New Jersey passes recycled content legislation

HOUSTON (ICIS)–Senate Bill 2515, which includes several post-consumer recycled (PCR) content mandates, was passed in the New Jersey state Senate and Assembly this Monday. It is now headed to Governor Phil Murphy’s office to be signed into law.

This bill primary focuses on plastics, requiring producers to incorporate up to 50% PCR content in rigid plastic containers and up to 40% PCR content in some plastic bags over a period of several years.

PCR content calculations would be enforced as an average across all eligible products sold into New Jersey by each manufacturer.

There are several exemptions to these requirements, such as beverage containers that are refillable, milk and infant formula beverage containers and plastic trash bags designed to hold, store, or transport hazardous waste or medical waste to name a few. Rigid plastic food containers would be exempt from complying for the first five years.

The bill also bans expanded polystyrene loose fill, such as packaging peanuts, and places PCR content requirements on both glass containers and paper carryout bags.

Following California’s Assembly Bill 793 and Washington’s Senate Bill 5022, this is the third PCR content mandate legislation to pass in the United States. The bill originally passed the Senate last June, but was amended in the Assembly and thus required another senate vote.

In a recent panel discussion hosted by the Northeast Recycling Council and the Northeast Waste Management Officials Association, David Allaway, senior policy analyst at the Oregon Department of Environmental Quality Materials Management Program, discussed some of the limitations of PCR legislation.

In his remarks, Allaway noted that PCR content laws may not necessarily boost local recycling supply, particularly in small states such as New Jersey, because impacted manufacturers may operate globally. Moreover, PCR content laws with a focus on beverage and food containers could disrupt open-loop recycling options which may be more environmentally beneficial than closed loop pathways.

Proponents of PCR laws cite that regulated content requirements will increase recycled plastic market demand, and thus incentivise improved plastic waste collection infrastructure from the private or public sector.

Last year, recycled plastics markets saw record high prices due to strong demand from fast moving consumer goods companies trying to meet their own PCR targets. Under this pressure, low recycling rates in the US has become a concern.

At these high prices, some producers may opt to pay the penalty for missing PCR targets, which the New Jersey Department of Environmental Protection (DEP) would assess on a per-pound basis for each pound of virgin material that is used where recycled material is required.

In accordance with the law, the DEP also has the authority to modify the targets, depending on several factors such as current market conditions, recycling rates or infrastructure and progress made by manufacturers.

Moreover, individual manufacturers can apply for waivers based on several situations, including if the manufacturer cannot comply due to inadequate availability of recycled material or a substantial disruption in the supply of recycled material.

ICIS is currently prototyping a US R-PET price report, covering premium and curbside post-consumer bales for both East Coast and West Coast, bottle-derived and post-industrial hot-washed flakes, and food-grade pellets. To find out more about the new report, or to receive a copy of the prototype, please contact Emily Friedman at emily.friedman@icis.com.