Editor's note: The following is the transcript of an live interview with Laurand Lewandowski and Mark Leo of Owens Corning. You can read the interview below, listen to the podcast, or watch the webinar.
Heidi Ellsworth: Good morning. Welcome to today's Coffee Conversations from RoofersCoffeeShop. My name is Heidi Ellsworth, and I am so excited about today's coffee conversation. Is there anything more important than saving the world and saving the earth? And that's what we're going to be talking about today. We're going to be talking about sustainability, the environment, and what the roofing industry is doing to help protect the future generations.
So, let's get started. Before we move on, as you all know, this is being recorded, and it will be available within 24 hours for you to share out, talk about, watch again, whatever you may need. So, be sure to share that with everyone who you know in the roofing industry who would be interested. Also, we like questions. So, the chat is enabled. Please get on, say hello, let us know where you're from, what kind of business do you have, commercial or residential, your name. We definitely want to have a lot going on in the chat. Questions the whole time. Don't wait till the end. If you have a question or a comment, you like what you're hearing or you're wondering about something, please put that in the chat and we can keep the conversation flowing.
So, let's get started on this great topic of roofing recycling. First of all, I would like to thank Owens Corning as our sponsor this morning. They are a leader in this. They have been leading the efforts in recycling, environment, and sustainability for years. In fact, if you go back to October 2021, you'll be able to see our current guest today, Mark Leo, in an earlier Coffee Conversations about roofing recycling. So, it's really interesting to see the dedication that Owens Corning and the people of Owens Corning have to this topic. So, thank you Owens Corning for being a sponsor, and thank you even more for everything you're doing to help the roofing industry and our environment.
So, first of all, I would like to introduce Laurand Lewandowski. Laurand, can you please introduce yourself and let everybody know who you are?
Laurand Lewandowski: Thanks, Heidi. Obviously, I'm Laurand Lewandowski, and I'm the director of asphalt innovation for Owens Corning. I've been with Owens Corning for over 11 years, and been in the roofing, asphalt, and the paving space for about 33 years. Probably been looking at the shingle recycling area probably the past 15 years.
Heidi Ellsworth: Wow. That is great. And so, lots of knowledge. You've been very involved. I'm excited to be able to have some of these conversations. I'd also like to introduce Mark Leo. Mark, can you please introduce yourself and tell us a little bit about yourself?
Mark Leo: Sure. Yeah. My name's Mark Leo. I'm director for circular economy with Owens Corning. I've been with Owens Corning for about six years, and I've been in the construction industry for about 20 years, and that's different areas, sort of up and down the value chain in construction and real estate development, and then all the way up the value chain into construction chemicals. And right now, obviously in building materials with Owens Corning. I'm focused on leading the circular economy team, which is all about keeping Owens Corning material out of landfills. And obviously for us, shingles is a top priority for that. So, that's what we're working on.
Heidi Ellsworth: That's excellent. That's awesome. Well, okay, I think it's always good to kind of get a baseline. And as we're talking about recycling, Laurand, I would love for you to talk about the history of recycling and roofing, and how did we get here today?
Laurand Lewandowski: So, the concept of recycling roofing really goes back to the late 80s when there were several patents issued for the use of recycled asphalt shingles and paving. And if you look at the cost of asphalt over the last four decades, going back to like 1980, the price of asphalt's really gone up by a factor of three to four. So, the value of the asphalt to the hot mix asphalt paving contractors increased over time. And with that, so has the use.
So, if we go forward a little bit, in 2016, it really peaked with the use of recycled asphalt shingles and paving, and then it started to taper off. It got to about almost 2 million tons of shingle waste going into paving. And really, the industry didn't really have the right use specification, so it really tapered off over the next several years. But if you look at today, the paving industry has really developed a novel approach with something called balance mix design. And that's allowing the contractor to be innovative and also to use more recycled content. And we think with that, we're going to get more recycling into the paving space.
When you look at the roofing space, you're starting to see a lot of focus on getting the shingle waste back into the manufacturing process and back into our products. That's really where we are today.
Heidi Ellsworth: I've been in the industry for quite a while myself, worked with contractors for probably 25 years who have been working at recycling, have been trying to get that moving for them personally. Some are having great success, some are still trying to work on it. So, what do you see as the current state of recycling with the contractors in roofing today, Laurand?
Laurand Lewandowski: So, I think with the heightened sense and focus around sustainability, and the increased regulatory and legislative activity, I think there's a lot of momentum to recycle more. Mark?
Mark Leo: Yeah, we've been following these trends over time and clearly trying to be a leader in this space and advancing our sustainability agenda and making long-term commitments there. So, I'd say the Owens Corning story is very similar to what you've described. We've been looking at this for decades. Up until this point, we haven't really found a breakthrough solution to solve the problem. But a couple of years ago, we've decided to kind of double down in this space, and we formed a team of people who are going to spend their priority, the most of their time looking at shingle recycling and trying to develop a program.
So, that team went out and has been working over the past couple years to look at different technologies, different approaches, what's being done in the market, and think about what's the best fit for Owens Corning in terms of what we want to build our platform around. So, that's how we've approached it, and that's what we're currently working on.
Heidi Ellsworth: And Mark, I know when we talked... it's been now almost a year and a half ago. You were talking about, you've been working on this for a long time to bring all of these solutions and to really figure out what's the best. Can you talk about the different methods and processes for recycling that's going on?
Mark Leo: Yeah, sure. And there's a lot going on out there. We've seen folks do all sorts of things and try all sorts of things when it comes to trying to recycle shingles. You can put them in cement kilns, you can grind them up and use them for dust suppression on roads, you can put them into landscaping. We've seen people try to extract diesel fuel from them. So, there's a lot of approaches out there. We talked about paving. That's something that we know we can do that can be improved upon. All these ideas are interesting, but aside from paving, as we mentioned, none of them have really been proven to be scalable into something that can be a commercial solution, that can really make a dent in the problem that we're trying to solve, which is that 13 to 15 million tons of shingles that go into landfill every year.
So, from the Owens Corning perspective, it was important for us to choose a path that fits uniquely for us, and we did that, and based on what our configuration looks like in the market and our capabilities. So, we believe that within the shingle, the most valuable piece of it is the asphalt. I mean, it's the highest cost component. So, we've built an approach that focuses on the value of the asphalt. We're trying to unlock that value. So, we've built a novel approach where we can actually deconstruct the shingle and extract the components out. So, in the case of asphalt, we're extracting a liquid asphalt where we can take that material. Now, it's not the same as virgin asphalt, but because we're an asphalt business and we have these capabilities, we can treat it and process it in a way that it can be used back into our manufacturing process and displace virgin material, which is one of the key things that we're trying to do here.
As a part of that process, we're also looking at recovering the other materials that come out of the shingle, which is granules and filler type products. And we believe that we can incorporate that back into new shingles as well. So, the idea is we're taking old shingles and using them as an input feed stock into making new shingles. So, that's the approach that we're taking. It's the right fit for us because we're vertically integrated into the asphalt business and we play in spaces other than just roofing. We're in the paving business. So, it allows us to work directly with our customers who are in that space, and we can work together on getting more shingles out of the landfill and back into either roads or into new products.
Heidi Ellsworth: Well, and I think there's a lot of buzzwords around in this space, but circular economy is so important in that the fact that we continue to reuse... So, that whole concept of what you're talking about is really getting that asphalt out there, and plus all the other elements that can be put back in. And it becomes that circular economy, instead of always having to go with virgin materials. That's going to be a big key to everything that's going on. Mark, that seems to be what I hear from you a lot, is really taking that direction.
Mark Leo: Yeah, it's a key part of our strategy that we're looking at going forward, and it's a part of the core DNA of Owens Corning.
Heidi Ellsworth: Yeah. Well, and you are not all alone, because ARMA, the Asphalt Roofing Manufacturers Association, is very, very active with this. And I'm going to share my screen here real quick because I want to show everybody some of the things that ARMA is doing. We're going to have Laurand speak to that.
I also do want to say one thing before we start on that, is in our chat, Tammy Hall, thank you so much for being here. And she did mention that she is working with the... she's on the board of NRCA, and they've been including this conversation. So, FRSA government affairs, so Florida, took up a subcommittee to discuss and address this issue. Thank you for bringing this program to us.
So, what we're seeing across the board is it's manufacturers, contractors, but it's the associations that are really stepping forward. And ARMA has an amazing goal of reducing landfill disposal of asphalt-based roofing materials to 50% by 2035, and to approach 0% by 2050. I think that's amazing. Laurand, let's talk about that. That is a huge goal.
Laurand Lewandowski: Yeah, it's an aspirational goal, Heidi. And ARMA, which obviously is made up of the commercial and low-slope roofing, asphalt roofing manufacturers, and then other suppliers that supply into that market. And in 2021, ARMA decided to reactivate the Asphalt Roof and Recycling Committee, and it had been kind of on a hiatus for a period of time. Other items were going on. And with that, there was a strong feeling that we needed to be proactive in this space and develop an aspirational statement.
So, members of the committee and members of the board of directors worked to craft a statement, and then it was approved by the board of directors, and the press release came out. You can see it on the screen here, it came out May 11th in 2022. And we're very excited to have a forward-looking direction for the industry and North Star that we can follow.
Heidi Ellsworth: Yeah. And the industry as a whole is working on this, which I think is incredible, because that's what it's going to take, is everybody all together. And so, maybe talk just a little bit too about the recycling or ARMA's approach on what manufacturers are doing to help meet those ARMA goals.
Laurand Lewandowski: So, Heidi, ARMA's really a trade association. It doesn't really drive the business decisions within the individual member companies. But what ARMA does through the Shingle Recycling Committee focuses on three areas. The first is really to inform and educate, and you can see the technical bulletin on the screen here, and that's one form in which we educate our individual members and others in the industry on asphalt shingle recycling. The other is we put on a shingle recycling forum in 2021, and that was a virtual event, and then also have worked with CDRA, Construction Demolition Recycling Association, on a face-to-face meeting, which they held in 2022. We will also hold another recycling forum later this year, similar to the format in 2021.
The second area that ARMA focuses on really is monitoring the legislative and regulatory space. There's a lot of activity going from the federal government, the GSA, buy clean, things around low in body carbon asphalt, to the state activities going on in the legislative space, and then in some of the areas like CalRecycle and other organizations within each state that are focusing on circular economy type activities. And then trying to monitor what's going on relative to what we look at as extended producer responsibility, getting the products back into the products we manufacture.
The third area is really around stakeholder collaboration. This is a big task. We're talking about 13 million plus tons of material being diverted from landfills. So, there's a lot of collaboration needed. So, ARMA has a longstanding relationship with the National Roofing Contractors Association and also the National Asphalt Pavement Association, NAPA, but also looks to collaborate with CDRA, with the Asphalt Institute, and other organizations to find synergies of how we can promote getting more shingle waste out of the landfill.
But when you think about how we meet that goal, really, the onus is on the manufacturers themself and to try to figure out what portion is theirs to divert of that 13 plus million tons of shingle waste from landfill.
Heidi Ellsworth: That is huge. And I'm just hearing, and I know this is a lot of what's out there in the industry already, or just people talking, but that there may come a point when contractors won't be able to take their waste or their shingles to the landfills. So, this is more important than ever that we kind of start getting some of these solutions now. Mark, and we're kind of talking about that with contractors, what are you seeing out there, and what can contractors be doing along these lines to... and I want to make sure I have this because this question came in. How can contractors start recycling their asphalt-based roofing materials?
Mark Leo: Yeah, I can speak to that. But first, I just want to follow on to what Laurand said about ARMA and the manufacturers being involved. I just want to give the OC perspective here as well. We're obviously, as ARMA members, very proud of that, and it's an aspirational goal that we set as an organization. So, we think that's great. And we had a seat at the table in driving that and helping set that target. Specifically for Owens Corning, we have a public aspiration for ourselves, which is similar. In fact, we tried to take a little bit more of an aggressive timeline. We're looking at the 2030 timeframe as opposed to 2035. So, our aspiration states that we want to be recycling 2 million tons of shingles per year by the year 2030. It's a stretch goal, it's aggressive, but we think we're up for the challenge. So, I just wanted to say that.
Heidi Ellsworth: Yeah, no. Yeah, and I meant to do that. Thank you. That's great.
Mark Leo: That's okay. Yeah. And so, yeah, specifically, when the rubber reads road, let's talk about contractors and those who are really interested in starting to improve the recycling profile, because we're hearing a lot of enthusiasm in the market. I've been actually really impressed, and I know within the Owens Corning community, we've been impressed about the enthusiasm that we see with contractors and embracing the idea of shifting from the linear economy to the circular economy, meaning instead of sending shingles to landfill, let's find a recycling solution.
So, as I've talked about before, we're working as hard as we can to quickly get more recycling opportunities into the market so we can take shingles and do what we talked about, breaking them apart and putting them back into manufacturing, increasing the use in paving, and we want to drive demand for that recycling through the efforts that we're doing. But in the meantime, we talked about that paving is being done today with recycled asphalt shingles, and the way to get your shingles into that space is to find a local recycler in your market. In some cases, that exists. In some cases, it doesn't. But where it does, the idea would be to divert as much of your shingle waste in that direction as possible.
We've also seen another impressive thing is contractors kind of taking matters into their own hands. We've seen them looking at getting their own grinding equipment, potentially even connecting directly with hot asphalt contractors to say, "Let's find a local solution. We can't wait for an entire ecosystem to be built out." So, that's a really cool thing. We've seen contractors talking about starting recycling businesses of their own. So, it's really great to see that.
In any case, as Owens Corning and with our relationship with our contractors, we encourage everyone, especially the ones who are showing the enthusiasm and interest in getting involved, to stay in touch because there's a lot of planning that has to happen as we build out these solutions and bring them to market. We need to work together to create the supply chains and understand how we work together. So, as we go through this journey, we're going to expect to be partnering closely with our contractors and those out in the marketplace.
Heidi Ellsworth: Perfect. So, we have a lot of questions here, gentlemen, that are coming through. So, I want to make sure we are getting through them and getting to everybody's questions. So, just real quick, before I pull up those questions, Mark, just again, because we've been kind of talking about this through the whole thing, but just maybe give us a high level again of the OC program and what you see coming down the pike that direction, so that then some of these questions are going to go right directly to that.
Mark Leo: So, another high-level description of the OC program?
Heidi Ellsworth: Yeah.
Mark Leo: It's a two-pronged strategy. We believe that in order to reach our goal of 2 million tons of shingles per year, we need to take shingles apart and get those components into a state that can be introduced back into our manufacturing process. And we think that's going to get us half of the way there. We expect to divert a certain number of shingles with that method. We'll consume that material that comes out of the back end of the recycling process, and if we have excess, we can potentially sell that into the market as well. We can work with the other folks in the industry who don't want to go into the business or go through the process of doing the recycling. Maybe we can supply that. So, that's the first side of it, is the actual deconstruction and extraction of the components.
The second side is the paving. We're in the paving space in the sense that we are in the asphalt business. We have customers who are paving contractors who we work with in different regions, and the idea is that we want to work directly with them to help them increase the amount of recycled shingles that they are putting into their mixes. As we discussed. That's something that is a practice that's been done to varying degrees over time. We've seen it peak out in the mid-teens, 20 teens, and we want to get back up to those levels, and we want to exceed that. And that can be done by using these balance mix design principles and making sure that the performance of mixes that include recycled asphalt shingles equal what's done with conventional mixes. So, that's what we've been focusing on with our customers and the players in those markets.
Heidi Ellsworth: Thank you. Because there's a lot of questions coming this way, so that's why I want to kind of level set here. So, from Ed Farnham. Thank you, Ed. He said, "So, has Owens Corning been able to crack the bond for shingles?" If that makes sense.
Mark Leo: The way I interpret that question is have we proven that the approach that we're talking about will work, where taking them apart and extracting the components and putting them back into the manufacturing process? The answer to that is we've proven that we can do this at the lab scale. We're working with partners in the market who we've established some projects together with. We've just, back in December, cut the ribbon on a pilot, a manufacturing facility, which is going to be doing this process, which is taking input shingles. Starts with a mechanical process, and then goes into a chemical recycling process, and then extracts the components.
Now, as I said, we have proven that this works at the lab scale. Now, for us, we're at a critical point here in this work stream where we need to prove that this can be scaled. So, we're at an interim stage where we are going to take material that comes out of this process and we're going to be testing it and doing trials internally to prove to ourselves that this is a commercial solution that we can then scale up across our entire network so that we can make a real dent in the challenge here of diverting shingles.
Heidi Ellsworth: Wow. And that's a large network, so it's going to make a huge difference for everyone. I do want to point, say hello to Sarah. Sarah, thank you for being on here. And yes, the recording is going to be available within 24 hours. And you also had mentioned that you are really excited about getting into this and offering recycling. So, I just want to read your notes. Sorry everyone, I'm looking... we have some great chat. But Sarah is in Minnesota and is deeply interested in learning how to offer recycling to her clients. No idea where to begin. So, hopefully this will help and will be able to get you with the people. ARMA is where you want to talk about. I also have another note here, Sarah, from Tracy Prochu in Washington where they have Miles is doing a great job with contractors and has an awesome system in place for recycling asphalt shingles.
So, sometimes, like Mark said, it's about finding those local ones, but then working with your manufacturer or with your associations to really continue to get that information. We're hoping this is going to get everybody asking those questions of who they're working with. So, we have another question here for you, gentlemen, and that is also from Ed. And so, the question is, can we use all shingles for RAS? So, we might want to explain to everybody what RAS is, or just waste from new material or RAS from 50-year-old roofs. Laurand, do you want to... or Mark, who will take-
Laurand Lewandowski: Yeah, let me take that.
Heidi Ellsworth: Yeah.
Laurand Lewandowski: So, recycled asphalt shingles. So, by the time a shingle reaches the end of life, there's a lot of commonality across all the products. So, from a shingle perspective, recycling is pretty indiscriminate with respect to that. Where there are challenges, though, are on the low-slope roofing side, and understanding that those materials have different compositions than shingles and require a different approach. But typically, you can kind of separate out shingle waste from a post-consumer, which is the tear-offs I talked about, and also the manufacturing waste. Obviously, the manufacturing waste hasn't been exposed to the environment for the period of time that a tear-off has, and it requires probably a little different approach to recycling versus tear-offs.
Heidi Ellsworth: Ed also mentioned here, each state is different in RAS use. And so, maybe to that pilot again, he's asking what states are you working with? Is New York one of them? Mark?
Mark Leo: So, in the use of paving, yeah, there's 50 different DOTs. So, every state has its own policy around the use of RAS, but even in states where there isn't, there are commercial paving projects that make up typically at least half of all the pavement that goes down, which can incorporate RAS because it's not subject to DOT. Approximately, nationwide or in North America, the amount of hot asphalt paving that goes down, or asphalt paving, is on the order of 400 million tons. So, there's quite a bit of opportunity across the nation on an annual basis for finding a place for recycled asphalt shingles. So, it's not like we have to have an acceptance of every DOT on every project. There's places that we can work in the meantime while we work to influence those codes and influence the increased acceptance of this as a good industry practice and build confidence in that space.
Heidi Ellsworth: And it's really going to take all of these initiatives to hit ARMA's goals and aspirations. And one of your fellow ARMA task force, Steve Wadding, Steve, thank you for being here, "ARMA's looking at low-slope roofing as well." Steve is working on the task force. He's chairing it, actually. So, this task force is looking for thoughts and ideas to help forward the mini challenges related to recycling low-slope roof materials. So, Laurand, maybe you can talk about that on the low-slope side of what ARMA is looking at.
Laurand Lewandowski: So, when you think about the low-slope products, they're in a different form than shingles, and the composition of those materials is... those are typically rolled goods versus the type shingle products. So, the way those materials are processed is unique to the form of the product. So, a lot of the focus has really been on shingle recycling without really establishing the proper approach to recycle low-slope roofing. So, I think that Steve's leading that group within ARMA to try to identify where the industry needs to focus and what are the best practices for doing that.
Heidi Ellsworth: Yeah, yeah. I think that's where everybody has to continue, as we talk about coming together. And we're also, when we're talking about... I think there's a lot of interest here from contractors across the board that are talking about how... and this is actually one of the things we were going to look at next as we were going through this, but how do contractors really work at getting the clean materials, meeting the needs, meeting the requirements? Ed had mentioned another challenge is RAS must be cleaned before it can be accepted. Is there anything that ARMA or as Owens Corning that you are working on to help contractors with those best practices to get their materials recycled?
Laurand Lewandowski: CDRA has put out some guidelines on how to prepare shingle waste for recycling. So, how to make sure in the rolloff you're not putting debris or other materials in there that's going to make it harder for the recycling site to actually process those shingles.
Heidi Ellsworth: Perfect. Mark, let's talk just a little bit more on how... I know we mentioned it earlier, but we have a lot of contractors here who are like, "I want to do something. I want to start recycling." And what are some of the things that you are seeing out there overall, besides... I know a lot of it's going into driveways, pavement. We were just up in Washington for the show up there. In fact, Tracy just mentioned, I know they're putting asphalt into concrete blocks, which you mentioned at the very beginning. So, they're doing a lot of it that way. As a contractor in their area, and sorry, I'm going to answer my own question here. They should go back and watch our Coffee Conversations from October 2021, because we had a recycler on there and they talked a lot about this. But can you hit on that again? How do they develop that relationship with their local recyclers and bring that into the culture of their business?
Mark Leo: Yeah. Again, I think that in the cases where there's established recyclers, that's just a matter of making contact and setting up your supply chain in a way where you can divert your shingles into that space. That's relatively easy, although sometimes you need to think about what sort of additional costs. Let's say you're hauling it all the way across town or upwards of an hour. Now you're starting to talk about adding additional costs. So, I would start to think about what sort of message are you giving to the homeowner, and what kind of value do they get out of it? So, thinking through, well, maybe if it's really important to a homeowner, can I pass through some costs in that space?
But some of the other things that you mentioned, the solutions that we've been talking about, I think we're looking at taking the biggest bite of the apple or trying to attack the problem in the biggest areas where it makes the most sense from an investment point of view. But those smaller scale solutions that we talked about, grinding up and using for dust suppression and these other applications that you just mentioned, there's other ideas out there, and the strategy that we've chosen make sense for Owens Corning, and that's where we're choosing to invest because of our asset configuration, the businesses that we're in... that makes the most sense for us. But I think there's other ideas out there, and the approaches that we're going to take are going to be most effective in these major metropolitan areas where our assets are located, where our contractor networks are, in some of these more rural areas or smaller regional areas. I think some of those other approaches might be the right solution.
So, we see it as all the above kind of approach to solving this challenge because it's just massive. And in some cases, those smaller solutions might be the right place. And I think that is an area where contractors can get directly involved with some of those projects that are out there. Some of them are still early stage, but the folks who are enthusiastic about working on those and want to be on the cutting edge, I see a lot of that going on out there as we interact with our partners and the people in the different networks we're involved with like ARMA and CDRA and other recycling forums. So, it's pretty exciting to see that.
Heidi Ellsworth: Yeah. And I think it's important for everyone who's listening out there to get involved locally in your own. And so, I wanted to say up in Washington, Tracy is putting out here, Greg Fishel is the contact at Miles who is heading up the program, would be a great contact. If you're in Washington, there's somebody.
I am also going to throw out, when I was at the most recent NRCA meetings, there was a lot of talk about sustainability, recycling, solar. All of that is a huge topic. So, get involved with your NRCA. And I'm going to throw out a name. He's probably going to be on a future show, but his name is Peter Horridge out of Maine, and he is a contractor that has set up, just like you said, Mark, an amazing recycling program, and they use it to sell to their customers. It has made a huge difference with their customers because they want that. As we talk about that messaging to the customers, the end users, the homeowners, what are you hearing on that level?
Mark Leo: I see a lot of enthusiasm, that this idea of a next generation shingle ecosystem has got a lot of people interested, especially as you look at some of the new demographic of homeowners. The millennial generation is coming in and now being a significant block of home ownership, and they're really interested in this space. And then there's other groups that can be influenced as well, who the more they learn, the more excited they get.
So, I think it's an important thing that we should emphasize, which is the more we talk to homeowners and the more we talk in these spaces about the end users and help them understand what we're trying to do and the idea that we're going to have product lines of shingles that have significant amount of recycled content, or a guarantee that when you replace your roof, the shingles that come off are not going to go into a landfill, they're going to go and be reused in some added value applications such as going into new shingles or going into roads or whatever it may be.
That kind of enthusiasm in the market just helps us move faster. It helps everyone who's in this ecosystem have the confidence to invest, because it does take investment. It takes a little bit of a leap of faith from players who are in this space. And the confidence that everyone has bought in and all in agreement that we're going to go in this direction just helps people get over the fence just that much sooner. So, that's what we would encourage folks to continue to do.
Heidi Ellsworth: Yeah. So, we have some more great questions. George Wadding, thank you so much for being on here. It's great to see your name. And George had a question for Laurand. Does the use of modified asphalt, is it a complication or an enhancement in the recycling process?
Laurand Lewandowski: Good question. When you think about the different processes that are out there to recycle, all of them typically start by grinding the shingle, and tear-offs, when they reach the end of life, are typically pretty brittle. And so, they're easy to grind and break into smaller particles, which is what you need in most recycling processes. When you get to modified materials, they're harder to grind because they tend not to be the same type of composition, and it's more difficult to grind them. They might gum up, for example, the grinders, or the teeth on it. So, it's a little harder to process. Once you get through that grinding process, I think the modifieds are just as easily recycled as the other material. So, it has that benefit at the end.
Heidi Ellsworth: Yeah. There's a lot of modified products out there, and so it's something we need to be looking at.
Laurand Lewandowski: Yeah. Absolutely.
Heidi Ellsworth: One of the questions, and I think this has been true since, man, when I was in the late 90s working with contractors on recycling, was the economics. What are the economics of, really, as a contractor, putting that in there? Is it going to buy us recycling... And actually, even at this point, Mark and Laurand, having some of the material go back in that circular economy, what do you see long term for the economics? Does this help with pricing for consumers? I know it's a long ways off, but what are some of the things you're seeing there?
Laurand Lewandowski: So, yeah, let me address that, Heidi. As I mentioned earlier at the start, the price of asphalt has increased dramatically over the last 40 years. And if you look at today's world, we talk about sustainability for roofing, but you see it in all aspects of our life. And the refiners are slowly converting some of their refineries to biorenewables, and those types of refineries do not produce asphalt. So, as the supply of asphalt continues to decrease, the value of recycling will increase. So, it's kind of a process long term, but I think you balance that and work through the process of building a sustainable solution that's both... it has practical business sense, economics to it, and you can basically not have a tremendous impact on the overall cost of the product to the customer.
Heidi Ellsworth: Go ahead, Mark.
Mark Leo: Yeah, no, I would just add that if you take that thinking to the next level, typically when you're consuming virgin asphalt for the production of products or the use in paving, you're taking it from those refineries, which tend to be in certain locations around the country, and you're transporting it, and then you're processing it, and then you're using it. And the way we're building these approaches is around leveraging the value of the asphalt that still remains in the shingles.
So, in that way, you should think about these piles of shingles that have accumulated around the country. We see that as a source of raw material, and we see that as a really interesting source of asphalt where it's becoming more scarce in some areas. We think of this as a feed stock raw material that in a lot of ways is decoupled from what a typical asphalt market is, which follows the price of oil roughly. So, this is an interesting space to be in, and we see it as a potential real benefit when we make that input a part of our business.
Heidi Ellsworth: Yeah. And we've been seeing a lot of items that are being recycled that no one even thought about recycling before. We heard the other day about someone, they were using for impact glass the film that goes on the impact glass. They're actually recycling that into materials to make them stronger. So, a lot of people are looking. I think, Mark, what you said is there's these piles of junk that could be used and could be taken to that next step that people aren't even thinking about. We saw it in the slate world. I mean, it's kind of across the board when you're talking about roofing.
But I think one of the things that I would like to bring up, and it was kind of mentioned here in the chat too, is in this messaging, it is really important if you are a contractor in an area, once you develop that program with your recyclers, once you develop the programs... because it takes a lot to put all of this in place. But I'm going to share actually some of the things that Peter Horridge shared with me. Once he was able to put those systems in place, and he has it, it's a culture now of his company. They talk about it to their customers. They try to use recycled materials when they can. It is a conversation, and they actually have been able to get a premium for their roofing surfaces because they are doing that. And that's what people are looking for. They're looking for contractors who are not taking the shingles to the landfills.
I think that's going to be a key because the demand that we're seeing from this next generation is, we want you to do something different. Mark, what are you hearing on that consumer side?
Mark Leo: Yeah, I agree with that. And I think the concept here is you're pushing a weight up a hill, and you get to a tipping point where when you get to the top, you create a positive feedback loop. It's almost like network effects. The more interest there is, the more players enter the market, the more people enter the ecosystem, things start to get more efficient. You're able to cut down on the transportation that you need because you've got more nodes in the system, those types of things.
So, that's what we expect to see as the ecosystem develops and more people get involved and more players and more products in the market and more technologies and processes get proven out. As the market matures, this is what we expect to see. Now, right now, it takes a little bit more fortitude and future thinking in terms of investment and things like that, but it's okay. We need leaders to step up in this space and lead it for now, but we expect things to get easier as time goes on.
Heidi Ellsworth: So, Laurand, for the contractors who are out there right now, and we have some questions like, "Where can I find recycling spaces?" Is there a list? Is there a way... How do I go about this? Is there anything that you're seeing from ARMA that can help these contractors, and should they be going to their manufacturers and then having the manufacturers go to ARMA? What's that little path if they're looking for help from industry associations?
Laurand Lewandowski: So, I think one thing is obviously talking to the manufacturers, but I think for each contractor, and Mark highlighted this before around the ecosystem in the way of recycling products is fairly geographically tight. You don't want to be taking the material from a job site more than an hour away. So, I think as the contractors look at their space... and there's many, we highlighted a few at the shingle recycling forum, that have worked with local paving contractors or actually built their own grinding capability and then aligned with others in the industry to build out that little ecosystem.
So, I think you have to look at the space as it exists today, what your area of business is, and find out what is going on. I think that's the first step. And there's a variety of lists out there, and I saw some questions around that. But really, it's germane to where you do business. And a good example of a fairly well-established ecosystem is if you look in the Chicago land area. They do a lot of shingle recycling and taking that waste shingle RAS back into paving actually with the Illinois Tollway Authority. So, they have a system set up, geographically defined, where you have recyclers, you have contractors, you have a local authority that's promoting the use of it.
And so, there's instances, that Mark talked about, as we get to that tipping point, that's going to become more common and it'll be easier for contractors to reach out and figure out where to go and who's doing what. And the process is still getting up that hill.
Heidi Ellsworth: Yeah. Mark?
Mark Leo: Also, just to answer your question with an actionable thing here as well, if you go to the Owens Corning website, you'll see that we've partnered with a group called Earth911. And if you go to their website, they have a database that they try and keep as updated as possible with folks who are recyclers for both shingles and other spaces as well. But that's one group that we've tried to work with to make sure that folks have the most up-to-date information in their area about who's in business, who's taking shingles, and who can they work with. So, that's one resource we could point you to. And either go straight there or go to the Owens Corning website and you'll easily find it.
Heidi Ellsworth: And we might even have Megan... Megan, maybe you can put that link into the chat. I just wrote down that chat too. So, Earth911. And like I said too, if you're doing Googles... doing Googles. But if you Google it, you're going to find a lot of different recycling groups out there too that are trying to... I know we had that before. So, we'll continue to get that information on RoofersCoffeeShop so you can find it.
We do have another question again from George. Thank you. "I am currently involved in two repair or replacement projects, my church and my HOA, both of which are a considerable size. This is in Phoenix, Arizona. Any input would be helpful. The HOA has considerable funds available. The church will have to raise funds." Oh, and George, I'm assuming this is in order to recycle. That's a really interesting question. As people are looking at it, and if they're going to recycle everything and there's that extra cost, how do they fund that? How do they make sure that it happens? Because that it's not always as easy as just taking it to the recycler, right?
Mark Leo: Right, and I don't know the Phoenix area very well, so it depends. So, you'll see different dynamics in different areas. Because there is value in shingles, sometimes you'll see that a recycler will charge... Landfills charge to take shingles. It's called a tipping fee. A tipping fee at a recycler may be less than it is at a landfill. So, in that sense, if there is an ecosystem in the local area where there are recyclers who are doing business and finding end markets for the RAS into paving, for example, they're going to be willing to take a little bit less tipping fee in order to make sure that they're getting that product so that they can do their business. So, that's an example of where it can be a benefit to a homeowner or a building owner.
Heidi Ellsworth: Ed just had a great comment, and I've seen this, Ed. This has been forever. And so, this is, I think, the tipping point. Things are going to start changing. But he says, "I don't see RAS really taking off until it costs less to take our waste to a recycler than to a landfill." That's been kind of the case for 20, 25, longer years, right, Laurand? We've been waiting for that tip when it's more important and economically feasible to recycle than it is just to throw it into a landfill.
Laurand Lewandowski: Yeah, and I think you need to look... As Mark talked about earlier, we're approaching this two ways, one into paving and one into roofing. And I think where we have manufacturing locations, obviously that's one scenario. But in the paving space, it really comes down to, for that contractor, is that recycling location closer than that landfill, or are the recycling tipping fees lower than the landfill? And so, that's just in a geographic space, you just have to look at that. And I think as more recycling occurs, I think that'll become more prevalent and it'll be easier to recycle over time. But those systems have to be built.
Heidi Ellsworth: And I'm going to be a little Pollyanna on this, and so forgive me, but I do think that consumer demand is going to start driving it too, that there are consumers out there who are willing to pay that extra amount to say, "Don't take it to a landfill, figure out the recycling part of it." So, it's a business strategy to look at to kind of think through that. And I am hearing that, and I'm hearing that from other contractors in the industry. I'm more than happy to get you connected to Peter up in Maine and to some of those folks because we're seeing some successful operations happening.
And George, I'm so sorry, he said it wasn't the roof he was recycling. He's actually working on projects for his church and HOA for parking lots and streets. So, the other side, trying to figure out how to get recycled material into your streets and parking lot if you're doing that.
Laurand Lewandowski: So, when we talk about building out the roofing recycling space, I think we can look at the model that has evolved over many decades in paving. Now, in the paving space, they have what's called reclaimed asphalt pavement. And when Mark indicated that there's like 400 million tons of asphalt mix that's used every year, well, 90,000 tons of that is actually reclaimed asphalt pavement. So, that's established at the state level, the city level. The contractors incorporate that. They actually typically will bring it in and process it themselves. So, that's an example of where you have built a viable circular economy and recycled... probably one of the largest circular economies that we have in the United States. So, I think that that's the aspiration we have when we start to think about shingle recycling, both into paving and back into shingles.
Heidi Ellsworth: Yeah, that's great. We have an excellent question that I just saw, and I'm sorry Susan if I was a little late, but this is just an awesome question. Says, "Contractors are often family-owned businesses. Do you find situations where contractors are wanting to recycle to preserve the environment for the next generation? Is there a sense of we owe this to the future? I've heard some antidotes in the field about this." Great question. Are you hearing any of that? Mark, let's start with you.
Mark Leo: Absolutely. I've been working in the sustainability space for quite a while now, and I've found that when you're trying to get something off the ground, the path to success is to work with people who are most passionate, every time. Otherwise, you're trying to push a rope and it's very difficult to do. But yes, so for us, the people that we tend to talk to are the people that reach out to me directly after something like a conversation like this or some sort of press release or whatever. It's always those folks who are extremely passionate about this, who want to get involved, and who are looking for a way to differentiate themselves, and whether it be a family business, they're a contractor, or whatever it may be, they're looking for that angle.
And oftentimes, there is a way to do that, to do some small-scale project, to work together on something where you can demonstrate to your customers that this is important to you. And people like that are going to have found themselves a customer segment who is willing to pay more her or who is going to choose them over someone who's not having these types of discussions. So, yes, it's very common. We see it a lot, and we love it. It's great to see that kind of enthusiasm in the market.
Heidi Ellsworth: I love the messaging for a roofing contractor in their marketing of we are a family-owned business and we care about the future of other families. I mean, it's something to think about. And that's, again, that opportunity that even if it does cost a little bit more to take it to the recycling, you now have such great messaging, such great marketing. You're meeting your customers with what they want to see. So, great, great thoughts.
We are starting to come to the end of our hour, which has just been amazing. So, as always, I do want to ask, let's just kind of talk about next steps. So, we did a little bit. We're encouraging everyone to look into their local area, find out what's going on recycling-wise. It could just be a Google. Find out what's happening in your local area. One of the things I'm going to recommend, too, is I know looking at the names who are on this Coffee Conversation today, I know many of you are involved with your roofing associations, local, state, regional, national. I think it is imperative that you all take this discussion to your associations. Have this discussion. What are we doing as a local association to build a relationship with local recyclers? How are we bringing this together for our contractors? Because as Laurand and Mark have said, it really starts locally.
So, Mark, I would just like you to talk about that, about that this is a push, right? It's a push me, pull me. It's a push for contractors to actually make sure that their associations, make sure that their local communities, that people are talking about this in order to make it happen.
Mark Leo: Yep, I agree. So, from the Owens Corning side, we're committed to advancing the projects that we have, the strategies that we have. So, in that sense, we're talking about creating demand for recycled shingles. We want to use those shingles in a way that goes back into our roofing products and goes back into paving. So, there has to be a balance here between supply and demand. The supply right now is no problem. We've got plenty of shingles at end of life that can be used. We're working on the demand side.
And I agree with you and your comments that we could use help creating both sides. And the demand would be reaching out to your organizations, helping spread the message through both your organizations as well as customer networks and thinking about how do we get more people excited about this and wanting to invest and see the future of where we expect this market to go as we look five, 10 years out.
Heidi Ellsworth: Yeah, Laurand, and with ARMA too, because I led us in with that thought.
Laurand Lewandowski: Yeah, and I think Mark hit it. Really, we have to build a demand. We have to create the opportunity to recycle, and that's going to drive people coming into the ecosystem where it makes sense, both from an environmentalist perspective and obviously from an economic perspective, to create those ecosystems across different parts of the country.
Heidi Ellsworth: I agree 100%. And we have a couple comments here that I think are great. One's for us to take away. So, first I want to say that I have a takeaway from this Coffee Conversation. I always think you should always have one or two nuggets after any conversation. And my takeaway is, I'm on the board of Washington State RCAW, and they had a recycler at their trade show last week. That's my takeaway. We're going to see if we can build a better, stronger relationship with that recycling company and the association and see what we can do. I'm taking that back to that board. Tracy, you're listening. We've got to do this.
And the other thing, too, is from a RoofersCoffeeShop standpoint, Ed, I see your note here, is there a forum for RAS? No, but there will be. And so, I tell you what we're going to do. You can find a lot of this information on the Owens Corning directory, but we will start a full forum on RoofersCoffeeShop. I'm going to introduce you to James Ellsworth, who is also very passionate about this, and with RoofersCoffeeShop. And we'll get a forum going on there so we can keep having these discussions. So, Ed, we're going to be contacting you so we can get that started.
The other thing that we had from Frank that just came in, that is great, is there any consideration for manufacturer rebate programs for recycling? I think we're kind of at the end, so we're probably not going to answer that right now, but I think that's a good thought for everybody to have in their head as we leave this conversation, is how do we, manufacturers and contractors, work together? There's a lot of great loyalty programs out there, and Owens Corning has one of the best, but there's a lot of those kind of things. So, maybe that becomes part of that. Frank, great comment.
And then, John Kenny, a very important and interesting topic today. Like any other change needed, continuing to have conversations like these and education will move us off the mark. John, you're awesome. Yes. Ed, you have a lot more questions there. We're going to come back to you because we're at the end of our day, but Tracy also talked about what we need to do up in Washington. So, thank you all. Thank you so much, Mark and Laurand, for being on here today. You were amazing as always, and we are really looking forward to continuing to watch where you take this. I mean, what an amazing program you have going.
Laurand Lewandowski: Thank you.
Mark Leo: Thanks for having us.
Laurand Lewandowski: Thanks for having us.
Heidi Ellsworth: Thank you. And thank you, Owens Corning, for sponsoring this conversation. As John Kenny said, this is critical. We need to have these conversations. We need to all be rowing the same direction in that boat and saving the planet. Basically, at the end of the day, that's what makes it happen. And so, Owens Corning, thank you so much for taking the lead in that, for sponsoring. And also a huge shout-out and thanks to ARMA for their inspirational goals that really are bringing the industry together.
I invite all of you back two weeks from today for... so excited. Black History Month, and it's going to be all about celebrating Black History Month, but really talking about culture, recruitment, retention, how we can continue to make this industry rich in all cultures, with true diversity and inclusion. So, we are excited to welcome Megan Keys and Erica Jackson. It's being sponsored by Johns Manville. Thank you so much. We'll see you all in two weeks. And as always, watch for on demand. It'll be out there. Share this with everyone. Thank you again, and we will see you on the next Coffee Conversations.
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