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Dr. Dominic Hogg
Chairman, Eunomia Research and Consulting, UK
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The Impact of Deposit Refund
Schemes on Municipalities
Best in Class Deposit Return Systems for
Single Use Beverage Packaging
Dr Dominic Hogg
Chairman
Eunomia Research & Consulting Ltd
18th November 2019
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Outline
1. Nature of the changes
2. What determines impacts today?
3. What may determine impacts tomorrow?
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Likely Nature of Changes
?
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Who Arranges for Separate Collection of Beverage
Containers?
1. Who arranges for the recycling
collection service?
➢ PRO?
➢ Municipality?
➢ Waste company
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Outline
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If the PRO Does Not Take Physical Responsibility….
2. If not a PRO, then …
➢ What does the producer responsibility scheme pay for (and
how is this determined)?
➢ What’s left for municipalities / others to pay?
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What is the Situation Where There’s No Support
from PROs?
3. Assuming the ‘worst case’ (no payment from PROs),
then
➢ What happens to collection costs?
➢ What’s the current ‘rate of capture’ of beverage containers (source
separation and mixed waste)?
➢ Determines nature of change in
➢ Dry recyclables stream
➢ Residual waste stream
➢ Litter stream
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Materials in Waste – DRS / Non-DRS
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Change in Volume Post-DRS (reduction)
0%
5%
10%
15%
20%
25%
30%
35%
North Somerset North Devon Trafford South Oxford Newham Lewisham Bassetlaw Barking &Dagenham
Change in V
olu
me (
%)
Recycling Residual
Low Recycling RateHigh Recycling Rate
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What Happens to Collection and Sorting of dry
recyclables?
4. What happens to the costs of the collection service for dry
recyclables?
➢ There will be a revenue loss (loss of containers)
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Estimated Change in Revenues Post-
DRS (relative to whole service)
-14%
-12%
-10%
-8%
-6%
-4%
-2%
0%
North Somerset North Devon Trafford South Oxford
Red
uctio
n in M
ate
ria
l R
eve
nu
es (
%)
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Factors affecting Municipalities
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What Happens to Collection and Sorting of dry
recyclables?
4. What happens to the costs of the collection service for dry
recyclables?
➢ There will be a revenue loss (loss of containers)➢ Changes in volumes can influence how collection
rounds are configured / required frequency of collection etc. – cost savings➢ Static view / dynamic view
➢ There will also be effects on sorting processes
➢ What is the balance of ‘revenue loss’ v changes in collection / sorting costs?➢ Who benefits from revenue from material sales?
➢ Where collection / sorting undertaken by private actors, what is the scope for contract re-negotiation / re-letting?➢ Some contracts are poorly specified
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Factors affecting Municipalities
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Factors affecting Municipalities
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What Happens to Collection and Treatment of
Residual Waste?
5. Are there savings to be made on residual waste?
➢ Unrecycled beverages are a smaller proportion of total
residual waste (and weight may be the constraining factor)
➢ Collection savings likely to be limited
➢ But savings on treatment / disposal are likely
➢ As long as contracts ‘allow’
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Factors affecting Municipalities
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What About ‘Public Waste Collection’ / Litter?
6. Are there savings to be made on public waste collection
/ litter?
➢ Collection / clean-up savings depend on approach taken /
frequency of visits
➢ Where containers are collected, there will be savings on
treatment / disposal
➢ As long as contracts ‘allow’
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Factors affecting Municipalities
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Summary (situation now)
1. If PRO takes physical responsibility,
effect on municipalities is restricted to
residual waste / littering
2. If Ms have responsibility for service,
impact depends on what, and how, PROs
support costs
3. Where no support from PROs, impacts
depend on current service performance
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Factors affecting Municipalities
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Future
➢ Full costs of recycling service to be met under EPR, net of recycling revenues / unclaimed deposits➢ Some may choose to expand the envelope of ‘cost
recovery’
➢ EPR to meet costs of public waste collection and litter clean-up (plastic beverage containers)
➢Will move increasingly to situation where effect on municipalities should be restricted to the costs of treating / disposing beverage containers found in residual waste
➢ Strong argument for introducing DRS as EPR schemes are reconfigured