Extended Producer Responsibility programs have boosted recycling rates and helped plastics processors with materials costs, an executive with one of the first EPR plans said — even though such schemes face an uphill battle in the United States.
In a presentation Sept. 10 at the Sustainable Packaging Forum in Denver, Ursula Denison, head of sales strategy and marketing for Duales System Deutschland GmbH, outlined Europe's 17-year experience with such arrangements, where product manufacturers bear some or all of the costs of recycling and disposing of packaging.
Unlike Europe, where industry accepted government-imposed EPR systems, ``EPR concepts [in the United States] reflect the cherished American tradition of taxation without representation,'' she said, drawing guffaws from the audience.
Köln, Germany-based DSD has run Germany's Green Dot recycling program since 1991, when a nationwide EPR law was passed. In reaction to the European Commission's 1994 packaging directive, 31 European countries have adopted EPR schemes covering 500 million people and 130,000 companies. Germany has achieved 80 percent overall recycling rates, with 50 percent plastic recycling, Denison said.
While consumers pay more for products because of the built-in costs of EPR, ``the systems ensure that consumers who buy heavily packaged products will pay more than those who don't,'' she said. That gives producers incentives to cut back on excess packaging while allowing customers to retain choice in purchasing, she said.
Denison acknowledged that the spread of EPR plans across Europe has not been uniform. Germany, Austria and Belgium mandated that companies pay the costs, while the United Kingdom allowed manufacturers recycling credits to offset taxes.
In Germany, the EPR plan was implemented in 18 months. France, on the other hand, took 10 years to apply its full program, Denison said.
Facing tighter EU regulations in 2012, some nations like the Netherlands have passed higher recycling taxes, with finance ministries deciding how the money gets spent, she said.
That has created a challenge to keep industry and tax money from mixing and to ensure that all funding for EPR goes toward infrastructure and new technologies.
``In this environment, EPR in the field of packaging recycling can be viewed not as a burden, but as an opportunity for producers … to actively influence the end-of-life issues of their packaging,'' Denison said.
German converters, who initially viewed EPR as a burdensome additional cost, now see EPR as a way to combat rising oil and resin price increases, which have resulted in PET flake costs at $750 per ton and HDPE flake at $1,005 per ton, she said. ``In Germany and much of Europe, urban mining ... and processing of post-consumer recycling for raw materials is no longer a vision but a reality,'' she said.
Also, the overall cost of Germany's privately run EPR program has declined 40 percent since 1991, while costs of municipally controlled waste management systems have steadily risen, Denison said.
As the U.S. eco-friendly/sustainable movement grows, she said, state bottle bills and plastic bag bans similar to San Francisco's will serve as pilot programs for ambitious politicians. Referencing the November elections, Denison said, ``I'm sure whoever wins, the signals from the red camp and the blue camp are set to green.''
She said in the current environment, processors can view EPR as an opportunity to have control over where U.S. recycling efforts are headed.
``If industry stakeholders … do not get actively involved in the discussion about packaging recycling you will be left with additional cost and administrative burdens to deal with, without influence over how the funds will be raised and spent,'' Denison said.
In response to Denison's speech, Gordon Day, membership service coordinator for Stewardship Ontario, said Canada's experience with EPR indicates it's possible to blend the European tradition of government-led recycling initiatives with the American tradition of private enterprise.
Stewardship Ontario since 2002 has collected fees from industry to pay for municipal recycling in the province.
``It was a shared responsibility in Canada,'' Day said. ``Industry had a 50 percent share [of EPR costs], but they also run the program. They set the fees and they run the program.''
Day said once Canadian provinces decided to implement recycling laws, the question for industry was how much say it wanted to have in the resulting programs.
``It came down to the [OEMs] saying `I'd rather have control,' thus they were able to work with the regional and provincial governments,'' he said.