What is packaging?
There are several types of packaging, used for products that are consumed both at home and away from home:
primary packaging (or sales packaging) used for products supplied to consumers
secondary packaging (or distribution packaging) used to help secure or bundle multiple units of product, such as cardboard boxes or shrink film overwrap
tertiary packaging (also known as distribution packaging) used to secure or bundle multiples of secondary packaging, such as pallets, pallet wrapping, and stretch film, shrink film and strapping.
Packaging plays an essential role in the safe preservation and delivery of most products and helps to reduce waste by minimising product damage and extending shelf life. Packaging also plays a key role in preventing food wastage, which has a significantly larger environmental footprint than packaging over the food production life cycle (OECD 2012). The packaging life cycle can be divided into three main phases: manufacture (using extracted resources), consumption and endoflife disposal and management. The design of packaging can influence environmental impacts in all of these phases.
Collectively, the packaged goods industry encompasses raw material suppliers, packaging manufacturers, packaging suppliers such as retail, food and grocery, beverage and hospitality industries and the brand owners of packaged products, for example McDonalds and 7-Eleven.
what are the key trends in PACKAGING use, WASTE and recycling?
Overall, packaging waste accounts for approximately 9 per cent of total waste generation in Australia. Beverage containers currently account for up to 2.8 per cent of total waste and almost a third (30 per cent) of packaging consumption and are a key item of consumer concern as they are also highly visible in litter. Paper and cardboard represent the greatest proportion of packaging consumed in Australia, largely due to its use as distribution packaging in the C&I sector (SRU 2013).
The proportion of packaging waste to total waste may change over time, for example if other types of waste increase to form a larger proportion of total waste. As a whole, the waste and resource recovery and packaging sectors in Australia are continuing to grow following the Global Financial Crisis in 2008–09 (SRU 2013, DIISRTE 2012 and WRAP 2011). However, it has been identified that there are significant opportunities to reduce disposal of waste to landfill and improve recovery of resources in the Commercial and Industrial (C&I) sector (Hyder 2012) which also includes public places and events, institutions and workplaces.
The packaging and waste and resource recovery sectors respond to a wide range of domestic and global social and economic developments. Responses to economic trends and consumer demands influence the environmental impacts of packaging, such as recyclability and litter potential. For example, there is an increasing trend internationally and in Australia towards the use of flexible packaging made from soft and composite plastics, such as sachets for drinks, microwavable foods and detergents (Manalili et al 2011, Sustainable Packaging Alliance 2012, Ferre 2010, Streeter 2007). These new types of packaging might reduce transport or storage impacts for businesses, but are not yet recyclable in Australia, adding to landfill volumes.
Between 2003 and 2012 Australia’s population grew at an average rate of 1.45 per cent per annum (ABS 2013a). Rising population, along with rising incomes and living standards, is promoting increased overall consumption of resources and products, including packaging. In addition, demographic and lifestyle trends such as the increased ageing population and number of households (EPHC 2010b, ABS 2010) and use of ‘convenience’ packaging based on per person units (for example, ready-made meals) are increasing packaging consumption. Because packaging is a fast moving consumer product that becomes waste as soon as it is used, increased consumption is leading to an overall increase in packaging waste (by weight).
As a result of continuing overall growth in packaging waste, there will be a future need for additional waste management and resource recovery infrastructure in Australia. There will also be a need to manage patterns of waste generation and develop end markets to address the challenges presented by Australia’s mix of highly concentrated urban population in the eastern and south western coastal regions, with areas of landmass being sparsely inhabited over large distances (EPHC 2010b, SRU 2012).
How does at-home and away-from-home recycling differ?
Collection and recycling systems for packaging materials in the C&I sector and other away-from-home areas such as public events are not yet comprehensive and face some barriers (SRU 2013, Hyder 2012). This sector also has not been subject to government intervention to stimulate recycling to the same extent as the municipal recycling sector. These factors have led to uneven performance in recycling materials other than paper and cardboard away from home compared to at home.
Waste in other away-from-home spaces such as public parks and reserves are mainly collected by local government, although private waste service providers can also be involved. The capacity for recovery here also depends on the terms and scope of waste services contracts and the availability and capacity of bin and reprocessing infrastructure. For example, a park in one local government area may have separate bins for recyclables and general waste, while a park nearby in a different local government area may have a single bin for all waste. This lack of consistency can again cause confusion for consumers and increase contamination. Because local councils generally rely on rates from residents to provide municipal services, there are limits to their ability to enhance and expand these services.
There is strong community and environment group demand for recycling and reuse of packaging materials. Consumer interest in the environmental and social impacts of purchases is increasing and industry is responding through increased use of environmental certification and labelling (AFGC 2012b) and focus on the ‘social licence to operate’ (Cook et al 2013).
There is likely to be continued investment in recycling technology to better address increasingly popular packaging types such as flexible plastics. However, based on past experience new technologies typically do not come into effect until well after new materials have been introduced and already become widespread, and subsequently a demand or incentive has arisen to reduce their environmental impacts1. Without such investment, current packaging trends will, over time, reduce the proportion of recyclable packaging and increase landfill disposal.
1 international approaches to packaging
Australia is in line with international trends in its efforts to encourage extended producer responsibility through the National Waste Policy. Internationally, the concept of extended producer responsibility for manufactured products has been a feature of the business landscape for many years. More recently the concepts of ‘closed loop’ economies (edie.net et al 2013) and using waste as a resource have been focused on (OECD 2012). This has led to an increase in a range of different product stewardship approaches being implemented around the world (Martin 2013). These include both regulatory (such as in the European Union and more recently China) and voluntary (such as in Australia, Singapore and New Zealand) approaches.
The European Union, China, Japan, South Korea, Israel and some Canadian provinces have introduced producer responsibility regulations for packaging (Martin 2013). South Africa and several US states are also considering legislated schemes. The European Parliament and Council Directive 94/62/EC requires member states to design reusable or recoverable packaging, minimise packaging weight and volume, reduce hazardous substances and materials in packaging and meet packaging material recovery and recycling targets. China’s regulations require firms, particularly those dealing with food, beverage and cosmetic packaging, to eliminate excessive packaging (APCC 2013a).
Other countries, such as Singapore and New Zealand, have adopted voluntary agreements similar to the Australian Packaging Covenant to address the environmental impacts of packaging.
interNATIONAL examples of container deposit schemes
Several international jurisdictions have long-running container deposit schemes (CDSs), including Norway, California and other US states, British Columbia and other Canadian provinces, Denmark, Sweden and Germany (MS2 2011). Germany expanded its CDS in 2010 and Fiji introduced a CDS in 2011.
Research on the operation of CDS systems internationally was commissioned for the Consultation RIS and has informed the development and analysis of the CDS options (Packaging Impacts Consultation RIS 2011).
Some international CDSs are industry-led and operated (Norway, Sweden), some are government-led (California) and others are coordinated by not-for-profit product stewardship organisations (British Columbia, Denmark). The types of containers collected (refillable, non-refillable or more recently flexible pouches and ‘tetra paks’) have evolved over time and across jurisdictions, based on local conditions and preferences (MS2 2011). European systems primarily use automated Reverse Vending Machines for collection.
In 2011 PwC Germany assessed the German CDS, finding that beverage container collection and recycling rates were significantly higher under the CDS than under other recovery systems. The study also found that the costs and benefits of beverage container recovery systems are influenced by secondary material prices, the weight of packaging and the number of units (PwC Germany 2011).
CDSs in overseas jurisdictions have also faced implementation issues and have been implemented in food and beverage retailing circumstances that are different to Australia, which could affect their applicability and performance here (MS2 2011). European CDSs have had issues with cross-border purchases and redemptions and imported products.
In 2012, the Dutch Parliament decided to cease its PET plastic deposit scheme from 2015 with the aim of boosting recycling of more packaging types and allowing a range of approaches to be undertaken by industry working voluntarily with municipalities to meet recycling and litter targets (European Environment and Packaging Law 2012). In 2010, Delaware in Ohio repealed its CDS and implemented kerbside recycling, as retailers became reluctant to process containers, undermining the effectiveness of the scheme (The Environmental Magazine 2011).
There are a number of existing legislative frameworks in place for managing packaging waste in Australia and some of these have pre-dated moves towards national consistency, such as the national roll out of kerbside recycling.
Recycling of packaging in Australia dates back to the 1900s, when return systems for refillable beverage containers for beer and carbonated drinks were run on a commercial basis in some states. Some states also had a depot network for the return of deposit items. These were a remnant of the 19th century material recovery network based on government-authorised ‘Marine Store Dealers,’ who were allowed under licence to trade in recoverable items, including bottles. In the mid-1970s South Australia’s beer and soft drink sector were still using refillables, supported by a deposit return system through existing depots and retailers. South Australian consumers returned soft drink bottles to retailers and beer bottles to 'marine stores' for a refund amount that was set and managed by industry. Marine stores were originally established by the Adelaide Bottle Company to collect, wash and re-hire glass bottles for refilling by local breweries, such as the South Australia Brewing Company and Coopers Brewery.
In other states similar manufacturer-led programs to collect containers for reuse, such as the Comalco ‘cash for cans’ program, were also popular in the 1970s (Planet Ark 2012, 2008). However these were not regulatory and hence operated differently to the more extensive, national-scale CDS options that are modelled to be legislated in this Decision RIS.
These smaller-scale, producer-led programs and the subsequent introduction of container deposit legislation (CDL) in South Australia in 1977 (see Box 1) pre-dated kerbside recycling.
BOX 1: CONTAINER DEPOSIT LEGISLATION IN SOUTH AUSTRALIA
The introduction (and increasing popularity) of single-trip (non-refillable) beverage containers in the 1970s meant that the new containers could not be used again and were of no further use once sold. ‘Single trip’ beverage containers soon became a highly visible part of the litter stream and a potential threat to the environment. Oregon, USA passed the first ‘bottle bill’ (also known as a deposit law) in 1971, requiring refundable deposits on all beer and soft drink containers. It was this piece of legislation that would provide the springboard for South Australia’s own ‘bottle bill’.
Based on the ‘polluter pays’ principle and reinforcing the existing return systems previously established by industry for its refillable containers, the South Australian Parliament passed the Beverage Container Act 1975 (the Act), which commenced operation in January 1977. The Act imposed a 5 cent deposit on containers, but exempted refillable containers. A later amendment in 1986 subjected non-refillable bottles to a refund of 15 cents and refillable bottles to a refund of 4 cents. This was eventually challenged in the High Court by interstate brewers and led to the legislation being amended to equalise deposits for refillable and ‘one trip’ packs.
Prior to the mid-1990s, the legislation excluded milk carton packaging, with the exception of plastic bottles, until the dairy industry lobbied in the mid-1990s to have plastic bottles included in the exempt category. In return the dairy sector was asked to contribute to recycling and litter programs.
SA’s CDL was extended on 1 January 2003 to include a wider range of products, which had been identified as an increasing litter issue. Containers for flavoured milk and fruit juice (less than 1 Litre) are now covered in the scheme, although liquid paperboard carton recovery rates remain lower than other container types. Wine, spirits, cordial, plain milk and fruit juice (more than 1 Litre) remain exempt. The deposit was increased from 5 cents to 10 cents in 2008.
Since the late 1980s, Commonwealth, state and territory and local governments have focused on improving municipal kerbside recycling systems and C&I recovery and recycling to reduce the disposal of recyclable materials to landfill and increase resource recovery.
Kerbside recycling collection was introduced in many urban council areas in the late 1980s and early 1990s, initially in Sydney, then other major centres and regional areas (Planet Ark 2008). This was driven by growing public interest in contributing to environmental protection through recycling and reuse (Planet Ark 2005). Kerbside recycling allowed households to separate common items for recycling such as paper, glass and aluminium, and later PET, HDPE milk containers, liquid paperboard milk and juice cartons and steel cans (Planet Ark 2008).
In 1992, Australian and New Zealand environment ministers endorsed a National Kerbside Recycling Strategy, which introduced expanded kerbside recycling access and a range of voluntary recycling targets for the packaged goods industry. Australia became one of the first countries to have a national voluntary recycling plan giving commitments at all levels of industry. From 1990 to 1993, the rate of household recycling in Australia doubled (Planet Ark 2008, 2005). Kerbside recycling is currently accessed by at least 94 per cent of Australian households (ABS 2012a).
Since 1999, all levels of government have also worked with packaging manufacturers and brand owners to reduce packaging waste and litter, specifically through the Australian Packaging Covenant (established originally as the National Packaging Covenant). More recently the focus for environment ministers has been on packaging waste arising in away-from home-locations (public places/business settings/events/hospitality) and on packaging litter.
Commonwealth, state and territory and local government responses to packaging waste and litter in Australia are focused through the National Waste Policy: Less Waste, More Resources. One of the National Waste Policy’s six key directions is taking responsibility, through product stewardship, to reduce the environmental, health and safety footprint of manufactured goods during and at end of life. Strategy 1 supports this in its aim to:
“Establish a national framework underpinned by legislation to support voluntary, coregulatory and regulatory product stewardship and extended producer responsibility schemes to provide for the impacts of a product being responsibly managed during and at end of life.” (EPHC 2009, p. 9)
The Product Stewardship Act 2011 (the PS Act) implements Strategy 1 and came into effect on 8 August 2011. Option 2 in this Decision RIS proposes several models for introducing co-regulatory product stewardship schemes for packaging, which would be implemented under the PS Act. The PS Act specifies at least twelve months’ notification must be given that a class of products is being considered for some form of accreditation or regulation. On 19 December 2011 a Product Notice was issued for packaging and subsets of packaging, such as consumer packaging or beverage packaging.
Televisions, computers and computer-related products are the first products regulated under the PS Act through the Product Stewardship (Televisions and Computers) Regulations 2011. These products are a priority due to growing consumption and waste generation and historically low recycling rates. The Regulations require television and computer importers and manufacturers to join and fund industry-run coregulatory arrangements (CAs), which recycle products on their behalf to meet annual targets. Organisations wishing to establish a CA must apply to the Australian Government for approval. As of August 2013, five CAs were approved and more than 500 ongoing collection services were established across Australia, with CAs required to provide recycling services for metropolitan, regional and rural areas by the end of 2013. All liable importers and manufacturers met their obligation to join an approved CA in 2011–12 and 2012–13. The scheme has provided an instructive working model of implementing successful co-regulatory arrangements under the PS Act.
The Mutual Recognition Act 1992 (MRA) and Trans-Tasman Mutual Recognition Act 1997 (TTMRA) promote the free passage of goods between Australian states and territories, and between Australia and New Zealand in the case of the TTMRA. In relation to goods, the MRA and TTMRA are designed to ensure that a good that is legally saleable in one jurisdiction can be sold in any another to ensure national consistency. The requirements of the MRA and TTMRA must be adhered to under any regulatory scheme that would seek to impose requirements on saleable goods that would differ across the participating jurisdictions.
The South Australian and Northern Territory container refund schemes operate under an exemption from the MRA in order to implement their product registration and labelling requirements.
AUSTRALIAN PACKAGING COVENANT AND THE NEPM
The Australian Packaging Covenant (APC), established as the National Packaging Covenant in 1999, is a primary mechanism for implementing Strategy 3 of the National Waste Policy. The APC is an agreement between all levels of government, companies in the packaging supply chain and relevant environment and community groups to reduce the environmental impacts of packaging. The APC pursues this by funding projects to progress the following performance goals:
Design—optimising packaging to use resources efficiently and reduce environmental impacts without compromising product quality and safety
Recycling—efficiently collecting and recycling packaging
Product Stewardship—demonstrating commitment by all signatories (APCC 2010).
The APC pursues shared responsibility for product stewardship and environmental impacts throughout the entire packaging supply chain, including raw material suppliers, packaging manufacturers and suppliers, brand owners and retailers. As at June 2013 there were 925 APC signatories (APCC 2013b). The APC provides national consistent annual reporting of packaging recycling rates in Australia (see Box 2).
The APC is underpinned by the National Environment Protection (Used Packaging Materials) Measure (NEPM), made under the National Environment Protection Council Act 1994 by Commonwealth, state and territory environment ministers. The NEPM provides free-rider regulation to ensure that APC signatories are not disadvantaged in the marketplace by taking action to reduce the environmental impacts of packaging. Packaging brand owners with an annual turnover greater than $5 million are required to join the APC, or under the NEPM can be part of an industry arrangement achieving equivalent outcomes. If they do not meet the APC or NEPM requirements, they are referred to state and territory jurisdictions for compliance action under the NEPM.
BOX 2: AUSTRALIAN PACKAGING CONVENANT REPORTING OF RECYCLING RATES
The APC reported an overall packaging recycling rate of 63.8 per cent in 2012, a 0.7 per cent increase on 2011 and a significant increase from the 2003 baseline of 39.2 per cent (APCC 2012b). From 2005 to 2012, the APC coordinated 141 projects with a total value of $126.1 million to increase recycling, improve packaging design and reduce litter. Industry members of the APC contributed $30.6 million towards these projects, or 24 per cent of funds. The APC estimates that these projects have contributed to 32.4 per cent of the total increase in recycled packaging tonnes from 2005 to 2012 (APCC 2013c). Figure 1 shows Australia’s packaging recycling rate from 2003 to 2012.
FIGURE 1: PACKAGING RECYCLING RATES 2003 TO 2012
Source: APCC 2012b, p. 9
INTERNATIONAL CONVENTIONS AND REGIONAL AGREEMENTS
The Australian Government is a party to several international conventions and regional agreements that refer to managing waste, including litter as marine debris. The Commonwealth works with other governments and organisations to address ocean pollution and implement the London Convention 1972, the International Convention for the Prevention of Pollution from Ships 1973 (as amended by the Protocol of 1978) and the United Nations Convention on the Law of the Sea. At the 2012 Rio+20 United Nations Sustainability Conference, leaders agreed to take action to reduce the incidence and impacts of marine debris on coastal and marine environments. In 2011, the Conference of Parties to the Convention on Migratory Species adopted an Australian resolution to improve cooperation on marine debris identification and management.
In 2003 “injury and fatality to vertebrate marine life caused by ingestion of, or entanglement in, harmful marine debris” was listed as a Key Threatening Process under the Environment Protection and Biodiversity Conservation Act 1999. In 2009, the Australian Government developed the Threat Abatement Plan for the Impacts of Marine Debris on Vertebrate Marine Life to address the Key Threatening Process and provide a framework for coordinated management of marine debris. The plan outlines actions to improve waste management practices on land and sea, raise public awareness, facilitate international cooperation, improve knowledge of marine debris origins and facilitate wildlife research and recovery actions. The Australian Government provides funding to implement onground activities that meet Threat Abatement Plan objectives through its natural resource management and water programmes.
STATE AND TERRITORY REGULATORY FRAMEWORKS
State, territory and local governments focus activities to address packaging waste through the National Waste Policy: Less Waste, More Resources. They also use a range of other approaches, including local government kerbside recycling collection, landfill levies and bans, waste and litter reduction targets and strategies, voluntary product stewardship programs and legislation allowing for the introduction of extended producer responsibility schemes.
Some states and territories have introduced regulations targeting specific environmental impacts or items of packaging. Victoria and South Australia have established landfill bans on items such as industrial waste containers (Victoria) and plastic packaging and glass that have been aggregated for resource recovery (South Australia).
South Australia (SA) and the Northern Territory (NT) have legislated container refund schemes, where consumers receive a 10 cent refund if they return a beverage container sold in these jurisdictions at an approved collection depot. South Australia’s CDL aims to reduce beverage container litter and promote resource recovery, and has achieved an 80 per cent beverage container recycling rate and reduced beverage container litter and waste sent to landfill (EPA SA 2013). The NT scheme which commenced on 3 January 2012 aims to reduce beverage container litter and increase resource recovery, reuse and recycling (DLPE 2012a). During the first quarter of 2012, the container return rate was 21.9%, rising to 30.3% by the end of June 2012 (DLPE 2012b).
Prevention of marine debris from land and sea sources is also addressed through state and territory legislation governing waste management, pollution, environment protection, species conservation and litter.
Voluntary initiatives operating to address packaging waste indicate that legislation is not the only driver to change recycling and litter behaviour. These include industry-led sustainable packaging initiatives and networks, such as the Sustainable Packaging Alliance. In addition, non-government organisations (NGOs) such as Keep Australia Beautiful, Clean Up Australia and Planet Ark undertake litter clean-up and recycling programs, community education campaigns and awards to encourage consumers and businesses to reduce waste and litter and increase recycling.
The Packaging Stewardship Forum (PSF) is a voluntary mechanism delivering recycling, litter reduction and education programs on behalf of members who are large beverage companies and their packaging suppliers. The PSF focuses on providing recycling bin infrastructure and glass reprocessing equipment.
The Plastics and Chemicals Industry Association’s Sustainability Leadership Framework for Industry (PACIA 2008) has been promoted by Commonwealth, state and local governments to assist industry to transform practices in moving towards a ‘zero waste’ goal. This includes participating in international moves to reduce accidental discharges of plastic pellets (a manufacturing feedstock) from sites which contribute to marine debris.
A key driver of industry actions to reduce the environmental impacts of packaging both within Australia and internationally are associated commercial benefits that can be achieved through coordination, such as lowered manufacture, transport and supply chain costs (Consumer Goods Forum 2013, SPC 2011, Wal-Mart 2006, Green Retail Decisions, 2011). In addition, national surveys indicate a consistent, growing trend of community support for expanding recycling availability in public places and workplaces (EPHC 2010b, ABS 2009, Pollinate Green Research 2007, Ipsos Australia 2004). Stakeholder expectations of reducing packaging waste and litter and enhancing recycling were also reinforced in research undertaken for the mid-term review of the APC, which showed 60 per cent of consumers believe there is not enough emphasis on reducing the environmental impacts of packaging and 40 per cent think this is because too much packaging is used (OmniAccess 2008).
ABS statistics indicate that Australian households are strongly committed to kerbside recycling. From March 2011 to March 2012, collection from the house was the most common way for households to recycle paper, cardboard or newspapers (94 per cent), glass (94 per cent), aluminium cans (91 per cent), steel cans or tins (96 per cent) and plastic bottles or containers (93 per cent) (ABS 2012a).
Surveys about CDS schemes also find a high level of community support, especially in South Australia. A 2012 national Newspoll survey showed 82 per cent of respondents were in favour of CDL (Boomerang Alliance, 2012). A 2011 NT Newspoll survey and 2007 SA Newspoll survey showed similar results (Boomerang Alliance 2011, Clean Up Australia 2008). A 2012 study commissioned by the South Australian Government showed 99 per cent of South Australians supported their container refund scheme, and 98 per cent supported the introduction of a similar national scheme (Harrison Research 2012).