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What is Extended Producer Responsibility (EPR) & How do Plastic Credits Fit In?

What is Extended Producer Responsibility (EPR) & How do Plastic Credits Fit In?

What is Extended Producer Responsibility (EPR) & How do Plastic Credits Fit In?

What is EPR?

Extended Producer Responsibility (EPR) is the concept that brands, plastic packaging producers and importers should take responsibility for the plastic they put into a market across its entire lifecycle. EPR policies are based on the “polluter pays” principle and are generally implemented by governments via a set of rules and targets.

EPR programs take one of two forms: those with mandatory targets and penalties for not meeting targets; and those with non-binding targets but with a legal requirement for brands to report on their mitigation performance. The latter is sometimes a stepping-stone towards a more comprehensive, mandated EPR framework.

So if you’re a company selling plastic-bottled mineral water in a country that has a mandatory EPR framework, you’ll probably be required to meet certain collection, recycling and possibly post-consumer recycled (PCR) content targets for your plastic packaging. This means organising your local supply chains and / or working with collection and recycling organisations (sometimes called producer responsibility organizations) to meet these targets.

Why EPR? The plastic pollution problem

EPR is all about addressing the global plastic pollution problem across the product lifecycle. Based on current recycling rates, out of the 460 million tonnes of plastic produced each year, 9 percent is recycled, 19 percent is incinerated, 50 percent goes to landfill, and 22 percent is leaked into the environment (OECD Global Plastics Outlook 2022). This leakage adversely affects human and animal health, air and soil quality, and ocean carbon sink capacity as it breaks down into microplastics. A well-designed EPR framework incentivises plastic packaging producers towards product stewardship via circular production systems and reusable product design which reduce this environmental leakage. It also provides incentives for stakeholders to establish deposit return and take-back schemes.

And a well-designed EPR framework will have clearly defined mandatory targets covering a range of plastic types which scale up over time and are accompanied by robust enforcement mechanisms. Revenue collected from non-compliance penalties will be used to improve plastic waste management infrastructure. EPR frameworks can contain end-of-life plastic disposal requirements and should be synchronised with other circularity-focussed EPR law and legislation such as single-use plastic bans.

Which countries have EPR frameworks?

There are now over 70 countries with some form of plastic EPR system in place or under development to help reduce the environmental impacts of producing and using retailer / consumer products and associated packaging material. A snapshot of the EPR schemes and policy approaches in the Philippines, India, Singapore, the European Union (EU) and South Africa is presented in the table below.

 

Table – a snapshot of EPR frameworks in India, Philippines, South Africa, Singapore, and the EU

INDIA

PHILLIPINES

SOUTH AFRICA

SINGAPORE

EU

Implementation date:

Feb 2022

Implementation date:

July 2022

Implementation date:

May 2021

Implementation date:

2025

Implementation date:

Each member state to implement an eco-modulation fee-based EPR framework by end 2024

Plastic types:

Rigids, flexibles, multi-layered and plastic sheet

Plastic types:

Rigids, flexibles, plastic bags, B2B plastic products

Plastic types:

14 categories including single use, compostable and biodegradable plastics

Plastic types:

4 broad categories of plastic packaging

Plastic types:

All plastic packaging used for the containment, protection, handling, delivery and presentation of goods

Targets:

For producers and importers – by 2028 recycle 60 to 80%, PCR content of 10 to 60%. For brand owners – by 2028 reuse 20 to 80%, recycle 60 to 80%, PCR content of 10 to 60%.

Targets: 

“Obliged large enterprises” (assets over USD 1.7m) must “recover and divert” 80% of their plastic footprint by end 2028, with multiple, broadly defined compliance options.

Targets: 

Producers design own EPR plan or pay a fee to one of 8 registered PROs which undertake collection and recycling activity required to meet the producers’ targets.

For PET, the 2026 targets are 20% PCR content, 70% collection, 65% recycling.

Targets:

Not yet specified; mandatory packaging reporting against submitted plan/targets has been in place since 1/7/2020

Targets:

55% by 2030

End of life:

Road construction, energy recovery, waste to oil.

End of life:

“Appropriate” end of life allowable part of recovery and diversion plan

End of life:

Not specified for plastic

End of life: 

Not yet specified

End of life: 

Differs between member states

Enforcement:

Levies TBD

Enforcement:

Non-compliance fines USD85,000 -480,000 

Enforcement: 

Revocation of licence 

Enforcement:

Applies to companies with turnover >USD 7 million; fines of SGD3,500 to 7,000 for non-compliance.

Enforcement:

Differs between member states (e.g. Germany requires PRO participation or face sales ban).     

Offset mechanism:

Tradeable certificates for surplus reuse, recycling and end of life disposal

Offset mechanism:

All offsetting of recovery and diversion activity permitted 

Offset mechanism:

Not included.

Offset mechanism:

Likely to be included.

Offset mechanism:

Member states are permitted to include economic instruments that promote recovery and diversion

INDIA

Implementation date:

Feb 2022

Plastic types:

Rigids, flexibles, multi-layered and plastic sheet

Targets:

For producers and importers – by 2028 recycle 60 to 80%, PCR content of 10 to 60%. For brand owners – by 2028 reuse 20 to 80%, recycle 60 to 80%, PCR content of 10 to 60%

End of life:

Road construction, energy recovery, waste to oil.

Enforcement:

Levies TBD

Offset mechanism:

Tradeable certificates for surplus reuse, recycling and end of life disposal

PHILLIPINES

Implementation date:

July 2022

Plastic types:

Rigids, flexibles, plastic bags, B2B plastic products

Targets:

“Obliged large enterprises” (assets over USD 1.7m) must “recover and divert” 80% of their plastic footprint by end 2028, with multiple, broadly defined compliance options.

End of life:

“Appropriate” end of life allowable part of recovery and diversion plan

Enforcement:

Non-compliance fines USD85,000 -480,000

Offset mechanism:

All offsetting of recovery and diversion activity permitted

SOUTH AFRICA

Implementation date:

May 2021

Plastic types:

14 categories including single use, compostable and biodegradable plastics

Targets:

Producers design own EPR plan or pay a fee to one of 8 registered PROs which undertake collection and recycling activity required to meet the producers’ targets.

For PET, the 2026 targets are 20% PCR content, 70% collection, 65% recycling.

End of life:

Not specified for plastic

Enforcement:

Revocation of licence

Offset mechanism:

Not included

SINGAPORE

Implementation date:

2025

Plastic types:

4 broad categories of plastic packaging

Targets:

Not yet specified; mandatory packaging reporting against submitted plan/targets has been in place since 1/7/2020

End of life:

Not yet specified

Enforcement:

Applies to companies with turnover >USD 7 million; fines of SGD3,500 to 7,000 for non-compliance.

Offset mechanism:

Likely to be included.

EU

Implementation date:

Each member state to implement an eco-modulation fee-based EPR framework by end 2024

Plastic types:

All plastic packaging used for the containment, protection, handling, delivery and presentation of goods

Targets:

55% by 2030

End of life:

Differs between member states

Enforcement:

Differs between member states (e.g. Germany requires PRO participation or face sales ban).

Offset mechanism:

Member states are permitted to include economic instruments that promote recovery and diversion

What’s really interesting is how these national EPR frameworks for environmental protection might ultimately complement and intersect with global initiatives such as the Verra Plastic Waste Reduction Standard and the United Nations Global Plastic Treaty.

Plastic Standard

Let’s start with the Verra Plastic Waste Reduction Standard. This global standard enables certified plastic waste collection and recycling programs to generate tradeable plastic credits, the revenue from which may be used to fund project scale-up (check out our blog on how plastic credits work). The requirements for certification are rigorous – so a brand / producer partnering with a certified project to help meet its EPR targets will have peace of mind that the project is independently audited, has no child labour, pays living wages, has engaged with stakeholders, and yields community-co-benefits. Certified projects also submit volume monitoring reports on a regular basis which might also be used to meet EPR reporting requirements.

From a brand perspective, Plastic Standard certification can offer a point of differentiation – it’s a signal that it goes beyond what is required to comply with the local EPR rules by being independently certified under a globally-recognised standard as part of its plastic product stewardship journey.

In addition, the certified project may generate tradeable collection and / or recycling credits that are recognised under some EPR frameworks (see table below) as a mechanism for a producer to offset its collection and recycling targets – the same way that carbon credits work as part of greenhouse gas mitigation strategies.

At the country level, it’s also conceivable that the Plastic Standard could be adopted by local governments and municipalities as a broader “plug and play” framework for the regulation and monitoring of its EPR framework.

Global Plastic Treaty

The United Nations Environment Assembly has the commitment of 193 parties to negotiate a Global Plastic Treaty by November 2024 that will address the full life cycle of plastic, including single-use plastics and microplastics (see our recent blog about the UN Global Plastic Treaty for more details). The treaty will be analogous in structure and intent to the Paris Agreement (and supplementary Glasgow Climate Pact) to limit climate change, with national action plans underpinning the plastic pollution mitigation targets set by each party.

An EPR framework would logically form the cornerstone of these national action plans, giving those parties with well-designed frameworks already in place a head start in this global effort. The Treaty will also contain an offset mechanism, allowing parties to trade plastic credits generated by certified plastic waste reduction projects.

All this points to a plastic stewardship pathway that is increasingly characterised by common concepts and tools: action on single use plastics, circularity in supply and design, mitigation targets that can be ramped up over time, and tradeable plastic credits to help companies and nations address plastic pollution efficiently and transparently.

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Recycled PET Market – Supply & Demand Market Issues

Recycled PET Market – Supply & Demand Market Issues

The recycled PET market:  many large buyers, but not enough collection

 

We know that of the 460 million tonnes of plastic consumed globally each year, just 9 per cent is recycled (1). Roughly 50 percent of plastic waste generated globally ends up in landfill; 19 per cent is incinerated, and the rest leaks into the environment (2). So what are the dynamics of the market for recycled plastic? Are these dynamics working to increase the recycling rate and build circularity in the production and consumption of plastic?

The widening supply-demand gap in the recycled PET market in particular would suggest not. Building commerciality – by facilitating the smooth transition of both materials and value across the entire plastic supply chain from post-consumer waste collection through recycled product manufacturing – is key to addressing this gap.

Market dynamics

Recycled PET is the most commonly recycled polymer (easiest to collect post-consumer, tends to be less contaminated, and reasonable margins) with a 40 percent share of global plastic recycling input capacity (3) . rPET global annual production capacity is around 20 million tonnes, centred in over 1,000 mechanical recycling plants generally located in urban areas, where plastic waste is easiest to collect and aggregate (4). rPET is predominantly used to produce textiles and bottles, with these two manufacturing sectors using 41 percent and 35 percent of all rPET molecules produced respectively (5).

Let’s take a closer look at the factors driving the demand for and supply of rPET.

On the demand side: in response to consumer and investor concerns over the plastic pollution crisis, most major brands using plastic in their supply chain have started to measure their plastic footprint and take mitigating actions. These actions include packaging redesign and light-weighting, reducing virgin plastic use, increasing reusability, and setting targets for recycled plastic content. A summary of these targets (and progress to date) for the top 10 plastic consuming brands is presented in Table 1 below (6). As brands strive to meet their targets, they are collectively expanding demand and increasingly competing with each other for available rPET, with the availability of food grade pellets being a particular pain point.

Table 1 – Targets and progress of the top 10 plastic packaging producers (7)

Company Plastic use (T) Recycled Plastic Content Progress
Coca-Cola Company 2,961,254 50% by 2030 11.5%
PepsiCo 2,350,000 50% by 2030 5%
Unilever 690,000 25% by 2025 11%
Nestlé 1,267,000

15% by 2025

4.2%

Procter & Gamble 714,000 50% reduction in virgin plastic by 2030 3% increase in virgin plastic use (relative to 2017) in 2020-21
Mondelēz International 189,500 5% by 2025 0.3%
Philip Morris International 127,000 Halve the plastic litter from PMI products by 2025 na
Danone 716,500 25% by 2025 10.3%
Mars 179,382 30% by 2025 0%
Colgate-Palmolive 288,487 25% by 2025 10%

 

New regulations are also driving demand for rPET – under the EU’s Packaging and Packaging Waste Directive, PET drinks bottles will be required to contain at least 25 percent recycled plastic from 2025, and 30 percent from 2030. This has prompted several members of the European beverage industry to call for a ‘first refusal’ mandate for rPET for the beverages industry in order to secure the supply required to meet these market and regulatory demands (and buffer against the ‘downcycling’ of food grade rPET into the textile industry).

And in April 2022, the UK introduced a tax on plastic packaging of £200 per tonne where recycled content is less than 30 percent. In the US, a tax of USD 0.20 per pound of virgin plastic used to make single-use plastics has been proposed.

On the supply side, collection is key to generating feedstock for rPET production – and this is where the supply bottleneck lies. “Informal” collection of post-consumer PET is labour-intensive, relying on networks of waste pickers to retrieve waste from land, waterways and dumpsites which must then be aggregated, sorted and transported. “Formal” collection by municipalities and private service providers requires sufficient volumes to justify investment in materials recovery and plastic recycling facilities; otherwise landfill or incineration is the end of life.

The rPET bottleneck (no pun intended) has been compounded by persistent global supply chain issues, labour shortages, and import bans – and these factors are now driving higher prices. European prices for post-consumer bottles reached record highs earlier this year, and flake prices rose around 10 per cent to reach €1,600 per tonne (8). In the US, food-grade rPET pellet prices have increased by 52 percent over the last year (9).

Rising rPET demand and prices are incentivising investment in new recycling capacity – Europe has seen a 21 percent increase in the installed capacity for PET recycling (10). The world’s largest rPET producer, Indorama Ventures, is raising its production target by 750,000 tonnes and is investing USD1.5 billion in additional capacity to achieve this by 2025. Whilst global rPET capacity is forecast to boom over the next five years, it will still fall short of the expanding demand from the packaging and textile industries.

Supply-demand gap

Despite rising prices and the addition of new recycling capacity, there is a persistent gap between the demand from packaging and textile companies for rPET and its supply. According to modelling work conducted by ICIS, at least 1,800 new rPET plants with an average output of 25,000 tonnes/year would be necessary globally to achieve the 2025 targets set by the major brands (11). In the US, it is estimated that there is a gap of nearly 500,000T between current US supply and projected 2025 demand for rPET for use in bottles alone (12).

A key to narrowing this gap is the continued commercialisation of the market for recycled plastic by facilitating the smooth transition of both materials and value across the entire plastic supply chain, from the post-consumer waste collection phase right through to the manufacturing of recycled products. This will require:

  • Addressing the collection bottle neck – the EU has set a 77 percent target for the separate collection of plastics for recycling by 2025 (90 percent by 2029). This target is to be achieved through deposit return schemes or separate collection targets in Extended Producer Responsibility (EPR) schemes. Over 30 countries have now implemented EPR schemes which aim to set collection and recycling targets for plastic packaging producers. It is crucial that EPR schemes also drive improvements in the working conditions and livelihoods of the 12 million waste pickers working around the world in dangerous conditions for less than a living wage.
  • Addressing the lack of transparency around feedstock quality and contaminants such that recycled material is seen by the market as a perfect substitute for virgin plastic, especially food grade (where the supply gap is the greatest). Customers are increasingly demanding certification of the recycled plastic feedstock they’re buying; the market and regulators need to facilitate this.
  • Recycling capacity addition – increasing investment in new capacity needs to be facilitated. Plastic credits generated via waste management project certification under stringent standards such as Verra’s Plastic Waste Reduction Standard provide a mechanism for this. A project certified under this standard can be eligible to generate both plastic collection and recycling credits (if it is engaging in both activities). Revenue from plastic credit sales can be used by the certified project to invest in additional collection and recycling capacity.

A further benefit of a robust plastic credit mechanism is that brands may purchase these credits and use them as a fully audited offset against their plastic mitigation targets.   For brands with ‘at risk’ targets due to rapidly expanding global rPET demand and persistent supply constraints, credits are an attractive interim solution.  It is anticipated that the UN Global Plastic Treaty  will include a credit trading mechanism when it is implemented in late 2024.

Plastic Collective is working with many projects and brands to incorporate certified plastic credits into their sustainability programmes – please contact us if you’d like to know more (see also our recent blog on how plastic credits work) .

(1) https://www.oecd.org/newsroom/plastic-pollution-is-growing-relentlessly-as-waste-management-and-recycling-fall-short.htm

(2) https://www.oecd.org/newsroom/plastic-pollution-is-growing-relentlessly-as-waste-management-and-recycling-fall-short.htm

(3)  (see (recycling magazine))

(4) https://www.recycling-magazine.com/2022/07/06/plastics-recycling-how-to-square-supply-and-demand/

(5) https://www.spglobal.com/commodityinsights/en/market-insights/blogs/petrochemicals/022621-us-plastic-recycling-pet-bottles-packaging-waste-investment

(6) https://www.breakfreefromplastic.org/wp-content/uploads/2021/10/BRAND-AUDIT-REPORT-2021.pdf

(7) Note that Procter & Gamble and Philip Morris International have not set recycled plastic content targets; their alternative targets are presented here.

(8) https://packagingeurope.com/news/rpet-prices-reach-record-high-across-europe/6953.article

(9) https://www.icis.com/explore/cn/resources/news/2022/03/04/10740575/insight-2022-to-be-a-pivotal-year-for-us-r-pet-market

(10) https://packagingeurope.com/news/how-will-the-pet-industry-deliver-its-sustainability-targets/7803.article

(11) https://www.recycling-magazine.com/2022/07/06/plastics-recycling-how-to-square-supply-and-demand/

(12) https://recyclingpartnership.org/the-recycling-partnership-announces-first-ever-u-s-circular-economy-roadmap/

(13) https://www.sea-circular.org/news/new-wwf-report-on-plastic-packaging-focuses-on-epr-solutions/#:~:text=More%20than%2030%20countries%20have,example%20of%20an%20effective%20solution

 

Global Plastic Treaty – The Lowdown

Global Plastic Treaty – The Lowdown

The OECD’s latest report on plastic pollution is not exactly ‘beach read’ material. It projects that plastic leakage into the environment will double to 44 million tonnes a year by 2060, while the build-up of plastics in aquatic environments will more than triple, exacerbating environmental and health impacts. And then there’s the carbon footprint of plastic from plastic production, transport, consumption and environmental leakage (currently contributing around 15% of total emissions) – greenhouse gas emissions from the plastics lifecycle are projected to more than double by 2060. Plastic pollution is a transboundary crisis that will get worse. Given that current regulatory responses are fragmented, uncoordinated across countries and yet to demonstrate impact, the case for coordinated international action and a global solution through a legally binding instrument is strong.

At UNEA-5.2 in Nairobi, the recently adopted UN resolution “End plastic pollution: towards an international legally binding instrument” is an historical step in this direction. So far, 193 UN member states have agreed to negotiate a global plastic treaty by November 2024 that will address the full life cycle of plastic, including single-use plastics and microplastics.

The global agreement will likely be analogous in structure and intent to the Paris Agreement (and supplementary Glasgow Climate Pact) to limit climate change, with national action plans forming the cornerstone of an overarching plastic pollution mitigation target with accompanying reporting and compliance measures. These latter measures, combined with ‘peer pressure’ and sheer will, are crucial to treaty effectiveness – its “legally binding” nature in practice has few legal teeth given there is no international environmental court or governing body ready to enforce compliance of a binding agreement.

It is anticipated that developing countries in Africa and Asia-Pacific and elsewhere – where waste management infrastructure is minimal and plastic leakage into waterways and oceans is extreme – will be proactive parties in these treaty negotiations. The treaty will include arrangements for capacity-building, technology transfer, and financial and technical assistance via a multilateral fund. Mechanisms for incorporating the best available science, traditional, local and indigenous knowledge will also be negotiated to help reduce the impact of plastic across its entire life cycle.

Finally, as a part of the negotiation process, in the new treaty there will likely be a market mechanism initiative to support the voluntary trade of verified plastic credits which represent a specific unit of plastic collected and / or recycled by one party and purchased by another to offset against their plastic mitigation target. This recognises the important role that markets can play in addressing global problems. The Clean Development Mechanism established under the Paris Agreement in 2006 has created a global market for carbon credits with a turnover of 229 billion euros per annum and double-digit growth forecast by 2030.

The nascent market for certified plastic credits is being facilitated by the Verra Plastic Waste Reduction Standard, the Zero Plastic Oceans Ocean Bound Certification Programme and their associated trading registries.

Plastic Collective is working hard with organisations and the private sector around the world to certify their plastic waste management projects under these rigorous standards so that they may generate and trade credits, using the revenues to further scale their mitigation work. Often this work is conducted by waste picker communities in remote areas with minimal plastic waste processing and transport infrastructure. Credit revenue enables supply chains to be built and waste pickers to be paid a living wage.

The use of verified plastic credits by both companies and consumers to offset their plastic footprints as part of their broader mitigation strategies has enormous potential to address the plastic crisis and reinforce the actions of similarly committed parties at a global level via the global plastic treaty. Now that is good news.

Find out more about Plastic Collective and get latest news and info about Plastic recycling, microplastics, clean energy and the effects of climate change, by subscribing to the Plastic Collective newsletter.

 

Plastic Credits: Safeguarding against “greenwashing” and false company eco-friendly / ESG claims

Plastic Credits: Safeguarding against “greenwashing” and false company eco-friendly / ESG claims

Greenwashing”, or the exaggeration of claims by companies about their environmental, social and governance (ESG) achievements, is a growing problem in the ESG industry.  Under pressure from consumers, shareholder and environmental groups, regulators are now looking at tightening rules when talking about environmental claims such as sustainability or neutral emissions[1].

To instill integrity and counter greenwashing claims in plastic credit programs (such as Verra’s Plastic Waste Reduction Program) safeguards and enforcement mechanisms are embedded to ensure that companies do not make duplicative claims.

What are duplicative claims?  Duplicative claims arise (theoretically) when two companies make the same claim about a single piece of work done by project therefore taking twice the credit for its environmental impact and getting a hidden trade off from each other.  For example:

  • Project A is an initiative which collects a total of 100 tons of plastic from the environment; and
  • Company X (a retailer) uses 100 tons of plastic in its supply chain and buys 100 tons of plastic credits from Project A in order to claim Net Zero Plastic Leakage[2]; and
  • Company Y (an airline) also uses 100 tons of plastic in its supply chain and buys 100 tons of plastic credits from the same Project A which were generated from the same work. These credits are purchased  in order to also claim Net Zero Plastic Leakage.

You can clearly see here how two companies X and Y both claim the work benefit of project A that conducts a single collection activity.  This is a duplicative claim (and for that matter a false claim)!  Companies may do this (inadvertently or otherwise) to justify their green marketing strategy, an example of greenwashing where company’s claims are duplicated for environmental benefits to propel their marketing campaigns.

While advertising standards and industries such as fast fashion have yet to catch up to this, thankfully, credible and regulated plastic waste management standards have extensive safeguards and independent auditing in place to prevent duplicative claims, whether of eco-friendly products or sustainability claims.  We’ll dive deeper into this in a separate blog!

The question of duplicative claims is often raised by plastic recycling businesses who sell both physical recycled plastic commodities and plastic recycling credits.  Let’s explore a little more closely why this is not a duplicative claim.

When a plastic recycling business sells recycled plastic commodities to a company for use in their packaging, e.g. a drink bottle,  they also usually sell the commodity buyer the opportunity to  claim something like “we use x% recycled plastic in our packaging” and might also add “sourced from recycling business B”.  This is usually very important to a company buying recycled plastic for use in the packaging.

We often get asked by plastic recycling businesses “if we sell recycled plastic commodity to a company and they say they use recycled plastic in their packaging, and additionally, we sell plastic credits to a different company, does this amount to a duplicative claim”?

The answer to this is no!  Here’s why.

Business Practices & Plastic Stewardship

When considering a company’s approach to plastic stewardship[3], the flow of plastic into and out of the environment is broken into three distinct stages:

  1. First, the use of recycled plastic material in packaging in place of virgin plastic in production is encouraged.  This is called the “inflow side”, describing the use of plastic before the consumer consumes the product.
  2. Second, after the consumer has consumed the product, some of the associated plastic packaging  will be collected and / or recycled. This is called the “outflow side”, i.e. what happens after consumption.
  3. Third, after the consumer consumes the product, some of the plastic packaging won’t be collected and instead leaks into the environment –  this is also part of the “outflow side”, i.e. what happens after consumption.

If a company is using plastic, it is encouraged to address each and every activity in the plastic value chain – production (inflow), collection and recycling (both outflow).  If the company addresses all three activities successfully (with zero leakage into the environment) it can claim to be Net Circular Plastic, that is, it has no reliance on virgin plastic.  This is plastic nirvana!  Bravo!

Illustration : Achieving plastic nirvana by addressing plastic packaging inflows and outflows

But how does a company get to plastic nirvana and truly be a sustainable brand

Credit programs enable a plastic waste collection credit (WCC) to be generated and sold from collection activity (activity 2 in the above illustration), and a plastic waste recycling credit (WRC) to be generated and sold from recycling activity (activity 3 in illustration).  Companies can address shortfalls in the collection and or recycling of their plastic waste (reducing plastic pollution) by buying these respective credits.  And buying credits represents an investment in the underlying collection and recycling activities.

However, existing credit programs[4] do not certify for recycled content on the inflow side (production activity).  So companies must actually use 100% recycled content to make a 100% Recycled Content claim.

Let’s now tie this back to the plastic recyclers’ duplicative claim question: “Are there duplicative claims being made if we  sell physical plastic commodity and our commodity buyer makes public statements that they have 100% Recycled Content in their packaging and additionally, we sell plastic credits and associated claims to a plastic recycling credit buyer?”

As you can see from the three separate plastic inflow and outflow activities, any claims relating to the use of recycled content in packaging are aligned with activity 1, i.e. the inflow side.  In contrast,  the claims relating to collection and / or recycling of plastic waste are aligned with activities 2 and 3 respectively, i.e. the outflow side.   The different claims sit at different parts of the supply chain.  So, an entity using plastic in its production activity (activity 1)  cannot claim that they did the activity of another entity in another stage (i.e. collection and / or recycling).  Each entity is responsible for the activity they perform and therefore the credits that their activity generates.  As you can see, the different green claims are mutually exclusive – not duplicative – of one another.

As the nascent plastic credit market develops, it is of utmost importance for all stakeholders that the risk of greenwashing is minimalised, by embedding integrity and rigor in the claims and certifications process.  Companies should follow the relevant guidance closely and conduct their own due diligence and auditing for each and every claim they seek to make.

Learn more about Greenwashing, along with reducing your carbon footprint, recycling plastic and finding green initiatives by subscribing to our mailing list today or becoming plastic neutral here.

Sources:

[1] Economist, The World This Week: Business. June 1, 2022.

[2] Zero Net Plastic Leakage means that an equivalent to the total weight of plastic put into a market is permanently removed from the environment (Guidelines for Corporate Plastic Stewardship, p.24)

[3] Plastic stewardship refers to an organisation’s strategic journey to achieve full and ongoing circularity in their plastic usage, with associated targets supported by regular and consistent accounting.

[4] The recently launched Recycled Material Standard is expected to generate recycled content credits (US only).

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