Citizens' Network on Waste Management

The Strategy

2.1 Principles

We adopted six principles that guided the development of the strategy:

1. Zero waste to disposal as an ideal.
   This is an ideal to strive toward, to motivate continual improvement, although in practice it is unlikely to be fully achieved.

2. Increased environmental protection through implementation of the 3Rs hierarchy.
   A strategy developed in accordance with the 3Rs hierarchy first reduce, then reuse, then recycle, and, as a last resort, dispose will maximize environmental protection.

3. Full producer responsibility for the products they produce - no taxpayer subsidies.
   This means that producers pay the full economic and environmental cost of their products over the life-cycle. The municipal property tax system will not subsidize producers. This principle applies to a return to producer system, a municipal Blue Box or other curbside system.

4. Regulations that ensure refillables targets are achieved.
   This will also require mechanisms for ensuring compliance (e.g., through effective and efficient monitoring and enforcement).

5. A convenient system for consumers to return products to producers.
   Consumer choice should be encouraged. Consumers have demonstrated a desire for various levels of convenience when priced appropriately.

6. Fair and equitable treatment of all producers.
   This applies to all producers, whether domestic or foreign, whether involved in a take-back system or financial contribution to the Blue Box program or not. For practical purposes, there may be earlier implementation for some producers.

In developing the strategy we did not look for perfection, but accepted instruments that move us incrementally forward. The test is reasonableness, while adhering to all of the principles.

2.2 Components of the Refillables Strategy

Our refillables strategy has seven major components:

1. Regulations with increasing refillables targets and a timetable for their adoption
2. Deposit-return systems
3. Start with deposits on all beverage containers
4. Convenient return to retail with adequate compensation for retailers
5. A curbside collection system based on full producer responsibility
6. Education on product take-back and reuse
7. Consultation on methods for meeting refillables targets

Regulations with Increasing Refillables Targets and a Timetable for Their Adoption

Refillables systems provide an environmentally sound packaging alternative, create jobs , and should be promoted through regulations.

Regulations are needed that ensure effective compliance and enforcement. The regulations should be designed to bring about desired producer and consumer behaviours that lead to the achievement of progressively higher levels of refillables.

Regulations on refillables should:

• lead to the elimination of non-refillable beverage containers over the long term
• contain increasing refillables targets and a timetable for their achievement
• describe what producers and consumers are permitted to do and are required to do
• be clear and easy to enforce
  

Regulations should be used to establish a framework for industry self-governance as well as government enforcement. For example, in Quebec, regulation establishes the framework. Producers are required to enter into a contract with Recyc-Québec, a provincial agency, in order to be able to sell non-refillable beverage containers. The contract specifies the non-refillables quotas to be met and the independent audits to be carried out by the producers to verify company performance.

Deposit-Return Systems

Deposit-return systems have proven to be a highly effective way for producers to recover the products purchased by consumers. Producers must recover very high levels of used product in order to have a successful reuse system. Since deposit-return systems achieve higher recovery rates than curbside programs, a deposit-return system is a necessary component of any reuse system.

Deposit-return systems are fairer than curbside programs because only the users pay. Only consumers who purchase the product pay the deposit. They can redeem the deposit when the empty container is returned. A deposit-return system is not subsidized by municipal tax dollars.

Deposit-return systems also reduce litter. A 1995 U.S. study of litter on U.S. beaches found that bottles and cans represent 7% by piece count of total litter where there were deposit-return systems and 19% where there were no deposit-return systems.

Products that are particularly well suited to a deposit-return system are those that:

• have value (e.g. can be reused);
• lose significant value if damaged or contaminated; and
• have significant environmental effects if disposed of improperly (e.g. lead-acid or nickel-cadmium batteries).

Deposit-return systems around the world collect a wide variety of materials. The following are some examples.

• In California, there are deposits on containers for beer and other malt beverages, soft drinks, wine and distilled spirit coolers, carbonated mineral water and soda water. Since the deposit law was enacted in 1986, there has been a 75% reduction in the beverage container component of roadside litter.
• There are deposits on car batteries in Rhode Island, Wisconsin, Minnesota and Washington.
• Commercial-size pesticide containers are subject to deposits in Maine.
• Car bodies are subject to a deposit-refund system in Norway and Sweden. In Sweden, the system raises US $14 million annually and is used for a vehicle scrapping fund. In Norway, the return rate is 90% to 99%.
• In Germany in 1993, a deposit was placed on packaging for a wide variety of products, such as soaps, detergents, paints and beverages. Retailers are responsible for the collection system.
• In Belgium, ecotaxes have been avoided by placing deposits on items such as batteries and the packaging of certain industrial goods.

Start with Deposits on All Beverage Containers

Initially, the Province should require a deposit-return system on all beverage containers . This is a good place to start because:

• Beverage containers are easily identified.
  The containers are plentiful and easily recognized.
  
  
• Beverage containers take up a lot of space in the Blue Box.
  Beverage containers (including liquor and wine bottles) take up approximately 50% by volume of the Blue Box . A deposit-return system on all beverage containers would increase beverage container recovery rates and save money.
  
  
• Deposit-return systems for beverage containers are very successful. Canadian and American experience with deposit-return systems for beverage containers yield recovery rates in the range of 72% to 98%. Current curbside collection for soft drink packaging in Ontario is only about 54%. The best curbside programs for beverage containers achieve less than 70%. Ontario's Blue Box now achieves only 30% diversion of packaging waste.
  
  
• The approach builds on existing Canadian experience.
  Deposits are used in every province in Canada for beer containers, and in every province except Manitoba and Ontario (except refillable glass soft drink bottles in Ontario) for other beverage containers.
  
  

  In Ontario there are regulations for some beverage containers, including deposits on beer, wine and soft drinks.
  
  

• Beverage containers have value in Ontario.
  Beverage containers are currently being reused (e.g. refillable glass beer and soft drink bottles) and recycled (e.g. aluminum cans and glass and PET bottles).

Convenient Return to Retail With Adequate Compensation for Retailers

Deposit-return systems are convenient, especially if based on return-to-retail. This allows for one-stop shopping saving energy and time, and minimizing air pollution impacts.

A broad distribution network of retailers exists across Ontario. Since a retail outlet is a major point of purchase, it is reasonable that a retail outlet should be a major point of return. Therefore, the deposit-return system should be based on returning used products to the place where they were sold.

Retailers must be properly compensated for any service they provide. A retailer is compensated for the sale of a particular product through the price of the product sold. The retailer sets the selling price of a product to cover the retailer's costs as well as to include a profit. In order to ensure a fair system for the retailer, this principle of cost internalization and compensation should be embedded in the return system. This means that retailers should receive fair compensation from the producer for accepting and storing the returned products. At a minimum, the handling fees paid by the producer should fully cover these costs to the retailer.

Technology has made it easier for retailers to handle and store the used containers. Today machines that automatically wash and refill empty bottles and reverse vending machines make it convenient for retailers to handle them.

To be effective and efficient, a return-to-retail program must encourage high levels of consumer participation. In order to encourage this participation, the deposit must be set high enough to encourage consumers to store the used products properly (e.g. avoid breakage, contamination) and to take used products back to the retailer.

A Curbside Collection System Based on Full Producer Responsibility

A deposit-return system is fully compatible with a curbside program. Not only are the two systems compatible, but when both systems are used together, total recovery rates and recycling rates are higher and overall diversion costs are lower.

According to a study published by the Congressional Research Service, deposit-refund systems working together with curbside recycling programs provide the best solution. Deposit systems collect more of their targeted materials than do curbside programs, while curbside programs can target a wider range of materials. Deposit systems remove potential sources of revenue from curbside programs but they also reduce operating costs of curbside programs. The study concludes that a greater diversion of solid waste from disposal at a lower cost per tonne could be achieved if both deposit refund and curbside collection programs were in place.

Curbside collection (wet/dry or multi-stream) is well suited to the remaining materials not covered by a deposit-return system. For example, the collection of fibre, yard wastes, and food waste (not covered by household composters) are appropriate for curbside collection.

Over time as producers become more sophisticated about the design and operation of their product take-back systems and as more products are covered by such systems, the number and types of products collected at the curb are likely to change. Eventually, we are likely to be left with products collected at the curb that are the most difficult to collect through a deposit-return system and/or harder to reuse or recycle.

The municipal tax system should not subsidize the curbside collection. Instead producers should take full financial responsibility for the economic and environmental impacts of their products and packaging collected in a municipal curbside program. Producers should also be responsible for the costs of disposal services.

A curbside program with appropriate materials going into it and paid for by the producers who use the system will protect municipalities from being overly dependent on one material, from price fluctuations in scrap materials, and from producers' packaging choices.

Education on Product Take-back and Reuse

Education for both the producer and the consumer on product take-back and reuse is essential. It helps producers to stay on top of trends, benefit from the experience of others, and identify new opportunities for improving product design and the take-back system from both environmental and business perspectives.

Public education on these issues will improve consumer buying decisions in favour of products that can be returned and reused. This is likely to lead to pressure on producers to design their products for disassembly, remanufacturing and reuse.

Consultation on Methods for Meeting Refillables Targets

The Citizens' Network on Waste Management's consultation led to the identification of the following seven options for meeting refillables targets:

1. The Legal fix - revising the existing Container Regulations to make them enforceable
2. Prohibition of non-refillables - making a regulation which requires a 5-year phase-out of non-refillables
3. Municipal licence to sell non-refillables - making retailers pay a licence fee for failure to meet refillables sales quotas
4. Half-back deposit-return system - requiring a full refund for return of refillables and a half refund for return of non-refillables
5. Green fees - requiring producers to pay a fee for the sale of non-refillables
6. Limits through legal agreements - placing quotas on producers for non-refillables sales volumes through contracts
7. Tradeable permits - setting limits on non-refillables through tradeable permits

Each option has merit and could be effective. However, each requires further investigation by the Province before the government decides on a preferred option(s). The Minister of the Environment and Energy should establish a multi-stakeholder consultation. The goal of the consultation is to develop preferred options for meeting refillables targets. These options must be designed to ensure that Ontario will have a significant, growing percentage of its beverages and other products sold in refillable containers supported by a comprehensive deposit-return system.


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