ENVI makes sweeping changes to Packaging and Packaging Waste Regulation proposals

LONDON (ICIS)–The European Parliament’s Committee on Environment (ENVI) has voted on initial amendments to the draft Packaging and Packaging Waste Regulation (PPWR), potentially ushering in sweeping changes.

These include:

• Bio-based virgin plastics acceptable in recycling targets
• Regulated value chain
• Harsh penalties
• Requirements for separate collection systems at member state level
• Banning intentionally added bisphenol A (BPA)
• Redefining meaning of “composite packaging”
• Potential loopholes for recycling targets in 2030, 2040
• Major investments in infrastructure required
• Ambiguity around chemical recycling

The vote took place on 24 October, with a wider vote among EU legislators set to take place later in November, before the regulation is adopted or signed into law.

Below are some of the key takeaways from the amendments and what they could mean for the industry.

BIO-BASED VIRGIN PLASTICS ACCEPTABLE IN RECYCLING TARGETS
One of the most significant amendments, if the legislation is adopted in its current form, would be the acceptance of bio-based plastics as counting towards up to 50% of mandated recycled content targets in packaging, in effect significantly diluting the targets.

New text published relating to Article 7 on bio-based plastics introduces “the possibility to meet up to a maximum 50% of the targets set out in Article 7(1) and (2) by using bio-based plastic feedstock”.

The Commission will publish a report assessing the possibility of laying down targets for the use of bio-based plastics by 31 December 2025.

REGULATED VALUE CHAIN
ENVI appears to be asking for regulated pricing as part of the development of recycling capacities as part of a regulated value chain that would also include quality checks, quality assurance, certification and logistics. What this means for the market and the pricing of recycled materials is open for debate, but could be a big shift compared with current pricing mechanisms.

HARSH PENALTIES
Article 62 empowers member states to set out rules on penalties for themselves if they fail to comply with the new regulation requirements. These include:

• Deprive those responsible of the economic benefits derived from their infringements, and gradually increase such fines for repeated infringements
• Confiscation of revenues gained by the manufacturer, producer, supplier, distributor, importer, authorised representatives, or appointed representatives for extended producer responsibility from a transaction with the relevant products concerned
• Temporary exclusion for a maximum of 12 months from public procurement processes and from access to public funding, including tendering procedures, grants and concessions
• Temporary prohibition from placing or making available on the market, or exporting relevant products, in the event of a serious infringement or of repeated infringements

These penalties would come into effect 24 months after the regulation is put into force and could have significant impacts on anyone they are imposed upon.

SEPARATE COLLECTION SYSTEMS
By January 2029, all member states will need to ensure there are sufficient separate collection systems for different fractions of packaging waste materials, which is likely to require a huge amount of investment.

For example, this may require separate bins for polyethylene terephthalate (PET) bottles, other plastics, glass, cardboard and paper, metals, general waste, which could see a huge change for some member states compared with their current collection set-up.

Coupled with this, the amendments also remove the previously proposed exemptions from separate waste collection systems where it does not conflict with the recyclability of a product. The proposed Article 43 paragraph 3 (b), which has now been deleted by ENVI, stated that:

“By way of derogation from the separate waste collection obligation in paragraph 3, certain types of packaging waste may be collected together where such collection does not affect their potential to undergo recycling operations and results in output from those operations which is of comparable quality to that achieved through separate collection.”

BANNING INTENTIONALLY ADDED BISPHENOL A (BPA)
Food contact packaging with intentionally added BPA will be banned from being placed on the market 18 months after the date the regulation enters into force, along with intentionally added  per- and polyfluorinated alkyl substances (PFASs). This could have an impact on European demand for BPA.

COMPOSITE PACKAGING
The amendments change the definition of “composite packaging”, adding exemptions for coatings, linings, paints, inks, adhesives, and lacquers to the existing exemptions for labels, caps and closures.

This is significant because paper, cardboard and aluminium can producers often use plastic linings as a barrier material, and this would appear to exempt them from recyclability requirements and could incentivise the shift to alternative materials to plastic, which in some cases may arguably have a higher overall environmental impact.

LOOPHOLE FOR 2030 TARGETS
An amendment to Article 7 paragraph 1 – which sets out recycling targets for 2030 – introduces an exemption where the inclusion of recycled content “results in non-compliance with food safety requirements laid down at Union level”.

This could present a loophole in hitting those targets if packaging producers or brands claim they are unable to find sufficient food-safety compliant material in the market – a particular challenge for plastics such as polyethylene (PE) and polypropylene (PP).

The European Food Safety Authority (EFSA) states that, to gain a positive opinion, recycled material must originate from 95% food-contact packaging.

For other polymers where end-use sources are varied and typically collected in a single input stream, it is an significant challenge and barrier to market growth.

The only currently available source of post-consumer food-grade recycled polyolefins is limited to the UK recycled high-density polyethylene (R-HDPE) market, where used milk bottles create a separable and easily identifiable source of input material. In the majority of the rest of Europe, milk bottles are manufactured from PET.

There is also some food-grade mechanically recycled polyolefins currently available from post-industrial secondary packaging sources from the meat and agriculture sector, but volumes remain minimal and there is a limited ability to scale up. The PPWR’s proposed introduction of separate collection may help meet this requirement.

Nevertheless, the EU’s recently adopted food-contact legislation mandates the use of “suitable technologies” for recycling waste, which currently only include mechanical PET recycling and chemically uncontaminated closed-loop recycling “not collected in mixed form, and/or from consumers”, and reused in the same type of product they have originated from.

INFRASTRUCTURE BUILD
Several elements of the amendments would require a significant investment in infrastructure across member states to meet the targets.

For example, Article 43, paragraph 5 has been removed, which had previously allowed for “certain types of packaging waste to be collected together” – meaning that combined collection of packaging waste is no longer allowed and separate collection for different types of waste must be put into place.

For packaging waste that is not separately collected, a new addition in the form of paragraph 5a puts the emphasis on member states to ensure that packaging waste not separately collected is sorted prior to disposal to remove packaging designed for recycling. This, again, could require huge investments in infrastructure for certain countries.

EXPORTS
Exports of packaging waste out of the EU may become more challenging as they will only be calculated for the member state they were collected in if the exporter can “prove that the shipment of waste complies with the requirements of this Regulation and that the recycling of packaging waste outside the Union took place under conditions that are broadly equivalent to those prescribed by the relevant Union legislation”.

AMBIGUITY AROUND CHEMICAL RECYCLING
The initial draft of the PPWR had appeared to clarify the legal status of pyrolysis oil – which has been left ambiguous under existing definitions of recycling – as counting towards the targets set out in the legislation. The amendments introduced by ENVI, though, roll this back.

The initial draft stated: “The amount of packaging waste materials that have ceased to be waste as a result of a preparatory operation before being reprocessed may be counted as recycled provided that such materials are destined for subsequent reprocessing into products, materials or substances to be used for the original or other purposes.”

The ENVI amendments change this to: “The amount of packaging waste materials that have ceased to be waste as a result of a recovery operation by which waste materials are reprocessed into products, materials or substances either for the original or other purposes may be counted as recycled.”

Under both wordings, end-of-waste materials to be used as fuels are not included, and the amendments add an exclusion for other means of energy generation. However, under the amended version it is unclear whether pyrolysis oil would count – because pyrolysis oil can be used as a fuel – reintroducing the same ambiguity that exists in the wording of Directive 2008/98/EC, which forms the basis of most definitions of recycling in EU legislation.

Also, unfavourably for chemical recycling, it introduces the following text signalling a thawing among EU legislators in their view of chemical recycling:

“While it is important for the Commission to take into account all processing technologies when drafting the delegated acts establishing the recyclability criteria, as well as the criteria for recyclability at scale, it is essential that the Commission further assess the added value of chemical recycling for those fractions that cannot be processed by mechanical recycling technologies.

“In the context of the objectives that have been set by Regulation (EU) 2021/1119, the Commission should take into account the energy consumption of new technologies, water consumption, material losses and, in the context of the revision of the Union legislative framework on environmental claims, avoid misleading environmental claims, by limiting these applications to a truly circular approach, excluding, for example, approaches to converting materials into fuel.”

The legislation has not yet been introduced into law, and the November vote could see further amendments before any final version is adopted.

Additional reporting by Mark Victory