Government

European countries urged to use economic incentives in next step towards circular economy

Bottle-deposit schemes and increased extended producer responsibility (EPR) schemes are among the existing economic measures that should be deployed to help European countries make the next step in the transition to the circular economy, according to a study by the waste reduction advocacy group Zero Waste Europe and the policy network Reloop Platform.

The study, ‘Rethinking economic incentives for separate collection’, released yesterday (12 July) in Brussels, explores the existing measures and incentive schemes currently being used to increase recycling and re-use in certain waste streams and whether they could be applied to other streams in a beneficial way; something that will surely be of interest to the European institutions currently negotiating the Circular Economy Package.

The report states that current fiscal and public policy across Europe supports the current linear economic model and obstructs the transition to a circular model, with a lack of incentives for companies to design products for re-use or for local authorities to collect certain types of waste. This is particularly evident when looking at the very low collection rates for certain waste streams, such as textiles (less than 20 per cent), cigarette butts (less than 35 per cent) and batteries (less than 40 per cent).

European countries urged to use economic incentives in next step towards circular economy

Stakeholders across Europe have voiced support for the circular economy, but the incentives up to now have not been strong enough. Zero Waste Europe’s report suggests that measures that are used around the world in market economies have the potential, if used in public policy, to greatly reduce littering and plastic pollution.

Commenting on the report, Joan Marc Simon, Director of Zero Waste Europe, said: “The move from a linear to a circular economy will require changing the economic incentives. This study provides a great toolbox to double or even triple collection rates for a variety of materials, including waste streams with existing EPR (extended producer responsibility) schemes.”

Furthermore, Clarissa Morawski, Managing Director of the Reloop Platform, added: "Deposit return schemes have been used to capture high quantities of empty beverage containers for decades. With more than 35 successful systems around the world and growing, maybe it's time for governments to consider this economic instrument for their own countries or regions. Just look to the best practice programs and follow their lead."

Proposed policies

In terms of specific policy measures regarding economic incentives for increased recycling and reuse in certain waste streams, the report offers several relating to certain under-recycled forms of waste, including:

  • A deposit system for mobile phones to complement the current EPR systems for WEEE with a refundable deposit applied on mobile phones in order to provide incentives to increase the collection rates of a product that contains a high number of scarce and strategic materials.    
  • A new EPR system for carpets, which would help increase the currently low recycling rate (less than three per cent) of this waste stream.    
  • A deposit system for coffee-cups to promote the use of reusable cups, which will reduce the more than 15 billion units of disposable coffee-cups going to waste in Europe each year, 2.5 billion of which are thrown away in the UK alone.
  • A deposit scheme for portable batteries, which currently offer no economic incentive to the last owner to return them for recycling, as well as tax on one-way batteries to incentivize the phase out of disposable batteries to push the recycling and re-use rate up to the 45 per cent target.

There are many more possible policies to consider in addition to those listed above, and the report reiterates that these are the steps that can be taken immediately under existing legislation – much more will need to be done in the future.

Economic incentive key

The desire more economic incentives incorporated into public policy to encourage businesses to adopt circular economy principles has been proliferating throughout the industry, evident at the Resourcing the Future Conference 2017, held in London last month (27-28 June).

The event, organized by the Chartered Institute of Waste Management (CIWM), brought together professionals from across waste and resources sector for two days to discuss the future of resource efficiency and waste management in the UK.

There was a strong feeling among those in attendance that the government should be doing more to incentivize businesses to take up the circular economy, although those from within business urged businesses to tell the government what it wants and needs to be able to achieve this.

Laura Sandys from Challenging Ideas said that “business must lead government”, and Mike Barry, Director of Sustainable Business at M&S, stated that a “sector gets the regulation its deserves” and must be clearer in what it wants from public policy in order to drive forward with innovation.

A conference-wide poll also suggested that there is a strong desire from within the waste and resources industry to see the government undertake a complete review of EPR post-Brexit.

For more information, you can view the Zero Waste Europe and Reloop Platform report, ‘Rethinking economic incentives for separate collection’, in full.

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