Implementing Individual Producer Responsibility for Waste Electrical and Electronic Equipment through Improved Financing

Abstract

Summary Under the European Union (EU) Waste Electrical and Electronics Equipment (WEEE) Directive, producers are responsible for financing the recycling of their products at end of life. A key intention of such extended producer responsibility (EPR) legislation is to provide economic incentives for producers to develop products that are easier to treat and recycle at end of life. Recent research has shown, however, that the implementation of EPR for WEEE has so far failed in this respect. Current WEEE systems calculate their prices according to simple mass‐based allocation of costs to producers, based on broad collection categories containing a mixture of different product types and brands. This article outlines two alternative approaches, which instead calculate charges for products sold by producers by classifying them according to their eventual end‐of‐life treatment requirements and cost. Worked examples indicate that these methods provide both effective and efficient frameworks for financing WEEE, potentially delivering financial incentives to producers substantial enough to affect their potential profitability and, as a likely consequence, the decisions relating to the design of their products. In particular they fulfill three important criteria required by the WEEE Directive: they can financially reward improved design, allocate costs of historic waste proportionately (on the basis of tonnes of new products sold), and provide sufficient financial guarantees against future waste costs and liabilities. They are also relatively practical for implementation because they are based solely on cost allocation and financing. Further research and investigation would be worthwhile to test and verify this approach using real‐world data and under various scenarios.

A Case Discussion on Market‐Based Extended Producer Responsibility: The Minnesota Electronics Recycling Act

“…)—an IPR‐related concept (Lifset and Lindhqvist ; IPR Works ; Mayers et al. ). This is because Minnesota's market‐based approach allows for independent manufacturer decisions and contracts (e.g., determining collection strategies and contracting directly with collectors and/or recyclers) and imposes no operational constraints that could increase costs of attaining IPR.…”

Implementing Extended Producer Responsibility Legislation

“…Since the introduction of the EPR concept, it has been argued that it is not simply about diverting waste away from landfills, but more about providing incentives to manufacturers to design more environmentally friendly products (Atasu and Van Wassenhove ; Lifset and Lindhqvist ; Mayers et al ). Thus an essential element to be considered in designing e‐waste regulation is the type of design incentives that it provides to manufacturers.…”

“…For example, Toyasaki and colleagues () study the impact of recycling competition; Jacobs and Subramanian () investigate supply chain configuration decisions under product take‐back mandates; Krikke and colleagues (), Hammond and Beullens (), and Walther and Spengler () study reverse logistics and network design; and Atasu and Subramanian (), Esenduran and Kemahlioglu‐Ziya (), Plambeck and Wang (), and Zuidwijk and Krikke () study product design implications of EPR. The industrial ecology literature has also provided evidence regarding the problem, pointing out the drawbacks and limitations of the current execution of EPR principles and suggesting conceptual solutions for improvement (e.g., Lifset and Lindhqvist ; Mayers et al ; Tojo ; Van Rossem ).…”

Feasibility of Using Radio Frequency Identification to Facilitate Individual Producer Responsibility for Waste Electrical and Electronic Equipment

“…), according to Dempsey and colleagues (), examples of systems that integrate elements of IPR abound, including the Specified Home Appliances Recycling Law (SHARL) and the PC Recycling System in Japan, the WEEE recovery systems in Maine and Washington in the United States, and operations in the Information and Communication Technology Milieu system in the Netherlands up to 2003. An alternative system to allocate costs to producers that does not require brand recognition or sorting is suggested by Mayers and colleagues (). All these systems aim to reduce the flow of waste to landfills and incentivize producers to design products that can be more efficiently recovered (Mayers et al.…”