UPDATED JULY 1, 2022 -- California's Governor Gavin Newsom has signed the United States most comprehensive paper and plastic EPR bill to date. The landmark legislation will create an EPR program for printed and plastic packaging, require certain reductions and eliminations in single-use plastic packaging, promote reuse and refill systems and implement eco-modulated fees and environmental justice provisions.California is now the fourth state to pass some form of EPR for packaging, following Colorado, Maine, and Oregon. The California EPR legislation is set to take effect Jan. 1, 2027.
UK food and beverage manufacturers are exhaling a sigh of relief. Extended Producer Responsibility (EPR) laws intended to go into effect later this year, have been delayed until 2024. However that relief will be short lived, as the clock to ramp up EPR accountability is mounting from many places, causing significant implications for product and packaging professionals. EPR is just one of the many growing regulations related to sustainability, and despite the delay, it’s critical that companies act now to prepare. In this post we’ll explore the basics of EPR and help you prepare to build EPR strategies that scale.
What is Extended Producer Responsibility?
In its simplest form, Extended Producer Responsibility (EPR), is a set of regulations designed to incentivize manufacturers to make more sustainable products and packaging decisions, keeping waste out of landfills. They place the responsibility for the environmental impacts of products on producers (A.K.A. manufacturers) not just at the point of manufacturing, but for the entirety of the product life cycle.The laws and regulations governing each region’s EPR policy approach are varied and growing, but they all share a common characteristic.
They create a truly circular economy.
The Ellen Macarthur Foundation defines a circular economy as “a systems solution framework that tackles global challenges like climate change, biodiversity loss, waste, and pollution…. In our current economy, we take materials from the Earth, make products from them, and eventually throw them away as waste – the process is linear. In a circular economy, by contrast, we stop waste being produced in the first place.” One well established example of EPR is the bottle deposit paid on plastic beverage bottles. These laws have been in place for many years and have proven to offer environmental protection. According to the UK parliamentary Environmental Audit Committee, “Deposit Return Schemes are currently in operation in around 40 countries worldwide as well as 21 US States. Typically, countries with Deposit Return schemes for plastic bottles achieve recycling rates of approximately 80 – 95%.”It's been a proven way to increase recycling of plastic materials. But recycling materials isn’t the only outcome EPR is affecting. EPR regulations typically spur the creation of EPR systems that address three factors:
- Reduction of material used in the production and packaging of goods. (using fewer materials)
- Reduce the environmental impact. (using less toxic materials)
- Keep materials out of landfills. Plan for a product’s end-of-life, with recycling and take back programs to repurpose materials.
For product and packaging professionals, there are significant opportunities to optimize across all three of these areas.
EPR doesn’t offer easy wins
There are significant consumer and regulatory pressures to adopt EPR, but that doesn’t mean it’s an easy win.Three factors make realizing the vision of EPR a challenge.
- The local nature of EPR mandates makes compliance a challenge. Each regulation is defined by local governments and has its own guidelines, incentives and penalties.
- The spirit of EPR is to take the burden off consumers for reducing the environmental footprint of product production and use. However, the consumer is still part of the process. Elements of EPR programs have to make it easy for consumers to comply with end of life take-back/reuse efforts.
- The transition to less wasteful processes generally comes at a significant cost to producers who have to change processes, reconfigure equipment and explore new materials. For example, in the UK new extended producer responsibility laws are expected to cost the food and drink industry 1.7 billion pounds (2.2 billion US Dollars).
Regulatory pressure is mounting
Challenges aside, producers must act – and fast. Almost 70 EPR laws are active in the US. Most of them, passed in the last 10 years. The focus on packaging is now on the near horizon. In July 2021, Maine became the first US state to pass an Extended Producer Responsibility (EPR) for Packaging law. The law mandates corporations pay for the cost of recycling wasteful packaging. Maine is not an outlier. In 2021, eleven states had new EPR bills in various stages of review.
What EPR Means for You
Some form of EPR for packaging exists in most European countries, and in a growing number of US States. Programs vary considerably in complexity, with some schemes requiring products to be split into over 15 different categories and sub-categories while others just ask for four or five. All of them will require a careful look at product design, and packaging waste to reduce environmental impact.
- Fees will increase, in some cases considerably, to ensure that producers are bearing a substantial proportion of the costs of waste management
- Reporting requirements will become more complex, to allow for greater differentiation of fees (e.g., countries that currently allow reporting of all plastic packaging in one category will begin to ask for splits between HDPE, PET, PP etc.
- Additional regulation and reporting requirements may be introduced by national authorities.
Specification Management: The Foundation of a Strong EPR Strategy
At the heart of every EPR strategy must be an engine that provides transparent visibility, simplifies regulatory reporting and helps your packaging and product teams make informed materials management decisions.Specifications are the structure by which those foundations can be built--they are the technical instructions needed to make a product. This includes everything from raw materials, ingredients, formulas, packaging, labels, and even machinery. Tens of thousands specification data points move across supply chains every day, but companies still struggle with finding an effective solution to managing specs.
Here’s how Specification Management software can help:
Measure your current product lifecycle impact on waste generation and waste disposal
- Digitize and associate DNA-level specification data to products, materials, suppliers, vendors, and finished goods. Propagate changes with many-to-many relationship capabilities.
Analyze and identify areas of waste management optimization
- Raw material usage, recycling rates and other relevant data can be benchmarked with dashboards & reports to identify bottlenecks, trends, and progress sustainable products and their packaging over time.
Act upon those insights to drive transformation
- Take action with your insights. Change out of compliance materials and packaging with your products. Identify sources of waste, and perform material optimization to save packaging costs.
Together, we can transform the way companies make amazing things to a more sustainable future for us all.