Select Committee on Environment, Food and Rural Affairs Minutes of Evidence


Dixons Group plc briefing note December 2001


  Dixons Group is Europe's largest specialist retailer of consumer electronic and electrical products. The Group has more than 1,250 stores across the UK, the Republic of Ireland, the Nordic region, Spain and France and trades in the UK and Ireland as Dixons, Currys, PC World and The Link.

  Currys is the leading choice for families buying electricals for the home. We deliver seven days a week to households throughout the UK.

  Over the last financial year the Group collected 750,000 end of life white appliances (fridges, freezers, cookers and washing machines), from people's homes at no cost to the consumer. Of these, approximately 300,000 were fridges. These were recycled or refurbished by a network of contractors, relieving Local Authorities who would otherwise be obliged to collect or receive these products of a significant burden. In effect Currys provided the consumer and local authorities with a cost-free channel for the disposal of this domestic waste.

  Until November 2001 our sub-contractors, a network of small waste disposal businesses, collected these appliances from our depots. They disposed of them in one of three ways. If suitable for re-use they were either refurbished for re-sale in the UK, often to low income households, or exported for further use countries outside the EU providing an income stream for the contractors. If not able to be reused the contractors extracted CFC gases from the fridge compressors, when present and recycle them for their constituent parts and disposed of non-recyclable materials through land fill.

  Since mid-November contractors have withdrawn these services as they will have no legal route to dispose of these products from 1 January 2002 when phase two of EC Regulation 2037/2000 on substances that deplete the ozone layer is implemented governing disposal of products containing CFCs. Phase two requires the removal also of the CFCs from the foam insulation in the fridge walls and doors, for which there are no facilities in the UK.

  This will also end the export of fridges containing CFCs to non-EU countries—thus ending an export revenue ending stream for small businesses. This, combined with the non-availability and heavy capital investment cost of extraction plant to comply with the new regulations means that many contractors believe their business is now non-viable.

What would we do were the implementation of these regulations to be delayed?

  We rely on these small contractors to dispose not only of used fridges but also other used white goods (cookers and washing machines). The resale potential of these is far more limited and for many contractors it was the fridge revenue that made their businesses viable. Without the fridge revenue several have given notice that they may withdraw all collection services. Many will exit the recycling and waste disposal business altogether.

    —  Were the regulations to be delayed we believe this network of contractors could be persuaded to restart their collection services. For their businesses to be viable they need this part of their business to generate an income stream—which would require the retention of the ability to export fridges suitable for sale and re-use. We estimate that, until now, up to half of the UK's end of life fridges were exported rather than disposed of domestically.

    —  Were Government to signal its intention to initiate the recycling credit scheme flagged by DEFRA officials we believe that this could create the impetus to get local authorities, major waste contractors and retailers together to investigate the feasibility of creating self-funding CFC extraction plants.

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