Reward those who get producer responsibility right

Organisations that show a commitment to getting their extended producer responsibilities right and reducing the environmental impact of their products at end-of-life should be rewarded fairly for their efforts, argues Axion Director Keith Freegard.

If the UK is to introduce some form of extended producer responsibility (EPR) to boost recycling rates of plastic packaging, and indeed other products, then it must be time to link the performance of an individual organisation’s products with how well they perform within the currently installed systems for end-of-life materials recovery.

Unless there is a mechanism that allows organisations to benefit financially from ‘doing the right things’ in terms of designing product and packaging for high levels of end of life recovery, there is no incentive for the ‘early adopters’ of good circular economy practices to make the necessary changes to their in-house design procedures.

Take plastic packaging, for example. A company that commits to change and then delivers a complete reappraisal of its grocery or other packaging product designs, in a way that follows the current best practice guidelines for recycling back into new materials, should be credited on an individual basis for the work they have delivered.

However, those who choose not to follow best practices and guidelines that would give a better yield of high-quality recycled material output should have to accept additional costs for supplying the end-of-life recovery market with poor, low-yield material mixtures.

Implementing these principles could require a significant increase in the share of collection, primary sorting and final materials recycling costs that retailers and producers have to bear as their obligated responsibility for end of life treatment and recycling. But the share of the overall costs must be allocated according to the suitability of the packaging as ‘good feedstock’ to the recycling and recovery circular supply chain. Hence early adopters of sustainable, circular economy principles would be able to offset these cost increases by changing their corporate behaviours and materials consumption habits.

So what’s the answer? One solution could be an online system for pack design appraisal whereby every new pack is ‘scored’ on its suitability for high-yield, high-quality recycling performance.

Companies that can show a very high proportion of their branded packs achieve ‘high marks’ in terms of packaging design-for-recycling would then be rewarded with a significantly reduced share of the total market cost for capturing and recycling those types of products.

Others who decide to stick with designs which are difficult to recycle at the end of life simply for aesthetic marketing reasons would then have to pick up a much higher share – by some kind of ‘factor times’ multiple of their own producer responsibility costs. That choice is one for individual companies to make in relation to their marketing plans and CSR principles.

Of course, checks would have to be put in place to ensure compliance and the metrics used to measure company performance would need to be well defined. But such a system would give branded retailers a new basis for competition based on the level of overall ‘top rank’ scores they can achieve. Consideration should also be given to cases where design-for-recyclability must be sacrificed for overall life-cycle benefits function, i.e. wet pet food pouches. It is unlikely these kinds of materials will ever have a mechanical recycling route and they cannot currently be redesigned to use compatible materials. The pouch gives an alternative to the conventional steel can, giving benefits in lightweighting and reducing the impact in transportation. Any system would have to consider these types of exceptions and not penalise the use of packaging which can be more environmentally-beneficial overall.

Given that a huge percentage of UK collected plastic packaging is currently either exported or ends up as RDF for incineration, I feel that the economic value embedded the material recovery alone does not stack up against today’s operating costs of kerbside collection, sorting and recycling. Therefore EPR needs to be about much more than simply ‘who’s going to pay for it’ and then applying the extra cost burden on a ‘blanket principle’ across all stakeholders in the supply chain, irrespective of the value benefit to be gained from the resource recovery system from the supplied waste feedstock.

Reward those who get producer responsibility right

 

We should embrace the opportunity of building in some reward-based, pull-through drivers to encourage design innovation and forward-thinking organisations. If a company uses a lot of recycled material in its packaging products, then they should be able to offset a significant amount of their total obligated tonnage that they put on the market.

For example, take a large UK dairy using 30,000 tonnes/year of HDPE polymer to make bottles. If they used 20% recycled content, you might argue that they should receive 20% off their packaging obligations. At recent plastic PRN prices that could be over £50,000 of saving in Producer Responsibility costs. That’s a bonus for really delivering on Circular Economy practices, creating a more stable market for recycled polymer.

In Axion’s opinion, if that hypothetical dairy also managed to adhere to a ‘perfect’ bottle design, they should get a similar level of benefit in addition to that for using recycled content. So the company would get further financial credit for following good design practice. This means that the material arriving at the recycler’s plant is able to be turned into a high value and quality secondary raw material without a loss in yield from undesirable packaging. Those numbers are likely to make an organisation take notice!

Margins in materials recycling are not huge; some materials are not economical to recycle at all and few are economical to recycle on their own. Therefore, if we want to achieve higher targets, there needs to be more investment in resource recovery infrastructure or more demand for the output material.

If more big brands adhere to better packaging design, this results in a better yield of material for recycling and a move in the right direction. Better yields and more demand is a real market-driven way of creating increased value around the organisation that is creating a final quality product – the recycled polymer producer.

Creating demand should keep quality materials in the UK and better quality recyclate keeps UK recyclers in business. This becomes a ‘virtuous circle’ of locally-sourced, locally-recycled and locally-used resources bringing jobs, value and economic benefit for the UK.

For the UK’s packaging market to succeed along Circular Economy principles, we have to be prepared to find more creative ways to support that industry and make it work both financially and sustainably in the long term. Alongside this, robust design guidelines and support for packaging producers and brand owners is required to ensure they can make informed decisions when placing material on the market.