In August 2020, the UK Department for Environment, Food & Rural Affairs (DEFRA) announced that an extended producer responsibility (EPR) reform would be implemented by 2023 to provide an up-to-date overview of Waste Management in England. Aluminium Packaging Recycling Organisation (ALUPRO) sustainability and public affairs manager Tom Giddings tells Packaging Gateway how this affects the packaging industry and why data quality is essential for the EPR reform to succeed.

The government has said that much-needed reforms to the extended producer responsibility (EPR) scheme will be agreed and implemented by 2023, with the second round of formal consultations to take place in early 2021, following their delayed release due to Brexit and the Covid-19 pandemic.

One of the four consultations arising from the Resources and Waste Strategy (2018), the EPR reform aims to revolutionise how the management of our waste packaging is organised and funded. It will replace the existing system, which has been in place since 1997, and will incentivise producers to embrace packaging that is easily reused, dismantled, or recycled at end of life,

With a ‘full net cost’ system proposed, the reform will see producers pay the entire cost of managing their packaging at end of life – from collection, transport and recycling to the clean-up of littered items, consumer education and disposal of non-recyclable items. Currently, UK packaging producers only pay a small percentage of these costs, with local authorities picking up the remainder.

However, while this system has been widely agreed as the most effective solution, it’s only fair that producers know exactly what they’re paying for through a completely transparent mechanism that accurately apportions responsibility. The quality of data is imperative to setting these parameters, as well as ensuring that every material ‘pays its way’.

Eco-modulation and its pivotal role

To ensure fair and effective implementation of the full net cost model across the packaging industry, eco-modulation is perceived to be the most viable mechanism to allocate fees. A relatively simple principle, eco-modulation dictates a fair structure through analysing the total cost of managing packaging at end of life and ensuring that producers refund the expenditure that their products create.

Materials that are considered more difficult to collect, transport and recycle – such as pouches and laminates – are given a higher rate of tax; while fees for more sustainable, easy-to-recycle materials – such as aluminium foil trays – are suitably lower. This approach not only fairly spreads the cost of managing end of life waste costs, but also incentives circular economy thinking and penalises the outdated ‘take, make, dispose’ model.

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Data accuracy and EPR implementation

Although eco-modulation seems the shining light in EPR reform, the calculations behind the system are critical to ensure fairness and equality among different material types. In the UK, the scheme administrator will be responsible for analysing end of life costs and defining a fee structure accordingly. Understanding the costs faced by local authorities is therefore critical.

This is where the value of transparent, accurate, quality data becomes pivotal. Up-to-date, accurate insight into key variables is the backbone of EPR reform, not just a nice to have. To create an effective structure, the scheme administrator needs granular insight into the following areas as a minimum:

  • The volume of material placed on the market by type and by producer
  • The amount of packaging collected by local authorities and businesses
  • True recycling rates by packaging type, per local authority

Without sufficient data, it would be almost impossible to accurately calculate the full net cost of recycling. The fee structure would become reliant on broader estimates, which has the potential to create inaccuracy across the system. Resultingly, easy-to-recycle items could end up subsidising the harder-to-recycle items – a scenario that we must avoid.

The trouble with national data quality

But while quality is key, the UK’s dated processes mean that disaggregated, decentralised and non-standardised data is unfortunately commonplace. Local authority insight is poor, with collections assessed by analysing tonnes of recyclate as a percentage of total waste and very few providing accurate insight into specific material types and volumes.

The only other national data source available is the National Packaging Waste Database (NPWD), which assesses performance against whether enough packaging recovery notes (PRNs) have been issued to cover the packaging placed on the market. Unfortunately, both databases are populated by both local authorities and independent packaging companies simultaneously. Data entry is open to interpretation, with different rules applying to different geographies and no enforceable penalties incurred for missing data or late entry.

Good quality data is critical, but infrastructure is alarmingly lacking. In result, our ‘reformed’ EPR system could be based on wildly inaccurate data. Setting a baseline will be challenging, nigh on impossible, if we rely on a flawed data management system developed almost 30 years ago. It is simply inadequate for the task in hand.

Finding a solution to drive successful EPR reform

So, while our national focus continues to shine a spotlight on rushing through EPR reform, maybe we need to take a step back and evaluate whether we have the data in hand to effectively design a fair and effective solution in the first place. The worst-case scenario would be using inaccurate data to create yet another poorly-functioning EPR scheme that doesn’t deliver upon the objectives it aims to tackle – in essence, taking two steps sideways, not forward.

But while this view may seem negative, creating a process to capture and manage data correctly should be a relatively simple task. All we need is a strong, single system that everyone is mandated to use. This system should be backed by clear rules and deadlines, all of which should be set and enforced by a credible scheme administrator who has the authority to effectively design, dictate and manage the system.

A subset of the information should be available to the public, allowing the necessary level of transparency required for scrutiny by all shareholders.

If we were to achieve this feat, it would be possible to not only ensure the smooth reform and implementation of a new EPR scheme, but also a plethora of other Waste Management schemes under review. Data quality, once again, will prove instrumental to the successful future of our waste management landscape – it’s a subject we that we surely can’t continue to ignore.