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The 'Extended producer responsibility for packaging and single-use plastic products' will come into force on January 1, 2025. The text of the political agreement states that the purpose is to make producers financially responsible for their packaging and promote the circular economy, including minimizing and recycling more packaging. Final legislation is not yet in place, but decisive frameworks and conditions are expected to land in 2023 and 2024 respectively.
One of the players that has come forward to lead a future collective scheme is VANA. The organization is a collaboration between the Confederation of Danish Industry, Danish Chamber of Commerce, Agriculture and Food and Dagsam (an organization that represents the interests of grocery and brand suppliers).
Leading VANA is CEO Marianne Roed Jakobsen, who has a solid experience in environment, recycling and green transition. Marianne is already working hard to prepare current and future members for the new change, including potential challenges and benefits. Marianne was also invited to speak on the same topic at ARGO's theme meeting on October 4th.
What is 'producer responsibility'
Basically, producer responsibility means that producers must take financial responsibility for their own packaging in relation to waste treatment. They must ensure that the packaging is collected, sorted, recycled and disposed of - an expense that has previously been part of the municipal waste disposal fee. This means that the cost of waste is shifted from citizens to producers (companies). This means a new cost for producers, which is likely to be recovered by allowing the price of goods to rise proportionally with the increased cost of waste. For citizens, this means that the municipal waste collection fee will decrease. On the other hand, citizens will have to pay slightly more for their goods.
Collective scheme to secure the packaging value chain
The political agreement states that collective schemes will be established to handle the administrative and practical tasks of waste management on behalf of the producers, from collection, sorting, recycling and marketing.
Producer responsibility applies to all packaging.
Both the packaging that surrounds the product itself, the packaging that several units are packed in (e.g. a cardboard box) and the packaging used for transportation (e.g. a pallet) - also called primary, secondary and tertiary packaging.
VANA's task as a collective scheme is to make it easier for producers and ensure the packaging's path from collection to sale through tenders and cooperation with various processors and buyers. It is also the collective scheme that must document compliance with environmental requirements for the actual recycling of packaging waste. In mid-2023, the executive order for collective schemes in the producer responsibility area is expected, and we are very much looking forward to it.
Marianne Roed Jakobsen, CEO of VANA.
According to the political agreement, collective schemes must be nationwide, cover all packaging fractions and be approved for a five-year period.
Graduation to ensure incentives for a more circular economy
The future producer responsibility will encourage producers to avoid unnecessary packaging, to increase the use of reusable packaging, to ensure effective recycling of packaging waste and to use recycled materials to make new packaging. Packaging will be included in a kind of economic graduation. This means that the more environmentally friendly the packaging is, the lower the cost will be for the individual manufacturer. The graduation will therefore have a major impact on manufacturers' production systems/processes.
Producers are already asking about the economics of the graduation incentive - a question that is not expected to be answered until 2024 in connection with the executive order in this area. It is clear that many companies are asking for the details of the graduation, because they need to calculate whether it is worthwhile to change production for a greater environmental benefit. In other words, the economic aspect must be significant before a large manufacturing company can change their production, as it can be very costly. The announcement for the graduation is expected to be made in 2024, and the actual producer responsibility will come into force on January 1, 2025 - which gives a very short transition period for producers.
Marianne Roed Jakobsen, CEO of VANA.
Fortunately, many are already working on the green transition - including the composition of their packaging.
According to Marianne, producer responsibility can drive the green transition in several ways. Producers will have a strong focus on the design phase, because this is where it is determined whether the packaging can be made more recyclable and thus more economically viable.
Future packaging responsibility may have a knock-on effect on us as consumers, so that in the future we may opt out of products that do not have environmentally friendly packaging or are surrounded by too much unnecessary packaging. Seen from this perspective, producer responsibility could be just the thing to kick-start the development.
Marianne Roed Jakobsen, CEO of VANA.
Tasks for manufacturers and VANA
According to Marianne, there are a number of tasks that manufacturers need to work on in the run-up to the upcoming regulations. "If they don't already have it, they must have complete control of the data on their packaging. What materials are used, how much and what design choices. When the framework for the environmental grading comes, it will be much easier to make a choice about redesign and conversion when the data is in order. For VANA, there are also a number of tasks that need to be worked on. These include IT (data processing systems), organizing VANA and recruiting as many members as possible. Tasks that Marianne and her team are already hard at work on.
