by Jonathan Cocker, Baker Mckenzie
The attention currently devoted to plastics waste in both the public and private sectors is breathtaking. A growing number of international brands have made recycled content commitments for their plastic packaging and related containers. The European Union’s Strategy for Plastics in a Circular Economy has begun implementing changes to the EU Packaging and Packaging Waste Directive and the UK Department of Agriculture, Environment and Rural Affairs (DAERA) has just released a well-developed plastics packaging taxation proposal that is currently under public consultation. The plans for plastic packaging are open and notorious.
Less obvious has been the regulatory direction for plastic products. An increasing number of consumer goods companies are promoting products with some plastic (or even ocean plastic) waste content, though there are no common standards by which these claims can be measured. The EU has committed to some limited prohibitions on single use plastics (read: knives and forks) and has called for voluntary member commitments to grow markets for recycled plastics in its Strategy. The G7 Oceans Plastic Charter includes, an aspirational 2030 member goal of “working with industry towards increasing recycled content by at least 50% in plastic products where applicable”.
The dramatic reduction of overseas markets, including China’s National Sword, has, however, made urgent the need for local markets for recycled plastics. Something must be done.
Circular Economy and the Demand Side
In response, there is increasing support for broadening the role that all plastic products (of some chemistry) can play within a broader plastics circular economy strategy. Reloop’s June 2018 A Call for EU Action on Recycled Content Mandates, Eunomia’s UK Demand Recycled, October 2018 and A Vision for a Circular Economy for Plastics in Canada, Smart Prosperity Institute, February 2019 are just three recent advocates for recycled plastics content standards, creating the necessary market to ensure both supply chains and reverse supply chains are designed for the resupply of the necessary recycled content input.
Further, the materials caught by these recycled content obligations could be substantially broadened to capture the industrial, commercial and institutional sectors, as additional to consumer goods, to expand the market (and thereby potentially lower the price) for recycled plastics content.
The Commercial Case for Recycled Content Standards
Among the benefits of recycled content requirements would be the marriage of product content with its recycling, compelling producers to better understand the opportunities for the recycled plastics generated, and to foster further innovation to best streamline more efficient recycling methods to produce high-grade plastics at commercial scale.
The Smart Prosperity Institute also points out that this closed loop strategy will insulate producers from plastic market fluctuations:
Recycled content performance standards create a market for recycled materials that moves in step with the demand for plastic products regardless of input prices from other feedstocks. Such an approach will overcome the economic barrier posed by fluctuating virgin commodity prices even as demand for plastic products continues to grow.
There is also existing recycling infrastructure in North America and the EU which is at risk if new viable markets aren’t found for recycled plastics. Finally, the liabilities associated with the release of plastic waste to the environment would be lessened given the market incentives for recapture.
How Would It Work?
As has already been proven on a more limited scale in California, recycled content standards can function in a local (though large) market without international adoption. It would, however, benefit from expansion through multilateral initiatives such as the G7 Oceans Plastic Charter and the EU Strategy, creating a sufficient market to attract broad-scale overhaul of international supply chains for plastic products.
Alternatives to direct mandated standards include an input tax based upon the percentage of fossil-fuel derived plastics. This is the approach seemingly favoured for packaging by DAERA. There are also more complex models such as a “feebate” or a tradable credit regime, both of which may offer unique functionality benefits but are perhaps too involved for easy and confident adoption by participating countries. All models, however, point to recycled plastics content as a coming reality.
It would be a mistake to review recycled content standards as either obscure or otherwise a 2030 obligation. As traditional recycling is going through a dramatic shift, plastic feedstock no longer has easy secondary markets in developing countries and there is a growing clamour for circular economy as a remedy to pervasive plastic waste, it is possible that the international push for these standards will be upon plastics product makers sooner than they might expect.
This article is republished at the permission of the author. It was first published on the Baker McKenzie Environmental Law Insights website.
About the author
Jonathan D. Cocker heads the Firm’s Environmental Practice Group in Canada and is an active member of firm Global Consumer Goods & Retail and Energy, Mining and Infrastructure groups. Mr. Cocker provides advice and representation to multinational companies on a variety of environment, health and safety matters, including product content, dangerous goods transportation, GHS, regulated wastes, consumer product and food safety, extended producer responsibilities and contaminated lands matters. He appears before both EHS tribunals and civil courts across Canada. Mr. Cocker is a frequent speaker and writer on EHS matters, an active participant on EHS issues in a number of national and international industry associations and the recent author of the first edition of The Environment and Climate Change Law Review (Canada chapter) and the upcoming Encyclopedia of Environmental Law (Chemicals chapter).