The drive to recycle just about everything is gaining ground, but the process — separating out all the different materials and item types — can be both confusing and tedious for consumers. For industrial recycling, it can be even more cumbersome.
Scrap metal, in particular, needs to be sorted in order to reduce pieces to their pure type. Traditionally the majority of scrap is shipped overseas and hand-sorted or melted down into lower-quality materials with limited uses. If it can be sorted in a better way, its value can be maintained, reducing both energy and emissions at the same time.
That’s where Sortera, a startup based in Fort Wayne, Indiana, hopes to come in. It’s one of several companies aiming to revamp the entire process.
In Markle, Indiana, for instance, Sortera is helping sort thousands of tons of shredded aluminum into different alloys, or types and grades of the metal.
“Things that are end-of-life — like our cars, washing machines and so forth — what happens is it gets shredded, and then all that mixed material now is no longer valuable, [and] nobody can use it,” Michael Siemer, CEO of Sortera, told CNBC. “We sort it so that all those pieces then can be reused.”
Some outlets for that reuse could be domestic industries like automotive, construction and aerospace.
There are roughly 300 metal shredders in North America, creating about 11 billion pounds of mixed aluminum, according to Sortera. The company buys metal from scrap yards, sorts it using a proprietary technology and then sells it back to companies like Novellis, which can then melt it using just 5% of the energy needed to make new aluminum.
“What Sortera did is use existing sensors with some really powerful AI software, and together [it] makes this special technology that allows us to sort the materials at high volume and at low cost,” Siemer said.
Sortera is starting with aluminum at its Indiana plant but plans to expand to other scrap metals. The technology is modular, so in the future, it can be moved anywhere the metal is located. That may be attractive to investors looking to see the business grow quickly.
“They’ve brought twenty-first-century technology to a industry that is literally as old as metal, which is a pretty amazing thing to do,” Kyle Teamey, managing partner at RA Capital, told CNBC. “They’re also the first to figure out how to scale it.”
In addition to RA Capital, Sortera is backed by Breakthrough Energy Ventures, Assembly ventures, T Rowe Price and Macquarie Capital. The company’s total funding so far is more than $73 million.
Sortera claims its process uses very little energy and no water; it also says the process does not contribute to landfills. While half of the shredded U.S. aluminum is shipped to Asia, Sortera says it is the only U.S. company that has the technology to sort it for the highest-quality re-use — i.e., take the aluminum from the hood of a car and put it back to a hood of the car.
— CNBC’s Lisa Rizzolo contributed to this piece.
