Extended producer responsibility

Tires are an example of products subject to extended producer responsibility in many industrialized countries.

In the field of waste management, extended producer responsibility (EPR) is a strategy designed to promote the integration of environmental costs associated with goods throughout their life cycles into the market price of the products.

The concept was first formally introduced in Sweden by Thomas Lindhqvist in a 1990 report to the Swedish Ministry of the Environment. In subsequent reports prepared for the Ministry, the following definition emerged: "[EPR] is an environmental protection strategy to reach an environmental objective of a decreased total environmental impact of a product, by making the manufacturer of the product responsible for the entire life-cycle of the product and especially for the take-back, recycling and final disposal.

Definition

EPR uses financial incentives to encourage manufacturers to design environmentally friendly products by holding producers responsible for the costs of managing their products at end of life. This policy approach, which differs from product stewardship, which shares responsibility across the chain of custody of a product, attempts to relieve local governments of the costs of managing certain priority products by requiring manufacturers internalize the cost of recycling within the product price. EPR is based upon the principle that because producers (usually brand owners) have the greatest control over product design and marketing and these same companies have the greatest ability and responsibility to reduce toxicity and waste.

EPR may take the form of a reuse, buy-back, or recycling program. The producer may also choose to delegate this responsibility to a third party, a so-called producer responsibility organization (PRO), which is paid by the producer for used-product management. In this way, EPR shifts the responsibility for waste management from government to private industry, obliging producers, importers and/or sellers to internalise waste management costs in their product prices and ensuring the safe handling of their products.

A good example for producer responsibility organizations are the member organizations of PRO EUROPE. PRO EUROPE s.p.r.l. (Packaging Recovery Organisation Europe), founded in 1995, is the umbrella organization for European packaging and packaging waste recovery and recycling schemes. Product stewardship organizations like PRO EUROPE are intended to relieve industrial companies and commercial enterprises of their individual obligation to take back used products through the operation of an organization which fulfills these obligations on a nation-wide basis on behalf of their member companies. The aim is to ensure the recovery and recycling of packaging waste in the most economically efficient and ecologically sound manner. In many countries, this is done through the Green Dot (symbol) trademark of which PRO EUROPE is the general licensor. The "Green Dot" has evolved into a proven concept in many countries as implementation of Producer Responsibility. In twenty-five nations companies are now using the "Green Dot" as the financing symbol for the organization of recovery, sorting and recycling of sales packaging.

Take-back

In response to the growing problem of excessive waste, several countries adopted waste management policies in which manufacturers are responsible for taking back their products from end users at the end of the products' useful life, or partially financing a collection and recycling infrastructure. These policies were adopted due to the lack of collection infrastructure for certain products that contain hazardous materials, or due to the high costs to local governments of providing such collection services. The primary goals of these take-back laws therefore are to partner with the private sector to ensure that all wastes are managed in a way that protects public health and the environment. The goals of take-back laws are to

1. encourage companies to design products for reuse, recyclability, and materials reduction;
2. correcting market signals to the consumer by incorporating waste management costs into the product’s price;
3. promoting innovation in recycling technology.

Take-back programs help promote these goals by creating incentives for companies to redesign their products to minimize waste management costs, by designing their products to contain safer materials (so they do not need to be managed separately) or designing products that are easier to recycle and reuse (so recycling becomes more profitable). The earliest take-back activity began in Europe, where government-sponsored take-back initiatives arose from concerns about scarce landfill space and potentially hazardous substances in component parts. The European Union adopted a directive on Waste Electrical and Electronic Equipment (WEEE). The purpose of this directive is to prevent the production of waste electronics and also to encourage reuse and recycling of such waste. The directive requires the Member States to encourage design and production methods that take into account the future dismantling and recovery of their products. These take-back programs have been now adopted in nearly every OECD country. In the United States, most of these policies have been implemented at the state level, due to the political impasse at the federal level.

Electronics

Many governments and companies have adopted Extended Producer Responsibility to help address the growing problem of e-waste—used electronics contain materials that cannot be safely thrown away with regular household trash. Many governments have partnered with corporations in creating the necessary collection and recycling infrastructure. Some argue that local and manufacturer-supported Extended Producer Responsibility laws give manufacturers greater responsibility for the reuse, recycling, and disposal of their own products.

In the United States, most producer responsibility laws in effect have been passed at the state level, due to unique political circumstances at the federal level. Twenty-five states have already passed laws requiring producer responsibility and many others are currently working towards passing producer responsibility laws.

Advantages

When producers either face a financial or physical burden of recycling their electronics after use, they may be incentivized to design more sustainable, less toxic, and easily recyclable electronics. Using fewer materials and designing products to last longer can directly reduce producers' end-of-life costs. Thus, Extended Producer Responsibility is often cited as one way to fight planned obsolescence, because it financially encourages manufacturers to design for recycling and make products last longer.

Disadvantages

Some people have concerns about extended producer responsibility programs for complex electronics that can be difficult to safely recycle, such as Lithium-ion polymer batteries. Others worry such laws could increase the cost of electronics because producers would be adding recycling costs into the initial price tag. When companies are required to transport their products to a recycling facility, it can be expensive if the product contains hazardous materials and does not have a scrap value, such as with CRT televisions, which can contain up to 5 pounds of lead. Organizations and researchers against EPR claim that the mandate would slow technical innovation and impede technological process. Other critics are concerned that manufacturers may use takeback programs to take secondhand electronics off the reuse market, by shredding rather than reusing or repairing goods that come in for recycling.

Implementation

EPR has been implemented in many forms, which may be classified into three major approaches:

• Mandatory
• Negotiated
• Voluntary

It is perhaps because of the tendency of economic policy in market-driven economies not to interfere with consumers’ preferences that the producer-centric representation is the dominant form of viewing the environmental impacts of industrial production: in statistics on energy, emissions, water, etc., impacts are almost always presented as attributes of industries (‘on-site’ or ‘direct’ allocation) rather than as attributes of the supply chains of products for consumers. On a smaller scale, most existing schemes for corporate sustainability reporting include only impacts that arise out of operations controlled by the reporting company, and not supply-chain impacts According to this world view, “upstream and downstream [environmental] impacts are […] allocated to their immediate producers. The institutional setting and the different actors’ spheres of influence are not reflected.".

On the other hand, a number of studies have highlighted that final consumption and affluence, especially in the industrialised world, are the main drivers for the level and growth of environmental pressure. Even though these studies provide a clear incentive for complementing producer-focused environmental policy with some consideration for consumption-related aspects, demand-side measures to environmental problems are rarely exploited.

The nexus created by the different views on impacts caused by industrial production is exemplified by several contributions to the discussion about producer or consumer responsibility for greenhouse gas emissions. Emissions data are reported to the IPCC as contributions of producing industries located in a particular country rather than as embodiments in products consumed by a particular population, irrespective of productive origin. However, especially for open economies, taking into account the greenhouse gases embodied in internationally traded commodities can have a considerable influence on national greenhouse gas balance sheets. Assuming consumer responsibility, exports have to be subtracted from, and imports added to national greenhouse gas inventories. In Denmark for example, Munksgaard and Pedersen (2001) report that a significant amount of power and other energy-intensive commodities are traded across Danish borders, and that between 1966 and 1994 the Danish foreign trade balance in terms of CO₂ developed from a 7 Mt deficit to a 7 Mt surplus, compared to total emissions of approximately 60 Mt. In particular, electricity traded between Norway, Sweden and Denmark is subject to large annual fluctuations due to varying rainfall in Norway and Sweden. In wet years Denmark imports hydro-electricity whereas electricity from coal-fired power plants is exported in dry years. The official Danish emissions inventory includes a correction for electricity trade and thus applies the consumer responsibility principle.

Similarly, at the company level, “when adopting the concept of eco-efficiency and the scope of an environmental management system stated in for example ISO 14001, it is insufficient to merely report on the carbon dioxide emissions limited to the judicial borders of the company”. 7 “Companies must recognise their wider responsibility and manage the entire life-cycle of their products … Insisting on high environmental standards from suppliers and ensuring that raw materials are extracted or produced in an environmentally conscious way provides a start”. A life-cycle perspective is also taken in Extended Producer Responsibility (EPR) frameworks: “Producers of products should bear a significant degree of responsibility (physical and/or financial) not only for the environmental impacts of their products downstream from the treatment and disposal of their product, but also for their upstream activities inherent in the selection of materials and in the design of products”. “The major impetus for EPR came from northern European countries in the late 1980s and early 1990s, as they were facing severe landfill shortages. [… As a result,] EPR is generally applied to post-consumer wastes which place increasing physical and financial demands on municipal waste management."

EPR has rarely been consistently quantified. Moreover, applying conventional life cycle assessment, and assigning environmental impacts to producers and consumers can lead to double-counting. Using input-output analysis, researchers have attempted for decades to account for both producers and consumers in an economy in a consistent way. Gallego and Lenzen demonstrate and discuss a method of consistently delineating producers' supply chains, into mutually exclusive and collectively exhaustive responsibilities to be shared by all agents in an economy. Their method is an approach to allocating responsibility across agents in a fully inter-connected circular system. Upstream and downstream environmental impacts are shared between all agents of a supply chain - producers and consumers.

Examples

Auto Recycling Nederland (ARN) is a Producer Responsibility Organisation (PRO) that organises vehicle recycling in the Netherlands. An advanced recycling fee is charged to those who purchase a new vehicle and is used to fund the recycling of it at the end of its useful life. The PRO was set up to satisfy the European Union End of Life Vehicles Directive.

The Swiss Association for Information, Communication and Organisational Technology (SWICO), an ICT industry organisation, became a PRO to address the problem of electronic waste.

See also

• List of waste management concepts

Further reading

• Ogushi, Yasuhiko; Milind Kandlikar (2007). "Assessing Extended Producer Responsibility Laws in Japan". Environmental Science & Technology 41 (13): 4502–4508. doi:10.1021/es072561x. ISSN 0013-936X. 
• Fishbein, Bette; Ehrenfeld, John; Young, John (June 2000). Extended Producer Responsibility: A Materials Policy for the 21st Century. ISBN 0-918780-73-X. 
• Lenzen, M; J Murray; F Sack; T Wiedmann (2007). "Shared producer and consumer responsibility — Theory and practice". Ecological Economics 61 (1): 27–42. doi:10.1016/j.ecolecon.2006.05.018. ISSN 0921-8009. 
• SAIC, Evaluation of Extended Producer Responsibility for Consumer Packaging, published by the Grocery Manufacturers Association (US), September 2012.
• Sheehan, Bill; Spiegelman, Helen, Extended producer responsibility policies in the United States and Canada: history and status  in Scheer, Dirk; Frieder Rubik (2006). Governance of integrated product policy: in search of sustainable production and consumption. Greenleaf Publishing. ISBN 9781874719328. 

External links

• Product Policy Institute
• The Product Stewardship Institute
• Container Recycling Institute
• ecosurety Market leading support for EPR and wider sustainable strategies
• Reforming Water Use Rights in Canterbury: A Shared Responsibilities Perspective
• Extended Producer Responsibility (in the EEE industry)