Brands, recyclers and state agencies are still in the early days of adapting to new EPR for packaging regulations and obligations. Getting comfortable with uncertainty and complexity is part of the process, said speakers during a Be Waste Wise webinar on Wednesday.
Seven states have passed extended producer responsibility for packaging laws, and each one is in a different place with implementation. Stakeholders are navigating ongoing legal challenges, packaging redesign decisions and lack of clarity around costs and harmonization strategies, among other hurdles.
But the sometimes messy process also offers brands and recyclers new opportunities to build better systems that will serve both companies and the public for the long term, speakers said.
“It's a long process with packaging, and you don't need to wait to see where the states are in another five years,” said Scott Cassel, CEO of the Product Stewardship Institute. “I would say start now.”
Uncertainty amid legal challenges
Companies are trying to decide how to proceed as they await the results of several legal challenges against EPR for packaging programs in Oregon, Colorado and California meant to block enforcement of the programs. The National Association of Wholesaler-Distributors led the Colorado and Oregon lawsuits, and it is also involved in California, where 17 Republican state attorneys general are leading the charge.
“The uncertainty is creating sort of a freeze response and a wait-and-see response from many of the small and medium-sized businesses that we talk to,” said Rachel Oster, co-founder and principal at Diversion Strategies. “The larger companies have internal operations focused on this, but the small to medium-sized businesses are stepping back and waiting to see before investing a lot of time, effort and money into this program.”
Cassel sees the legal challenges as a way to “stall for time” to help companies delay having to pay into EPR programs and come into compliance with the law.
“There can be appeals to this, and it could go on for a long time,” he said, noting that a lawsuit around pharmaceuticals EPR in California in 2012 “took a while to shake out before that moved forward.”
Cassel and Oster both said the current lawsuits might eventually have a positive outcome by helping to refine future laws and raise productive discussions on how to improve EPR programs across the board.
“I think we're going to get better laws out of it,” Cassel said.
In the meantime, the seven states that have adopted EPR for packaging laws are continuing to roll out implementation, said Michael Wasserman, senior environmental consultant at Eunomia.
“Other states will see the improvements in the system being made in Colorado, in California, in Minnesota,” he said. “I think there will maybe be another push towards this legislation being put forward in non-EPR states. We had a first push in 2021 to 2024, and now it's been more about implementation. Hopefully, we see another push later, once we see all the good things happening because of EPR in these states.”
Untangling ecomodulation
As EPR implementation moves forward, cost concerns are a central focus for brands and packaging producers, speakers said. But many state EPR laws include ecomodulation elements that lower fees for companies that make sustainable packaging changes, which could translate to long-term savings.
“It’s an opportunity to think about your packaging and sustainability initiatives. Something you might have thought about five years ago but was cost-prohibitive might now make sense,” Wasserman said.
Some companies may be cautious about making packaging changes, in part because many companies don’t have a clear picture of what EPR implementation will cost them yet.
“But the packaging engineers are thinking about it because it's going to save them a lot of money in the future. And those changes take a lot of time. So now is the time,” Cassel said.
Oregon’s EPR program includes a unique component that offers fee reductions when a company conducts a lifecycle assessment on certain types of materials. Doing such an assessment can be “very tedious, very costly, but still is a way to get into that granular level about the changes that a producer can make in their packaging,” he said.
Opportunities for harmonization
Design decisions aren’t made in a vacuum, and producers are still contending with the fact that changes they make will need to work across numerous state EPR programs that all operate slightly differently, speakers said.
“Every single state has a different covered materials list. That one packaging could be considered a covered material type in one state and not in another — that creates challenges,” Wasserman said. “There’s more work to be done in terms of harmonizing kind administrative things.”
At the same time, states are still working to invest in infrastructure and end market development to make sure the materials listed on the covered materials lists can actually be recycled into new products, he added.
Oster worries that these complexities could cause some materials to end up being disposed instead of recycled, at least at first. “When that occurs, we're not creating the right environment for responsible end markets,” she said.
Currently, the Circular Action Alliance is the main producer responsibility organization managing EPR in many states. Wasserman said that has been helpful since one organization can keep track of covered materials, as well as data reporting and other obligations, across multiple programs.
There are more opportunities for packaging EPR programs to harmonize, but that process will be complex, Cassel said. “For packaging, there's multiple associations that have overlapping or different interests, and they have not all wanted to come to the table. It's only various ones at various times. It has been very complicated,” he said.
But Cassel pointed to other types of EPR programs that have successfully harmonized key elements, including in the paint industry. Those players “came to the table” to agree on harmonization across the 12 states and the District of Columbia with such a law, he said.
Battery EPR is another area that has demonstrated successful harmonization strategies, in part because discussions have been ongoing for more than 20 years. In that time, the associations involved have gone from four to just one, he said.
Federal efforts, such as a newly introduced truth in labeling bill, could also prompt EPR players to work together on harmonization efforts, Oster added.
The webinar was moderated by Waste Dive Managing Editor Cole Rosengren.
