Amy Westervelt
Forbes
Earlier in the week, this blog looked at some of the ways in which the U.S. recycling system has become dysfunctional. Today, we look at what might happen if recycling started to really work in this country, and turn to a potential solution–one that is being promoted by some of the very companies responsible for creating the country’s packaging waste.
Called Extended Producer Responsibility (EPR), this legislation would essentially set requirements for companies to collect and recycle a certain percentage of the packaging waste they generate, but would leave how they go about doing it up to the companies themselves. Companies like it because it gives them some control, and environmentalists like that it could drastically improve U.S. recycling rates (while rates are decently high for paper and aluminum, for other materials–particularly plastic–they are low, and overall only 33 percent of municipal solid waste is diverted from landfills). A recent report from the Blue-Green Alliance found that increasing recycling rates in the United States to 75 percent for all municipal solid waste would create 1.5 million jobs. For consumers, who, at the end of the day, are the ones that actually pay for recycling, EPR promises a more effective, efficient system, one that delivers better value for taxpayer dollars. While the cost of EPR would be built into the cost of consumer products, the legislation would eliminate the fee consumers currently pay for city- or county-provided recycling.
All of which is not to say that EPR is without its detractors. Some municipal governments worry about handing control of recycling systems over to industry, and some industries are loathe to see any sort of government regulation of packaging, even if it’s legislation that leaves implementation up to industry.
EPR programs have been implemented throughout Europe for years, starting in Germany in the 1990s, and have been hugely successful at both increasing recycling and improving access to quality recycled materials. Canada has also adopted successful EPR programs. In the United States, recycling systems are largely a local government affair, wherein programs in neighboring cities can differ dramatically. Perhaps surprisingly, Nestlé Waters North America has been spearheading the drive toward EPR legislation for packaging in the United States. The company’s director of sustainability, Michael Washburn, says part of the reason is that the company wants to use more recycled PET plastic in its bottles, but it is currently expensive because supply of the stuff is low and demand is high. If they could collect and recycle a larger proportion of their bottles, that problem would be solved.
“We have found that packaging is the largest part of our environmental footprint, so from a sustainability perspective, we have an incentive to increase our use of rPET [recycled PET], but can’t because of the limited supply and high cost,” Washburn says.
He adds that purely as a resource management issue, it makes sense for the company to reuse its packaging materials. “The idea that we’re taking valuable material out of production by putting it in the ground or burning it should concern all of us,” he says. “We also think this [EPR] could help take some volatility out of the markets and out of our supply chain – remember plastic is an oil-based product.”
Some early coverage of EPR proposals has pitted EPR laws against container deposit laws (also called “bottle bills”), which are currently active in 10 states. Bottle bills have been extremely effective at increasing recycling rates, but Washburn points out that they only deal with bottles, whereas EPR gets at the broader issue: packaging writ large. Paul Gardner, executive director of Recycling Reinvented, and a former Minnesota legislator with some experience dealing with EPR legislation, echoes that statement. “Beverage containers actually make up a small part of the waste we have; with EPR, vs. bottle bills, we would get at five or six times more material than just bottles,” Gardner says. “Let’s think bigger.”
EPR isn’t entirely new in the United States, it just hasn’t been applied to packaging yet. EPR laws are on the books in various states for paint and batteries. In 2006, Natural Resources Council of Maine teamed up with Hewlett Packard to pass the first EPR electronics recycling law, and since then 23 other states have followed suit. “It’s one of the most effective policy tools out there for addressing waste and pollution of various kinds,” says Matt Prindiville, associate director of the Product Policy Institute and co-founder of the Cradle2 Coalition, a coalition of organizations and businesses pushing for EPR recycling laws of various kinds. Prindiville was involved in the passage of the Maine EPR electronics recycling law, and has been working on bringing EPR to the United States since 2003.
There have been a variety of EPR laws passed throughout the country, governing everything from paint to batteries to specific toxic ingredients like mercury,” Prindiville says. “But what we’re realizing is that EPR shouldn’t just be applied to one particular type of product. It needs to be applied to the entire waste stream.”
Applying EPR to packaging is a slightly different animal, Gardner points out, because packaging materials are commodities. ”These recyclables are a commodity whereas other types of waste that have been governed by EPR legislation are a liability, both environmentally and financially,” he says. “Packaging and paper are traded on the global commodities markets, people have invested money and taken risks to handle these materials. For them, EPR transforms the financing component; it ideally raises recycling rates and acts as a rising tide that lifts all boats.”
Because EPR is not prescriptive about implementation, it provides incentives for businesses to voluntarily reduce packaging and get innovative with materials and design. At the outset, however, some companies are balking at the idea of any sort of regulation on packaging, particularly companies that attract less attention than the Nestlés and Coca Colas of the world for their packaging. “As far as we can tell publicly, if you’re Procter & Gamble or General Mills you love living in a world where the beverage industry guys take it on the chin and nothing is asked of you if you make a tuna can or a cereal box or a laundry bottle,” Washburn says. “All of these materials have value and costs associated with collecting them at scale, all on the back of taxpayers.”
And in fact the Grocery Manufacturers Association, a trade group that represents a variety of grocery manufacturers, including Kellogg, Procter & Gamble, and PepsiCo, has come out in opposition to EPR for packaging, as has a new group called the Product Management Alliance (a coalition of trade groups, including the American Forest and Paper Association, Toy Industry Association and Carpet and Rug Institute), which is arguing instead for what it calls a “voluntary” form of EPR. According to proponents of EPR, however, without the initial government requirement as a lever, voluntary programs are unlikely to succeed.
Every voluntary program tried in this country is expensive if you bring it down to cost per container,” Washburn says. “You end up with the bigger players running the program, paying the freight and so on, and then you get the free riders. If we’re going to have an efficient system, everyone needs to be in, no free riders, and if you spread it across all waste streams then everyone’s burden is smaller.
That’s where Prindiville and company come in. “One of the things I’m trying to do is help corporate America see that [EPR] is not as scary as it sounds,” Prindiville says. “This is not a tax on your products, it’s about figuring out how to get stuff back and do something with it, and you figure out the financing yourself. It is a market-based system.”
Plenty of businesses do see Prindiville’s point. In addition to Nestlé Waters, Gardner says manufacturers who use recycled material have “literally been begging the public sector to increase recycling, but local governments are not really equipped to get supply to meet demand.”
Packaging manufacturers that use a lot of recycled content – plastic and glass in particular – are saying we will support anything that will get us new supply right now,” Gardner adds. “Glass plants are cheaper to run with recycled glass because it takes less heat to work with recycled glass than virgin materials. The same is true for plastic, and really all of the commodity recyclables–it requires less energy, fewer chemicals, and less water to make stuff out of recycled materials. Those plants are saying we’ll support anything that gets us more material at a price that’s reasonable.
Currently, organizations like the Cradle2 Coalition and Recycling Reinvented are focusing on outreach and education, talking to companies about the nuts and bolts of EPR and encouraging them to weigh in on what U.S. EPR legislation could and should look like. Gardner says the earliest we’re likely to see legislation proposed is 2013, and it’s still unclear which state will be the guinea pig, although it won’t be a bottle-bill state since EPR proponents want to steer clear of anything that would pit bottle bills against EPR.
“Coca Cola a couple years ago wanted to introduce EPR-like legislation in Vermont, a bottle bill state, and passage of that legislation would have required getting rid of the state’s bottle bill,” Prindiville says. “It wasn’t really the best way to go about things because it made the discussion combattive, and it made it seem like the only interest beverage companies have in this is getting rid of bottle bills. Actually, container deposits and producer responsibility are not mutually exclusive, you could easily have both.”
What we definitely won’t see is a national EPR proposal. Gardner explains that dealing with waste issues at the federal level has historically been problematic. Instead the strategy is to roll EPR out in a few states, fine tune those programs so that other states have a model, and then watch the legislation spread, as it has in the case of other products.
“We’re targeting states that have robust curbside recycling in their cities now, and reasonable distribution in rural areas (Minnesota and Maryland for example),” says Washburn. “So we’re not starting from zero. The idea is to first get it [EPR] into a handful of states. What happens then? Companies whine about there being different system in Minnesota than Wisconsin and so forth, so we need to unify. Great, that’s when we take it national. But we don’t want to start with national.”
