Esquemas Inclusivos de Responsabilidad Extendida del

Productor (REP):Aprendizajes, Desafíos y Oportunidades

February 5, 2015Bogotá, Colombia

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What this presentation will cover

• Brief introduction

• The underlying drivers of EPR

• Examples of different EPR approaches

• Role of waste pickers

• Some lessons learned

Strategy Matters Inc.• My background:

– Research Director Is Five Foundation (1972 Canada)– Founder & President RIS (1974 Canada, USA, Europe)– Founder & Managing Director Enviros-RIS (1998 UK)– Founder & President Strategy Matters Inc. (2001 Canada)– Senior Vice-President Corporations Support Recycling (2004 Canada)– Founder & President StewardEdge Inc.(2008 Canada, USA & international)– Director Global Solutions, the Reclay Group (2013 Germany)

• Expertise:– Design and implementation of materials recycling programs

• from facility level to national scale

– Developing public policy, legislation and corporate strategies– Design and implementation of product stewardship & EPR programs

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3 billion more middle-class consumers will fuel future demand & waste generation

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Global middle class1

Billions of people

ROW

2030

3.23Latin America

4.88

3 billion

Asia-Pacific

North America

Europe

2020

3.25

1.74

2009

1.85

0.53

1 Based on daily consumption per capita ranging from $10 to $100 (in purchasing power parity terms)

Source: OECD (2011), Perspectives on Global Development: Social Cohesion in a Shifting World

0.03

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2 billion New Urban Residents by 2030, 3 Billion by 2050

Reference: World Urbanization Prospects, 2011 Revision (United Nations, 2012)

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Cities are adding 1,500,000 Residents each Week

Shenzen in 1987 Shenzen today

Reference: WHAT A WASTE: A GLOBAL REVIEW OF SOLID WASTE MANAGEMENT, World Bank, 2012

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Enormous Growth coming:Global Peak Waste unlikely Before 2100

Reference: WHAT A WASTE: A GLOBAL REVIEW OF SOLID WASTE MANAGEMENT, World Bank, 2012

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Global Waste Market• € 310 billion/yr: The global municipal waste market

• including collection and recycling• equals the GDP of Denmark • Not including the sizeable informal sector

• In developed countries waste management ~ 2% of GDP

• 4 billion tpy waste of which 1.9 billion from households

• 40 million people work in waste management sector worldwide

• 50% are informal

Source: ISWA estimates, 2014

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Search for “Global Solutions” is on

Six “big ideas” for accelerating reduction, reuse & recycling1. Enable and empower people locally to adopt “best practices” 2. Green taxes to expand services and change consumer

behavior3. Tradable credits (incent existing recycling industry to do more)4. Make the producer responsible through EPR (fully or shared )5. Collaborative consumption 6. Circular economy (rethink fundamental economic paradigm)

Common objective to scale up perceived best practices

10 OECD, 2001

What is “EPR”? What is “Product Stewardship”?

§ Encompasses EPR and a wider range of public policies and corporate activities § This concept allows for

greater flexibility and opportunity to find effective solutions most appropriate to specific market conditions§ Includes both voluntary and

regulated initiatives.

§ An environmental policy approach in which a producer's responsibility for a product, physical and/or financial, is extended to the post-consumer stage of a product's life cycle. § A wide range of EPR models

have been implemented by legislation globally. (OECD (2001))

Product StewardshipEPR

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Core recommendations of the OECD

• OECD recommends the implementation of EPR, leading to:o Increased collection and recycling rateso Reduction of public spending on waste managemento Reduction in overall waste management costso Design for environment (DfE) innovations

• OECD guidelines now under revision and changes will likely include:o Full costs of managing used products should be

allocated to producerso Realities of informal waste collection in developing

countries must be considered in EPR program design

• Packaging• Products with potentially hazardous chemicals:

– Paints, solvents, cleaners, pharmaceuticals, pesticides, fertilizers, etc.

• Lubricating oil• Tires• Waste Electric and Electronic Equipment (WEEE)• End of Life Vehicles• Batteries• Bulky wastes

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Product groups

?

??

?V

Overview of EPR landscape worldwide

Proposed/Expected

EPR or Product Stewardship in Place

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What are the Key Drivers of EPR?• EPR a reflection of broader transition underway

– Quantifying environmental impacts– Internalizing these costs to producers & users

• Driven by converging forces– Government systemic financial stress– Commercial pressures for greater transparency along

the supply chain– Securing supplies of key strategic materials– Policy innovation & adoption across the OECD

• Recognition that cradle-to-cradle management essential to sustainability

Some EPR Examples

“Classic” European EPR Model

GovernmentInstitutions

Recycling Companies

Obligated Companies

Fees

CollectionCompanies

Proof of recycled amounts to be delivered

Agreement on the design of the local system

Approval

LocalAuthorities

Call for tender

Exemption from obligations

Authorized System

Call for tender

Sorting Companies Public/

Consumer

Awareness raising / education

Take back + recycling obligations

No two national programs are exactly the same

After 20+ years experience in Europe

Markets with a single producer controlled shared responsibility scheme

Markets with a single producer controlled full responsibility scheme

Markets with competing compliance services

FranceSpainCyprusGreece Italy

BelgiumNetherlandsIrelandFinlandDenmarkNorwaySwedenLuxemburgCzech RepublicPortugal

GermanyGreat BritainPolandTurkeyEstoniaRomaniaLithuaniaLatviaSlovakiaSloveniaBulgariaMaltaAustria

Typical Recycling Model Operated in Europe

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EPR is becoming an integral part of national Resource Efficiency Strategies throughout Europe

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Waste reduction

Resource efficiency strategy

Evolving national resource strategies

Packaging directive in Germany

1991

1994

EU packaging and packaging waste ordinance

2004

EU directive on WEEE

2008

EU packaging directive

2012

Resource efficiency program in Germanycovering waste reduction and secondary raw materials

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Example of Canada

• No national waste management or single market legislation

• Provinces & states take their own unique approach to EPR– Performance goals – Designated materials– Financial responsibility

• “Framework” EPR legislation vs. material specific

• Industry driving harmonization

white-washed symbols = program proposed or under consideration

full-colour symbols = program in place or pending

see inset

2012 Status

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EPR Programs in Canada

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Current Approach in USA to EPR • Limited federal government role: waste

management regulated at state level• Municipal recycling programs financed

primarily by local government– state grants – property taxes, assessments, disposal levies

• EPR being applied to “difficult to manage” products – paint, WEEE, mattresses, etc.

• No national or state legislation on printed paper & packaging

Broad Application of EPR in the U.S.

Source: Product Stewardship Institute 23

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Chile – Draft Law in Congress

• Make value recovery from waste a priority in Chile’s waste management strategy

• Introduce EPR as an economic mechanism to increase the recycling rate of packaging and products for at least 9 categories of goods set by the Ministry of Environment (article 9):

1. Packaging2. Lubricating oils3. Tires4. WEEE/light bulbs5. Batteries6. Vehicles7. Newspapers and magazines8. Expired medicines9. Pesticides

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Industry responsibilities• Register the quantity of obligated products supplied into

Chile in national database • Organize and finance the collection of priority products waste

in all the national territoryo individually (self-compliance) o through an authorised collective management system

• Deliver their waste to a manager authorised to process itunless the producer handles the waste itself– Solid household or comparable waste shall be delivered to the

relevant municipality or an authorised manager • The penalties for infringements of the law range from

significant fines (up to 10 times the waste management costs) to temporary prohibition of sale of the priority product

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A blend of global experience• Chile‘s approach to formulating a general framework EPR

law followed by product specific regulations reflects international best practices

• Recognizes the need to involve the informal recycling sector

• Introduces other supporting mechanisms that will make EPR more effective and efficient

• List of “priority products” noted in the legislation would make Chile one of the leading EPR jurisdictions in the world

• Agreeing on general framework for EPR is not easy. Working out product specific regulation through decrees is even more difficult

Chile study tour Spain

Chile study tour Germany

Household collection Santiago

Santiago sorting

Santiago sorting

Brazil cooperative

The Essential Role of “Waste Pickers”

• Worldwide, millions of waste pickers manually remove recyclable items from landfills and urban areas (including in all developed countries):

• India: 1.5 million (2010), mostly women and marginalized groups

• Colombia: 18,000 “recicladores”• Uruguay: 15,000 “clasificadores”• Argentina: 42,000 “cartoneros”• Brazil: 229,000 “catadores”

• Provide essential separation of valuable recyclable materials sold into global markets

• Often working under hazardous conditions

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How are some CPG companies responding?

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“¿Puede sentirse orgulloso de estacadena de valor?”

“Is This A Supply Chain to be Proud of?”

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Key issues for industry1. Scale up projects at a quicker rate2. Waste picker well-being 3. Operational efficiency 4. Procurement & quality of material5. Design of packaging & products6. Promote multi-material approaches to recovery & recycling 7. Ground recovery and recycling projects within broader

sustainability thinking 8. Institutional development9. Legislation10.Regional/cultural issues

Broad Waste Recovery GoalsCompany Goal(s)

v Recover 50% of equivalent cans and bottles by 2015. Aiming for 75 percent recovery of the Coca-Cola bottles and cans introduced into developed markets by 2020

v Double the global recycling rate of its’ used beverage cartons by 2020

v Contribute to the collection of materials used in the packaging of Danone products, and when this is not yet in place, try out new collection systems

v Zero manufacturing waste going to landfills: Working to eliminate or reduce solid waste from production processes; identifying ways to repurpose waste as useful raw materials (“Waste-to-Worth”); designing more material-efficient delivery systems

v a 10 percent absolute reduction in total waste disposed off-site using 2010 total off-site waste disposal as a baseline

v 2020 goal: pilot studies in both developed and developing markets

v Increase recycling and recovery rates on average by 5% by 2015, and by 15% by 2020 in our top 14 countries.

v Double the amount of aerosols that gets recycled around the world by 2020.

v Committed to increasing the recyclability of our packaging, increasing recycling of post-industrial packaging related to our products and making sure our containers utilize materials that are compatible with accessible recycling systems

How does this relate to EPR?

Before

After

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Full Public Sector Responsibility

Full Private Sector Responsibility

Shared Responsibility

• Managed by the state or municipalities

• Financed through taxes• Public service

• Private management• Financed through

producers contributions (fees)

• Independent system

• Shared management• Public-Private

Financing• Mutual initiative:

Government & private sector

Post Consumer Waste Management Systems

Full public sector responsibility

Full private sector responsibility

Shared responsibility

Post Consumer Waste Management Systems

• Consumer pays and the government manages the system

• There are no direct financial incentives to improve the type of packaging or product supplied by the producer.

• The producer has full financial and operational responsibility for the operation of the recycling system

• The producer has a direct financial incentive to improve the recyclability of the packaging to reduce end of life management costs

• The producer pays for part of the total system cost and responsibility is shared with local governments

• Both producer and the consumer/local government have an incentive to improve the efficiency of recycling programs

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Choosing the right approach• You cannot simply copy and paste an EPR model from

another country• Need a solid fact base to ensure that the objectives of

the law are achievable• Test many different program elements to learn what

works best• Ensure that the regulations and financing systems

encourage recycling program effectiveness and efficiency– Regional programs provide economies of scale

• Training and motivating citizens to properly sort priority products for separate collection is the key to success– Most successful national programs build a common recycling

“brand”

Keys to Successful EPR

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Producer Responsibility Legal Frameworks Demonstrate Clear Benefits

• If combined with other policies: comprehensive solid wastemanagement legislation; charging generators for wastecollection services, mandatory recycling; bans from disposal

• Drives establishment and enhancement of collectioninfrastructure, sorting technology, and recycling capacities

• Fosters investment in modern technology for sorting andrecycling

• Enables competition, and therefore system efficiencies

Thinking about how to link producer responsibility/product stewardship legislation and the informal recycling sectors is just

beginning

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Contact information

Derek StephensonStrategy Matters Inc.

Phone: +41 79 195 40 77

derek@strategy-matters.ca