Product stewardship schemes have the potential to address problems with products that are difficult and costly for consumers and councils to dispose of. Product stewardship moves responsibility for waste to those involved in the production and supply of the product, and indirectly to the consumer by ensuring any residual waste costs are reflected in the purchase price. It therefore provides incentives for better product design and other measures to reduce waste and resource costs.
As previously described, the Act sets out a procedure for Government accreditation of both voluntary and mandatory product stewardship schemes. If the Minister for the Environment declares a product to be a priority product, a product stewardship scheme must be developed and accredited. If no scheme is developed, the Minister can make regulations to require a scheme.
The identification of the priorities will help us focus our work programme so we assess the potential for product stewardship in the right areas.
The issues we want you to consider for Part 2
We want your feedback on:
products for which it would be beneficial to have accredited product stewardship schemes
the costs your business, industry or council may face if mandatory product stewardship schemes are developed and implemented
the possible benefits that would arise from product stewardship for products you have identified, and evidence to support your view.
Your feedback will help us develop the Ministry’s work programme for product stewardship and identify those products where we should be undertaking early assessment of product stewardship options.
If assessment suggests that any regulatory proposals will be required for a particular product, further consultation on a specific proposal for that product will be carried out. As well, the impacts, including costs and benefits, of and need for regulation will be assessed. The results of the assessment will be included in a regulatory impact statement.
How does product stewardship address waste problems?
Product stewardship schemes could address:
inefficient use of materials
environmental effects of waste disposal.
Product stewardship options under the Waste Minimisation Act
Part 2 of the Act provides a framework for product stewardship and seeks to encourage the development of product stewardship schemes. The term ‘product’ can include classes of products (for example all refrigerators and freezers) and includes packaging.
Product stewardship requires producers, brand owners, importers, retailers, consumers and other parties to accept responsibility for the environmental effects of products – from the beginning of the production process through to, and including, disposal at the end of the product’s life. Suppliers of products may have to factor the costs of waste into production, import and other supply chain decisions. These costs could provide an incentive for more efficient resource use, and any residual waste costs would be reflected in the price consumers pay for the product.
Voluntary product stewardship
There are many examples of product stewardship schemes being developed and run by industry on a voluntary basis. To date, voluntary schemes have been developed for products such as agrichemical containers, waste oil, whiteware, mobile phones and paint.
The Ministry will continue to encourage voluntary product stewardship schemes under the new legislation. Those running these schemes may apply to the Minister for the Environment to have the scheme accredited, provided it meets the requirements listed in the Act. Accreditation gives voluntary schemes government recognition and could help market the product. We would like to see more voluntary schemes developed for products where the product, or waste from the product, causes environmental harm, or where there are benefits from having a voluntary scheme.
One issue that may arise for industries developing voluntary schemes is ‘free-riding’ from businesses that benefit from the programme but do not contribute to it.
The Act allows for regulations to be developed in support of voluntary schemes, including controls on disposing of products or waste; controlling the manufacture or sale of products containing specific materials; take-back services for products; labelling; and advance disposal fees. We are not currently proposing to make any regulations. Before proposing any in future, we would need to consult further and consider the costs and benefits.
Mandatory product stewardship schemes for priority products
The Act contains provisions for making the development of product stewardship schemes mandatory. Mandatory schemes could be required where there is significant advantage in having a product stewardship scheme, but this is either unlikely to be developed, or an existing voluntary scheme is not effective. If a product or class of products is declared by the Minister for the Environment to be a priority product, then product stewardship schemes must be developed. Any scheme for a priority product must be accredited by the Minister.
The Minister must not declare a product to be a priority product unless he or she is satisfied that its waste will or may cause significant environmental harm; or there are significant benefits from the waste minimisation or treatment of the product. The Minister must also:
be satisfied that the product can be effectively managed under a product stewardship scheme
consider the effectiveness of any relevant voluntary product stewardship scheme.
Before declaring a priority product, the Minister must give the public an opportunity to comment on the proposal and consider any public concerns about environmental harm associated with the product when it becomes waste (including concerns related to its disposal). The Minister may also publish guidelines on the expected contents and effects of a mandatory product stewardship scheme.
This document identifies three products that could be candidates for a mandatory scheme. If any are to be declared priority products, we will consult further on the Minister’s behalf about each proposal, possible guidelines, the expected contents and effects of a mandatory scheme, and any regulations required to support the scheme.
We will also assess the costs and benefits of the proposals and undertake a full regulatory impact analysis. We would expect any further consultation to be undertaken in 2010, after which the Minister will decide whether to declare the product a priority product. It is likely that not all will be declared as priority products, as industry may develop effective voluntary schemes, or the product may fail to meet the criteria.
Products proposed for further investigation
We are proposing three products to be fully investigated to see if a mandatory product stewardship scheme is warranted – agricultural chemicals, used oil and refrigerant gases. In line with the proposed revised targets for the New Zealand Waste Strategy, this initial list focuses on products that cause environmental harm when they are disposed of. The proposed products are discussed below.
Agricultural chemicals include pesticides, herbicides, veterinary medicines, farm cleaning products, plant growth regulators and other chemicals. Some of these chemicals are intractable and can only be destroyed by high temperature incineration. Where these agricultural chemicals are not collected, treated and disposed of correctly, there is a high risk of environmental harm.
Since 2003, the Ministry, in partnership with regional councils, has funded the disposal of legacy (old and unwanted) agricultural chemicals through the management of the ‘Agrichemical Disposal Programme’. This programme ends in June 2009.
In addition, there is currently a voluntary product stewardship scheme for collecting used agricultural chemical containers. This scheme only recovers containers from participating suppliers.
Proposal for managing agricultural chemicals
In the short term, the Ministry is supporting the development of a voluntary product stewardship scheme for agricultural chemicals, in partnership with industry and regional councils. This is expected to be launched in mid-2009 when the current disposal scheme ends. A key issue in the success of this new scheme will be ensuring that all of the agricultural chemical industry participates.
If full participation does not happen, a mandatory scheme may be required. In that case, agricultural chemicals would be declared a priority product and other supporting regulations may also be needed.
The proposed voluntary scheme will not specifically address the issue of legacy or orphan
(ie, obsolete or unbranded) agricultural chemicals. However, it will provide the framework within which a solution for legacy and orphan agricultural chemicals can be developed.
Effect of the proposal
An effective nationwide product stewardship scheme for the safe collection and disposal of unwanted and unused agricultural chemicals will reduce the potential for environmental harm from these products.
It is estimated that 33–40 million litres of used lubricating oil are generated each year (MfE, 2007a). During use, oil becomes contaminated with substances that are hazardous to human health and the environment, including heavy metals and polycyclic aromatic hydrocarbons. Some of these contaminants are potential carcinogens. Good management of used oil is required to prevent harm to people, the environment and the economy.
Used lubricating oil can be refined for reuse or used as a fuel source in high-temperature industrial processes. International best practice encourages these two options. Used oil is also used as a fuel source in low-temperature burners and heaters, or sprayed on roads to reduce dust. There are environmental problems with these two uses, in particular harmful air emissions.
A producer-based used oil recovery programme involving Holcim, oil collectors and major oil companies, has been in place for some years. This voluntary programme collects an estimated 13 million litres of used oil a year for use as a fuel substitute for Holcim’s cement kiln in Westport. Consented facilities, asphalt plants, lime kilns and other industrial plants use another 6.4 million litres. It is estimated that another 8 million litres of used oil is collected and used in small low temperature burners (which often do not require a resource consent) and as a dust suppressant on some roads. Some 7 million litres are not able to be accounted for.
Proposal for managing used oil
A product stewardship scheme would ensure that all used oil is managed and directed to high value uses with minimum harm to the environment. These uses could be as fuel (similar to the Holcim scheme) or involve processing of the used oil to produce new lubricating oils. To be effective, the scheme must have good coverage of New Zealand and recover a high percentage of used oil. If the current voluntary schemes cannot achieve this, a declaration of used oil as a priority product, or other regulation, may be needed.
Effect of the proposal
More comprehensive product stewardship would reduce poor handling and disposal practices, and the risks that these pose to people and the environment. It would also reduce potentially harmful air emissions from low temperature combustion of used oil.
Refrigerant gases are used in the cooling systems of refrigerators and freezers. While large volumes are used in commercial and industrial units they are also used in household appliances. The gases are not consumed during their use. They are either lost to the atmosphere through leaks or accidental release, or collected for reuse or destruction.
There are penalties (under the Ozone Layer Protection Act 1996) for releasing ozone-depleting refrigerants, and a system of licenses controls who can import ozone-depleting refrigerants. Refrigerants are currently collected by the Ozone Protection Company1 and exported to Australia for destruction. This is funded through a voluntary $1 per kilogram levy on imports of ozone-depleting refrigerants. New Zealand has also committed to phasing out the importation of these types of refrigerants. The current scheme has worked well because of regulatory controls on the release of ozone-depleting substances. These regulatory controls do not exist for other refrigerant gases.
Other refrigerant gases, including many that are greenhouse gases, are not covered by the current rules.
Proposal for managing refrigerant gases
For the collection scheme to continue with other refrigerant gases, the Ozone Protection Company recommend that a levy be applied to all fluorine-based refrigerants which would cover the costs of the collection and safe destruction of these chemicals. Funding could also be used for training refrigeration engineers. This may require declaration of refrigerant gases as a priority product to ensure full coverage and/or other regulation to impose a levy.
Effect of the proposal
The proposals would ensure the collection and disposal of all refrigerant gases of concern.
Several other products were assessed, and are listed below. While they have not been selected for the initial investigation for mandatory product stewardship schemes, voluntary schemes may be developed. The Ministry will monitor the effectiveness of any voluntary scheme for the first two-to-three years of its operation and assess whether further action is required.
Computers, computer accessories and televisions: The potential harm of these products is less than the products selected for investigation as priority products. Voluntary initiatives provide annual drop-off events for waste computers. The Ministry is undertaking further research to help determine whether further action is required.
Packaging: There is a proposal for industry to develop a further voluntary product stewardship scheme once the current Packaging Accord finishes in mid-2009. The Ministry will monitor this and, if it is effective, no further action will be taken.
Mercury-containing lamps: Immediate action is not warranted because, based on information currently available, the volume and potential harm of these products is considerably less than the three products selected as priorities. The Ministry is undertaking further research to help determine whether further action is required.
Lead acid batteries: Most of New Zealand’s lead acid batteries are currently being recovered and recycled. We will monitor this voluntary initiative and, if it is effective, no further action will be required.
Mobile phones: Voluntary initiatives are in place to recover and recycle mobile phones. Industry is being encouraged to develop and seek accreditation for a voluntary product stewardship scheme. We will monitor this to see if any further action is required.
- Paint: Voluntary initiatives are in place throughout New Zealand, although not all paint companies participate. We will encourage all companies to participate, or set up their own schemes and apply for accreditation. We will monitor to see whether any further action is required.
Plasterboard: Industry is working to develop a voluntary product stewardship scheme. We will monitor this to see whether any further action is required.
Tyres: A voluntary tracking scheme (TyreTrack) has been developed, covering the collection and disposal of around 25 per cent of discarded tyres. We will monitor this to see whether any further action is required. Tyres were not selected for investigation as a priority product because the potential harm is less than the other products selected.
Questions for Part 2
Use the following questions to guide your feedback on identifying products that are priorities for product stewardship. You do not have to answer every question. Please list any feedback on specific products separately.
Which products do you think should be the highest priority for a mandatory product stewardship scheme? These may already be one of the products we have identified, or they may be other products that you think we should consider.
- For each product you identify:
- What do you think is the problem?
- What is the volume of waste from the product?
- What is the nature of the harm associated with the product?
- Where in the life cycle of the product is harm occurring (eg, manufacture, use, disposal)?
- What should we be trying to achieve in managing this waste?
- Why are existing waste management tools not adequate to deal with these problems?
- Are there alternatives to product stewardship? Would they work?
- What targets (for reduction, reuse, recycling, recovery, treatment or disposal) need to be set to guide management efforts?
- Are regulations required to effectively manage the product? Why or why not?
- Who would be affected by a new product stewardship regime for this product, and to what extent?
- Who would need to be involved in designing and running any product stewardship scheme?
- Costs and benefits:
- What would be the types of costs and benefits of developing and operating the desired product stewardship activity? Do you have any information on the magnitude of any costs and benefits?
- Who should bear the costs of establishing a scheme?
- What would be the barriers to implementing new measures for this waste?
Is there anything else we need to consider?
Note that the responses will help assess which products may be candidates for product stewardship. Before any declaration of priority products under the Act or other regulation occurs there will be a further consultation round and a regulatory impact statement will be prepared.