What Does the Future Hold for EPR?
Extended producer responsibility (EPR) is a broad concept that requires manufacturers to accept responsibility for environmental effects during the life cycle of their products, and to assume responsibility for the disposal of the products they sell.
EPR has many forms, the most prominent of which is “product take-back,” which requires companies to take back their products at the expiration of their useful lives. Product take-back began in Europe and has since spread. More than 30 countries have product take-back laws covering consumer electronics, electric appliances, office machinery, batteries, cars, tires, paper goods and construction materials, among others.
The products targeted by take-back legislation share several characteristics. The products tend to create disposal problems because of their volume and hazardous components; have no effective secondary market; and typically are not subject to leasing arrangements, i.e., leasing arrangements are not customary.
Take-back programs of one form or another are costly to implement but are believed to be more desirable than other options. These alternatives include raw materials taxes, purchasing policies that require a minimum of recycled content, and some sort of leasing arrangement.
EPR traditionally has been applied to consumer goods and electronic products, but there is increasing interest in extending the concept to include chemicals. Certain chemicals share the three characteristics noted above in that disposal can pose challenges, there often is no effective secondary market and manufacturers seldom retain ownership.
In Europe, EPR proposals for chemicals already are being considered. For example, in 2002, Austria’s Environmental Ministry announced that several chemical companies proposed to “lease” certain chemical products to customers, making the chemical firms responsible for recovering the substances after use. Certain solvents and catalysts appear to be suited for such a system.
The application of product take-back to chemicals would pose significant challenges and would appear to be motivated by different considerations altogether. Traditional product take-back goods are amenable to recycling and/or reclamation. There is considerable motivation for product manufacturers, for example, to reap the financial reward of reclaimed parts for end-of-life products and/or to eliminate or blunt the resale of products into secondary markets beyond the control of the original manufacturer.
Not all chemicals are amenable to recycling or reclamation. Solvents and certain catalysts clearly are candidates for beneficial reuse and/or reclamation. Take-back strategies applied to other chemicals with zero reclamation/reuse value would seem motivated largely (if not solely) by a desire to shift the cost and liability for discard from the user to the producer.
The concept of EPR has been and continues to be a subject of significant interest among U.S. Environmental Protection Agency (EPA) decision-makers. For example, on Nov. 19, 2002, EPA released “Beyond RCRA: Prospects for Waste and Materials Management in the Year 2020.” The white paper seeks to open dialogue about what the future could hold for the Resource Conservation and Recovery Act (RCRA) program during the next 20 years. A copy of the white paper is available at www.epa.gov/epaoswer/osw/vision.htm.
The imposition of product take-back requirements on chemicals seems improbable, but it is not out of the question. Such pressures could increase with the advent of Registration, Evaluation and Authorization of Chemicals (REACH) in the European Union, (see CP, May, p. 12) which is expected to hasten chemical product deselection opportunities.
These scenarios may seem unlikely, but they are more probable today than ever before. Chemical manufacturers and processors should revisit the economics and commercial wisdom of EPR arrangements. Recent developments may force renegotiation of the fundamental terms of commercial engagement between chemical producers and users.
By Lynn Bergeson, regulatory editor. She is a founding shareholder of Bergeson & Campbell, P.C., a Washington, D.C.-based law firm concentrating on chemical industry issues. Contact her at email@example.com. The views expressed herein are solely those of the author. This column is not intended to provide, nor should be construed as, legal advice.