Scotland launches UK's first deposit scheme on drink containers to boost recycling

Author: Matt Tudball

2020/11/04

LONDON (ICIS)--Scotland will introduce the UK’s first deposit return scheme (DRS) which will see a 20 pence (p) fee added to single-use drinks containers in the country from 1 July 2022.

The aim of the DRS scheme is to incentivise and increase recycling among consumers by putting a value on single-use items, and will be the first DRS scheme to be rolled out in the UK.

The 2009 Scottish Climate Change Act provided for the setting up of the DRS scheme, which is aimed at helping the country reach its targets of increasing recycling rates to 70% by 2025 as laid out in the 2010 Scottish Zero Waste plan, and the 2023 target of 70% collection rate for in-scope materials in the scheme.

WHAT IS COVERED
Speaking at a virtual seminar hosted by waste management company Veolia, Stephen Freeland, a Policy Advisor for trade body Scottish Environmental Services Association, which represents the waste and recycling industry, said the scheme has gone for an all-in approach.

Thus, it would include all drinks containers of all sizes and types – PET plastics, glass and aluminium.

However, it will not include high density polyethylene (HDPE), which is used to produce milk bottles in the UK, due to concerns around hygiene.

IMPLEMENTATION
A Scheme Administrator is expected to be appointed in January 2021.

The administrator will be responsible for the application and approval for members wishing to join the scheme, arranging collection from the 3,000+ RVMs and 14,000+ manual return points across Scotland, and ensuring the consumer gets their 20p refund per returned container.

The administrator is expected to be made up of a consortium of the British Beer and Pub Association, British Soft Drinks Association, and the Natural Water Resources Association.

SECTORS INCLUDED
The scheme will cover the hospitality, retail and online sectors, with the retail sector seeing the largest impact of the scheme, according to Mark Sweeting, Product Development Manager for Veolia.

All in-scope material will display a Scottish DRS logo on it, which has two functions: to allow the customer to see that the container is part of the DRS scheme so therefore has had a 20p fee added to the retail price which the consumer can claim when returned.

Another function is  to allow the RVMs and manual collection points to identify the bottle as part of the scheme.

For retailers, such as convenience stores, off-licences and supermarkets, all in-scope material sold from 1 July 2022 will have the 20p fee added to the retail price, and will be labelled to show it is part of the DRS scheme.

Retailers must also ensure clear advertising around the scheme, the fee and returns process, as well as clear instructions on how customers can make any formal complaints about the scheme.

For the hospitality sector they are not obliged to add DRS to in-scope material, or act as a return point if they materials are not intended for off-site consumption.

However, if there are materials that are allowed to be taken off site, then they will encompass having a deposit added to it and the potential to be a return point for customer, Sweeting said.

For online retailers with a delivery service, they are obliged to offer a free of charge collection service for in-scope material delivered to customers. In-scope material would have the 20p fee added to it, which would be refunded to the consumer at the time of collection.

However, it is expected that the majority of consumers will not take advantage of this service, and prefer to return the in-scope material to their nearest RVM or return point in person.

HOW THE FEE WILL APPLY
The whole scheme is designed to be cost neutral, with the fee passing along the chain in a constantly moving circle, according to Sweeting.

The producer adds the 20p fee to the wholesalers, who passes it to the retailer, who in turn passes it on to the consumer.

The consumer is reimbursed by the retailer when they return the in-scope material, either with physical money, or in-store credit.

The retailer, in turn, is reimbursed by the Scheme Administrator once it has collected and ratified the returned material against a report kept by the retailer.

The Administrator then gets reimbursed by the producer, and the loop starts again.

The timeline for the reimbursement of the retailer by the Administrator is yet to be defined, but is expected to be within a working week, Freeland said.

Retailers have to accept all in-scope material returned to them, regardless of whether it was purchased from its own store.

CLARIFICATION NEEDED
There are still some aspects of the scheme still being defined, with more clarity expected upon the appointment of the Scheme Administrator, who will be the first point of contact for most questions.

However, some issues were highlighted as still needing further clarification.

- Pandemic impact: As a result of the ongoing coronavirus health crisis, it is likely that cost data, assumptions and the size and shape of the retail sector over the next two years in Scotland will need to be revisited, Freeland said.

- Impact on retailer: Smaller retailers in particular will need to work with the Administrator to decide if they have space for a RVM in their store, and its impact on areas such as safety, hygiene and movement around the store.

Staff will also need to be fully trained on all aspect of the scheme, from the adding of the 20p fee to the product, through to the returns process and handling any complaints from the consumer.

- Avoiding fraud: With Scotland implementing DRS before other UK nations, there is a concern that some may and return bottles that are not part of the scheme.

However, the DRS label that will be on all in-scope material will help the RVMs refund only the containers that are part of the scheme. Manual return points will have to be more vigilant, though, and check for the logo on each returned container.

Retailers will also need to consider where they store returns ahead of collection by the Administrator to ensure they cannot be stolen.

Front page picture: Return machine in Germany, archive image; deposit schemes are common in northern Europe 
Picture source: Walter G Allgower/Imagebroker/Shutterstock

Focus article by Matt Tudball

Click here to see regulatory targets and a list of chemical and mechanical recyclers on the ICIS Circular Economy topic page.