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Overhauling extended producer responsibility laws in Ontario

New Waste Reduction Act golden opportunity to implement and achieve core EPR principles

by Jo-Anne St. Godard  

Ontario’s diversion rate has been at a low 25 percent for more than a decade. In 2002, the provincial government here followed many other jurisdictions by introducing the Waste Diversion Act (WDA) to achieve extended producer responsibility (EPR) outcomes: transfer the cost and liability of materials management from municipalities and taxpayers to industry and producers. To date, four materials have been designated: packaging, tires, electronics and hazardous waste. 

Almost immediately, the WDA proved itself to be over-prescriptive and cumbersome because it confused roles and responsibilities; caused funding disputes between producers and municipalities; and re-organized the marketplace. Unlike other EPR framework, the WDA mandated the creation of Industry Funding Organizations (IFOs), whose fundamental role is to collect fees from producers through pay-in systems that attempt to fit all producers into one program type. IFOs then use these fees to pay out collection, transport and processing costs to service providers. Essentially, IFOs wedge themselves between the generators of materials and the recyclers, track and manage material flows, and establish market price. 

In many cases, recyclers had to adjust from having several customers to relying on IFOs exclusively. Municipalities went from being relatively autonomous – the sole investor and manager of their diversion programs – to sharing and having to justify their costs.  

In 2010, coinciding with the introduction of harmonized provincial and federal point-of-sale taxes, consumers were introduced to eco-fees: producer fees that have effectively been passed through at point-of-sale. A swift, negative reaction by consumers resulted, and became the catalyst for change.  Fast-forward to June 6, 2013 and after more than seven years of review, the Government of Ontario unveiled replacement legislation to the WDA: the Waste Reduction Act (WRA).  

The WRA is meant to direct liability of end-of-life management of materials to individual producers and remove mandatory IFOs. This gives producers options and encourages them to consider their own business systems and costs when deciding how best to manage their obligations. 

Given this option, one can surmise that producers will manage their obligation within these new rules, with the most efficiency at the least cost; perhaps through an existing system or by investing in their own. 

The opportunity to educate and motivate producers will likely stimulate innovation, encourage new partnerships and most importantly, drive new investment that can lead to growth in local capacity and reduce the current reliance on overstrained municipalities.

It is also hoped that this new legislation will help the recycling industry by outlining operational and processing standards that better track materials to their final disposition, and by defining processes that result in the highest economic and environmental value. For this to happen, legislation needs progressive targets that maximize diversion of products from disposal, as well as recovery of materials inherent to them. Setting high standards establishes an important performance benchmark for the resource recovery industry, and provides a mechanism and assurance that producers’ investments are focused on achieving the best environmental outcomes. 

Provisions that assign meaningful consequences of non-compliance are also widely recognized as essential to achieving effective EPR policy. For example, penalties for non-participating producers levels the playing field for all producers, not just those who willingly comply with the EPR policy requirements. 

The WRA is a golden opportunity to implement and achieve core EPR principles that outline, facilitate and oversee the transfer of liability and cost of materials management to producers. It must not require producers to pay municipalities, but rather facilitate investment in them and/or alternative systems that eliminate the burden on them all together. The WRA can draw upon the innovation of industry and leverage from public and private expertise. It can transform recycling into a commodities-based system that drives environmental outcomes.   

Ontario’s political parties and all other stakeholders are now reviewing this lengthy legislation, unpacking its provisions, and preparing their responses. Stakeholders have 90 days to review and influence its language and path through legislature. Although replacement legislation is more than welcomed, whether it possesses the crucial elements needed to turn Ontario into an EPR leader most certainly depends on the details. 

Jo-Anne St. Godard is Executive Director of Recycling Council of Ontario, a not-for-profit, membership based organization involved in policy, education and project work around the issues of consumption, waste generation, reduction and diversion, and recycling. Recycling Council of Ontario  

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