David Meehan, General Manager of sustainable waste management company Biffa’s compliance team, Biffpack, takes you through what Extended Producer Responsibility (EPR) means for your business in 2023.
Being introduced in the UK in 2024, EPR is a policy holding producers responsible for the collection, sorting, recycling or disposal of their product packaging. Introducing this new policy means it will soon be down to businesses to fund the total cost of managing their household product packaging from production to disposal.
Household packaging is defined as anything that may be removed from a household, including large bulky packaging from white goods in addition to smaller everyday grocery packaging.
The policy – designed to transfer the annual £1.7bn financial burden of household packaging waste collection from taxpayers to producers – aims to generate accountability across waste streams, as well as encourage and empower brands to think more sustainably about their packaging’s’ life-cycle post-purchase.
Where historically the responsibility has sat with a small group of around 8000 compliant producers, now it will be spread further to include a greater number of smaller producers. Biffa recognises the potential for EPR to help businesses better engage with a circular economy (where waste is recovered, recycled or regenerated in a closed loop).
Which businesses are impacted?
Any business that handles over 25 tonnes of packaging in a year will be affected by EPR legislation. Whether your business purchases packaging for products or you are producing packaging to sell to other businesses, if you handle over 25 tonnes per year, you are identified as a “producer” and must act now.
“Producers” include:
Brand owners – who sell packaged goods under their brand name. When a brand isn’t identifiable, the responsibility lies with the business responsible for packing or filling the packaging.
- Importers – who import packaged products into the UK.
- Service providers – who hire out or lend reusable packaging (such as supermarket crates).
- Distributors – who manufacture or import empty packaging and sell that packaging to UK businesses (not already obligated as a producer).
- Online marketplaces – that operate a marketplace whereby non-UK sellers can sell packaged products or empty packaging to UK consumers.
- Sellers – who sell packaged products or packaging to the end-user.
All charities are exempt, even if they sell packaged products (such as boxes of Christmas cards) in-store or online.
There are many scenarios that exist within these definitions, and the impact on businesses will vary. That’s why the packaging compliance experts at Biffpack are working with businesses to ensure compliance is met.
The Department for Environment, Food & Rural Affairs (Defra) has also released an online obligation checker to help businesses understand if they are affected by the new legislation.
How your business will be affected
The scheme is set to impact smaller and bigger businesses differently. Smaller organisations with a turnover between £1 million and £2 million that are handling 25-50 tonnes of packaging in a calendar year will have to provide detailed reporting on the packaging they produce and how the waste will be managed.
Larger businesses with a turnover above £2 million handling more than 50 tonnes of packaging per year will have to cover the cost of EPR regarding their waste and report their data every six months.
The collection of this data must begin from January 2023 to create a full calendar year of data, with the first six months due for submission between July and October 2023 for large organisations or between January and April 2024 for small organisations.
Due to the lower threshold introduced by EPR, there will be lots of newly affected businesses in the UK that will need to review their reporting processes and make changes to start capturing data.
The government estimates that producers’ costs will be around £1.7bn in the first full year of implementation. However, the government needs to calculate the cost based on the new reporting structure. Producer fees will be calculated in 2024 after a year of reporting.
Fees will initially depend on how much it costs to process or dispose of the packaging based on the volume. However, this will change over time and move to a system based on comprehensive recyclability assessments.
Reduce financial impact with vital preparation
For the first year, companies will have to report on aluminium, steel, glass, wood, plastic, paper, cardboard, fibre-based composites and other materials like industrially biodegradable packaging.
Additional reporting requirements will be introduced as time goes on. For example, from January 2023, a business may only need to report a plastic bottle as a 10g clear plastic bottle. But as EPR progresses, they will need to break down each plastic type used to make that bottle so that it can be recycled more effectively.
In short, the legislation will increasingly favour recyclable materials – the easier packaging is to reuse or recycle, the lower the cost to producers. Higher volumes of waste created by packaging choices will increase costs. Reviewing and redesigning your packaging now may incur costs in the short term but will ensure your EPR obligation is minimal going forward.
At a minimum, businesses must understand the requirements for branded products and packaging that will be disposed of in public bins. Better yet, identify by the brand which products will be categorised as household waste and record the materials that make up their packaging; this will establish a clear head-start with reporting. Beginning to sort products into these areas will make the transition much smoother.
Ultimately, the best way to prepare for EPR is to ensure you have a thorough understanding of the recyclable potential of the packaging you handle. Then, use the reporting data you collect this year to pre-empt costs and plan more sustainable solutions for your packaging.
In summary
Crucially, be mindful of time. Preparation is key, and it’s essential to report in October the product packaging used since January.
Business owners are not alone. There will be systems available to help with the EPR transition. Defra is developing a calculator to help businesses estimate how much EPR will cost them individually.
The government is also offering help via a third-party compliance scheme. This allows a third party to help you register and report your data if needed. At Biffa, our EPR implementation team supports businesses with getting EPR ready; running seminars and clinics that explain the new regulations.
There’s real merit to EPR – it will benefit the circular economy by incentivising businesses to recycle more. The policy encourages greater use of highly recycled and durable materials, which should spark a mindset shift from “produce to dispose” to “produce to reuse”. Keeping track of and effectively managing packaging waste enables businesses to contribute to a “Waste Net Zero” future.
