Crunch Time: Key Issues Around The Circular Economy Package

David Newman, director of the Bio-based and Biodegradable Industries Association (UK) and president of the World Biogas Association, looks at some of the key issues around several of the EU’s Circular Economy Package directives… 

We are approaching crunch time for the Circular Economy Package being negotiated in the European Union. The European Commission believes that a conclusive package should be reached in the autumn of 2017 with a series of directives finalised by early 2018 – which means entering into law in the EU28 in 2020. Until Brexit is officially concluded, I consider the UK to be part of the EU. And should this timetable be respected, then gives five to ten years to reach the objectives as currently laid down.

The Package, as we know, contains several directives, all of which impact upon waste management in different ways and with different outcomes for countries, waste streams, treatment and disposal solutions. To reach the objectives for each of these in less than a decade is a significant challenge, especially for southern and eastern Europe, but not only. To take just one indicator, the 50% recycling target for 2020 under current legislation: of the EU28, only a handful will reach that objective. Many are not remotely near, most are somewhere in between (see graph), although these data need refreshing as they are now 5 years old.

Note: The recycling rate is calculated as the percentage of municipal waste generated that is recycled and composted. Changes in reporting methodology means that 2012 data are not fully comparable with 2004 data for Austria, Cyprus, Malta, Slovakia and Spain. 2005 data used instead of 2004 for Poland due to changes in methodology. Due to data availability instead of 2004 data, 2003 data were used for Iceland; 2007 data used for Croatia; 2006 data used for Serbia. For the former Yugoslav Republic of Macedonia, 2008 data were used for 2004, and 2011 used for 2012. Source: Eurostat Data Centre on Waste

Interestingly, as waste recycling increases, a definite trend to falling waste volumes can be noted as the graph below shows.

Let’s look at some of the key issues

1.Calculation method of the recycling targets

Germany has strongly spoken against revising the methods in the short-term because, under the proposed changes, Germany’s declared recycling rate of 65% today would effectively, overnight, be reduced to around 44%. This creates stranded assets, renders the German system partially obsolete and requires a major re-equipping of both collection and treatment processes. So what was once the world’s leading waste system becomes one that requires re-thinking and a struggle to reach the 2025 65% recycling target.

Germany has allies in this, and the debate is a fierce one. The European Parliament’s Environment Committee has laid down its vision, rejecting the German-led opposition to revision of targets in its vote of January (24). The proposal will be put to a vote by the full House at the 13-16 March plenary session in Strasbourg. Meanwhile, member states are struggling to find a compromise within the Council under the lead of the Maltese presidency. Germany has not yet lost the debate. The process of revision involves the trialogue between Parliament, the Commission and the Council and all bets are off on the final agreement to bereached by the end of June.

2. EPR systems

The European Parliament’s Environment Committee adopted an amendment to the Packaging and packaging Waste directive requiring extended producer responsibility (EPR) systems to be transparent, comparable between nations and waste streams, and above all to cover the full cost of collecting and treating their respective waste streams.

The debate here divides into two camps. On the one hand there are those that express the view that industry is playing lip service to the “polluter pays principle” and contributing very little to collection and treatment. This camp argues that the amount of non-recycled waste, or non-recyclable waste (the two concepts are allied but diverse) are due to industry not having the financial responsibility for the materials it puts into the marketplaces.

This responsibility is passed onto the collectivity who pays through waste taxes or council taxes to collect, recover or dispose of them. And argues that were EPR costs to reflect the real cost of these services, industries would redesign to reduce waste, and institute circular recovery programmes to avoid the upstream resource cost of new materials.

Where does the responsibility lie for meeting the 50% recycling target? In the UK system with municipalities, in systems where EPR contributes more, the industries have a greater share of the burden, both financially and legally

The opposing camp argues that waste management is a collective responsibility and the consumer, through his choices, has to bear the cost for the materials he buys too. This camp argues that EPR schemes are already instituted for many streams, packaging, tyres, vehicles, batteries, WEEE and that the recovery targets set under these by the EU are mostly being met. They argue that the burden for greater recovery should not be borne by them alone but by the system collectively with each part playing their role.

Some systems pay considerable amounts into their systems. Italy for example, under the CONAI agreements which cover packaging, contributes some €500 million annually to municipalities to collect and treat those waste streams. The UK PRNs contribute some £35 million, around one tenth. The collection and treatment costs are not wildly different but these are borne in Italy by industry (who pass them onto the final consumers through their pricing), whilst in the UK they are borne by municipalities and council tax payers, whether they have bought that product or not.

Which is fairer? And where does the responsibility lie for meeting the 50% recycling target? In the UK system with municipalities, in systems where EPR contributes more, the industries have a greater share of the burden, both financially and legally.

How this will play out is still to be seen. Very heavy lobbying against greater EPR contributions is coming from the FMCG companies, (the multinationals) and to some extent Governments influenced by these. We should recall that the Potocnik Circular Economy Package in 2014 was killed off by opposition from Business Europe, the powerful lobby group whose members include many household brand names. So far the Europarliament Environment Committee has stood firm, but the crunch is yet to come.

3. Biowaste

Biowaste constitutes 25-to-40% of municipal sold waste (MSW) throughout Europe and food waste some 90 million tonnes a year.

Biowaste collection is clue to high recycling levels (compare the below graph with the first one in this article), reduced landfill, reduced GHG emissions, bringing greater carbon content to soil and rising energy production through anaerobic digestion (AD). A waste collection programme which isolates the wet, organic fraction increases the ease with which the dry, recyclable fractions can be recovered. And as technologies advance, biowaste will become a valuable feedstock for bioeconomy industries such as chemical extraction.

Highest interception rates for biowaste are in northern Italy (around 125kg/ inhab/ year) and recycling rates in these regions exceed 70% overall. Where biowaste collection is instituted a trend shows overall waste levels actually declines as consumer awareness of waste rises. Several countries have biowaste collections instituted whilst most are far behind (see map).

There are two main questions around biowaste: what is it? And should collection be obligatory?

On the question what constitutes biowaste, the debate seems to be closed now, with there being little or no opposition to the Europarliament’s Environment Committee amendment allowing biowaste to include those materials that can be treated industrially with food/ garden waste in the same process and with the same outcome in terms of soil quality when applied as compost/ digestate. So we may see in the future certified compostable products such as packaging materials, table ware, diapers, bags, going to composting and AD with food and garden waste. This will be a boon to operators who will see their feedstocks rise, but will require careful technical evaluation because many operators are simply not ready for these new materials.

The Environment Committee in January also fully recognised AD as a recovery operation, thus including this technology among those at the top of the waste hierarchy.

Source :

Allowing these materials to be recovered and returned to soil is key to circularity because it will increase food waste collections quantitatively and qualitatively and give be a boost to producers of compostable materials and the bioeconomy in Europe, where these products can be produced instead of being imported. Expect some opposition from the traditional plastics industry who have recently successfully opposed the French ban on non compostable throw away table ware ( all of which is not recycled and mostly imported from the Far East), although I expect this opposition to be defeated.

A much tougher debate regards the obligatory collection of foodwaste by 2020. Again, there are two camps, and the waste industry is in both of them, ironically.

On the one hand we have those who say that obligatory collection is expensive, impracticable especially in less densely populated areas, renders obsolete existing infrastructure, such as MBT and WtE plants, and produces a compost for which there is little market. So collection should be subject to TEEP, ie, only being implemented where it meets certain (as yet unspecified) economic and environmental criteria.

Those in favour of obligatory collection argue that by separating biowaste higher overall recycling levels are achieved, better selection of dry recyclables is possible, reduced emissions of GHG and production of clean energy ensue; whilst compost has value when it is used as a raw material to produce higher value fertiliser mixes (the EU Fertiliser Regulation is due in 2017 and this closes the regulatory circle for the end-of-waste criteria of biowaste). They argue that TEEP effectively means giving an excuse to not implementing collections anywhere.

This is a debate, which finds the waste industry divided, with opposition from the countries to the east and south, but not only. How this will play out is anybody’s guess at the moment, with the Parliament again taking the more advanced position in favour of obligatory collections, but expect heavy opposition from a majority of countries, supported by municipality organisations, some waste sector groups, and the waste to energy (WtE) industry lobby.

4. Waste to energy

Further and intense debate regards the role of WtE in the Circular Economy mix with significant opposition to the intention of the Package to restrict the growth of WtE in Europe.

Here we find the two camps divided again with the waste industry in both of them but with the major companies heavily in favour of an increased role of WtE in the waste disposal mix. They are supported by countries whose systems are somewhat dependent upon WtE and with existing infrastructure risking becoming stranded. I have no idea how this will work out.

When it comes to those member states heavily relying on incineration, the Commission calls on them to raise taxes on WtE, phase out public support schemes, decommission old facilities and establish a moratorium on new ones

The European Commission entered into this debate forcefully with the Communication on the Role of WtE in a Circular Economy released on 26 January. Although non-binding, the communication analyses the current role of waste-to-energy and gives guidance to member states on how to cope with the situations this generates. The Commission appears to have changed its position from promoting incineration to acknowledging the problems related to overcapacities, distortive economic incentives and the risk that a very quick phasing out of landfills shifts waste from these to incinerators and not to prevention, reuse and recycling.

In this regard, the Commission advises those member states heavily reliant upon landfills to focus on separate collection, on increasing recycling capacity and on diverting bio-waste from landfills. It insists should these Member States want to obtain energy from waste, they are recommended to recycle bio-waste through AD. In addition, they are called upon to take into account the commitments and objectives for next 20-30 years (separate collection and recycling targets) and carefully assess the evolution expected for mixed waste when planning infrastructures, so as to avoid investments that could create stranded assets (ie, redundant incinerators).

When it comes to those member states heavily relying on incineration, the Commission calls on them to raise taxes on WtE, phase out public support schemes, decommission old facilities and establish a moratorium on new ones. The case for defunding waste-to-energy has been extended to all member states, so as not to distort the waste hierarchy. In this sense, the Commission acknowledges that the waste operations delivering the highest reduction of GHG emissions are prevention, reuse and recycling and these should be promoted.

5. The role of data and calculation methodology

The EU has data collection systems that are mostly incompatible between them and lead to distortions in understanding which countries’ treatment systems, collection methods, EPR systems, give the best results or the best value for money. One ambition is to sort this out and to create data management methodologies which allow us to compare different realities.

Whilst there is no real debate around this, nor opposition/in favour divisions, getting data systems which are comparable will require compromise and the loss of a certain sovereignty by countries and by the waste industry and EPR systems across Europe. With a small group of partners from around Europe I am working on how this could look and will be talking to the Commission in the future to try to map out a process to harmonise data management to ensure the targets of the Circular Package, whichever they may be, can be measured with certainty and transparency – a situation which the Commission recognises does not currently exist.

As a waste manager, I find it somewhat dispiriting that in the circular economy debate, the waste industry is divided into various camps – this weakens our overall influence even when we are united and my sincere appeal to our associations representing us in the Commission is to agree common, compromise positions, to avoid  losing the debate on those which we all agree upon.

Watch this space as the debates come to conclusion over the next months and be ready for some surprises!


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