Three groups of charging for packaging waste in overview
- Are product-linked waste fees a more efficient way to
reduce waste? – Essay based of experiences of the German
′Duales System′ (Green Dot)

by: Michael A. Braun

When consumers buy vegetables on a street market things are normally wrapped in some newspapers. But if they are bought instead from a supermarket next door they are at least covered by some plastic packaging. No wonder people think things are over packaged. (Lascelles, 1996) This essay is going to outline these issues. After a general introduction it focuses on three groups (pre-paid, traditional and innovative)¹ of charging for (mainly packaging) waste that include collection and processing. There will be an evaluation of implications that come up with each method as well. But the emphasis of the essay is on product-linked charging where, as an example, the German Duales System with its Green Dot, is presented more in depth. This method is widely seen as helpful for the environment because it caused both significant reductions of the quantities but also innovations within the manufacturing and packaging sector as well. Therefore product-linked charging might be seen as an efficient way to less waste. For further reading and a clear structure of the essay a short view on references and appendixes in the end is recommended.

Talking about packaging waste (plastics, glass, papers, metals, …) society is facing a tricky problem. (Tietenberg, 1998) Because it is not clear whether this kind of waste is useless or useful in the end of the day. In other words whether it is an economic good or bad. Of course packaging waste can be seen as positive. It keeps diverse goods clean and safe, so they are ready for transport and sale. After having done its task packaging can be a huge generator of new raw materials within the recycling process. Therefore it is necessary to collect, sort and process it. And this task needs a lot of employees and opens up new markets with all supporting industries. In this line of argument, waste coming from packaging can try to solve its own market failure. (Bastian, 2001) On the other hand waste always has something negative on it. Pollution costs that are not included in its price are hard to manage and expensive for society. Also the use and finiteness of resources has to be taken into account as well as problems coming up with scare disposal capacities. For these reasons politics try to come to a reduction of packaging quantity. By giving incentives both customers and producers are forced to change their behaviour significantly. One should act in a more innovative way that saves money in the long-run. And the other one should have a stronger look for products that are more environmental friendly.

Because it is not clear which side weights more, politics do have a massive problem to deal with. Of course sustainability and environmental factors have to be taken into account2 but on the other side this market failure generates problems to consumers and manufacturers or generally spoken the society. Question is how to act with a good in the end that does neither have a real use nor a scarceness as well. And, if there is none who wants to benefit from it, who is responsible for it? Who takes care about all consequences coming up – consumers, enterprises or society? This essay is not going to solve such questions but tries to give a general idea about different ways of charging for packaging waste. Therefore it seems to be necessary to have a better understanding about the topic first.

According to Bates & Phillips (1998; B&P) or Tietenberg (1998; the three ‘R’) waste management could be divided into a clear hierarchy. The priority (1) always should lay on reduction of the quantity of waste at source. Then (2) follows the reuse of materials and objects. This means putting them back so they do not enter the waste stream at all. Later (3) recovery of value or energy from waste materials is recommended. Only as a last option (4) disposal (landfill or incineration) can be seen as an option. But nowadays incineration is not very unpopular; the method is linked to health problems and does hardly improve society’s environmental responsibility. And traditionally, a lot of the waste quantities have been land filled. However, this procedure is getting more and more expensive for several reasons. On one hand, landfill capacities are closed for environmental reasons and on the other hand, the left capacities are becoming seriously scarce. Further on current legislation all over Europe forces the waste management process outlined above in terms of the given hierarchy. Legal obligations such as landfill taxes are introduced and will become probably much more relevant in future as well. One of their aims is always to reduce the final quantity of waste for disposal and to increase recycling and reuse rates significantly. Because it is mostly believed that waste reduction and recycling are the only sustainable solutions, they also should encourage a waste minimisation in general. (McGurty, 1994) Therefore enterprises, households and public institutions should try to reduce their quantities on the long-run. For enterprises it can be assumed that a clear environmental management strategy can cause high financial savings as well as it gives a environmental friendly image in customers view.

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1 There is a range of different points of view. This grouping is not widely agreed. Moreover, it is a very individual idea of an solution.