Today I finally had a chance to rise above the details of changes to Ontario Regulation 347 (Waste) as proposed in the Ontario Ministry of Environment’s new Regulatory Amendments to Facilitate Waste Recycling, Use of Alternative Fuels and New and Emerging Waste Management Technologies. As I turned my attention away from the draft regulation and read the associated EBR posting I came across a real gem – there in all its elegant simplicity was the Extended Producer Responsibility Systems (EPRS) proposal.

Without reproducing the environment ministry's description in its entirety, the EPRS model involves the “producer” (manufacturer, brand-owner or first importer) or a voluntarily convened collective of producers establishing a self- or third-party operated management system for spent products. All costs of the system are to be borne by the producers (though there would be a natural tendency to try to diffuse costs through the product chain) and all arrangements between producers (i.e., cost allocation) and service providers (i.e., charges for service) would be negotiated and set via commercial agreements and contracts. Ministry approval of an EPRS would require details of the system’s operation and regular reporting of the final disposition of wastes to the ministry (very important to be sure).

Back in my March 13th blog post Wither EPR?, I described such a property-rights-based model for end-of-life product management. To save you looking for it, here is what I wrote in context of a notional EPR program for waste TVs:

“What about the formation and operation of a Producer Responsibility Organization (PRO) for waste TVs? What about the 'funding mechanism' (i.e., fee scheme) for collecting and processing TVs to the 'environmental standard'? What about all the regulatory and bureaucratic clap-trap that normally accompanies 'stewardship' programs?

In a property-rights-based regulatory approach, all of these things are immaterial to the regulator. The producers -- the waste TV title holders -- sort themselves out to meet the environmental standard in managing their wastes. Producers could band together in a collective (e.g., Electronic Product Stewardship Canada -- EPSC comes to mind) to manage their wastes (much as electronic producers do to create technical standards for CDs, DVDs etc.). Like any other aspect of business, contractual obligations and charges for covering the costs of administration, collection and recycling services are the subject of commercial negotiations between producers (or the producer collective) and service providers -- what prices are actually established are also irrelevant to the regulator.”

Well as I read it this is exactly what the ministry is proposing with its EPRS model – right here in Ontario: home of the infamous Waste Diversion Ontario!

Whoa there! WDO! What about the WDO? Well my guess is if enacted EPRS is going to cure what is ailing reuse and recycling in Ontario – the WDO.

How so? Consider that under the Waste Diversion Act “stewards” can set up Industry Stewardship Plans (ISPs) outside of an approved Industry Funding Organization (IFO) program – imagine a fast food chain setting up a packaging management system independent of the approved Blue Box program via an ISP (but only after having suffered through being part of the collective blue box program). Well, the EPRS proposal goes one step further by effectively saying producers can set up a program entirely outside of the WDO.

Now ask yourself why any producer or group of producers would want to be forced to work in an Industry Funding Organization not of their choosing? Who wants to run the WDO Board gauntlet to try to get their stewardship program approved when they could deal directly with policymakers and endure a relatively clear and simple approval process? Can someone remind me why it makes sense to have the soft drink industry, beer industry, consumer packaging users, retailers, the LCBO and newspaper industry vote on whether to approve a program on scrap tires or household hazardous/special wastes when we have folks in the Ontario Public Service well qualified to do just that?

While it might make sense for the Stewardship Ontario to remain under the Waste Diversion Act so it can continue to enjoy a 50 per cent discount on blue box services, where is the impetus for any other steward to hang around the WDO? Who really wants to cover the WDO’s administrative costs and help pay back the packaging brand-owners their $600K+ loan to the WDO? If you had to be regulated would you not pick the least troublesome and least costly regulatory option?

So all that has to happen is that the environment ministry designates a waste under the EPA or WDA and producers can pick how they go. My bet is that they go the EPRS route.

In the last few months a prototype EPRS type program for fluorescent tubes has been convened by the Recycling Council of Ontario which involves the Toronto District School Board (the waste generator), two fluorescent tube manufacturers and Fluorescent Lamp Recyclers Inc. The approvals for operating the waste management system were graciously expedited by the ministry and took only a few months to complete. The program will be up and running in September.

All those in favor of EPRS write in to the Minister early and write to her often – The EBR comment period ends on September 18th.