PET sector backs unusual Texas recycling plan

A Texas environmental group and a coalition of plastics firms and others are pushing unusual legislation that would put a 1-cent fee on shopping bags, PET bottles and retail drink cups to create a state fund to clean up packaging litter.

The complicated plan from Texans for Clean Water is endorsed by plastics recycling companies and the PET industry trade group National Association for PET Container Resources (NAPCOR), as well as environmental groups like the Container Recycling Institute and a local chapter of the Surfrider Foundation.

The head of TCW said the bill, which has deposit-style rebates on some packaging, has attracted bipartisan interest in the conservative Texas state legislature. TCW calls it a "free market, no tax" approach.

"We have Republican authors in both chambers, that's never happened before in this sort of effort that our group has been working on," TCW President Maia Corbitt said. "We're really happy about the momentum."

Still, Corbitt said it's too soon to predict if the bill will move forward. It has a few weeks left to move out of committee in the Texas Legislature, which only meets every two years.

On the positive side, Corbitt said previous opposition from some larger grocery chains in the state has softened to being neutral. She said the legislation at this point does not seem to have public opposition, although that could surface if it gets a hearing.

NAPCOR, which represents the PET bottling sector, said it supports the bill, seeing the fee on PET bottles and rebates as a way to raise recycling rates.

It said its position is an outgrowth of a policy change it made last year to endorse bottle deposit programs.

"We can't just keep talking about this, we're supporting bottle deposit legislation," said NAPCOR Executive Director Darrell Collier.

He said the structure of the TCW legislation, called Senate Bill 1276, is unique in recycling policy: "I've never seen anything like it."

The plan would put a penny fee on the most commonly littered items in the state — bags, cups and PET bottles — and then rebate that money back when consumers or local recycling programs collect and return them.

But it's an unusual rebate. Rather than return money for each bottle or cup, it pays 25 cents a pound for materials aggregated and returned, as well as handling fees.

TCW estimates that consumers or recycling programs would need to collect about 18-20 bottles for 1 pound of material to get the 25 cents.

That's much less than a traditional bottle bill, which typically pays 5-10 cents per container.

Supporters of the bill acknowledge the smaller fee likely means a smaller increase in recycling rates compared with a regular bottle bill, but they still see benefits.

Corbitt said the bill would create a flexible program that could increase fees if needed or add more materials into the system, as recycling markets change. It includes an industry consortium to help run it.

TCW has advocated for a traditional bottle bill in Texas for years but designed this program as something that would be politically palatable in the small government state, Corbitt said.

"What we're trying to do here is provide an effective approach to solve the problem but make it passable here in Texas," she said.

The legislation is focused on fighting litter and would likely raise $100 million to $150 million a year to support litter cleanups and build much-needed infrastructure for local governments, she said.

"We desperately need more infrastructure in Texas," Corbitt said. "We have recycling deserts. We have solid waste deserts."

That poor infrastructure contributes to a PET bottle recycling rate of only 12.4 percent in Texas, according to TCW calculations. That's less than half the 30 percent rate in the U.S. and only one-fifth of the 60 percent or higher rate common in bottle bill states.

Collier said NAPCOR is concerned the bill's 1-cent fee and 25-cent rebates may be too small and would need to be raised. But he said the group likes that the law has flexibility to adjust if needed.

"We have our experience in the other deposit states that would tell us that you've got to have a sufficient redemption value to encourage participation," Collier said.

The Container Recycling Institute, which typically supports traditional bottle bills but also supports the TCW plan, called it a "Texas-specific solution."

CRI President Susan Collins said the bill could "significantly increase" recycling rates for materials it focuses on, even if the smaller fees could limit the potential upside.

"I do see the smaller [fee] value as having the potential to significantly increase the recycling rate for the targeted materials in Texas, though it won't reach the higher redemption rates that strong deposit programs do," Collins said.

Corbitt said the TCW plan is more than just bottles, and she argues that it provides flexibility.

It puts the 1-cent fee on all manner of cups used in takeout foodservice, including plastic-lined paper cups, expanded polystyrene foam versions and thermoformed PET cups.

But in another layer of the bill's complexity, it does not pay rebates to collect the paper or the EPS cups because they don't currently have viable recycling markets in Texas, but it would pay rebates on PET thermoformed cups that are collected, Corbitt said.

"Your EPS cup is a fine cup and we're not trying to ban materials here in Texas," she said. "However, there are not readily available markets here to truly recycle EPS cups."

She said EPS cups are frequently littered and "once they hit the ground or water, they're gone. They're not at all really even collectible."

But materials like PET thermoformed cups have markets, and the bill is designed to create financial incentives to encourage use of the more recyclable materials, she said.

One recycler of thermoformed PET packaging, Green Impact Plastics SA de CV, which has a plant in Vernon, Calif., supports the bill because it sees the potential to pull significant amounts of PET material from the Texas waste stream. Green Impact also has a plant in Ciudad Juarez, Mexico, across the border from El Paso.

"I see a great impact on PET thermoforms," said CEO Octavio Victal. "I would say that we need to act now and not wait another two years. Any bill that actually helps collection is a great piece of legislation."