How tech is changing the Indonesian waste management industry

This article is written by M. Bijaksana Junersano (Sano), the founder and CEO of Waste4Change an Indonesian waste management company.

In Indonesia, each person is estimated to generate about 0.5 kg of waste a day. It doesn’t sound a lot, but for a country with a population of 273 million, this is equivalent to 136,500 tonnes of waste a day. With this amount of waste, Jakarta residents are able to build the Borobudur temple every two days in Bantar Gebang (the largest uncovered landfill site in Southeast Asia.

In the last decade, the government has enacted many waste management regulations. They built up awareness and had spent a lot of money on procuring waste management infrastructure. However, there are many gaps in the conventional waste management process. A large chunk of waste management in Indonesia is managed illegally by unregistered companies and only 8% of our waste is composted or recycled. The rest of 69% of the waste ends up in landfills and 23% of the waste is burnt or dumped into the ocean. This is just the tip of the waste management iceberg problem.

If I were to dive in deeper, I would say that the real challenges would be at the bottom of Indonesia’s waste management iceberg problem, and it is composed of four crucial parts: Waste management behaviour, waste management agency, bureaucracy and political governance, and Indonesian people’s moral values. I spoke in detail about it in my op-ed in Jakarta Post. 

Here, I want to share how me and my company, Waste4Change, have been tackling some of these problems.

 

Waste management in Indonesia

Waste management is the elephant in the room in Indonesia. We all know it is a serious issue, our health is impacted by it but many people try to ignore it. Most traditional players in this market, legal and illegal, have been dominating the operations. For those players, profits can be quite high and they set a quite high barrier as well.

In the illegal sector, there is actually an ecosystem of its own. The waste scavengers that pick through waste for valuable items. The broker or what we usually called ‘lapak’ is the middlemen that buy waste from the waste scavengers and sell it to larger players. There is also ‘bandar’ that buys from the middlemen and sells the waste to recycling plants. In each of these sectors, the players will find ways to cut costs by choosing illegal practices such as illegally unloading the waste, cutting transport costs, and making people work in unsafe conditions.

How about the people? Why are so many people being irresponsible with their waste? It is definitely not for lack of education. We all know it. But the reality is that some people do not want to afford the cost. Even though there are regulations on managing your waste, there is a lack of law enforcement. This makes people careless as there is no disciplined governance for littering or dumping.

How about big FMCG companies? This is the silver lining in this waste management situation. Many companies, spurred by the movement from the western countries, are now facing a lot of public pressure to clean up their act and want to be part of the solution. 

Companies that serve millions of Indonesians a day need to show that they are actively taking steps to reduce their waste footprint, improve their public image, and are open to working with partners to showcase their efforts.

 

How does Waste4Change come in?

We are a startup founded back in 2014, where we use technology to make waste collection and sorting more efficient for individuals as well as for big corporations. Through our operations, we collect data and advise corporations on how to reduce their waste footprint. We also use the data to provide guidance to the governments on how to tackle this ever-changing waste problem.

 

Why do corporations need to work with us?

Quite similar to the concept of carbon credit, big international companies are now under pressure to reduce their waste footprint and show their contributions through a concept called waste credit. They need to calculate how much plastic they are producing every year, and then create financing strategies to prevent their plastic waste from accumulating in the environment. Waste credit value is determined on how easy a packaging is to be recycled. If it’s easy to recycle, the waste credit will be low.

Responding to this customer need, Waste4change can support the traceability of the waste journey. Our newest service, Waste Credit, helps FMCG companies and producers to collect and manage more inorganic waste from a specific area. We give full details on the amount of waste recycled, as well as the before and after condition, and of course, the cost needed to process the waste.

As ESG criteria become more important in these companies’ KPIs, the reports we provide will provide more transparency on their activities. The government, especially in Indonesia, is also becoming more supportive of this kind of reporting to enforce waste management regulations – something that has been lacking from traditional players.

Data has been our biggest asset that has helped us to succeed. Our platform allows us not only to connect more regularly with our customers, but it has also helped us to generate data on how much waste is collected from a corporation or a specific residential area. This data is the key to traceability through which we can trackback after sorting the number of volume and percentage of different waste components. 

The example that I have given is a case study where customer pressure and regulators could work together in creating a massive impact on waste management. We need to use the Polluter Pay principle to challenge the status quo of the false belief ”littering is cheap”. 

Waste management is not a free service and it works just like how you pay your electricity or water bills. The more you use, the more you have to pay.

 

The Next Step

Most international companies are surprisingly very open to our initiatives.  They are looking for other options and ways so that they can make sure that the packaging industry could actively support the circular economy concept. . That’s why I see companies like Unilever getting actively involved in the recycling efforts. They still want to create products using plastic.

The biggest resistance I see is the fact that there is a lot of back-end court lobbying about waste issues in the plastic industry.

Because of the regulations, all producers need to reform their strategy to be responsible for their packaging. Private sector had to spend more on how to create better logistics, make sure the recyclability, and how to increase recycling rates. They need to realize how big is their part in making a change in Indonesia.

Covid-19 pandemic and the floods that happened last January 2021 had impacted our operations. Many people had to work from home. Luckily, we are a tech company. Our platform could help us to still reach out and connect with our customers.

We received a lot of support from our stakeholders and community. Many corporations and governmental bodies had asked us for ESG advice and for us to share our experience. The National Plastic Action Partnership (NPAP), World Bank, IFC, and other development agencies such as ISWMP and GIZ are also starting to give more encouragement to solve Indonesia’s waste problem.

As much as Waste4Change operations are important to address the elephant in the room, building up the urgency for individuals to take responsibility is even more important. And I look forward to sharing more on how my and my team’s inspirations could make the world a better place.