Letter to Stakeholders

September 30, 2017
SENT VIA EMAIL TO AUOMA REGISTERED COLLECTORS AND PROCESSORS
RE: NOTICE of Return Incentives Reduction and Paying on Processed Weight

Dear Collectors and Processors,

As you know, the Alberta Used Oil Management Association (AUOMA) in the process of making some challenging decisions as we take the necessary steps to balance our budget by 2018. Your ongoing input has helped us consider various options, and understand the effect our decisions will have on each of you as collectors and processors. Thank you for the input you provided during AUOMA’s spring consultation, and for the conversations that I’d had with many of you since, which have provided the context and background necessary for AUOMA to vet the options and come to a final decision.

As a follow up to my letter of July 18, 2017 (Appendix 1) regarding the reduction in return incentives (RI) for used oil and the transition from paying on collected weight to paying on processed weight, I am advising you of the following changes, effective January 1, 2018:

  1. The RI on used oil collected will be reduced by 15 per cent across all zones (Appendix 2). This reduction was approved at AUOMA’s September 2017 Board meeting.
  2. Processors will be paid on processed weight as shipped to end users, rather than the current practice of paying on collected weight. This decision was approved at AUOMA’s June 2017 Board meeting.
    • Material collected prior to January 1, 2018 will be paid at current RI oil rates and based on collected weight.
    • Material collected on or after January 1, 2018 will be paid at the new rates and based on processed weight.
  3. The RI on used oil plastic containers and filters will increase slightly to reflect the shift to paying only for the processed weight of materials. The amount of the increase is still being determined and will be announced in November 2017.

These changes will present challenges. However, the changes are necessary to assist AUOMA in reducing the 2018 RI payout by approximately $1 million so that we can balance our 2018 budget, protect our working capital, and do our best to maintain the integrity of Alberta’s used oil materials recycling program. Regrettably, we have no other option to balance our budget than make RI cuts. The regulations governing our program have remained unchanged since first enacted 20 years ago, and they inhibit our ability to raise the Environmental Handling Charges (EHCs) we collect to fund program operations.

For questions, concerns, or to express support for the changes needed to the regulations that govern the used oil materials recycling program, I encourage you to reach out to Rick Berkenbosch, Waste Management Specialist, Alberta Environment and Parks at rick.berkenbosch@gov.ab.ca.

As always, please do not hesitate to contact me with any questions or concerns.

I look forward to seeing you at the October 5, 2017 training session on the electronic claims system, ProgressionLIVE.

Sincerely,

Jodi Tomchyshyn London,
Executive Director, Alberta Used Oil Management Association

cc. Ronda Goulden, ADM Policy and Planning, Alberta Environment and Parks
cc. Rick Berkenbosch, Waste Management Specialist, Alberta Environment and Parks
cc. Lee Wilkie, Chair, Alberta Used Oil Management Association

Read Appendices