Pro Europe EUROPEN EPR Seminar Packaging 2020 Cradle to Cradle Management Brussels, 6 October 2010

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1 ARA PRODUCER RESPONSIBILITY PUT INTO PRACTICE Pro Europe EUROPEN EPR Seminar Packaging 2020 Cradle to Cradle Management Brussels, 6 October 2010

2 AUSTRIA: FACTS AND FIGURES Capital Vienna Area 84,000 km² Population 8.4 million GNP 2009¹) billion GNP per capita 29,700 Post consumer wastes (MSW and others)²) million tons Packaging waste³) 1.1 million tons 1) Eurostat, as of November ) Federal Ministry of Environment, ) Federal Ministry of Environment, 2007.

3 TOP RANKS FOR PACKAGING WASTE RECOVERY IN AUSTRIA 100% recycling rate total recovery rate 80% 60% 40% 20% 0% BE BG CZ DK DE EE IE GR ES FR IT CY LV LT LU HU MT NL AT PL PT RO SI SK FI SE UK Source: EUROSTAT 2009

4 CONTENTS 1 The framework 2 The model put into practice 3 Operation 4 Effects and achievements a review

5 1 THE FRAMEWORK

6 SEPARATE PACKAGING COLLECTION STAKEHOLDERS AND THEIR OBJECTIVES Ministry of Environment National targets according to Packaging Directive Macroeconomic reasonability Consumers Convenient, comprehensible and credible collection systems Minimal total financial burden from packaging tariffs and household waste fee Local communities Waste reduction Fair payments for community services Coordination with other sectors of waste management Economic operators License partners: Transfer of duties at long term lowest cost Waste generators: Convenient and adequate collection service Waste management companies Successful principal agent relation Secondary raw materials Compliance schemes/collection systems Sufficient degrees of freedom for management of services and cost Level playing field for competition

7 THE GENERAL AIM OF THE AUSTRIAN PACKAGING ORDINANCE The general aim of the ordinance is to require packaging producers packers and fillers wholesalers l and retailers til to adopt responsibility for packaging material by making economical use of packaging in general developing full scale collection systems and improving reuse and recycling schemes.

8 THE PACKAGING ORDINANCE OFFERS TWO OPTIONS FOR COMPLIANCE Companies that do not take part in a collection and recovery system Companies taking part in a collection and recovery system Recovery through dedicated own collection schemes Reuse or recovery of collected packaging in state of the art facilities Sign a license agreement Report the volumes of packaging materials put on the market Pay the material specific fees Minimum recycling ratio for each packaging material Annual documentation to the MoE, with a breakdown by packaging materials Packaging volume put on the market Volumes collected Collection ratio in percent Volume and transferee company

9 KEY LEGAL REQUIREMENTS FOR COLLECTION AND RECOVERY SYSTEMS IN AUSTRIA Must be formally approved by the Ministry of Environment Must prove contractual t and logistic provisions ii for nationwide id collection services Must prove financial resources Must technically separate household and commercial systems Have to provide information and communication Have to support waste minimization programs Are under regulatory supervision by the Ministry Must meet the collection standards as well as the collection and recycling targets specified by the Ministry Have to report annually to the Ministry All fees charged by authorised recovery systems with monopolistic characteristics must undergo an audit procedure (through Ministry of Environment).

10 2 THE MODEL PUT INTO PRACTICE

11 ARA: SUCCESSFUL COLLECTION AND RECOVERY FOR PACKAGING WASTE SINCE 1993 ARA AG Founded by Austrian packaging manufacturers, fillers, packers, importers and trade companies to ensure compliance with the Austrian Packaging Ordinance Relies on public tendering to select private sector and municipal contractors for the collection, sorting and recovery of packaging waste Non profit organisation: Unplanned revenue surpluses are used to lower tariffs, thus benefiting businesses and consumers. Sustainable collection and recovery Ensure compliance with all provisions of the Austrian Packaging Ordinance since 1993, highest recovery quota in the EU 95% of all recycling and recovery activities take place in Austria Around 4,000 jobs created directly and indirectly (source: IHS Carinthia) Help save approx. 600,000 tons of CO 2 equivalents per year

12 PRODUCER RESPONSIBILITY FOR PACKAGING: ARA SYSTEM More than 15,000 licensees transfer to ARA their obligations arising under the Packaging Ordinance ARA System organises the nation wide collection and recovery of packaging waste from households and industry and meets the targets set by the Ministry of Environment Local authorities and more than 200 collection and recycling companies are the operational backbone Producers Fillers, packers importers ARA Paper Plastics Metals Wood Compounds Textiles Ceramics Biodegradable materials * Local authorities Collection companies Retailers AGR Glass * Recycling companies ARA AGR Altstoff Recycling Austria AG Austria Glasrecycling GmbH * System operator according to Art. 29 Waste Management Act for each packaging material

13 ARA SYSTEM SERVICE RANGE AND STRUCTURE One stop provider of compliance for household and commercial il packaging waste Non profit orientation No cross subsidies between household and commercial sector or between packaging materials Specifications for regional collection systems at district level define the service scope and responsibilities of private collectors and municipalities and are up dated annually. Local authorities and municipalities provide ARA with country wide collection infrastructures and offer communication at the local level. For collection, sorting and recovery, public tenders are held every 3 to 5 years. European Commission confirms compliance with competition law.

14 3 OPERATION

15 MINISTRY REQUIREMENTS FOR PACKAGING WASTE COLLECTION SYSTEMS Recovery ratios Mt Material specific il ifi percentage of the licensed packaging volume for household h and commercial il systems (> 50 mass % each) Minimum ratios for material recycling Material specific percentage of the licensed packaging volumes (> 15 mass %) Overall ratio across all packaging materials of the volumes licensed by collection and recovery systems (> 25 mass %) Adequate capacity of collection and recovery systems National average (l/capita) Regional minimum and maximum standards (l/capita)

16 TARGETS FOR ARA SYSTEM Household system Commercial system Recovery Recycling Recovery Recycling Paper, board, cardboard 80% 75% 90% 85% Glass 80% 80% 80% 80% Plastics 95% 30% 85% 65% Composites 95% 15% 50% 15% Metals 65% 65% 65% 65% Wood 15% 15% Textiles Ceramics Packaging made of biodegradable materials 95% 95% Total 60% 55% 60% 55% Ratios according to Packaging Ordinance Art. 11(1) and (2) refer to compliance quantities.

17 ARA COLLECTION AND RECOVERY SERVICES Collection from private households Collection from small shops Regional collection centers Commercial collection services Customized dindustrial i collection services Event services Sorting of municipal and commercial wastes Energy recovery from packaging in municipal solid waste

18 ELEMENTS OF THE ARA RECYCLING VALUE CHAIN Collection Collection Transport Recycling Sorting infrastructure (optional) Recovery Household collection: Curbside bag collection Curbside container collection Sorting plant Material recycling Public drop off containers Local communities Private or public waste collectors Local collection centers (MRF) Industrial and commercial collection Regional collection center Energy recovery Customized industrial collection

19 DIFFERENT MEANS OF LIGHTWEIGHT PACKAGING DIFFERENT MEANS OF LIGHTWEIGHT PACKAGING COLLECTION

20 COLLECTION AND RECOVERY IN 2009 Packaging material Collection containers Collection [tons] Recovery ¹ ) [tons] Paper, cardboard 1.044, , ,618 Glass 80, , ,621 Plastics and lightweight packaging (container collection) Households serviced by curbside collection (bag collection) 230, , , ,139 Metals 50,000 40,558 32,205 Wood 22,719 22,846 Total 2.837, , ,429 1) Net figures.

21 4 EFFECTS AND ACHIEVEMENTS A REVIEW

22 INDUSTRY AND TRADE JOIN IN: FREE RIDER SHARE BELOW 10% Number of licensees 16,000 8,379 9,707 10, ,994 11,479 12,027 12,295 12,652 13,051 13,396 13,557 13,995 14,352 14, ,893 15,135 14,000 12,000 10, ,000 6,000 5,356 4,000 2,

23 CONSUMERS IN FAVOUR OF SEPARATE COLLECTION Consumers (aged 14+) who think that is a good or very good idea 100% 90% 80% Are satisfied or 70% highly satisfied 60% 50% 40% 30% 20% 10% 0% separating waste packaging waste collection Do not request any changes Cumulative grade (1= best, 5= worst) Paper Lightweight packaging Metal packaging 88% 81% 87% 89% 83% 91% Source: IMAS, 2009.

24 ARA PACKAGING WASTE COLLECTION : 30% GROWTH PROVIDES SECONDARY RAW MATERIALS AND SAVES 600,000 TONS CO 2 EQUIVALENTS PER YEAR Tons 900, ,000 t 800, ,000 +1,2% Glass* 600, ,000 +0,9% Lightweight packaging incl. Wood 400, ,000 2,0% 1,6% Metals 200, ,000 Paper & cardboard * Glass: AGR

25 GNP AND PACKAGING CONSUMPTION % (1991 = 100) GNP Packaging Consumption Sources: Statistics Austria, WIFO, Prognos (packaging consumption ), Federal Ministry of Environment (Marktmengen ), reading March 2008

26 AVERAGE ARA LICENSE FEES COMPARED TO THE CONSUMER PRICE INDEX /t % % 47% 52% Sources: ARA (2010) Statistics Austria (1995 = 100)

27 LESSONS LEARNT Obliged parties industry and trade in full control of implementation and operation as the main driver for efficiency i and cost reduction Division of labour: Co operation with local communities and waste management companies Coordination of collection schemes with other sectors of waste management Positive effects of competition and innovation Transparency Uniform licence fees, no discounts Quantities and quotas Audits of licencees, waste collectors and recyclers Bench marking Ecologic and economic effectiveness and efficiency

28 Copyright ARA is the owner of all intellectual property p rights in relation to this presentation and all parts thereof. All rights reserved. This presentation does not constitute a permission to use the intellectual property of ARA or third parties. Any use or distribution to third parties without ARA s prior written consent is strictly prohibited. Reproduction, modification, translation, use of data or charts contained, and display by means of photographic reproduction or other, as well as storage on, or modification in, systems for retrieval is strictly prohibited. Disclaimer The information and assessments contained in this presentation reflect the status at the time of its writing. ARA disclaims any legal liability or responsibility for the completeness and accuracy of the information provided, and the assessments made, in this presentation. Upon dissemination, the authors do not undertake to provide consultancy services to the recipients of this presentation. The authors reserve the right to make alterations and/or amendments at any time. The authors do not undertake to provide the recipients of this presentation with additional information or updates, if so required..