Extended producer responsibility is needed now
Diagnosis
One must cure recycling, lower the fees for the residents, and stop pathological activities on the waste market that have been cutting the wings of honest entrepreneurs for years. These are the most important goals of the planned reform of the so-called Extended Producer Responsibility (EPR), signed by all interested parties: local government officials, recyclers, packaging producers, and environmentalists. This cannot be a purely cosmetic change, because the system of business participation in the costs of subsequent environmental clean-up and management of the remains of their products, which has been operating since 2001, is now just an illusion. We need real, deep reform.
What does the EPR in practice mean? It is a mechanism operating successfully in other countries. It obliges companies marketing products in packaging (e.g., drinks in plastic bottles) to participate more in the costs of the waste system, in line with the "polluter pays" principle. In practice, the EPR comes down to incurring expenses for each product packed in plastic that goes to the store shelves. These fees are higher the more difficult it is to recycle the materials used for their production (e.g. a combination of several types of plastics that is difficult to be recycled).
Making disproportions equal
Unfortunately, as a result of many years of neglect and lack of success to reform the failing system, the burden of costs related to recycling currently concerns primarily local governments and residents. They pay much more than the inhabitants of other European countries to ensure that the packaging thrown away by them (e.g. bottles, sachets, foil, containers) is thoroughly cleaned and processed in special plants, and not sent to a landfill where they will decompose and pollute the environment for many years to come.
However, the experiences of other countries show that this does not have to be the case. It is enough for companies introducing millions of packaging products to the market to pay more than they do today in Poland. How does this disproportion look? While in the Czech Republic, the EPR fee is 206, in Spain 377, in Estonia 400, and in Austria 610 EUR for each tonne of plastics that go to store shelves, in Poland it is just... a few Euros. In total, producers pay only several dozen million PLN for the EPR. The estimates of, for example, the Polish Chamber of Commerce or the Waste Management Forum show that if the average European charges were applied, these amounts would amount to several billion PLN. This money could help municipalities, residents, and recycling plants.
Common goal, divergent expectations
The problem is that work on the implementation of the EPR has been going on for many months and still, despite many discussions, analyses and announcements, no specific draft amendment to the regulations has been presented. Of course, it does not help that reforming such a dysfunctional system is quite a challenge. There are billions of zlotys at stake, and the expectations of the reform are enormous, but very divergent. Each market participant has different priorities and sees its role in the new system differently.
- Local governments - overwhelmed by rising demands and costs - mostly count on an additional stream of money that would allow them to stop the sudden increase of utility prices. On the other hand, ecologists and circular economy supporters hope that after the introduction of the EPR, thousands of tonnes of plastics will quickly gain market value. As a result, the method of their management would change: instead of ending up in an incineration plant or landfill, they would end up in a recycling plant, they argue.
- Recyclers combine the expectations of both these groups. In the face of uncertainty related to fluctuating prices on the raw material market and with low revenues from producers, the industry needs both money and support in the development of demand for its products, i.e. recyclate.
- Producers expect that the planned reform will allow them to be able to keep control over what their money is spent on and what effects it brings. They also hope to have access to good-quality secondary raw material from recycling, the use of which will soon be forced by EU regulations. It is worth recalling that by 2030 all newly manufactured plastic bottles will have to be made of at least 30% recycled materials. This will be a real challenge for many entities, because today there is not enough clean and suitable for contact with food secondary raw material on the domestic market to meet such requirements.
Solutions
Today, nobody doubts that the reform of the EPR is necessary. The question is how to carry it out and what model of its functioning should be introduced instead of the present, dysfunctional system. This is where the obstacles begin. The first, largest dividing line becomes visible here. The main axis of the dispute is between supporters of the concept that the system should be managed by a central system regulator, which would supervise financial flows and define the obligations of all its participants, and supporters of transferring responsibility for the EPR to producers and recovery organizations cooperating with them.
The first model means simple financial responsibility, which is practically only in Slovenia and, in a particular variant, in Hungary (in practice they abandoned the EPR and introduced the National Central Recovery Organization, controlling the flow of funds from producers to waste management). It involves just the fact that entrepreneurs placing products on the market in packages pay a kind of ecological tax. The EPR fees are directly collected from them, and recovery organizations do not function as in other countries. 
The second model involves partial organizational liability, in which recovery organizations share obligations with municipalities: either on the basis of a statutory division or on the basis of bilateral agreements. In such a model, municipalities are most often responsible only for selective collection, and further processes, i.e. transport to the sorting plant, cleaning and recycling, are the responsibility of the recovery organization. This model functions, for example, in France, Spain or Belgium.
The implementation of this option would require the imposition of reporting new obligations on municipalities to ensure that the costs of the system borne by producers are known and transparent. This would force municipalities to accurately report how much was the cost of separate collection, transportation, and preparation for recycling, and how much the recycler paid or how much the recycler needed to be paid due to the complexity of financial flows on the plastics market, in which many entities participate.
It should also be possible for recovery organizations to control how the municipality selectively collects, which is the basis for all further stages of waste management, because without well-selected fractions, subsequent recycling will be impossible or disproportionately expensive.
The third model means full organizational responsibility, in which recovery organizations are responsible for organizing and financing the selective collection of packaging waste, its preparation for recycling and the recycling itself. This model works in Sweden, Germany, Austria, Bulgaria and the Baltic States. Recovery organizations or packaging EPR organizations play a key role here. They organize the entire system, choose a company that will collect all raw material waste, i.e. paper, plastic and glass, and are responsible for the entire subsequent processing up to selling this waste to be recycled.
In this variant, municipalities are not responsible for managing the raw material waste fraction in practise. Of course, this does not release them from the obligation to manage the remaining fractions: bio, bulky waste, debris, and residual waste. Although this solution may seem tempting to many local governments, it involves many dangers. If only recovery organizations were responsible for the management of packaging waste, it is natural that they will want the highest possible efficiency. There is obviously nothing wrong with this, but in extreme cases, e.g., in municipalities where selective collection is at a very low level, it can force the organization to impose very strict criteria for collecting waste on the municipality, or else not collecting mixed waste. It would be necessary to define unambiguous and statutory standards of cleanliness, so as to avoid this scenario. There can be no doubt what percentage of contamination in a container or bag would qualify a given fraction as "collected selectively". There is also a risk that even the statutory criteria will not be enough (how to weigh or assess that a plastic container has 10, and not, for example, 15% of pollution waste), especially considering the different standards of sorting plants accepting waste: some of them are able to manage more, other less polluted streams.
This concept also does not provide for the financial participation of producers introducing packaging waste in the mixed waste stream, which is still collected in the largest number in Poland (approximately 63-70%). Therefore, there is a risk that producers will take over the management of the cleanest and easiest to be processed (and thus the cheapest) raw material waste. In this arrangement, municipalities would lose the advantage of transferring selected and valuable fractions to the sorting plant, while remaining with the costs of managing the packaging still going to residual waste.
The Ministry of Climate and Environment also presented its proposal to reform the EPR. According to the presented assumptions, the system would meet many criteria of the fiscal and distribution model, in which producers would pay fees to the market regulator, which would then redirect the stream of money to other market participants involved in recycling. The regulator's task would be to supervise and control financial flows, the amount of fees and the rules governing all participants of the system: producers, packaging recovery organizations, recyclers, and municipalities. The governments emphasize that they want all groups affected by the EPR to take part in shaping and correcting the system. This would be achieved through the appointment of a special council consisting of representatives of individual industries. A part of the environment of recyclers and local governments is in favour of this solution. They state that the system managed by the regulator would ensure transparent financial flows because it would not only set the fee rates, but also supervise funds spent by recovery organizations. Such a solution, as argued by its supporters, would also allow for a thorough analysis of the costs of collection and processing of specific types of waste and adjustment the rates for producers in accordance with the real costs of waste management.
In turn, the disadvantage of such a solution, as argued by its opponents, will be excessive bureaucracy in procedures, which will make the system ineffective. In addition, they are of the opinion that money will be distributed contrary to the goals set out in the directives and on non-transparent terms, and that the rates of the EPR fees will be set arbitrarily and will not be updated so often as to realistically reflect the changing situation on the raw materials market.
Eco-modulation is needed
It will be crucial for the success of the EPR reform that the change does not only have a fiscal dimension, which would be reduced to a simple transferring of funds from producers to municipalities and recyclers. Simply pumping money into the currently underinvested municipal economy is not enough to heal the market. The EPR system should be reformed so as to support higher ecological standards of packaging design. The idea is to support environmentally friendly solutions from the very beginning, i.e. at the stage of their design and production, and to eliminate packaging that is unsuitable or difficult to process from the market.
Why is it so important? Today there are no requirements that would oblige producers to consider recycling. The law allows for virtually all possible combinations of materials, thanks to which the only criterion that most entrepreneurs follow is production profitability and attractiveness. The problem is that products that look great on store shelves and meet their marketing goals, are often quite difficult in later processes. To put it briefly, processing them is extremely costly or even technically impossible.
This trend can break the eco-modulation mechanism that should be introduced with the reform of the EPR. In short, it consists of differentiating the rates of the EPR fees and making their amount dependent, as well as other things, on what materials will be used, how much material will be available and what percentage of it will be recycled. The assumption is simple: the easier the product is to process, and the less environmental impact is observed, the lower the fee should be.
Author: TOGETAIR Editors