Medicine Hat, AB – The City of Medicine Hat and Can Pak Environmental partnered up to bring curbside recycling to the gas city just over a year ago.
That partnership is over.
On Tuesday, the city announced that they were parting ways with the company.
“There’s been disruption in the market around what to do with plastics. And their recycling process was it making quite difficult for them to be able to continue the contract at the price that they had originally quoted.” Said Lora Brenan, the general manager of environmental utilities with the city.
According to the city, over the last six months, they had been in negotiations with Can Pak who said they would need to raise residential rates to be profitable.
The city is hopeful that by finding a new contractor, they will be able to keep prices around the current monthly rate of $6.31.
“There’s different ratings of plastics and some are worth more than others. And some of the ways that CanPak processes the plastics makes it more difficult for them to sell it.” Brenan said. “And in some of the discussions we’ve had with other providers, they’re able to sort the material in a way that they can make more money on the more expensive plastics in reselling. And that allows them to make up that difference.”
One of those vendors looking into bidding for the contract is REDI Enterprise, a local-not-for-profit who ran the city’s centralized depot recycling program for 20 years before curbside pick up was launched.
With the challenges facing the recycling industry though, executive director Craig Wood says they need to be sure it can be a viable project before officially bidding.
“As a not for profit, we can’t lose money on it. We would do it to make money to support our services. But certainly, if there is an opportunity we would be interested in talking to the city.” He continued. “But I do know that recycling across the country right now is really struggling. The price of recycled goods is depressed. It’s difficult to even sell some of the product.”
Wood said that when they were running the depot program they made between $100,000 to $200,000 a year that was put back into their programming for people with disabilities.
They were also one of the groups in 2017 that bid for the curbside pick up contract.
“We’re actually just right now sort of bringing the proposals and business models out from storage. And looking at what we had put through and seeing what the possibilities are.” He said.
Wood says the REDI board of directors will need to make a decision quickly if they want to get back into the recycling business as the city says they are looking for a new contractor to be ready to take over for CanPak in 6 weeks.
