What is Extended Producer Responsibility?

What is Extended Producer Responsibility?

This post was originally published by Shelby Bell in 2020 and has been updated.

America has a bit of a problem. In 2020, the EPA set its first-ever National Recycling Goal, aiming to achieve a 50% overall (all-material) recycling rate by 2030. The issue, however, is that since 2005, our progress in that arena has been stagnant.

The U.S. has never topped a 35% national recycling rate, and rampant “wishcycling”—the process of adding an item to your recycling bin without knowing if it’s actually recyclable—has led to overall contamination rates soaring over 25%.

It’s a problem as complex as, say, your standard juice box. Juice boxes are constructed with three to six layers of paper, plastic, and aluminum, plus a plastic straw wrapped in plastic film affixed to the side with a glob of glue. They are very hard to recycle.

As is the nature of big problems in the United States, there has been more than one opinion on how best to tackle tricky recycling challenges (like juice boxes) within the country’s inefficient recycling system. And one of the most hotly debated topics revolves around determining who’s really responsible for making it work.

In 2021, with sustainability and environmentalism at the forefront of both consumer and business conversations, there’s a growing movement that believes businesses should be held accountable for their products through product stewardship, a concept known as extended producer responsibility (commonly shortened to “EPR”).

Through corporate governance, regulation, and the influence of the consumer, EPR may have a major impact on how both businesses and the waste industry operate for decades to come. But it’s no magic pill, and knowing the concept’s pros and cons is essential for sustainable decisions to come.

WHAT IS EXTENDED PRODUCER RESPONSIBILITY?

Extended producer responsibility is a strategy that shifts the responsibility of post-consumer management of waste and recycling from municipalities, commercial businesses, and other end-users back to the producers

The concept, first introduced by Swedish professor Thomas Lindquist, has the stated aim to prevent waste at the source, promote sustainable product design, and minimize the negative impacts that improper waste disposal has on human health and the environment. 

Traditionally, end-users dispose of waste by employing the services of a waste management company to collect, transport, and dispose of materials. Whereas most waste gets sent to landfill for a variety of reasons, transferring this responsibility back to the producers can reduce waste, create a more efficient, “circular” supply chain, and encourage the creation of more sustainable products (read: reusable, recyclable, and less toxic) that, in some cases, are more cost-effective to produce.

EPR isn’t just one policy, though. Ultimately, EPR comes in a variety of flavors, with supportive producers leveraging the following mechanisms:

Fiscal. Manufacturers pay a tax, levy, or monetary investment into programs that offset the environmental impact their products have on the environment. This is often a regulatory measure by state governments but can also be voluntary.

Product design. Manufacturers redesign a product to improve convenience of recycling (or re-manufacturability), use less raw materials or packaging, or utilize a greater percentage of recycled materials in its construction.

Supply chain & collection. Manufacturers encourage their suppliers to reduce environmental footprints, facilitate the collection of post-consumer material, and boost circularity of its product across all stages of its lifecycle. Mail-in retrieval, in-store collections, and buy-back programs are common examples. 

WHY DO SOME COMPANIES SUPPORT EPR?

As mentioned, attitudes toward increased sustainability and environmentalism are at an all-time high. However, the nation’s predominantly linear economy—sometimes referred to as consumerism and more derogatorily coined “throwaway culture”—is incongruent with these eco-minded initiatives. 

It’s a vicious cycle that repeats itself, albeit with brand-new materials, each time. To create new products, natural resources are extracted for the Earth, manufactured into products, sold to consumers, and used until they are discarded as waste (which explains how humans produce over two billion metric tons of municipal solid waste worldwide annually).

An oil derrick, a factory, a shopfront, a mouse cursor and button, and a trash can depicting a linear economy.

The extraction is a primary concern for both environmentalists and economists. According to Mathis Wackernagel, the head of Earth Overshoot Day, we used a year's worth of the Earth's finite resources in only seven months in 2017. 

“We are using the Earth’s future resources to operate in the present and digging ourselves deeper into ecological debt," Wackernagel cautioned.

EPR, through a more circular supply chain or a redesign of products, has the ability to break strong dependencies on natural resources. For those that support EPR, it’s about operational sustainability.

Magnified by the COVID-19 pandemic, the cost and availability of raw materials has caused nightmares for supply chains around the globe. Outside of lumber, computer chips, and pool chlorine, manufacturers have faced massive shortages of aluminum, glass, and even old corrugated cardboard—materials known for their recyclability and re-manufacturability.

• Creating new aluminum products from recycled aluminum saves more than 90%—and even as high as 95%—of the energy it would take to produce new metal.

• Using one kilogram of recycled glass cullet can replace 1.2 kilograms of raw materials, and producing glass from used cullet requires 30% less energy.

• The cardboard commonly used in shipping boxes can be reused 5–7 times without degrading in quality and saves nearly 25% in production energy costs.

• Even post-consumer plastic resins show clear reductions for energy consumption and global warming production in the re-manufacturing process.

A wheel of steps and processes that make up a circular economy.

Improving design has also proven to be an eco-friendly measure for producers, where they can alter the trajectory and footprint of their products. Design changes include reducing the amount of materials used to create a product, simplifying its makeup, or improving its ability to be recycled, reused, or repaired.

Voluntary EPR has social ramifications as well, as raw material scarcity and the ubiquity of plastic pollution has reinvigorated calls to protect our environment. 

In a 2021 survey from LendingTree, 55% of Americans indicated they are willing to spend extra money for environmentally friendly products, while 40% would completely boycott companies for a lack of eco-consciousness. 

Reading the room, some of the nation’s largest producers are beginning to shoulder more responsibility than ever before. 

Unilever

By 2025, global CPG giant Unilever has stated it will halve the amount of virgin plastic and reach 25% recycled material in all of its packaging. Additionally, all of its plastic will be designed to be fully reusable, recyclable, or compostable. It has also committed to collecting more plastic packaging than it sells by 2025.

Patagonia

Outdoor clothing company Patagonia is recognized as not only a leader in responsible textile production but also for its fierce and unwavering commitment to the environment. According to its website, this season’s garments were created using 64% recycled materials—from wool to nylon to plastic fishing nets. And by 2025, all apparel will be made from 100% recycled, reclaimed or renewable resources, while all packaging will be 100% reusable, home compostable, renewable, or easily recyclable.

IKEA

Multi-national furniture store IKEA announced it wants to become fully circular by 2030. To reach that ambitious goal, they’re rewriting policies in order to quell the “throwaway” nature of its products (the average lifespan of an IKEA piece is only 18 months after purchase). To aid in repairability, the company has begun selling spare parts, and to prevent more furniture from finding the landfill, it created a “buy-back” program for gently used furniture.

Colgate-Palmolive

Colgate-Palmolive, the corporation known for its household products, revealed its goal to completely design out plastic waste from its operations, starting with eliminating one-third of “New Plastics” by 2025. The company has also committed to engaging its suppliers for more sustainable sourcing.

Nestlé

In addition to making all packaging recyclable or reusable by 2025, Nestlé is exploring packaging-free solutions, simplified packaging, functional paper, and recycled, biodegradable, or compostable materials for its many brands. Perhaps most notably, however, is Nestlé’s direct involvement in funding and organizing of national EPR programs across the globe.

WHAT ARE THE NEGATIVE EFFECTS OF EPR?

If a solution were that straightforward and all-encompassing, waste and recycling would already be transformed. But the fact of the matter is that EPR is no panacea. And it’s not just multinational corporations that oppose it.

Extended producer responsibility is a complex system to implement, and few nations have perfected an EPR program that solves every problem it was intended to rectify. In some cases, the prominent and eco-friendly policies have unintended consequences.

The first is economic. Critics argue that shifting the financial responsibility of recycling their products would lead to increased prices for consumers, especially if certain price gouging measures weren’t exhaustively addressed in the mandate.

Design changes, supply shifts, and minimum recycled content percentages can raise the cost of production irreversibly. And with the overall cost of recycling rising nationwide, many producers wonder how much of the financial burden they can reasonably assume while staying competitive (i.e., without raising prices). 

For the municipalities and local governments shedding the burden, it can also divert a steady revenue stream, like in the case of collections fees for electronics in Pennsylvania

The second deals with access. While multinational companies like Nestlé and PepsiCo are at the table, countless small and midsize businesses are left out. SMBs often lack the expertise and influence to negotiate prices and practices with suppliers. Additionally, as deep-pocketed conglomerates call the shots, many small businesses simply don’t have the operational budgets for such a shift.

In this case, EPR laws would need certain protections for small and midsize businesses in order for them to stay competitive.

On the receiving end, SMBs operating in the recycling and waste sectors might also struggle to continue without representation. Across the United States, small, specialized collectors, processors, and even nonprofits perform unheralded and vital services within their communities. From repairing and donating e-waste to responsible end-of-life management of hard-to-recycle items, taking these resources off the table could have negative consequences. 

A third highlights caution for differing definitions of “responsibility.” Tasked with the end-of-life management of products and packaging, companies may have different interpretations as to what constitutes “responsible” management. Essentially, without strict oversight, some companies would recycle... and some would look for the path of least resistance to dispose of the material.

Alternate, less eco-friendly, and potentially iniquitous ways companies might skirt recycling laws could be funneling materials for incineration or exporting bulk materials to nations with poorer infrastructure to handle such recycling tasks.

WHERE DOES A CONSENSUS ON EPR STAND?

It’s a valid question that most businesses need to consider: At what point will EPR no longer be voluntary?

Currently, in the United States, 118 EPR laws have been adopted across 33 states. However, there is no federal law addressing EPR, and only one of the state mandates relates to packaging—the source of nearly one-third (28.1% in 2018) of all solid waste produced by the United States.

Nearly all of the 118 laws focus on harder-to-recycle items like electronics, carpet, medical waste, paint, batteries, mattresses, and more. But in 2021, businesses large and small are collectively watching the solitary packaging legislation—a bill passed by Maine in June. Armed with many of the same arguments we’ve covered, the Maine bill’s supporters and detractors will ensure its effects—positive and negative—remain in the spotlight.

The Maine EPR experiment will undoubtedly influence other bills across the nation, too. Seven states—California, Hawaii, Maryland, Washington, Oregon, New York, and Massachusetts—have introduced bills that would shift the financial responsibility of recycling packaging to producers. And three more—Vermont, New Hampshire, and Colorado—are all expected to join in this year or next.

All this being said, whether in support of EPR initiatives or not, finding a stance on sustainability is an important part of business moving forward. And RoadRunner works with companies all across the spectrum.

Beginning with an evaluation of your business’s supply chain, RoadRunner can unlock the potential to increase business efficiency, reduce costs, and generate new business opportunities while significantly reducing your environmental impact. 

And when it comes to recycling more, RoadRunner sees it as our own responsibility to help our partnered commercial producers, manufacturers, and retailers boost their recycling rates up to 60% or higher. Get in touch to see how we make sustainable attainable.

 

 

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