MALAYSIAN PLASTIC CIRCULARITY SERIES Report #3 Exploring Plastic Circularity Opportunities in the Electrical and Electronics Sector Administ r d b © 2025 The World Bank Group 1818 H Street NW, Washington, DC 20433 Telephone: 202-473-1000; Internet: www.worldbank.org This work is a product of the staff of the International Bank for Reconstruction and Development (IBRD) and the International Finance Corporation (IFC), members of the World Bank Group, with external contributors. The “World Bank Group” refers to the legally separate organizations of the IBRD, IFC, the International Development Association (IDA), and the Multilateral Investment Guarantee Agency (MIGA). 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The World Bank Group therefore does not warrant that the use of any third-party-owned individual component or part contained in the work will not infringe on the rights of those third parties. The risk of claims resulting from such infringement rests solely with you. If you wish to re-use a component of the work, it is your responsibility to determine whether permission is needed for that re-use and to obtain permission from the copyright owner. Examples of components can include, but are not limited to, tables, figures, or images. All queries on rights and licenses should be addressed to World Bank Publications, the World Bank Group, 1818 H Street NW, Washington, DC 20433, USA; e-mail: pubrights@worldbank.org. Cover design: Sarah Jene Hollis Contents 1. Introduction 4 2. Overview of plastic usage and waste in the E&E sector 5 3. Challenges for durable plastic recycling in the home appliances sector 13 13 4. Global initiatives to increase E&E plastic recycling 15 15 5. Opportunities to unlock recycling value 19 19 6. Conclusion 21 21 1. Introduction This report is the third in the Malaysian Plastic Circularity Series, a market assessment conducted in 2023-2024 with the objective of offering comprehensive insights into Malaysia’s plastic recycling economy. The assessment covers topics along the value chain, including feedstock collection, infrastructure, policies, and initiatives to address plastic waste challenges, with an in-depth analysis of the electrical and electronics (E&E), automotive, construction, and healthcare sectors. Information on the approach, methodology, and background to the series is in the first report, Introduction to the Malaysian Plastic Circularity Series. This report centers on Malaysia’s durable plastic (Box 1) recycling value chain for the E&E sector. It focuses on home appliances such as refrigerators, air conditioners, washing machines, and televisions, because they generate more potential recyclable waste than smaller household E&E products like laptops or smartphones. This sector-specific assessment aims to create a market by identifying potential opportunities in durable plastic recycling in Malaysia and attracting private sector investment across the value chains. In Malaysia, the home appliances sector generates an estimated 70 kilotonnes of plastic waste per year from end-of-life (EOL) home appliances. Polypropylene (PP) and acrylonitrile butadiene styrene (ABS) are the key plastics for recycling, given their comparatively large waste volumes and their in-sector and cross-sector application opportunities. Based on the study’s assessment, only about 20 percent of the durable plastic waste generated from EOL home appliances in Malaysia is collected, and of the collected waste, only 32 percent is recycled. This inadequate supply of plastic waste from the sector emphasizes the need for cross-sector plastic recycling efforts, such as open-loop recycling, compared to in-sector closed-loop recycling efforts.1 To increase plastic recycling from the E&E sector, a national collaborative effort is necessary. The plastic recycling landscapes for Malaysia’s E&E and automotive sectors share similarities, particularly the key durable plastic resins used and the EOL management processes, including waste recovery and recycling. As a result, the insights and findings for these two sectors are also similar. 2 In Malaysia, the home appliances sector generates an estimated 70 kilotonnes of plastic waste per year from end-of-life home appliances. 1 The definition for closed-loop recycling used in this study is that plastic waste from one sector is recycled for use in the same sector. The definition for open-loop recycling in this study is that plastic waste from a given sector is recycled for use in other sectors, or plastic waste from other sectors is recycled for use in the given sector. For more information, see Introduction to the Malaysian Plastic Circularity Series. 2 For more information about the automotive sector, see Malaysian Plastic Circularity Series - Exploring Plastic Circularity Opportunities in the Automotive Sector. 4 2. Overview of plastic usage and waste in the E&E sector In Malaysia, the packaging sector consumes the most plastic, accounting for 45 percent of consumption in 2023. The E&E sector is the largest non-packaging and durable plastic user, comprising 28 percent of plastic consumption (Figure 1). IFC has developed a global durable plastic recycling market opportunity scoring system, which evaluates a country’s access to plastic waste, EOL vehicles, and electronic waste from EOL home appliances. Based on the results, Malaysia has one of the top 10 highest market potentials for durable plastic recycling. Leading the rankings are large, advanced economies such as the United States and Germany (Table 1). Figure 1: Breakdown of plastic consumption by revenue and sector in Malaysia, 2023 70 FOCUS 33.8 61.4 60 E&E Malaysian ringgit, Billions 28% 50 40 12% 3% 6% 30 27.6 3% 3% 20 45% 10 0 Packaging Non-Packaging Total Packaging E&E Automotive Construction Others Household Agriculture Source: MPMA, 20243 3 MPMA (Malaysian Plastics Manufacturers Association). “2024 Roadshow.” 2024. https://mpma.org.my/upload/Industry_Outlook_2024_ Roadshow.pdf 5 IFC’s durable plastic scoring system is based on three pillars designed to identify countries with the highest availability of vehicles and E&E feedstock. Pillar 1. Current access to domestic and imported plastic waste (20 percent weighting): Identify countries that produce large quantities of plastic waste and import plastic waste to be reused, and that have initial policies in place to enhance business opportunities. Pillar 2. Potential access to EOL vehicles (40 percent weighting): Assess the access to EOL vehicles based on current sales or cars in use, the expected increase in vehicles, and apply a penalty to countries importing used cars (highly correlated with a longer vehicle life). Pillar 3. Potential access to E&E waste (40 percent weighting): Measure the market size of large and small appliances, e-waste generated, and policies to encourage companies to recycle e-waste. Table 1: IFC’s Global Durable Plastics Recycling Market Opportunity Scoring Country Global Ranking Access to Access to EOL Access to EOL home plastics4 vehicles5 appliances6 (Focus of this report) United States 1 1 3 1 Germany 2 3 19 5 United Kingdom 3 8 25 2 China 4 29 1 21 Japan 5 20 1 3 Turkey 6 2 17 17 France 7 10 12 4 Spain 8 9 29 8 Canada 9 32 28 7 Malaysia 10 4 15 27 South Korea 11 41 10 11 4 Combination of data on the import and export of plastic waste, plastic waste per capita, mismanaged plastic waste, and available plastic circularity policies. 5 Combination of data on light vehicle sales, passenger cars in use, number of imported cars, and growth in passenger cars. 6 Combination of data on the absolute number of units of large appliances and small appliances sold, e-waste per capita, and e-waste legislations. 6 The plastics used in the home appliances sector primarily consist of durable plastics (Box 1), as opposed to the single-use plastics mainly used in packaging. Durable plastic waste is generated when a product reaches the end of its usable life, often after months or years of use. Between 20 percent and 40 percent of the weight of large home appliances is made up of plastic.7 This study focuses on plastic waste from large home appliances—their size means these appliances have a higher potential volume of plastic waste per collected EOL home appliance than other home appliances (Table 2). Figure 2 illustrates the major plastic components in typical large home appliances, also commonly called whitegoods. Table 2: Plastic waste generated by common household E&E appliances Appliance Refrigerator Air conditioner Washing machine Television Computers/ Smartphones laptops kg per unit 227 40 26 8 1.1 0.095 Sources: Illumynt, PCGlance, Compare and Recycle8 Figure 2: Examples of plastic components in typical white goods Plastic trays and compartments Plastic Plastic control body panel Plastic cover Plastic door Wind deflector Plastic inner linings 7 CECED (European Committee of Domestic Equipment Manufacturer). 2017. Material Flows of the Home Appliances Industry. https://www. researchgate.net/publication/322759408_Material_Flows_of_the_Home_Appliance_Industry_-_CECED 8 Carol Baroudi, “Recycling Plastics from Computers,” Illumynt, n.d. https://illumynt.com/blog/recycling-plastics-from-computers/; Isaac Smith, “How Much Does a Laptop Weigh – Laptop Weight Guide,” PC Glance, accessed June 11, 2025, https://pcglance.com/how-much- does-a-laptop-weigh/; and Compare and Recycle, “How Much Plastic Is in Your Phone?” last modified November 3, 2024, https://www. compareandrecycle.co.uk/blog/how-much-plastic-is-in-your-phone 7 Box 1. WHAT ARE DURABLE PLASTICS? Durable plastics are typically designed for months or even years of use before reaching their end of life.9 This contrasts with single-use plastics, which are manufactured to be used once or for a short period before being discarded. The primary distinction between the two plastic applications, single-use and durable, is their intended duration or number of uses. The relatively long life span of durable plastics makes them suitable for use in long-life applications and consumer products, such as fridges, washing machines, air conditioners, televisions, and insulation. The disposal of these products at the end of their life can occur years after they were manufactured. Durable plastics can be used by several owners and can be moved interstate and internationally. Their relatively large size means these household appliances are typically not disposed of via Municipal Solid Waste10 (MSW) streams, in contrast with single-use plastic products. Distinct types of plastics prevail within each plastics classification. In the case of single-use plastics, polyethylene terephthalate (PET), high-density polyethylene (HDPE), low-density polyethylene (LDPE), and PP are the predominant materials. Conversely, in durable plastic applications, such as home appliances, PP, ABS, polystyrene (PS), and other plastic types are more common. An overview of the typical distribution of plastic types across various plastic classifications is in Table 3. Table 3: Differences in plastic types across end-use application sectors Plastic types Single-use plastic applications Durable plastic applications Packaging11 Home Appliances12 PET 18% <1% HDPE 23% - PVC 3% <1% LDPE 25% - PP 26% 23% ABS - 14% PS 13 - 46% Other Plastics14 7% 16% Total15 100% 100% Source: OECD, 2023 9 In this study, the average life expectancy for durable plastics in home appliances is as follows: 12 years for washing machines, 15 years for air conditioners, 15 years for refrigerators, and six years for televisions. 10 MSW is any substance discarded within the area of a municipal waste collection. The sources of MSW are residential, commercial, institutional, industrial, and city centers. 11 OECD, 2023, Plastics use by polymer - projections. https://doi.org/10.1787/b9bae4d1-en 12 Based on the assessment carried out as part of this study and incorporating plastics from refrigerators, air conditioners, televisions, and washing machines. 13 Not in focus due to limited recyclability potential. 14 Includes polyurethane (PU), polyamine (PA), polyethylene (PE), polycarbonate (PC), and other plastic types. 15 The numbers may not add up to 100 percent due to rounding. 8 Figure 3: Estimation of the durable plastic waste volume and type from the home appliances sector in Malaysia, 202316 75 70 13 60 30 45 Ktpa 70 30 12 15 0 0 13 0 Total PP PS ABS PU PA Others The home appliances sector in Malaysia generated an estimated 70 kilotonnes per annum (ktpa) of durable plastic waste from EOL home appliances in 2023, consisting primarily of PP, PS, and ABS (Figure 3). Just 20 percent of the volume of plastic waste generated from the home appliances sector is collected for recycling, which is roughly 14 ktpa (Figure 4). This collection rate is low, especially compared to countries like Japan, where it is 99 percent (Box 4), highlighting Malaysia’s underdeveloped plastic waste collection system for EOL home appliances. The remaining 80 percent of the durable plastic waste that is not collected is sometimes illegally burned due to the lack of an EOL home appliances collection system, mandatory extended producer responsibility (EPR), and enabling policies. Approximately 32 percent of the collected durable plastic waste (4.5 ktpa) is mechanically recycled. Due to limitations in processing the collected volume, almost all of the remainder, 67 percent (9.4 ktpa), is sent to landfills. Malaysia exports 1 percent (0.1 ktpa) of sorted plastic waste. Within the volume sent for mechanical recycling, 95 percent (4.3 ktpa) is transformed into recycled plastic resins, while 5 percent (0.2 ktpa) is lost during the recycling process. In terms of output, 70 percent (3 ktpa) of the recycled plastic produced is exported due to the lack of domestic end-use demand for recycled plastic and higher prices in the export market. The remaining 30 percent (1.3 ktpa) of recycled plastic resin fulfills the domestic demand for recycled plastics, primarily from outside the home appliances sector. Figure 4 shows the volume and flow of durable plastic from the home appliances sector in Malaysia in 2023. The launch of the Malaysia Plastics Sustainability Roadmap (MPSR) in 2021 demonstrates the country’s commitment to driving plastic circularity efforts. The MPSR focuses on reducing plastic waste from all sectors and has the potential to drive increased supply and demand for recycled plastic in Malaysia. 16 Calculated using information from Euromonitor database 2023 Industries - Consumer Appliances: Major Appliances, based on the sales volume in 2011 for washing machines, in 2008 for air conditioners and refrigerators and 2017 for televisions, whereby the average life expectancies are 12 years for washing machines, 15 years for air conditioners and refrigerators, and six years for televisions. 9 Figure 4: Estimated volume and flow of durable plastic from the home appliances sector in Malaysia, 2023 Maximum potential supply 70.0 ktpa 80% Mismanaged plastic waste - inappropriate disposal1 20%2 Opportunity to increase collection Post-consumer plastic waste collection for recycling rate via regulatory, education, and 14.0 ktpa public-private partnerships (target of 75% under MPSR) 100% 1% 67% Export surplus of Post-consumer waste sorting Landfill post-consumer 14.0 ktpa 0% waste for recycling Energy 32%3 recovery Post-consumer waste sent Opportunity to scale up local 5% for mechanical recycling Lost residues recycling capacity to o take 4.5 ktpa collected plastic waste (no specific target under MPSR) 95%4 Recyclates from 70% post-consumer waste 30% Surplus export of used domestically used in new products post-consumer recyclates5 in other industries 4.3 ktpa 0% Opportunity to increase local demand directly Manufacturer demand via minimum recycled content target regulations 0.0 ktpa6 or indirectly via green tax incentives for consumers (target of 15% under MPSR) Notes: 1. Mismanaged waste is lost through various streams, primarily ending up in landfills or the environment. 2. The 20 percent post-consumer plastic waste collection for recycling rate represents an average of three estimates: a 12 percent collection-for-recycling rate from United Nations University/United Nations Institute for Training and Research and International Telecommunication Union’s 2020 Global E-waste Monitor;17 a 30 percent average recycling rate for PP estimated by The World Bank Group in its 2021 Market Study for Malaysia;18 and a 25 percent household e-waste recycling rate reported by the Department of Environment (DOE), quoted in The Edge Malaysia.19 The 20 percent rate has also been validated through stakeholder consultations. 3. A 32 percent mechanical recycling rate is derived based on SWCorp’s 2021 recycling figures. 20 4. A 95 percent yield is estimated for the mechanical recycling of mono materials, 21 as PP and ABS are the most recycled plastics in the EE sector in Malaysia, and are mono materials. 5. 70 percent recycled resin export volume is derived from expert interviews due to a lack of centralized data sources. 6. Manufacturer demand is negligible as there is no evidence of commercialized adoption of recycled plastics among original equipment manufacturers (OEMs) in Malaysia. 17 United Nations University/United Nations Institute for Training and Research and International Telecommunication Union. 2020. The Global E-waste Monitor, 2020: Quantities, Flows and the Circular Economy, 74, https://www.itu.int/en/itu-d/environment/documents/toolbox/ gem_2020_def.pdf 18 World Bank Group. 2021. Market Study for Malaysia: Plastics Circularity Opportunities and Barriers. Marine Plastic Series, East Asia and Pacific Region. Washington, DC., https://documents1.worldbank.org/curated/en/272471616512761862/pdf/Market-Study-for-Malaysia-Plastics- Circularity-Opportunities-and-Barriers.pdf 19 The Edge Malaysia “Managing E-waste Is Key to Our Sustainability,” accessed June 11, 2025, https://theedgemalaysia.com/node/703393 20 New Straits Times, “SWCorp: National Recycling rate now at 31.52 pct,” 13 December 2021, https://www.nst.com.my/news/ nation/2021/12/753941/swcorp-national-recycling-rate-now-3152-pc 21 Geert Warringa, Geert Bergsma, Pascal Bouwman, and Martijn Broeren. 2023. Impacts of Allocation Rules on Chemical Recycling: Consequences on the Environment and Maximum Circularity of Plastics. CE Delft. https://zerowasteeurope.eu/wp-content/uploads/2023/05/ CE_Delft_230135_Impacts_of_allocation_rules_on_chemical_recycling_Def.pdf 10 The durable plastic value chain for the home appliances sector in Malaysia was assessed according to the value chain shown in Figure 5. The durable plastic value chain involves various actors along the distribution/put-on- market, collection/sorting, and recycling/EOL stages. Figure 5: The durable plastic recycling value chain for Malaysia’s home appliances sector E-waste Appliances recovery facility Other industry retailer Landfill material input Informal Other recycler OEM Consumer Other E&E – Home sectors appliances circular sector circular Recycled resins economy economy manufacturer E&E Consumer OEM Other industry waste output Virgin plastics E&E plastics manufacturer parts manufacturer Distribution/put on market Collection/sorting Recycling/end-of-life 11 The home appliances sector in Malaysia does not have dedicated large sector-specific recyclers due to the lack of formal collection systems, weak demand for recycled plastic, geographically dispersed recycling facilities, and a lack of enabling policies such as mandatory EPR. Key findings from the study include: 1. The home appliances sector generated 70 kilotonnes of durable plastic waste in 2023, and this is expected to increase by a compound annual growth rate of 2.2 percent between 2023 and 2033.22 The durable plastic waste from EOL home appliances consists primarily of PP, PS, and ABS (Figure 3). These types of plastics make up approximately 80 percent of the plastic waste volume generated by the sector. Although PS has the highest potential volume, it has limited recyclability, while PP and ABS have high recyclability and potential volumes for collection of 13 ktpa and 12 ktpa, respectively. 2. With no formal EOL home appliances collection system, there is a high loss of plastic waste during collection. The loss of plastic waste along the home appliances durable plastic recycling value chain mainly occurs at the collection stage, with an estimated average of just 20 percent collected (Figure 4). The plastic waste that is not collected tends to end up in landfills, illegally burned, or as other mismanaged plastic waste. 3. Low demand for recycled plastic hampers domestic value chain development. While global demand for recycled plastic is expected to increase as more countries introduce EPR for the home appliances sector,23 this is not the case in the Malaysian domestic market. The sluggish growth in durable plastic recycling can be attributed to the low demand for recycled plastic from OEMs in the home appliances sector. This lack of demand from OEMs also reduces demand from parts manufacturers. As a result, there is little incentive for other value chain players to prioritize recycling durable plastic within the sector. 4. Informal recyclers dominate due to the high entry barriers for formal recyclers. Informal recyclers are more prevalent along the value chain primarily because formal recyclers are subject to stringent requirements on full recovery (the extraction and processing of all materials from e-waste, including precious metals, rare earth elements, and plastics) and lengthy approval processes for operating permits. Informal recyclers prioritize high-value materials, especially metals, while plastic waste is often discarded or sent to landfills. 22 Based on the data from Euromonitor database 2023 Industries - Consumer Appliances: Major Appliances and the study’s assessment. 23 The implementation of EPR for the automotive and home appliances sectors can potentially increase the plastic recycling rate as observed in other countries. For example, Germany implemented an EPR system for the automotive sector managed by the joint office for EOL vehicles - Gemeinsame Stelle Altfahrzeuge (GESA). GESA is responsible for managing the country’s EOL vehicle recovery and recycling flow (including plastic recycling). Under the EPR system, manufacturers are responsible for financing the recycling process for EOL vehicles. To reduce the cost of doing so, manufacturers collaborate to ensure EOL vehicles are collected and that the process of extracting recycled materials is optimized, including for plastics. 12 3. Challenges for durable plastic recycling in the home appliances sector Limited durable plastic waste supply from the home appliances sector The study indicates that the maximum potential volume of recyclable plastic that can be collected from the home appliances sector is insufficient to support more than one or two sector-specific and plastic-specific recycling plants. This is because mechanical recycling plants, which can benefit from economies of scale, require a minimum capacity of approximately 30 ktpa24 to be commercially viable. The inadequate supply of plastic waste from home appliances emphasizes the need for cross-sector plastic recycling efforts, such as open-loop recycling. Further areas along the plastic recycling value chain must be considered to enable cross-sector recycling, especially in the non-packaging sectors. For instance, standardized plastic specifications that are incorporated into product design are required for recycling across sectors. The next step is to consider an integrated collection and sorting infrastructure for plastics from all sectors. Finally, scaling up chemical recycling will open opportunities in other hard-to-recycle plastics across sectors. Weak collection system for EOL home appliances The high loss in plastic waste (estimated at 80 percent) from the home appliances sector is partly caused by the lack of a formal collection system, as there is no central agency to monitor and drive EOL home appliances collection. This insufficient supply of collected plastic waste hinders recyclers from specializing exclusively in plastic waste from the sector, as demonstrated by the absence of sector-specific recyclers. Several countries have implemented recycling requirements that are both industry and consumer-focused to drive collection and recycling rates. Countries including Japan, Germany, and the Republic of Korea have a central agency to manage recycling for EOL home appliances (Box 2). EPR for E&E has also been enacted in Germany (Box 3) and the Republic of Korea.25 In Japan, consumers are required to pay a collection and recycling fee for EOL home appliances (Box 4). Lack of local demand for recycled plastic from domestic home appliances OEMs There is limited end-use demand from the domestic home appliances sector caused by an absence of regulatory requirements and the high price of recycled plastic compared to virgin plastic. Local stakeholders have highlighted that OEMs are slow to incorporate recycled plastic due to the lack of regulatory requirements. 26 The price for recycled plastic is expected to rise in the near term, as demand, driven by a growing awareness and focus on sustainability goals, increases without a corresponding rise in production capacity. Recycled plastic is more likely to be exported, given a greater willingness to pay from importing countries. The combination of no regulatory requirements for recycled plastic to be used by home appliance OEMs and the price premium of recycled plastic resins presents an economic barrier to advancing durable plastic circularity in Malaysia. 24 Based on the study’s assessment, validated through interviews with technology providers. 25 For more information, visit https://enviliance.com/regions/east-asia/kr/report_12742 26 Hamod, Haruna. 2021. “Plastic material composition and separation in waste electrical and electronic equipment.” Lappeenranta: Lappeenranta-Lahti University of Technology (LUT). https://urn.fi/URN:NBN:fi-fe2021060132638 13 Prevalence of informal recyclers27 along the value chain Informal recyclers may undermine the position of formal recyclers, limiting their potential for future expansion. The absence of large off-takers limits the presence of large recyclers, making it possible for small or informal plastic waste recyclers to exploit open-loop opportunities. Furthermore, insights gathered from discussions with stakeholders along the value chain reveal that informal recyclers do not always adhere to recycling guidelines, resulting in lower-than-anticipated recycling feedstock specifications. Leveraging their lower costs, informal recyclers can undercut formalized recyclers, which are burdened with higher costs imposed by regulatory requirements. The presence of a large informal sector also limits the traceability and transparency of the treatment of EOL appliances. Integrating these players into the system is key in managing EOL appliance recycling and enhancing traceability.28 Box 2. AGENCIES MONITORING THE RECYCLING OF EOL HOME APPLIANCES Japan’s Association for Electric Home Appliances (AEHA) is a private-sector foundation that coordinates home appliance recycling. The foundation has 28 OEMs and 11 partner associations as members. AEHA plans and implements research and policies relevant to home appliances, including recycling. It is also designated as a special proxy organization that encourages and drives waste from E&E equipment (WEEE) recycling in Japan. Germany’s Stiftung Elektro-Altgeräte (EAR) is a public-sector foundation that acts as a clearing house for WEEE recycling. Some of its main roles include registering and providing financial guarantees for producers seeking to enter the German market, monitoring producers’ compliance with e-waste recycling requirements, and other recycling-related activities in the home appliances sector. The Republic of Korea’s Korea Environment Corporation (KECO) is a public-sector organization tasked with developing the country’s circularity ecosystem. KECO establishes and manages environmental complexes, including recycling facilities and waste-to-energy facilities. Additionally, KECO installs and operates waste management and monitoring networks and extends financial assistance to small and medium enterprises aiming to enhance their recycling operations. Sources: AEHA, 2022; Stiftung Elektro-Altgeräte, 2023; Korea Environment Corporation, 202328 27 Informal recyclers are players without specific approval/permit from the DOE, Malaysia, to operate as recyclers, which could include metal recyclers as well as scrap recyclers that extract useful spare parts. 28 Association for Electric Home Appliances (AEHA). “2022 Annual Report.” July, 2023. https://www.aeha-kadenrecycle.com/pdf/report/ kadennenji_2022.pdf; Stiftung Elektro-Altgeräte. “Who we are” (n.d.) https://www.stiftung-ear.de/en/about-us/who-we-are; Korea Environment Corporation. 2023. “About K-eco”. https://www.keco.or.kr/en/lay1/S295T304C311/contents.do 14 4. Global initiatives to increase E&E plastic recycling Initiative 1: Central entity to monitor (and, where relevant, implement) durable plastics recycling Some countries have a central entity to oversee EOL home appliance recycling (Box 2), monitor the performance of EOL home appliance recycling, and sometimes take a more active role in facilitating recycling activities. These entities can either be a government agency (fully funded by the government) or an industry-led entity (funded via various sources, including fees for services rendered or based on a levy on all OEMs in the market). Initiative 2: EPR for the E&E sector Some countries have implemented EPR for the E&E industry. In Germany, EPR regulation requires E&E producers to be responsible for product takeback. (Box 3). Box 3. GERMANY’S ELECTRICAL AND ELECTRONIC EQUIPMENT ACT (ELEKTROG)29 The Electrical and Electronic Equipment Act (ElektroG) was introduced in 2005 and was later revised in 2022. ElektroG regulates the introduction, recovery, and recycling of E&E equipment. Producers, importers, and in some cases, resellers are required to take back and handle the disposal of WEEE at their own expense. The legislation contains five product collection groups: 1. Large household appliances, automatic dispensers 2. Refrigerators and freezers 3. IT and telecommunications equipment, consumer equipment 4. Gas discharge lamps 5. Lighting equipment, small household appliances, electric and electronic tools, toys, sports and leisure equipment, medical products, monitoring and control instruments. Producers and importers must fulfill the responsibilities outlined in the ElektroG, including ensuring an ecological design of products is considered, being registered with the EAR before selling products in Germany, and planning for the recovery, treatment, reuse, or disposal of the WEEE with continuous reporting to the EAR. 29 For more information about Germany’s ElektroG, visit https://elektrogesetz.com/ 15 Producers have the option to choose from three takeback schemes: 1. Individual brand-selective takeback scheme: Producers take back only their own brands of e-waste, whereby contracts with EOL service providers and public waste management authorities (PuWaMA) are required (to separate the brand’s WEEE). 2. Individual non-selective takeback scheme: Producers take back e-waste from all brands in the collection group and contract with EOL service providers. 3. Collective takeback scheme: Producers join a group to take back e-waste from all brands in the collection group and contract with EOL service providers. Consumers can return WEEE free of charge at their nearest public collection point. Figure 6 shows Germany’s EOL home appliance recovery and recycling flow. Germany’s WEEE collection rate is approximately 45 percent.30 Figure 6: Germany’s EOL home appliance recovery and recycling flow Public waste management authorities (PuWaMA) collection points Send to Inform to PuWaMA collect and collection collect store WEEE according points set up to the five collection by PuWaMA groups, ready for EOL Service Provider collection Retailers Inform and Clearing House pay to collect EOL Service Providers Assigns a collection Trade-in when to a producers (via buying new one of three take- appliances back schemes) Direct Producers drop-o (OEMs) Consumers Useful life of appliance Appliance end-of-life processing Source: Deubzer, 201131 30 BMUV (Federal Ministry for the Environment, Nature Conservation, Nuclear Safety and Consumer Protection). 2023. “Waste Management in Germany 2023.” April, 2023. https://www.bmuv.de/fileadmin/Daten_BMU/Pools/Broschueren/ abfallwirtschaft_2023_en_bf.pdf 31 Deubzer, Otmar (2011). E-waste Management in Germany. United Nations University Institute for Sustainability and Peace (UNU- ISP), https://collections.unu.edu/eserv/UNU:6627/Report_E-Waste_Management_in_Germany.pdf 16 Initiative 3: Implementing recycling requirements for consumers Some countries have implemented requirements for consumers to recycle EOL home appliances (Box 4). The study indicates a correlation between high collection rates of EOL home appliances and requirements for consumers to participate in EOL recycling. Box 4. JAPAN’S EOL HOME APPLIANCES RECYCLING SYSTEM Japan implemented a consumer-focused recycling system for EOL home appliances managed by AEHA. Consumers are required to pay collection and recycling fees at the end of their appliances’ lives. Records of payments are kept via official tickets, which also ensures that home appliances entering EOL processing can be easily tracked to comply with regulations. The recycling fees are used to reimburse any associated costs incurred when recycling EOL home appliances. Figure 7 shows Japan’s EOL home appliance recovery and recycling flow. Figure 7: Japan’s EOL home appliance recovery and recycling flow 322 sites Designated collection points Submit ticket to confirm receipt of appliance Authorized Submit Reimburse firms Retailers issued ticket recycling fees Local government Purchase ticket at post o ce if Home Appliance opt for direct Recycling Ticket drop-o Manufacturers Centers (RKC) Direct drop-o 47 Consumers recycling plants Useful life of appliance Appliance end-of-life processing Flow of recycling ticket Flow of funds 17 Combined with substantial penalties, Japan’s EOL home appliances tracking system has led to a remarkably high collection rate (Figure 8). This collection rate consistently exceeds 99 percent of the annual number of EOL appliances. Figure 8: Japan’s home appliances collection rate, 2013-2021, in % of EOL home appliances and thousands 99.7% 99.7% 99.6% 99.6% 99.2% 99.4% 99.5% 15,923 15,485 99.4% 99.4% 14,671 13,684 12,133 11,555 11,754 11,080 11,142 93 75 70 62 54 54 51 53 45 2013 2014 2015 2016 2017 2018 2019 2020 2021 Collection rate Not collected for recycling Collected for recycling Source: AEHA, 2022 Initiative 4: Incorporating recycled single-use plastics into home appliance manufacturing Companies in the home appliances sector have recently explored the possibility of adopting recycled single- use plastics, such as PET, into their products. The best examples of commercialized components using recycled single-use plastics are in washing machines. For instance, Beko uses post-consumer PET bottles for the tub in its RecycledTub washing machine range. The recycled plastic accounts for up to 10 percent of the materials in each tub.32 Similarly, GRUNDIG incorporates recycled PET plastic in its Recycled PET Drum, each of which contains 60 recycled PET plastic bottles. 33 These efforts have been driven by the wide availability of recycled PET (rPET) and recycled PA (rPA) and increased sustainability goals to divert ocean-bound plastic by incorporating it into home appliances. Adopting rPET in the home appliances sector may encounter competition as there is already high demand from other sectors, particularly packaging. However, using recycled single-use plastics within home appliances is expected to be an easier way to increase their recycled plastic content than incorporating recycled durable plastics in home appliances via a closed-loop recycling approach. 32 For more information on Beko’s RecycledTub, please visit https://www.beko.com/au-en/Sustainability/recycletub 33 For more information on GRUNDIG’s Recycled PET Drum range, please visit https://www.grundig.com/za-en/pet_tub 18 5. Opportunities to unlock recycling value Based on the study findings, there are several opportunities to enable durable plastic circularity in Malaysia’s home appliances sector. Table 4: Summary of opportunities to unlock recycling value for the home appliances sector Areas for action Opportunity Description Applicable Immediate or Expected value chain medium-term improvement segment timeline Strengthen the ❶ Formalizing Formalizing informal recyclers can Recycling Medium Collection rate waste management informal durable provide policymakers with greater (next 3-5 years) Recycling rate governance and plastic recyclers visibility of the flow of durable Data institutional plastics from the home appliances transparency framework sector and ensure better recycling practices. ❷ Monitoring and Mandatory data reporting Governance Medium Data reporting plastic will provide a clearer picture (next 3-5 years) transparency waste of plastics usage and waste generation in the E&E sector. ❸ Establishing a Setting up a central entity to Governance Medium Collection rate central entity to monitor durable plastic circularity (next 3-5 years) Recycling rate monitor and drive ensures that relevant data is Data durable plastic collected and plastic recycling transparency circularity policies align with industry needs. The central entity can also drive specific recycling activities that support the development of the recycling industry (for example, standardizing dismantling processes and material selection). ❹ Development Developing a consumer-focused Collection Medium Collection rate of a consumer- collection system for the home (next 3-5 years) Recycling rate focused collection appliances sector can potentially Data system for the increase the collection rate of transparency home appliances appliances at their EOL, thereby sector improving the recycling rate and increasing data transparency. ❺ Implementation Implementing EPR for the Industry Medium Collection rate of EPR for the home appliances sector has the application (next 3-5 years) Recycling rate home appliances potential to increase plastic sector collection and recycling rates by placing significant responsibility on producers to manage their products at the end of their lives. 19 Areas for action Opportunity Description Applicable Immediate or Expected value chain medium-term improvement segment timeline Build synergies ❻ Designing and Designing and standardizing Industry Immediate Recycling rate across value chains standardizing plastic specifications for recycling application (next 3 years) and sectors to plastic allows plastic products from promote cross- specifications for different sectors to be recycled sector recycling recycling across together, facilitating cross-sector sectors synergies. ❼ Exploring Chemical recycling, a more Recycling Immediate Recycling rate chemical recycling advanced recycling technology, (next 3 years) as a new recycling can be explored as a technology complementary technology to process mixed plastics from different sectors, creating an avenue for cross-sector recycling. ❽ Developing To circumvent the limited supply Collection Medium Collection rate an integrated of plastic waste generated (next 3-5 years) Recycling rate collection by the home appliances and sorting sector, the development of infrastructure integrated collection and sorting infrastructure, such as waste collection trucks and material recycling facilities, can facilitate the collection and aggregation of waste across different sectors. Encourage the ❾ Implementation Implementing minimum recycled Industry Medium Demand for use of recycled of minimum plastic content policies in the application (next 3-5 years) recycled plastics materials in end recycled plastic home appliances sector has applications content policies the potential to drive domestic in the home demand for recycled plastic. appliances sector Supply-related enablers: Expected to increase the supply of plastic waste feedstock or the supply of recycled plastic Demand-related enablers: Expected to increase demand for recycled plastic 20 6. Conclusion Based on the findings of the E&E sector assessment, the Malaysian market faces challenges presented by a weak collection system, a lack of feedstock, a lack of local demand in recycled resin usage for home appliances, and the prevalence of informal recyclers along the value chain. The inadequate supply of plastic waste from the home appliances sector emphasizes that cross-sector plastic recycling efforts, such as open-loop recycling, are a more viable opportunity than closed-loop recycling. To unlock the value of home appliances’ plastic waste, several opportunities have been identified that require collaborative efforts from both the public and private sectors. Strengthening waste management governance and institutional frameworks will be critical. One opportunity includes formalizing informal recyclers and mandating data reporting of plastic waste, which can provide policymakers with greater visibility into the flow of durable plastic from the home appliances sector and ensure proper recycling practices. Malaysia could consider establishing a central entity to monitor and drive recycling activities and standards, as demonstrated by Japan, Germany, and the Republic of Korea. Furthermore, Malaysia could implement a consumer-focused collection system and introduce mandatory EPR, which will greatly contribute to improving waste management practices. These measures could ensure active recycling participation from both consumers and home appliance manufacturers. Building partnerships across value chains and sectors is essential, particularly given the challenge of low feedstock volumes from Malaysia’s home appliances sector. To enable cross-sector recycling in Malaysia, three key initiatives have been identified: 1. Designing and standardizing plastic specifications across different sectors that are fit for recycling 2. Exploring chemical recycling to process mixed plastics 3. Developing an integrated collection and sorting infrastructure. Finally, to boost domestic demand for recycled plastic, it will be important to implement policies requiring minimum recycled plastic content in the home appliances sector. 21 June 2025 Administ r d b