publications such as the Scrap Tire News .

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3 Business plan for the disposal of used tires by pyrolysis

Limited liability company "Investment company" EnergoTechnoPark”
409, Shevchenko, Cherkassy, 18006, Ukraine

Summary. .........................................................................................................

The project involves the construction of a pilot project in Ukraine on recycling used tires, rubber and

1. The situation in Ukraine.
Road Transport annually becoming cheaper and more accessible, so the problem of disposal of...

Also Presidential Decree № 31/2010 «The solution of the National Security and Defense on January 15,
2010" On State Regu...

Contact tires with rainfall and groundwater leaching followed by a number of toxic organic compounds.
During the combust...

2. Existing technologies of recycling of used tires.
Existing international and domestic experience shows that the most ...

To render the additive in paving or asphalt mastic, need to make the formulation. Two equal-sized wheels,
but different ...

Pyrolysis gas, usually (unless specific tasks) is used as fuel for a partial coating on the heat consumption
of the pyr...

3. Description of the technology of low-temperature pyrolysis.
The very idea of a low-temperature pyrolysis of used tir...

Boot Process The reactor is as follows. The used tires are crushed at the beginning and fed to a buffer
tank. From the ...

The pyrolysis process and obtain a final product are shown in the scheme below.

The project plants for the treatment of used tires, rubber and plastic waste with a capacity of 10,000 tons
per year.

Industrial plant with a capacity of 10,000 tons per year.

4. Energy efficiency.
The energy intensity of the pyrolysis technology is high enough. Effective process for pyrolysis ...

Convert low-grade heat into electrical energy by using ORC modules are currently commercially available.
For combustion...

5.2. Characteristics of the fuel gas.
The second most important product of pyrolysis. Combustible gas (methane and etha...

25%. Therefore, the process resulting in a combustible gas used to the maximum for production purposes,
and in case of ...

6. Marketing Plan.
For successful implementation of this project is necessary to solve two problems. Firstly, it is nec...

6.2. Sale of finished products.
As can be seen from the diagram, the main income of the company receives from the sale ...

Sale of carbon black and steel cord for a total of less than 5% of the total income of the enterprise. With
the sale of...

7. The financial plan (financial model).
The financial model was developed for a comprehensive study of the project and...




The above analysis leads to the following conclusions:
Firstly, this project is very relevant in the curre...




Possible Risks and Obstacles
Every industrial project includes risks, which can be depended on external issues or compa...

possibility to act
Time/scheduling  Can we get enough
raw material in time
 Can we get the
machinery in time
 Is thi...

5 High risk – probability for this risk is remarkable and/or the result of the realized risk is fatal
for the project. ...

Can we afford to
keep products in
The stock capacity is planned to keep one
month production in stock, capacity ...

Do we have the
Management at the moment is the one who
will work out the plan. Key per...

process and that is why it has to be started in
the beginning of the process. Laboratory
analyses from existing plants ...

than ours products are “green” recycled.
What is the public
opinion about
storing the tyres?
This issue h...

aid…All these factors support project now.
Are we delivering
end products in
Our production is process type, so t...

use other raw materials, like plastics.
Can we use other
raw materials?
Yes, technology is suitable and tested for

Are there any
legal issues
limiting use of
No, on the contrary. It is possible to gain tax
discount ...

information and training in order to run the pyrolysis plant. However, the importance of recruiting the best
possible m...

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3 Business plan for the disposal of used tires by pyrolysis

  1. 1.
    Limited liability company "Investment company" EnergoTechnoPark”
    409, Shevchenko, Cherkassy, 18006, Ukraine
    Registration number of the Project: 059-12
    Registration Date: 7.9.2012
    Type of Project: Other long-term partnership, Pilot project related to Finnish environmental
    Project Country: Ukraine
    Business partnership entity in the Project Country ("Partnership Entity"): Peatec Oy
    Description of the Project: The project objective is to establish a pyrolysis plant in Ukraine

  2. 2.

    Summary. ……………………………………………………………………………………………………………………………………4
    1. The situation in Ukraine………………………………………………………………………………………………………..5
    2. Existing technologies of recycling of used tires………………………………………………………………………..8
    2.1. Restoration of worn tires. ……………………………………………………………………………………………….8
    2.2. Burial of used tires. ………………………………………………………………………………………………………..8
    2.3. Recycling tires into crumb……………………………………………………………………………………………….8
    2.4. Incineration of tires in cement kilns………………………………………………………………………………….9
    2.5. Pyrolysis of scrap tires…………………………………………………………………………………………………….9
    3. Description of the technology of low-temperature pyrolysis…………………………………………………….11
    4. Energy efficiency. ………………………………………………………………………………………………………………..16
    5. The final products. ………………………………………………………………………………………………………………17
    5.1. Characteristics of heating oil………………………………………………………………………………………………17
    5.2. Characteristics of the fuel gas. ……………………………………………………………………………………………18
    5.3. Characteristics of carbon black. ………………………………………………………………………………………….19
    5.4. Features metal courts. ………………………………………………………………………………………………………19
    6. Marketing Plan. ………………………………………………………………………………………………………………………20
    6.1. Organizing the collection of used tires…………………………………………………………………………………20
    6.2. Sale of finished products……………………………………………………………………………………………………21
    7. The financial plan (financial model)………………………………………………………………………………………….23
    Possible Risks and Obstacles ………………………………………………………………………………………………….31

  3. 3.

    The project involves the construction of a pilot project in Ukraine on recycling used tires, rubber and
    plastic waste by low-temperature pyrolysis. The final products of this technology are: fuel oil, fuel gas,
    carbon and metal. All these products are sufficiently in demand in Ukraine, especially the first two.
    This technology was developed by the Finnish company Peatec Oy, which is a leader in this field. The
    company has already built Peatec Oy in Finland, a pilot project on the basis of a paper mill UPM's
    Tervasaari. Trial operation of the pilot plant to prove the viability of this technology and its effectiveness.
    Peatec Oy company has designed several factories for processing of used tires capacity of 5, 10 and 20
    thousand tons per year.
    The purpose of this business plan is to analyze the application of this technology in Ukraine and the
    development of a pilot project.
    The analysis of the situation in Ukraine, especially in light of recent events, suggests that this technology
    is very relevant and cost-effective for Ukraine. Construction of the pilot plant will at least partially solve
    two big problems in Ukraine: Dispose of waste that pollute the environment, and to provide themselves
    with alternative heating oil, which is extremely important now for Ukraine.
    Created specifically for this project financial model demonstrates the economic efficiency of the project.
    A relatively large investment in this project, even in the worst case, fully repaid within 3 years and in the
    future profitability of the plant exceeds 50%. This is undoubtedly a very good result. Construction of the
    pilot project will not only teach the profits from his work, but also to optimize the technology to expand
    the resource base and on the basis of the experience gained to replicate data plants throughout Ukraine.

  4. 4.

    1. The situation in Ukraine.
    Road Transport annually becoming cheaper and more accessible, so the problem of disposal of used
    tires is growing every day. Landfills overflowing with mountains of waste rubber, which, as a rule, do not
    pass the necessary processing, and thrown into the garbage or landfills, which leads to the formation of
    environmental problems. The most critical situation is typical for Kiev and other major cities in Ukraine,
    where the tire recycling requires huge capacity.
    Worn tires are large-capacity products consisting of polymeric materials, which are not amenable to
    biological decomposition process in nature, even after lying in the ground for a long time. The most
    objective way of getting rid of waste rubber tires is recycling, and store huge mountains of this kind of
    waste – is not an option, as the tires are a threat to the environment. Bus at ignition isolated life-
    threatening carcinogens – biphenyl and benzo (a) pyrene, not to mention other chemical compounds
    anthracene, fluorentan, pyrene. It is noteworthy that the European Council of 02.04.1999, adopted a
    directive "On the dumps" on which in 2003 banned the burning of tires.
    Therefore, recycling of tires – the right solution for caring for the environment. It should also be noted
    that they are made from petroleum, a limited natural resource, and its economy should use the services
    for the processing of tires.
    According to expert estimates in Ukraine in the past five years, the market of tires was 6.4 million. Units
    / year, resulting annually produce more than 180 thousand. Tons of waste. At existing facilities utilized
    only about 14 thousand. Tonnes of used tires, which is less than 10% of the needs. In Ukraine, the non-
    existent power, using the latest technology of recycling used tires. However, in recent years the state
    bodies of Ukraine adopted several decisions aimed at solving this problem.
    Resolution of the Verkhovna Rada of Ukraine on October 6, 2005 № 2967 "On the state of
    implementation of legislation in the field of waste management in Ukraine and ways to improve it"
    determined that the consequences of poor governance, imperfect legal framework in the field of waste
    management is, in particular, the lack of effective control of waste streams and imperfect forms of
    statistical reporting, making it impossible to obtain reliable information on the volume of education,
    waste management, the state of the internal market of secondary resources and complicates make
    informed decisions on regulation of the market.

  5. 5.

    Also Presidential Decree № 31/2010 «The solution of the National Security and Defense on January 15,
    2010" On State Regulation in the field of waste management "determined that the consequences of
    poor governance is the presence in Ukraine, a number of problems and negative trends in this area
    namely does not provide full collection, the maximum utilization, timely neutralization and disposal, are
    not implemented environmentally friendly methods and tools for dealing with them, because of what
    increases the risk of waste, growing technological and environmental risks, the slow pace of the
    infrastructure of waste management .
    An important issue in the field of waste management as a secondary raw material is the imperfection of
    market mechanisms of the system of collection, preparation and disposal of such waste, in particular,
    used tires, the improvement of this system will prevent pollution of the environment and bring this
    waste in repeated economic turnover.
    Adoption of the proposed draft order the Ministry of Environment "On establishing the minimum
    monthly payment for services for organizing the collection, harvesting and recycling of used tires" will
    enhance the effectiveness of the current system of handling worn tires. The purpose of the order is the
    adoption of minimum monthly service fees for the organization of the collection, harvesting and
    recycling of used tires, which will create the necessary preconditions for the implementation of the
    requirements of the Cabinet of Ministers of Ukraine dated July 27, 2011 № 1136 "Some of the
    collection, harvesting and recycling of used tires", which provides for the creation in Ukraine of the
    collection, harvesting and recycling of used tires, as well as ensuring the implementation of appropriate
    control by specially authorized bodies of executive power to meet the requirements of current
    legislation by enterprises, institutions and organizations of all forms of ownership, individual
    businessmen, including business entities that manufacture or import tires and tire use in its operations,
    which resulted in the formation of the worn tires on codes of product categories 4011, 4012, 4013
    (including all sub-categories) according UKTVED, activities associated with the collection, preparation
    and disposal of used tires and / or the use of waste as secondary material and / or energy resources, are
    the owners of used tires.
    This order will create the infrastructure system for collecting, harvesting and recycling of used tires,
    which will build a new, capital-intensive, fully automated installation using the best available technology
    that will ensure compliance with the most stringent requirements of environmental and sanitary-
    epidemiological legislation.
    American and Swedish experts conducted a study which found that the tires – a rather dangerous part of
    the car: the dust arising due to wear rubber, can cause serious illness.
    By simple calculations Swedish researchers found that every day an ordinary citizen of Sweden breathes
    6 grams of rubber dust, and American – 13.
    As for Ukraine, then, according to preliminary estimates, this figure could reach up to 20 grams per
    person daily. Discarded in landfills or buried tires degrade in vivo for at least 100 years. Even if the tire is
    not in use, it allocates a certain amount of chemicals (all of them can have up to 100). The most harmful
    carcinogens are benzpyrene and other polyaromatic hydrocarbons, which are found in the tires up to 15
    connections. Also there are 4 tires from 12 species N-nitrosamines. All of these substances are included
    in the list of dangerous toxins that make up the International Organization for Research on Cancer and
    the United States Environmental Protection Agency.

  6. 6.

    Contact tires with rainfall and groundwater leaching followed by a number of toxic organic compounds.
    During the combustion of tires produced are chemical compounds that are getting in the air, becoming a
    source of danger to humans. In addition, depending on the conditions of combustion can be formed as a
    number of highly dangerous organic compounds: benzapiren (especially dangerous carcinogen)
    dibenzoantratsen (especially dangerous carcinogen). No coincidence that the European Council 2 April
    1999 adopted a special directive "On the dumps" on which since 2003 a ban on incineration.

  7. 7.

    2. Existing technologies of recycling of used tires.
    Existing international and domestic experience shows that the most common methods of disposal of tires
    are burning to produce energy (the most popular burning them in cement kilns), pyrolysis at relatively low
    temperatures to produce a light distillate, solid fuel with similar properties to charcoal, and metal and
    obtaining rubber crumbs and the powder used to replace the natural rubber and synthetic polymers in
    the manufacture of building materials and mixtures thereof.
    2.1. Restoration of worn tires.
    Restoring tires – is its overhaul in which updated or tire tread, in order to prolong the life of the tire.
    Recovery is environmentally friendly way in which can be increased tire life.
    The share of retreaded tires in different countries varies. Thus, eg., In the US recovery is not actually play
    any role in Japan recovers only every tenth of a tire in Germany – one in five in the Netherlands – one in
    Determinant for car owners of vehicles is primarily advantageous expense ratio and lifetime. However,
    from a technical point of view, no bus recovery can be repeated any number of times without affecting
    the quality and safety of operation (typically, the bus can be reduced as much as possible only twice). Each
    retreaded tire inevitably turns into a worn-out.
    Widespread doubts about the quality and safety of retreaded tires. For example, retreaded tires approved
    for use for vehicles having a certain speed limit.
    2.2. Burial of used tires.
    Worn tires legally or illegally stored on landfills mixed with other waste and landfills, designed exclusively
    for used tires. The number stored in the world of tires in landfills is estimated at a billion pieces. Lack
    alternatives tire recycling increases the number of tires stored in dumps. Against removal to the landfill
    of waste tires are economic, technical and environmental causes.
    Due to the mixed landfill disposal of used tires extracted from the economic turnover, and therefore can
    not be used for further processing. This way of using the tires can be equated to the destruction of
    Worn tires, because of their properties is the product not in principle suitable for burial. As previously
    mentioned, the tires cause great harm to the environment. In addition, the shape of the tire and specific
    weight due to cavitation (the formation of voids) do not allow a regulated landfill compaction.
    Lack of control over waste, arson, spontaneous combustion (eg., During a lightning strike) lead to the
    duration of the fire in landfills, which are due to good flammability (flammability) tires is difficult to
    extinguish. In 90 years this has led to devastating fires of tires in landfills in the United States and Canada,
    where only in Ontario during the month burned more than 12 million tires. Such fires due to the high level
    of emissions of gaseous and liquid substances lead to severe air pollution, topsoil, subsoil waters.
    2.3. Recycling tires into crumb.
    Shredding rubber waste recognized as the most simple and rational way of processing, as it allows to
    preserve physical, mechanical and chemical properties of the material. However, it is the final stage of
    the use of the resulting chips and a stumbling block cost-effective solution to the problem of complete
    recycling of rubber waste.

  8. 8.

    To render the additive in paving or asphalt mastic, need to make the formulation. Two equal-sized wheels,
    but different manufacturers, will in their composition heterogeneous mass in which you want to add
    components to impart the desired properties. It is known that for over a hundred years there have been
    numerous efforts to combine rubber with bitumen and asphalt with a view to recycling and giving
    astringent properties of rubber-like materials. Were developed many technological schemes of direct
    introduction of rubber in asphalt mixture, the use of crumb rubber as filler in road-building materials.
    Were built hundreds of experimental sections of roads, bridges and airfields coatings, which initially
    showed a wonderful performance. But then there was a slow swelling of the rubber particles trapped in
    the structure of asphalt. Coverage under such internal loads and decompresses rapidly destroyed.
    Unrelated rubber particles of asphalt and chip, practically unchanged, carried by the wind, contaminating
    the surrounding area.
    Thus, more than a century of negative experience with rubber waste in road construction compromised
    in the eyes of experts Road the idea of using rubber (vulcanized rubber) in road construction materials.
    To produce crumb of any product, you must purchase additional equipment that will bring to nothing the
    declared comparative cheapness. For such production requires grit with minimum dimensions that
    require the use of cryogenic grinding technology. In addition, the range of products that can be made
    from rubber crumb is limited. This coating for sports grounds, a pavement for tram and railway crossings,
    and so on.
    2.4. Incineration of tires in cement kilns.
    Tyre burning occurs primarily in the cement industry and thermal power plants. Tires are used here as a
    material substitute coal and fuel oil. Burning tires has a large number of historical reasons. For decades,
    the burning of tires is an inexpensive way to produce energy. At the same time had the opportunity to
    save primary fuels. Alternative ways to recycle tires available in the past, often been unprofitable.
    However, changing conditions, particularly in the field of environmental protection, awareness of the
    need for sound management of natural resources, as well as the creation of innovative technologies for
    recycling used tires, all this requires a new, critical approach to the method of processing.
    Some disadvantages of burning tires lies in the very nature of the method. Temperature fluctuations in
    the combustion process leading to incomplete combustion of the tire. At temperatures below 1.100 ° C
    produced toxins such as chlorinated dioxin and furan. All known and undeniable fact that such processes
    have contributed to increasing the greenhouse effect. So, is formed in the combustion process 3,700 kg
    of CO2 per tonne of tires. In the production of the cement quantity used tires as fuel technologically
    limited. Application in the production of a large number of old tires adversely affect the quality of cement,
    as contained in them began to show in the cement as iron oxide, which stains the material.
    2.5. Pyrolysis of scrap tires.
    When using the tire pyrolysis technology under the influence of heat in the absence of oxygen are
    separated into solid, liquid and gaseous substances. Wherein long polymer chains are converted into
    molecular hydrogen particle. Technology Basics concluded that shredded waste tires, and waste
    production and the consumption of polymeric materials (polyolefins, polystyrene, etc.) Are subjected to
    pyrolysis at 450-550 ° C. As a result of processing obtained by pyrolysis tire pyrolysis oil, combustible gas,
    carbon and steel.

  9. 9.

    Pyrolysis gas, usually (unless specific tasks) is used as fuel for a partial coating on the heat consumption
    of the pyrolysis process itself.
    Pyrolysis resins can be used as an additive to fuel oil, or may be processed together with the crude oil or
    its fractions, respectively, increasing the production of end products or intermediates.
    Solid carbonaceous pyrolysis residue in a tire suitable as a substitute for some of the carbon black in
    rubber mixtures, as well as a filler for a variety of commercial products, from Bakelite resins and mixtures
    ending paving.
    With a large variety of technological solutions proposed by both domestic and foreign experts, at this
    stage of the economic situation in Ukraine, the priority method of disposal of rubber waste should be
    technologies that provide:
     high environmental safety of the proposed process;
     extremely low energy consumption of the recycling process;
     waste-free process;
     receive output products of commercial value in terms of Ukraine.
    Satisfies all of the requirements of the processing technology of waste rubber tires and plastic waste by
    low-temperature pyrolysis without oxygen.

  10. 10.

    3. Description of the technology of low-temperature pyrolysis.
    The very idea of a low-temperature pyrolysis of used tires is not new and is widely used in the world.
    However, the Finnish company Peatec Oy managed to create an industrial design with optimum process
    parameters. In addition, the technology Peatec Oy ensures the most stringent requirements for
    cleanliness of emissions into the environment.
    Used tires are shredded and pre-fed to the reactor, where the feedstock is heated. Under the influence
    of the decomposition temperature of the starting material for liquid fuel (45-55%), a combustible gas
    (8%), metal cord (10-12%) and carbon black (25-35%). In addition, excess heat that is not less than 300
    Technological scheme of installation for waste tires and waste plastic includes:
     boiler to heat the reactor. During installation the boiler start running on auxiliary fuel, and after
    the pyrolysis process proceeds to use the boiler fuel gas, which is formed in the reactor.
     main reactor in which the pyrolysis process of the starting material.
     The condenser, which condenses the liquid fraction of the pyrolysis products.
     Filter and distiller of the liquid fraction of the pyrolysis products.
     Magnetic separator for separating the metal from the total weight of the solid fraction.
     Chopper and modifier for carbon black.
    The combustible gas which is formed during pyrolysis of the capacitor after purification fed to the boiler
    and burned for process heat. Excess heat can be used for heating of industrial buildings and nearby homes.
    In addition, excess heat may be used to generate electrical energy using ORC module.

  11. 11.

    Boot Process The reactor is as follows. The used tires are crushed at the beginning and fed to a buffer
    tank. From the original hopper chopped raw material by a screw conveyor is loaded into a pyrolysis

  12. 12.

    The pyrolysis process and obtain a final product are shown in the scheme below.

  13. 13.

    The project plants for the treatment of used tires, rubber and plastic waste with a capacity of 10,000 tons
    per year.

  14. 14.

    Industrial plant with a capacity of 10,000 tons per year.

  15. 15.

    4. Energy efficiency.
    The energy intensity of the pyrolysis technology is high enough. Effective process for pyrolysis of the
    starting material must be heated to a sufficiently high temperature and to maintain this temperature
    throughout the process. Then, in order to condense the vapors, they must be cooled below the
    condensation temperature of the liquid fraction. Evaporation and condensation of fluid require any large
    amount of energy as latent heat of vaporization of oil depending on the fraction of 200 to 500 kJ / kg.
    Therefore, at an output line for the liquid fraction of at least 1 ton per hour, the capacity of the capacitor
    is of the order of 200 kW. This power is dissipated as the cooling water of low temperature heat.
    Approximately the same amount of heat is removed with cooling of carbon black. All these low-grade heat
    can be recovered and used to produce electrical energy.
    The costs of electricity in this technology is also quite high. The total installed capacity of electrical
    equipment (crushers, pumps, conveyors, and so on) is not less than 400 kW.
    In the process of tire pyrolysis combustible gas is released. This gas with vapor of the liquid fraction fed
    into the boiler and burned. An exemplary flow of the gas is up to 35 kg / h. Consequently, the thermal
    capacity of the boiler is not less than 500 kW, and we have a surplus of thermal energy not less than 300

  16. 16.

    Convert low-grade heat into electrical energy by using ORC modules are currently commercially available.
    For combustion of 1 kg of gas take at least 10 m3 of air. The same quantity of combustion gases is
    discharged into the atmosphere at a temperature not lower than 350 ° C. These gases can be submitted
    at ORC module of TRI-O-GEN and get at least 300 kW of free electricity for their own needs.
    5. The final products.
    During the processing of 10,000 tons per year at the output we will have at least 4,500 tons of heating oil,
    3,500 tons of carbon, 1250 tons of metal courts, 750 tons of fuel gas (methane, ethane).
    5.1. Characteristics of heating oil.
    The main product, which is obtained by pyrolysis – a heating fuel. The product
    was installed in a laboratory SGS. According to the recommendations of the
    developer of technology, this product can be added to motor fuel or added to
    crude oil to its processing at the refinery. However, in the present
    circumstances of the energy crisis in Ukraine this product is suitable to use as
    a backup fuel boiler installations. According to the report laboratory SGS, the
    calorific value of the fuel is not less than 0.01 Gcal / kg. With the cost of thermal
    energy in Ukraine for at least 1000-1200 UAH / Gcal total annual income from burning 4,500 tons of
    heating oil will be at least $ 2.8 million. Extract from SGS report is listed below, and the full report is given
    in the appendix.

  17. 17.

    5.2. Characteristics of the fuel gas.
    The second most important product of pyrolysis. Combustible gas (methane and ethane), and a pair of
    liquid fuel boiling fractions which were not condensed in the cooler to the boiler and completely
    combusted. The resulting thermal energy is used for the following purposes:
     On the technological needs for heating the pyrolysis reactor;
     For the production of electrical energy by means of ORC module;
     For heating and hot water production building;
     For heating and hot water supply of nearby houses.
    All consumers above except the last can significantly reduce production costs. The latter will give the
    consumer a small (in terms of Ukraine) income. This is explained by the fact that in Ukraine tariffs for
    electricity and heat for businesses are quite high, and the population pays for the same energy of only

  18. 18.

    25%. Therefore, the process resulting in a combustible gas used to the maximum for production purposes,
    and in case of excess power this energy intensive to develop additional production. In this case it is
    possible to obtain the maximum economic benefit.
    5.3. Characteristics of carbon black.
    Carbon black, which has been obtained by pyrolysis may be used as a filler:
     in the production of new tires;
     producing paints (as a black dye);
     in the manufacture of building materials.
    In addition, this product can be used as for the production of
    activated carbon and subsequently used as filler in exhaust filters.
    5.4. Features metal courts.
    Steel cord and spikes separated in a magnetic separator after the end of the pyrolysis process. Used as
    scrap metal as a raw material for steel production. For its successful implementation within the enterprise
    must be provided briquette press steel cord.

  19. 19.

    6. Marketing Plan.
    For successful implementation of this project is necessary to solve two problems. Firstly, it is necessary to
    ensure a stable supply of raw materials to the plant. Secondly, the implementation must provide a stable
    starting product.
    6.1. Organizing the collection of used tires.
    Theoretically collecting used tires have no problems. As stated above in Ukraine has already accumulated
    more than 5 million scrap tires generated annually and has up to 200 thousand pieces. For this project,
    you must annually 10,000 tons or about 100 thousand pieces. However, all this stuff is scattered over a
    large area to collect it needs a certain system.
    The first category of suppliers of used tires – a road transport companies. With this second group no
    particular problems, since according to law they are required to take the used tires specialized companies
    for disposal at applicable rates. You only need to enter into a long-term contract of transport enterprises
    and periodically take used tires as they are formed. In this regard, a more optimal work closely with
    companies that are engaged in the supply of motor spare parts enterprises. As a rule, these enterprises
    are engaged and delivery of spare parts to customers. Therefore, bringing parts cars go empty back and
    can take used tires. For example, the Ukrainian company "AGroSoyuz" engaged in supply of agricultural
    enterprises and has offices in all major cities of Ukraine. Using their procurement network can organize
    the collection of used tires from all regions of Ukraine. In any case, with the majority of agricultural
    enterprises of Ukraine.
    The second category of suppliers of used tires – are companies who receive the tires. In most cases, such
    enterprises in Ukraine are not
    engaged in disposing of these tires,
    but simply warehoused them in their
    territory. These companies are happy
    to give their accumulated tires, but to
    pay for its disposal will not. In Ukraine,
    still enough abandoned areas on
    which to store the junk. Protect such
    landfills is also not necessary.
    Therefore, these companies should be
    considered as important suppliers of
    raw materials, but to pay for the disposal of them can not count. Moreover, the transportation to the
    disposal site they also will not pay.
    The most difficult category of suppliers of used tires – a private car owners. This category will take the
    tires only at presence of economic incentives. This is a small fee for surrendered tires or discount when
    you buy new tires. Other levers of influence on this category in Ukraine is not there. It is easier to throw
    the used tires at illegal dumps or just leave on the road. It should be noted that this category is very large
    and to work with them it is necessary. The easiest way in this plan to work through the point of sale of
    tires in the form of discounts on the purchase of new tires. This is of course an additional cost, but it will
    provide the company with raw materials.

  20. 20.

    6.2. Sale of finished products.
    As can be seen from the diagram, the main income of the company receives from the sale of heating oil.
    As already mentioned earlier, in Ukraine this product is best used as a backup fuel boiler installations,
    namely as furnace fuel. In this case, the minimum requirements for the quality of the product. In the
    context of Ukraine is simply unlimited market. Even if a barrel of oil will fall to $ 40 a fuel will be in demand.
    According to its characteristics, this heating oil in any case better fuel oil M-100, in all respects.
    Annual production of heating oil in this project is 4500. In terms of thermal energy it will be 45 thousand
    Gcal per year. For example, one of the regional hospital complex with a total area of 30,000 m2
    consumption per heating season 3000 Gcal. heat. Thus it will be enough fuel for heating only 15 hospital
    complexes in Ukraine. Another example is the amount of heating oil is comparable to the fuel needs of a
    small town municipal boiler (11 MW and 10 Gcal / h). Similar utility boilers in Ukraine more than 10
    In view of the foregoing, any problems with the implementation of heating oil in Ukraine is not there.
    Enough to sign long-term contracts with several municipal heating plants. For the price, too special there
    is no alternative. Natural gas costs the same as the calorific value below. Fuel oil costs the same. Wood
    pellets will cost considerably more expensive. And so on.

  21. 21.

    Sale of carbon black and steel cord for a total of less than 5% of the total income of the enterprise. With
    the sale of steel cord no problems. He will always be in demand. Since carbon black complex. Of course,
    as a filler for paints it is claimed, but in this regard, many other similar materials. Competition in this area
    is very large. In this regard, the project includes the development of technology for production of activated
    carbon, which can be used for the filter media. In this case, the product value increases.
    Payment for the disposal of used tires is more important, as is 11% of total revenue. Getting this payment
    is especially important in the first stage of the project. This is clearly seen in the financial plan. It was noted
    above that in the context of Ukraine to receive full payment for this is quite difficult. Two of the three
    categories of potential suppliers produce this payment will not. It is simply unrealistic and unlikely
    anything will change substantially in the near future.
    Exit need to look for an entirely different direction. This project is aimed at solving environmental
    problems of the country and region-specific. This makes it possible to receive certain benefits on payment
    of land for the construction of the plant, certain payments from the local budget to eliminate illegal
    dumping and so on. In addition, the legislation of Ukraine provides the ability to compensate fully or
    partially interest on the loan, which is used for environmental projects. In this direction need to work very
    In the most extreme case, the project is fully paid off through the sale of heating oil. Therefore, all other
    products are secondary. This does not mean that these products should not engage in reverse.
    However, at the first stage it is not so important.

  22. 22.

    7. The financial plan (financial model).
    The financial model was developed for a comprehensive study of the project and allows you to calculate
    a variety of configuration options, performance and financial stability with changes in market

  23. 23.


  24. 24.


  25. 25.


  26. 26.

    The above analysis leads to the following conclusions:
    Firstly, this project is very relevant in the current environment of Ukraine. Currently, due to problems
    with natural gas The Ukrainian government has decided to transfer heat boiler installations on reserve
    fuel – fuel oil and heating oil. Under these conditions, the receipt of this fuel from alternative sources is
    more than urgent. Of course, this project will not completely solve the problems of Ukraine in the fuel,
    but it is only a plus for this project. The small market share of this fuel – this is the maximum guarantee
    the absence of problems with product sales.
    Secondly, this is a big step in solving environmental problems in Ukraine in terms of waste disposal. In
    Ukraine, the share of waste does not exceed 5%, while in other European countries, the figure is 60-
    90%. Waste in Ukraine is still stored in landfills, causing huge damage to the environment. Currently,
    waste dumps employs more than 5% of the territory of Ukraine. Of course this project can not
    completely solve the environmental problem, but this is the first step that you can further develop and
    Third, the financial calculations are made for the worst case, when the project is drawn bank loan with
    a very high interest rate (25% per year) and in the absence of tax benefits. However, even in this case
    the project pays off in full within three years. For three years, the company fully repays the loan with
    all interest. In addition, the project remains stable even when the sales volume of more than 10%.
    Naturally, provided investments or soft loan project becomes even more attractive.

  27. 27.


  28. 28.


  29. 29.


  30. 30.

    Possible Risks and Obstacles
    Every industrial project includes risks, which can be depended on external issues or company’s abilities to
    manage or run the business. Before making investment decision, we have to point out all the known and
    foreseen risks and to eliminate as many of them as possible. Even if we make the preparative works well, some
    things will still remain uncertain or it’s hard to forecast them. After eliminating or deceasing possibilities of
    realization of risks, we will decide if we can live with the remaining risks or we consider them too dangerous to
    continue the project.
    1. List of Risks and Questions to be Analyzed
    Below listed items can be considered as potential risks. All of them have to be analysed and each risk should be
    minimized as well as possible taking other business aspects into account.
    Raw material Technical process End Products
     Is the Company
    capable to finance raw
    material flow
     Can we finance the
     Can we keep the
    Investment budget
     Can we bear possible
    delay or stop of the
    production process
     Can we afford to keep
    products in stock
    Technical  Is the quality of tyres
    good enough
     Does the technology
    and technical process
     Can we make end
    products good enough
    for market
    Human resources  Can we get
    professional labour
     Do we have the right
     Can we get salesmen
    for the products
    Health, Safety and
     What kind of
    restrictions there are
    for storing of old tyres
     What kind of
    restrictions there are
    for processing old tyres
     Permissions needed
     Restrictions
     Permissions
     Certificates
     Analyses
     Authority control
    Competitors  What if we cannot get
    tyres (raw material)
    due to competitors
     Can our competitors
    establish similar or
    better process
     Are there any other
    products similar or
    better than ours
    Public opinion  What is the public
    opinion about storing
    the tyres
     Any inconvenience to
    public due to our
    process – their
     Public opinion about
    our products

  31. 31.

    possibility to act
    Time/scheduling  Can we get enough
    raw material in time
     Can we get the
    machinery in time
     Is this the right time to
    establish the factory
     Are we delivering in
    Market (price/volume)  How stabile is the raw
    material price
     Can we get the price
    budgeted – how does
    the price effect to
     Is there market enough
    for our products
    Business growth  Is there enough raw
    material for growth
     Can we use other raw
     How easily we can
    increase capacity
     How easily we can
    establish new plants
     What is the volume of
     Is there a market for
    new products
    Legal aspects
     What if legislation
    concerning tyre
    recycling changes
     Are there any legal
    issues preventing tyre
    recycling process
     Are there any legal
    issues limiting use of
    recycled products
    Importance and level of each risk will be evaluated numerically and most of the attention will be paid to solve
    the most important issues. However, as written before, besides of the local business environment, also
    Peatec’s experiences for decreasing the risks are used in following analyses.
    2. Risk Analyses
    Next we have to analyse problems above – their probability and possible impact to success of investment. We
    estimate the probability of current risk in scale 0 to 5 as follows
    0 No risk at all – probability that this risk comes true is zero or it doesn’t effect to result of
    investment project at all
    1 Only theoretical risk – generally this could happen but probability is very, very low and
    possible effect to project is barely noticeable
    2 Slight risk – probability is very low and/or possible effect in case risk is realized is very limited
    3 Moderate risk – probability is low and/or effect to project is moderate. This risk realization
    will not cancel the project but effect to financial result or timing.
    4 Risk – this risk is reality and could come true and/or the effect of the realized risk is
    remarkable. Risk coming true will effect seriously to financial result, timing or status in
    market etc.

  32. 32.

    5 High risk – probability for this risk is remarkable and/or the result of the realized risk is fatal
    for the project. Risks evaluated in this level shall be carefully analysed and possible effects
    and counteracts estimated.
    Section Problem/risk Short Analyze, solution Level
    of Risk
    Is the company
    capable to finance
    raw material
    Peak Power should sign an Agreement for
    delivery of raw material to plant free of
    charge, say the raw material will not tie any
    funds at all. Agreement should be valid until
    end of 2016. Raw material can theoretically
    be problem only after that. However, this
    item has to be agreed with raw material
    Can the Company
    finance the
    Investment for the plant is approximately 13
    M€. It is essential that the whole financing is
    firmly agreed before investment decision.
    Certainly, lack of financing will stop the
    Can the company
    keep in
    Peatec has received binding offers for the
    similar machinery to be installed in Finland.
    The rental/purchase agreement for the
    building should be done using Peatec’s
    consultancy. The budgeted 13M€ is slightly
    over dimensioned and including the price of
    the building.
    Can we bear
    possible delays or
    standing time of
    Salaries are the biggest expense item in
    operative budget, representing about 30 % of
    the costs. If the plant is idling 6 months with
    full personnel the annual incomes are
    decreased 50 % but the production is
    profitable. If any standing time will be longer
    than 2 months, it is possible to dismiss
    temporarily workers until problem is solved
    and thus save in expenses.

  33. 33.

    Can we afford to
    keep products in
    The stock capacity is planned to keep one
    month production in stock, capacity is
    enough for that. According to preliminary
    agreements concerning sales of and products
    should be delivered weekly and invoiced
    monthly. Considering the EBIT >50 %
    company can bear stocking the goods a few
    months financially but company’s own stores
    are not enough
    Is the quality of
    tyres good
    Generally, there are no “unsuitable” tyres at
    all. All the tyres can be recycled, only some
    tyres give better results than the others.
    Average quality of tyres in Finland (and
    Europe generally) is very good for pyrolysis.
    The same machinery can use also plastics as
    a raw material.
    Does the
    technology and
    technical process
    work properly?
    We are using only tested technology which is
    already in use at Peatec’s premises. There are
    plenty of factories using similar technology
    from the suppliers we are using.
    Can we make end
    products good
    enough for the
    We have given end product laboratory
    analyses (done in independent laboratories
    like SGS) results to potential oil customers
    and they have accepted the product quality.
    However, signed preliminary sale
    agreements should be done before the
    investment decision. Carbon is the only end
    product which sales is still open. More
    detailed analysis is necessary in order to
    maximize the value of carbon.
    Can we get
    The availability of the labour depends on the
    situation of the plant. This issue has to be
    considered when deciding the location.

  34. 34.

    Do we have the
    Management at the moment is the one who
    will work out the plan. Key persons are
    experienced in business and international
    operations and they are dedicated to this
    business. This group also has very good
    experience of the technology. But this is
    important question and should be followed
    carefully and when necessary, professional
    local people shall be hired.
    Can we get
    salesmen for the
    Most of the products are will be sold
    according to preliminary agreements already
    before the investment decision. End products
    are commodity type and they have existing
    large market. According to strategy, Peak
    Power distributes its’ products through
    strategic partners.
    What kind of
    restrictions there
    are for storing of
    old tyres?
    Generally, there are no restrictions as long as
    they are properly stored and protected from
    fire. Peak Power has to organize storing and
    all the required permissions for that.
    What kind of
    restrictions there
    are for processing
    old tyres
    There are no restrictions as long as meets all
    the requirements set from authorities. We
    need to co-operate closely with
    Environmental authorities concerning
    emissions and type of production
    Process requires HSE certificate and
    permission. Most probably we will hire an
    external consult for taking care of
    permissions required. That is a time-taking

  35. 35.

    process and that is why it has to be started in
    the beginning of the process. Laboratory
    analyses from existing plants emissions
    (same type of machinery) will be submitted
    to controlling authorities and they will meet
    easily the limits set by officials. Time may be
    the critical factor.
    Authority control
    Peak Power will cooperate with professionals
    controlling quality, emissions and process.
    There are some certificates, like REACH-
    classification which are required. Peatec
    already has a lot of documentation about
    similar technology, which will be useful in
    the new plant.
    What if we cannot
    get tyres (raw
    material) due to
    A binding contract concerning delivery of
    tyres should be signed already in the
    preliminary stage. This is an important
    matter and therefore alternative suppliers will
    be named and the situation with them will be
    periodically checked.
    Can our
    establish similar
    or better process
    We will negotiate with machinery supplier
    about local exclusivity to use their
    machinery. Also, we should guarantee the
    exclusivity to use the raw material in our
    market area. After combining these two
    items, competitors may build similar plant
    using worse machinery but they don’t have
    the tyre raw material. Considering the sales
    of our product, there is enough market for all
    Are there any
    other products
    similar or better
    Products made of crude oil are corresponding
    to ours, but technically we are at the same
    level and pricewise we can sell even cheaper
    if necessary. A big advantage is that our

  36. 36.

    than ours products are “green” recycled.
    What is the public
    opinion about
    storing the tyres?
    This issue has to be discussed with
    representatives of local community. In case
    of necessity, walls can be built around stock.
    Tyres are stored in proper way in 24/7
    guarded area.
    inconvenience to
    public due to our
    process – their
    possibility to act?
    All the emissions will be in given limits,
    easily. We are prepared to filter possible
    smell also even though it is not chemically
    beyond permission limits. It is very
    important to act in open and informative way
    in order not to arouse any public suspect or
    resistance. Possible resistance may cause
    delays but cannot stop the process.
    Public opinion
    about our
    Open informing and marketing are key
    factors for creating and keeping a “green”
    image to our products. Ecology and recycling
    are the trends of today and that is for our
    Can we get
    enough raw
    material in time?
    Total production of used tyres in Ukraine is
    more 120 000 tons. We have to make long-
    term agreements with tyre recyclers. We
    have planned to build a store for 10 000 tons
    of tyres so that we have always tyres enough
    for process. Furthermore, in future it is
    possible to import from other countries.
    Can we get the
    machinery in
    Delivery time for the main components is 6
    months according to offer but we have
    considered 8 months in our main schedule.
    Is this the right
    time to establish
    the factory?
    All the factors are now on our side –
    technology is ready and developed, long term
    location problem with tyres, public opinion
    about recycling, state policy and financial

  37. 37.

    aid…All these factors support project now.
    Are we delivering
    end products in
    Our production is process type, so that it is
    possible to estimate rather accurately
    monthly production and agree upon
    deliveries accordingly. We also will have one
    month buffer stock at the plant to balance
    How stabile is the
    raw material price
    Our contract for tyre delivery should
    guarantee the stabile tyre price until year
    2016. After that the price shall be negotiated
    again. Import from other countries will be
    considered as well.
    Can we get the
    price budgeted for
    end products –
    how does the
    price effect to
    A separate study and analysis concerning this
    question has been carried out.
    Is there market
    enough for our
    All the 4 products produced are commodities
    having already a very large market. We will
    sign preliminary contract concerning sales.
    For starting the plant, at least 60% of the
    revenues should be secured by preliminary
    agreements. Especial attention will be paid to
    increase the value of carbon for suitable
    Is there enough
    raw material for
    Tyre raw material in Ukraine is enough to
    double the production. As the hand ling of
    old tyres is a problem in neighbouring
    countries as well, we don’t see a problem
    with raw material availability. Also we can

  38. 38.

    use other raw materials, like plastics.
    Can we use other
    raw materials?
    Yes, technology is suitable and tested for
    other raw material as well, like plastics and
    other organic scrap.
    How easily we
    can increase
    There is no technical, legal or management
    excuse preventing increase of capacity, only
    question existing question is financing.
    What is the
    volume of market
    for end products?
    End products we produce are standard
    commodities having a huge market already
    in Central Europe. Certainly, products are
    coming into competed market, but they are
    very competitive compared to traditional
    Is there a market
    for new products?
    Peatec is investing to R&D and development
    in order to increase quality of products and
    develop new ones. Especially carbon based
    (new) upgraded products should have market
    – with higher prices. We will follow Peatec’s
    innovations and realize them if it can provide
    even better profitability for us.
    What if
    concerning tyre
    Our way to turn ecologically problematic
    product into valuable materials provides
    negative carbon footprint. We expect
    legislation to be changed during next ten
    years but it will be changed into more
    ecological direction providing even better
    position for us.
    Are there any
    legal issues
    preventing tyre
    There are no laws or other legal matters
    preventing tyre recycling as long as
    environmental permission is correctly
    granted and observed. For us, old tyres are
    not waste but valuable raw material.

  39. 39.

    Are there any
    legal issues
    limiting use of
    No, on the contrary. It is possible to gain tax
    discount for products due to recycled raw
    material. Furthermore, public opinion is
    favouring recycling strongly.
    3. Findings of the Risk Analyse
    Based on the risk evaluation, we have found out three most important risks which are needed to analyse
    deeper. In the next chapters we analyse the risks related to financing, management and raw material
    3.1. Risks on Financing
    We are starting a new company without any remarkable funds or assets, so that both establishment of the
    business and business growth shall be financed by funds coming outside of the company. Company business
    will be on healthy basis and estimated profit (EBIT) is on very good level. This provides possibility to pay the
    external loans back in rather short time period. However, the investments to the technology are big and we
    have to use purchased components as a guarantee for the loans to be taken. The guarantee value is an
    essential factor when selecting a bank for the loan.
    Nevertheless, external funding is required in the beginning when the plant will be established. Finding a
    competent partner(s) being able to fund the company is essential. Considering business nature and profitability
    it should be possible – company will give a very good return for invested money in rather short time.
    3.2. Management Risks
    Generally, any company is as good as its’ management. In case of new plant to be established this is very true,
    since company is new, technology is new for the local management, customers are new – everything is new.
    This means that all the procedures, documents, systems etc. shall be established from scratch. Considering that
    at the same time production process shall be founded, task waiting for management is huge.
    The management role will be shifted to the new company during the first months of operation. According to
    our contract with Peatec, during preliminary and constructive phase of the project, we will receive all needed

  40. 40.

    information and training in order to run the pyrolysis plant. However, the importance of recruiting the best
    possible management cannot be overestimated.
    Our main supplier’s, Peatec, management team is experienced in pyrolysis technology and certainly, most of
    people in charge have experience in running own business. Peatec knows where it is committing. Team
    members have also international business background and their capability to communicate in several
    languages makes it easier to make and maintain international contacts which are extremely important
    considering the technical development and business growth.
    At the moment, the management team is a combination of long experience and young enthusiasm – most
    members have technical education, which is good for technical process and production. Also the management
    team members have good experience and great results about green energy investment projects.
    The management team will be modified according to the forecasted needs. In the very beginning we are
    pointing out the experience about financing, successful investment projects and knowledge about reliability of
    pyrolysis technology. Later on, the management will be more in the operational side dealing every day with
    customers, personnel, suppliers, authorities etc.
    3.3. Raw Material Availability Risk
    Even there are a lot of old tyres reaching the end of their life every year; we still have to consider this as one of
    the most crucial issue when planning investment to the new plant. The plant cannot operate without raw
    material and that is why this issue has to be solved already before the investment decision. This very important
    risk is relatively easy to minimize by contacting the recycling companies and making agreement on the tyre
    deliveries. Also, we will have a back-up plan to guarantee the availability in case of severe problems with the
    selected supplier. Due to the high margin of our business, in case of necessity we can pay for the tyres, even
    more than other old tyre consumers.
    Also, raw material availability and the logistic chains from other countries will be analysed and if needed,
    utilised during the operation of the plant.


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  1. Recycling Today
  2. August 2011

Tire Recycling Basics

Features – Sorting Equipment Focus

An equipment supplier offers his advice for getting started in the tire recycling business.


August 15, 2011
Rusty Angel

The United States generates approximately 300 million scrap tires per year. Through government interaction and entrepreneurial initiative, tire recycling has become a big business. From TDF (tire-derived fuel) to playground cover to landscaping mulch to asphalt additives, the uses for recycled tires are growing.

Points to Consider
Developing a business plan for recycling tires involves many aspects that can easily be overlooked, such as:

  • The number of tires you can gain access to within a 200-mile radius;
  • The type of tires you can access—passenger tires, light truck tires or both;
  • The amount you can charge to collect the tires;
  • Finding customers who will purchase the shredded tires; and
  • The ultimate end market use—TDF, landscaping material, playground cover or engineering grade powders.

It is my experience that you need to have access to about 500,000 tires per year to begin working on a successful business model. Anything less than this will not justify the initial capital investment required.

The next thing you need is a customer (preferably a large group of customers) that will purchase the ground rubber from you. The price you can get for ground rubber is a simple, relatively linear formula. The finer you grind the tires, the more money you can sell the material for. However, the finer you grind the tires, the more equipment you will require. You cannot, for example, make chips or crumb (1/4-inch minus down to 200 mesh) with a single shredder. In fact, getting down to 30 or 40 mesh typically involves as many as four steps in the shredding process.

Processing Pointers
Below, I provide a general overview on the process used to make TDF, wire-free chip and crumb rubber as small as 1/4 inch in size.

Step 1 — The Primary Shredder.
As of today, approximately 50 percent of recycled tires are used as  TDF. TDF is defined as a 2-inch-by-2-inch (sometimes even a 1-inch-by-1-inch) particle that still contains the steel wire. You can make TDF with a single shredder, called a “primary shredder,” a vibratory screener and some conveyors.

Primary shredders to handle passenger tires start at about $130,000 to $150,000. If you want to handle passenger tires and truck tires (but not OTR, or off-the-road, tires), then you can plan on spending roughly $300,000 for the primary shredder.

You should plan to spend $200,000 to $250,000 for the vibratory screener and conveyors required for your TDF production system.

Whole tires are loaded onto a roller belt conveyor that takes the tires up into the primary shredder. After passing through the primary shredder, the “shreds” fall onto the vibratory screener. Pieces larger than 2 inches by 2 inches are carried onto a “return conveyor” that brings them back to the primary shredder where they are shredded again (and again and again, if necessary) until they are 2 inches by 2 inches or smaller.

The “unders” (the pieces sized 2 inches by 2 inches or smaller) are now TDF and are removed from the vibratory screener via another belt conveyor.

A system like this, laid out in a straight line, would be approximately 80 feet long and about 20 feet wide, at maximum. The approximate investment would be $300,000 to $500,000, depending on whether you are processing passenger tires only or passenger and truck tires. The approximate operating costs of the system as described is $12 to $15 per ton, and the end product value could range from $25 to $50 per ton, depending on your market, the quality of the TDF, customer demand, etc.


A secondary shredder is required to liberate tire wire (top) from rubber (bottom) when processing tires.

Step 2 — The Secondary Shredder. Some markets require a particle size of less than 2 inches by 2 inches and, more importantly, they require the material to be “wire free.” To produce a wire-free product, a secondary shredder must be added to the processing line.

Vecoplan offers a rotary tire re-shredder, or RTR, that has a single rotating head (called the “rotor”) that has knives (or “cutters”) mounted on it. The RTR has a hydraulic ram that pushes the pre-shred into the rotor and a PLC program that controls the feed rate of that ram based on the amp load of the main drive motor. The cutters on the rotor pass through a stationary bed knife, cutting the rubber and pulling the wire from the pre-shred.

A stationary screen controls the particle size of the material. The smaller the screen, the longer the material stays inside the machine. Screens are offered in various sizes and are interchangeable.

The rubber and wire come out of the RTR in the same stream, so the product gets carried away via a drag chain conveyor that is equipped with a self-cleaning, rotary drum magnet. The wire is separated from the rubber at this point. The rubber, now mostly “wire free,” is dropped into super sacks.

The approximate investment to add this second shredder is $250,000 to $500,000, while the approximate operating cost for this equipment is $9 to $15 per ton. The typical size of product ranges from 5/8 inches to 1 inch and it is suitable for a range of markets, including playground cover, landscaping mulch, arena cover, wire-free TDF and an engineering grade replacement for gravel at a value of $150 to $200 per ton, depending on market, material quality, customer demand, etc.

The wire derived through this processing step can be valued at $40 to $120 per ton, again depending on market, quality, customer demand, etc.

Step 3 — Granulation. You can demand more money for your final product the smaller it is. And now that you have the wire out of the rubber, further size reduction is easier. Granulators can take the 3/4-inch-minus material out of the secondary shredder and reduce it down to about 1/4 inch to 1/2 inch, depending on the need. If additional size reduction is required after the granulator, then it is necessary to reduce the material down to at least 1/2 inch to 1/4 inch to prepare the material for the next step.

In addition to the further size reduction this step offers, it also aids in removing the loose fabric from the shredded material. (Passenger tires have about 10 to 15 percent nylon or polyester fabric in them by weight.) Separating the fabric from the rubber is typically done using an air system, which “lifts” the loose fabric out of the material stream. Each time the material is downsized, more fabric will be liberated from the rubber, and fabric separation will be required. However, some of the fabric can (and will) stay embedded in the rubber.

The approximate investment for the third processing step is $350,000 to $500,000, while the typical product size is 1/4 inch to 1/2 inch. Suitable end markets include horse arena cover and sports field additive, among others. The typical product value ranges from $200 to $300 per ton, depending on factors such as market, quality and customer demand.

Rusty Angel is regional sales manager for Vecoplan LLC (www.vecoplanllc.com), High Point, N.C. 

BIR Report

Departments – BIR Report


August 15, 2011
Recycling Today Staff

Shredder Committee Discusses Key Issues at BIR Spring Convention

During the Shredder Committee Meeting held during the Bureau of International Recycling’s (BIR) World Recycling Conference in Singapore in mid-May, the panel of speakers outlined recent progress toward increasing the recovery of nonferrous fractions from the shredder process as well as maximizing material value.

During the session, Olivier François of Belgium’s Galloo Group announced to attendees that his company’s AD REM joint venture with the Valtech Group owns the exclusive rights to a bi-directional barrel separator, which, in certain turnkey projects, has helped achieve end-of-life vehicle recovery rates of greater than 90 percent.

During his presentation, Uwe Habich of Steinert, Germany, focused on the products offered by his company, including the latest developments designed to “hunt down” various types of wire that can be found in automotive shredder residue (ASR). The company’s XSS-F X-ray fluorescence system is capable of achieving separation of copper motors at a capacity of up to 150 metric tons per hour, Habich said.

Jörg Schunicht of Titech, headquartered in Norway, addressed the issue of minimizing copper content in ferrous scrap that is delivered to steelmakers. He told attendees that the company’s latest X-ray fluorescence sorting development is achieving copper removal rates similar to those achieved via manual picking and has the potential to achieve even better results in the future.

The BIR World Recycling Conference was May 23-25 at the Shangri-La Hotel in Singapore.

BIR Releases Updated Steel Recycling Report

The Ferrous Division of the Brussels-based Bureau of International Recycling (BIR) released the 2006 to 2010 version of its “World Steel Recycling in Figures” booklet at its 2011 World Recycling Congress in Singapore.

The BIR bills the booklet as an “important compilation of statistics on the global ferrous scrap markets.”

BIR Statistics Advisor Rolf Willeke conducted key research and authored the report, which also includes a foreword from BIR Ferrous Division President Christian Rubach.

The figures for 2010 show that global scrap consumption by the steel industry amounted to 530 million metric tons, an increase of about 15 percent compared with 2009.

Among the surprises when comparing 2010 figures with those from 2009, Rubach told conference attendees, was that China imported 57 percent less ferrous scrap in 2010 and India’s imports dropped by nearly 25 percent.

Willeke predicted, though, that China’s scrutiny of industrial carbon emissions levels would prompt it to buy more ferrous scrap in 2011 and beyond, as the government encourages electric arc furnace steel production rather than integrated steel production.

Leading ferrous scrap exporters in 2010 were the United States (20.5 million metric tons), the European Union (18.9 million metric tons) and Japan (6.5 million metric tons).

Willeke also thanked Chinese agencies and associations for providing figures for the new “World Steel Recycling in Figures” report, the second edition the BIR has completed.

The second edition also includes information on the use of ferrous scrap grades by the iron and steel foundry industry.
The report can be accessed at http://www.bir.org/assets/Documents/publications/brochures/aFerrousReportFinal2006-2010.pdf .

The 2011 BIR World Recycling Convention was May 23-25 in Singapore.

Personnel Notes

Departments – Personnel Notes


August 15, 2011
Recycling Today Staff

Rinn to Lead OmniSource Subsidiary

Steel Dynamics Inc. (SDI), Fort Wayne, Ind., has appointed Russell Rinn executive vice president of metals recycling and president and COO of OmniSource Corp., a wholly owned subsidiary.

Rinn will be responsible for OmniSource’s ferrous and nonferrous scrap operations. SDI says Rinn fills the vacancy created when Mark Millett was promoted to president and COO of SDI in April 2011.

Rinn has more than 30 years of experience in metals recycling and steel making. Most recently, he was executive vice president of Commercial Metals Co. (CMC) and president of CMC’s Americas Division.

Millett says, “Russ’ appointment culminates a search process which began three months ago and surfaced a number of top-notch candidates, both internal as well as external. In the final analysis, however, it was clear that Russ was the right choice. Russ is a top level executive. He is a proven leader, proficient in delivering bottom-line results. His strong involvement in sales, operations and finance, along with his respect for his colleagues in all areas and levels of his previous company, fits our culture nicely.”

Aleris Names Vice President

Aleris, Beachwood, Ohio, has named Jeffrey Byrd vice president, Aleris Operating System (AOS). Byrd will lead the company’s global operating system of integrated principles, operating practices and tools designed to drive continuous improvements. He will report to Steven Demetriou, Aleris chairman and CEO.

Byrd previously was vice president, operations and supply chain for Aleris’ Rolled Products North America business. Before that he served as vice president, supply chain, for the Rolled Products business. Byrd joined Aleris in 2004.

Demetriou says, “Jeff’s appointment to this new position emphasizes our commitment to strengthen our operations. AOS is key to transforming our core processes across the enterprise to support our growth, productivity and customer service goals.”

City Carton Recycling Expands Management Staff

City Carton Recycling, based in Iowa City, Iowa, has hired Earl Brocklehurst as its maintenance service and sales manager.

Brocklehurst will be responsible for selling and advising current and potential customers on service, repair and preventative maintenance packages. He also will oversee the maintenance/shop division’s budget and maintain a required profit margin. He will be located in the Cedar Rapids, Iowa, office. 

Recycling Today Media Group Adds Staff

The Recycling Today Media Group, a business unit of GIE Media Inc., Richfield, Ohio, has added two new staff members in response to continued demand for its information services and advertising and marketing communications tools.

Jackie Van Meter has joined the group in the newly created position of sales director. She will be responsible for managing the group’s marketing efforts and its print, online and conference advertising sales.

Group Publisher Jim Keefe says, “Jackie brings a wealth of media experience to this position, having worked in both consumer and business-to-business industrial sectors throughout her career.”

Van Meter also will manage direct sales for the group’s Recycling Today and Recycling Today Global Edition titles in the Western United States.

Kelley Stoklosa has joined the group as assistant editor. A recent graduate of Kent State University’s School of Journalism and Mass Communication, Stoklosa has a range of practical experience in feature writing, print production and video journalism.

Recycling Today Media Group Associate Publisher and Editorial Director Brian Taylor says, “Through her academic achievement and extracurricular activities, Kelley has demonstrated both strong journalism training and skills as well as a strong work ethic. She’s already begun making important contributions to the group.”

Stoklosa will be working across the group’s portfolio of print and interactive media products as well as on its conferences.

The Recycling Today Media Group publishes Recycling Today, Construction & Demolition Recycling, Storage & Destruction Business (SDB) and Recycling Today Global Edition magazines. It also produces the annual Paper Recycling Conference, Paper Recycling Conference Europe and C&D Recycling Forum.

Bunting Magnetics Names Davis CFO

Bunting Magnetics Co., based in Newton, Kan., has added Jana Davis as its new chief financial officer.

In this position, Davis will be responsible for all the financial operations for both Bunting Magnetics and its wholly owned subsidiary Magnet Applications Group Ltd.

“Jana will strengthen our company in many ways,” says Robert Bunting, Bunting Magnetics owner and CEO. “First, her financial acumen is ideal for us as we continue to grow and expand internationally. Second, she has a wide range of experience, from strategic planning to human resource and information technology management which will be instrumental for us in the next few years. Finally, she has the ability to identify and implement solutions which will help us operate more efficiently.”

Decker to Lead at Apple Valley Waste

Apple Valley Waste, Kearneysville, W.V., a provider of solid waste collection, recycling and disposal services in Berkley and Jefferson Counties, W.V., and Washington County, Md., has named John Decker managing partner and CEO.

Decker is a 20-year waste industry veteran who has held leadership positions with public and private solid waste companies. Most recently, he was the vice president of operations for Casella Waste. Decker will work alongside founding partner, James (J.P.) Phillips, a 13-year industry veteran who also has worked for Allied Waste Services and General Refuse.

Phillips says, “We are pleased to welcome John to the team. John shares our passion and dedication to offer dependable waste and recycling collection services with a commitment to provide friendly, high quality services to our customers.”

Eriez Promotes Dave Heubel

Eriez, Erie, Pa., has promoted Dave Heubel to director of North American sales. The announcement follows the company’s decision to consolidate its United States and Canadian sales organizations into a North American sales team.

Most recently, Heubel served as national sales manager for the company’s U.S. light- and heavy-industry markets.

Heubel joined Eriez in 1990 as a technical sales representative, progressing through several assignments, including product manager of separation and market manager for the food, pharmaceutical and chemical industries.

Wendt Hires Scrap Recycling Veteran as Regional Sales Manager

Wendt Corp., Tonawanda, N.Y., designers and manufacturers of automobile shredding and nonferrous separation systems, has named David Kaminski regional sales manager.

He brings more than 40 years of experience to the job, having started in the scrap recycling industry in 1969 at Benton Processing (now Alter Trading Corp.). During his 22-year tenure at Benton, he had several titles and areas of responsibilty, including yard superintendant, operations manager and general manager. Kaminski then joined OmniSource Corp., where he managed yards in Ft. Wayne, Ind.; Mansfield, Ohio; and East Chicago, Ind. After leaving OmniSource, Kaminski spent five years as a sales consultant servicing automobile shredding operations across North America before joining the Wendt Corp. family.

In his new role as regional sales manager, Kaminski will report directly to Tom Wendt, president of Wendt Corp.

Tom Wendt says, “As part of Wendt’s continued growth, we are developing a regional sales force in order to provide an additional level of support for our customers. We are pleased to add David to our team, as his industry experience and knowledge will add value for our customers and help them improve their shredding and nonferrous processing operations.”

One to Watch

Departments – One to Watch

A Growing Cloud


August 15, 2011
Recycling Today Staff
At a Glance

Company: CloudBlue Technologies Inc.

Principals: CEO Ken Beyer (pictured above) and Chairman Randy Altschuler   

Headquarters: Norcross, Ga.

Year Established: 2001       

No. of Employees: More than 250

Website: www.cloudblue.com

Services Provided: E-scrap management, asset recovery and product return services for electronic assets

Norcross, Ga.-based CloudBlue Technologies Inc. was formed in 2001 with the goal to build the world’s leading e-scrap management services and electronics returns company, says CEO Ken Beyer.

In the last decade, CloudBlue has grown to provide services in more than 145 countries, Beyer says.

CloudBlue has grown in part by implementing best-in-class processes and technology, he says.
“CloudBlue’s services and proprietary technology reduce the risk, cost and complexity associated with securely managing the return and disposition of electronics across multiple global locations in an environmentally compliant manner.”

Beyer tells Recycling Today where his company is today and where he thinks it is headed in the future:

Q: What is the scope of your operation?

A: We have 40 global company and partner locations, a full chain-of-custody security framework, an online asset tracking portal and are certified in environmental compliance. Our customers include Fortune 1,000 companies in the education, retail, financial services, health care, insurance, consulting, legal, manufacturing and media industries. We cater to customers that are brand conscious and focused on data security with a high volume of electronics.
CloudBlue is processing more than 40 million pounds of electronics annually, including enterprise IT assets, data center equipment, consumer electronics, mobile devices and other electronic equipment.

Q: Where do you see your company five years from now?

A: Demand for secure, environmentally compliant professional services to manage electronics returns and asset disposition will grow dramatically over the next five years, according to industry analysts. CloudBlue will be leading advances in new technology, processes and strategic relationships that will shape this global market. We will listen to the expanding needs of our customers to create world-class solutions that cover a broader range of asset categories and related services.

Process Improvement

Features – Sorting Equipment Focus

Recyclers try to keep up with the changing stream of electronics.


August 15, 2011
Kelley Stoklosa

As technology used to create electronics improves, manufacturers strive to create sleeker and more compact versions of computers, cell phones, TVs and MP3 players. While consumers can benefit from these changes, electronics recyclers face a new set of challenges in the end-of-life processing of these devices. Recyclers are finding paper-thin tablets and MP3 players that are smaller than a deck of cards being shuttled through their processing streams at an increasing rate. The recycling processes cannot stay the same because the devices being processed are different from the devices that were being processed 10 years ago.

Pace Setters
Electronics recyclers are adapting new ways to handle the change in the incoming material stream. Some electronics recycling companies have responded to these changes by adding new shredders to their processing lines. John Shegerian, chairman and CEO of Electronic Recyclers International Inc., says his Fresno, Calif.-based company added a small shredder in 2005 before making the decision to include an additional, larger shredder to its Fresno lineup of processing equipment in 2008.

“Everything you build, you want to build it better. As you evolve, your technology evolves. This changing stream is about evolving,” he says. 

Bill McGeever, vice president of operations at ECS Refining, Santa Clara, Calif., says, while shredders have had a role in electronics recycling for a long time, he has seen a dramatic increase in the number of  companies using shredders to processes end-of-life electronics in the last five or six years.

McGeever also points out that people are storing personal information on these devices and naturally want that data destroyed before parts are sold for re-use, which makes information destruction a critical part of the electronics recycling process.

The Two-Step
Many recyclers have adopted the use of primary and secondary shredders in their processing lines. Chris Ryan, president of Metech Recycling, Denver, says he has found several advantages to this two-stage shredding process. In a two-stage shredding line, the primary shredder produces a coarse shred. A sorting line then follows. “This is very common for quality control. It helps us make sure toxic matter doesn’t go to the wrong place and buyers get what they are supposed to get,” he says. The sorting line that follows the primary shredder is where things like batteries are supposed to be removed and high-grade and low-grade items are separated.

Magnets and eddy currents also are used to remove base metals, such as steel and aluminum, Ryan says. “This is used more in low-grade things that may or may not have a circuit board but aren’t worth picking by hand.” 

Shegerian says the dual-stage shredding process also can improve commodity recovery and value. “The more we can separate things out, the more value it has for our smelter partners,” he says. Finding the best commodity value is something that needs to be thought of every day, and a two-step shredding process better allows electronics recyclers to recover secondary commodities, Shegerian says. This keeps downstream consumers happier, he adds.

McGeever shares the saying he says is often heard around ECS Refining’s facility: “Give me material only that is green and clean.”

Recyclers say they have seen a difference in the composition of the incoming material stream. A lot of items like laptops, cell phones and wireless keyboards contain batteries that need to be removed prior to shredding. Recyclers are hand sorting incoming material to remove unwanted items, such as plastic casings and lead components, to prevent them from making their way to downstream customers.

“The process still involves a lot of manual sorting because of the high amount of low-grade stuff coming in,” Ryan says.

ECS Refining’s McGeever says he has noticed an increase in unwanted materials in his company’s incoming stream. “You don’t want to shred items like consumer packaging, propylene bags and structural foam, things that are obviously not suitable for metals recovery or landfills. These all have to be separated before we shred,” he says.

Into the Future

Evaluating the shredding process is a constant aspect of the electronics recycling business. Sometimes, the latest equipment may not be the greatest equipment for all operations. As an example, McGeever cites his company’s decision not to add a certain shredder to ECS Refining’s processing system, even though it was creating a lot of industry buzz. Particle size is a debate McGeever hears about a lot, he says. Recently the discussion turned to the potential merits of chain shredders, with some industry professionals saying they performed  better than traditional knife shredders.

McGeever says, “Shredding technology has been reassessed two or three times in the last few years. If we see something that is a better tool, we’re always watching and thinking about it.”

He continues, “Chain shredders were being used in Europe, the United States and Canada, or so people said. We were thinking about replacing our knife shredder but decided not to after going over the pros and cons.”   

For ECS, it comes down to the entire sets of tools (shredders, magnetic separators, eddy current separators, optical separators, pick stations, ball mills, float/sink technologies) and how they are configured and deployed as a system. The decision to use the knife technology in ECS’ primary shredder was about optimizing separation from the downstream processing system that the company had configured, McGeever says.

Smaller pieces may not always be advantageous, either. McGeever says smelters still want material delivered in a certain way and plastics recyclers prefer larger pieces so they can more easily sort incoming material.

The general consensus among the sources interviewed for this feature is that the electronics recycling process will continue to evolve to meet the changing nature of incoming material. Metech Recycling’s Ryan says, “It’s tough to devise one disassembly line because of the ever evolving stream of electronics that is coming our way.”

The electronics recycling process could continue to get faster and more efficient as companies continue to work on their methods, but Ryan says he strongly believes manual picking will continue to be a part of the process.

Electronic Recyclers International’s Shegerian agrees, saying, “A certain level of manual labor will still be necessary.”

Manual picking is still considered the best way to make sure materials don’t end up where they should not, though it is a more expensive process, according to sources.

“You end up paying for it in labor costs or you will pay for it after” when material needs to be disposed of in a classified landfill because it contains toxic substances, McGeever says. “Sometimes what may seem cheapest isn’t what’s best for the environment.” 

One thing that is likely to change is the shredder. As time goes on, those sleek TVs will continue to get sleeker, and tiny MP3 players will start resembling matchbooks instead of a deck of cards—and these items will make their way to recycling facilities at the end of their useful lives.

McGeever predicts shredders will shrink to accommodate these changes to electronic devices. “You don’t want the entire device slipping through the shredder,” he says.

Additionally, McGeever says sizing and screening changes might help recyclers better accommodate flat panel LCD monitors. Ideally, as LCDs enter the recycling stream, they will be able to go into the shredder whole.

One thing remains certain amid all of these changes: The electronics recycling industry is working to keep pace with technological advancements in electronic devices, and it is not always an easy process.

The author is assistant editor for Recycling Today and can be reached at [email protected]


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