Circular guide

EPR – COLLECTIVE SYSTEM 

Didactic Units 4.2

EPR implies that companies must care about the end of life of their products, extending this responsibility to industrial recovery and recycling supply chains. 

 EPR (Extended Producer Responsibility) appears as a logical transposition of the polluter pays principle and the principles underlying the waste hierarchy and, in today’s terms, is the tool that promotes the circular economy. In the new EU Directive 2018/851 the principle of Extended Producer Responsibility (EPR) is redefined precisely in Article 8-bis, where the minimum requirements for the operation of EPR schemes are redefined in order to reduce their costs, improve their effectiveness, and ensure a level playing field. This principle underpins the operation of collective waste management systems in Italy. EPR is a fundamental principle that must be respected in order to succeed in achieving the challenging new goals of the EU directives on the circular economy, and it allows for the economic support of those recycling supply chains that would initially fail to make an economic return for the total management activities, from sorting to collection to the selection, treatment, recycling and reuse of recycled materials. In Italy, most manufacturers who put a product on the market comply with the EPR principle by having founded national consortia that, thanks in part to a payment of a predetermined economic contribution annually (Environmental Contribution) that allows them to economically support the management chain, delegate to them the responsibility of taking care of their product put on the market at the end of life. Under the new directives, more and more manufacturers will have to comply with the EPR by making themselves responsible for the end-of-life of their products released for consumption, thus succeeding in achieving the challenging goals listed above. 

 The new rules on extended producer responsibility, are one of the main changes contained in the September 3, 2020 Legislative Decree No. 116, which transposes and implements Directives 2018/851/EU and 2018/852/EU – Waste and Packaging Standards – Amendments to Legislative Decree 152/2006 (Environmental Code) – Effective from 26/9/2020.

EPR: New collective systems 

As mentioned in the previous point, in order to fulfill the EPR obligation, producers resort to the formulation of individual or collective systems to be able to take care of the entire life of their product placed on the market until it becomes waste. In Italy there are several collective systems that operate differently from each other according also to the types of waste that are handled, having different physical, quantitative and logistical characteristics. The main collective systems concern the most produced urban waste, such as packaging, which, thanks to the CONAI consortium and its 7 supply chain consortia, manage the vast majority of packaging waste produced, or used mineral and vegetable oils with the CONOE and CONOU consortia or that of end-of-life tires such as ECOPNEUS. For so many other types of waste, there are still no recovery chains organized with a tool such as the collective system creating inefficiencies and not recovering the waste produced in the best possible way. There are whole sectors such as construction and demolition waste, which is also the most waste produced in Italy, that could be organized in a collective system to recover materials as much as possible, organizing in a defined and connected supply chain while also managing to incentivize the use of recycled materials in the initial stages of production. A collective system in these sectors would provide security of waste going to recycling instead of disposal and greater economic development support for the entire supply chain. Other sectors such as textiles or organic and green waste could use the collective system tool to be able to incentivize the recovery of their generated waste. 

How a collective system works

In order to be able to explain how a collective system works in detail, let’s take the example of packaging recovery in Italy of the national consortium CONAI (Consorzio Nazionale Imballaggi), which with the operation of 6 other sub-consortia of specific supply chains, manages to incentivize the recovery and recycling of this waste.

The diagram presents the operation of the packaging collection consortium system in Italy, which involves different actors and basically two flows, one of matter and one economic.

MATERIAL FLOW: 

By initially analyzing the material flow, a producer releases for consumption a raw material or packaging that will be used by industrial supply chains to produce packaging that will be put out for distribution to be purchased by consumers. Once the packaging has served its purpose, it becomes waste that is collected through separate collection by municipalities or their waste managers. These wastes, through an ANCI (National Association of Italian Municipalities) – CONAI agreement, are managed by sorting, valorization, recycling/recovery plants consortiumed to the specific consortia of each packaging divided by material: COREPLA -> PLASTICS, COMIECO -> PAPER, RILEGNO -> WOOD, COREVE -> GLASS, RICREA -> STEEL, CIAL -> ALUMINUM. These plants recycle materials by producing Secondary Raw Materials (SPM), which are then resold to the producers themselves or to other industrial supply chains.

ECONOMIC FLOW:

 The second flow of operation of a collective system is the economic one, which enables the success of the “material” one. Producers of raw materials or packaging comply with the EPR principle by paying the Environmental Contribution (in this case, Conai Environmental Contribution – CAC), which allows them to support the recovery chain. By paying the CAC they are thus concerned with recovering and recycling, albeit indirectly, their products that have become waste, thus managing to recover matter and reduce disposal. The CAC is collected and managed by CONAI, which then divides the proceeds into the various supply chain consortia to support separate collection and recycling/recovery costs. Municipalities and waste managers who make separate collection enter into a framework agreement called the ANCI-CONAI Agreement to set economic values for the different packaging collected, thus succeeding in incentivizing collection. Recycling plants receive the waste and are supported economically according to the consortia’s instructions and recycle it and then sell the MPS to the producers themselves or to other industrial supply chains. 

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