Technical briefing to House of Representatives Committee on circular economy

On 14 April, Chris Backes, of the Utrecht Centre for Water, Oceans and Sustainability Law (UCWOSL), and Walter Vermeulen and Kieran Campbell-Johnston of the Copernicus Institute for Sustainable Development, explained to the House of Representatives Committee on Infrastructure and Water Management an important element in the transition to a circular economy: extended producer responsibility (EPR). In the EPR regulations, for a large number of products – from batteries and car tyres to packaging and mattresses – it has been agreed how collection and recycling will be organised and financed. According to the speakers, who previously published a white paper on the subject, the EPR needs to change if the Netherlands is to meet its circularity target for 2030 (halving primary raw materials consumption). First of all, they advise to start a 'chain-wide' consultation.

The EPR implies (in short) that producers and importers are individually or collectively responsible for the product throughout its life cycle, in particular for taking back the products in the waste phase. It was introduced at the end of the 1980s as an environmental policy instrument in several Northwest European countries, including the Netherlands. Later, the instrument was also introduced at the European level. The 2008 EU Directive identifies it as "one of the means to contribute to ensuring that the design and production of goods take full account of, and facilitate the efficient use of, resources over the whole life cycle of the goods – including repair, re-use, disassembly and recycling – without impeding the free movement of goods in the internal market."

Chris Backes kicks off this 'technical briefing' to the House Committee by noting that EPR as an instrument in the transition to the circular economy is currently not fit for purpose and needs some 'renovation'. "The scheme was explicitly aimed at the entire life cycle of products. That was later watered down somewhat, so that in practice, it now mainly concerns collection. It has been effective in reducing the amount of waste sent to landfill and incineration and to increase recycling, but it has not been used to promote waste avoidance. And for another purpose – influence on a more circular product design – it has hardly been effective; there are no incentives to this end." 

Walter Vermeulen goes on to show that the effect of the EPR within different product groups is generally very positive. "Most of the legal targets are met; we are in a good position within Europe, and the costs of the EPR have largely been internalised by the market. But the new objectives of the circular economy require adjustments. For example, the EPR is not currently aimed at the entire waste stream, and it does not focus on the so-called 'higher' R's (Re-use, Repair, Refurbish). The agreements on what recycling may cost (maximum 205 Euros per tonne) are also problematic, because if it is more expensive, the industry is not obliged to do it – one of the main causes of down-cycling." Furthermore, he calls the current monitoring of what happens to the material (euphemistically) "rather lean".

Thus, the EPR instrument needs to be tinkered with to achieve the circularity target of 'halving raw material use by 2030'. The initial focus on recycling was understandable, and a whole recycling industry has emerged. However, it has not been involved in the planning process. The current EPR rests too much on a limited exchange between government and industry. Vermeulen: "You should actually leave the financial responsibility with the producer, and separate it from the strategic and organisational responsibility, because you need other parties for that. What is needed is a chain-wide consultation to list and optimise usable recycling and reuse techniques, and also to see how and by whom any cost deficit can be covered."

The European Directive says that there must be continuous and regular consultation between all chain players. The priority now is to actually do that! In the longer term, you can use the law to institutionalise chain-wide consultation and also bind this consultation to government policy objectives.

The current, highly efficient EPR structure [using non-profit collection methods] has been realised at a cost price increase of only 0.1 to 0.2 percent of the product price. We advocate the inclusion of all costs, including responsibility for the international chain. This will probably lead to an increase of no more than 0.2 to 0.4 percent.

Backes also emphasises that progress can be made within the current legal framework, without having to amend the law or wait for a new European directive. During a chain-wide consultation, the various parties can jointly determine objectives and conclude covenants on the basis of these. "You can weave the circularity targets into the EPR scheme, and ensure that the national government takes more of a lead. In the 1990s it was understandable to leave it to the producers, but with the current pressure to achieve circularity targets, both partners – producers as well as municipalities and waste-collecting organisations – are asking for more direction."

In summary, their advice to the House of Representatives is: discuss in the House and with the Ministry the broader function that the EPR should play within the circular economy, and include in (the adjustment of) the EPR regulations the ideas inventoried in the chain-wide consultation. Looking a little further ahead, Backes would recommend institutionalising the chain-wide consultation in order to bring Dutch legislation in line with European legislation. 

For the longer term, they would advocate playing an active role in Brussels. For although the EPR offers room to take national steps, with the further-reaching eco-design principle and the product requirements this implies, we are entering the realm of European legislation. Other relevant measures also require more time and possibly new (European) legislation. These include the possible extension of the EPR to include rules for foreign processing. For example, attention should be paid to the correct processing of electronic waste in Africa, and this could be included in the costs. There should also be more (strategic) attention for specific critical raw materials and also for the presence of substances of concern in products.