Harmonising rules, Green Deal funds & innovation needed to boost EU circular economy

With the European Commission presenting its EU Circular Economy Action Plan in March 2020, stakes have never been higher to strengthen a continent-wide circular plastics economy, including for non-food packaging.

As part of this action plan, the review of the Packaging and Packaging Waste Directive (PPWD) is now on the table and, among other efforts, it will aim to ensure a well-functioning market for secondary raw materials and reaching compliance with the recycling targets for packaging.

Against this backdrop, Henkel and FIPRA hosted an interactive session in the presence of industry leaders and Brussels policy experts on how to boost the contribution of the circular plastics economy to these ecological efforts.

The main goal of the webinar was to explore the policy and practicalities of the existing proposals in this context, while identifying a common position and next steps for the European industry.

Anna Cavazzini, the Chair of the Internal Market and Consumer Protection (IMCO) Committee of the European Parliament, emphasized the increasing presence of circular economy debates within public discussions.

“I believe that the circular economy is really the main pillar of the Green Deal,” she said, adding, “If you want to tackle resource use, overconsumption and the climate crisis, we need to make sure that our economy comes more circular. I believe there’s not only a huge environmental impact but also economic advantages if European companies are forerunners in the circular economy. At the European Parliament, we’re discussing this matter in great detail.”

Discussions were framed by a recent Center for European Policy (CEP) study which included concrete policy recommendations. Participants were able to build upon ideas in the study together with Dr. Götz Reichert (Head of Department, Center for European Policy), Maja Desgrées du Loû (Policy Officer for Packaging and Packaging Waste Directive, European Commission) and Thomas Mueller-Kirschbaum (Corporate Senior Vice President, Innovation & Sustainability, Henkel).

Close attention was paid to the needs of the EU Single Market regarding packaging, the potential of chemical recycling, the role of digitalization, and EPR schemes in order to push the circular economy forward.

Dr. Götz Reichert, who presented the CEP study, stressed the importance of quality, recyclable materials within the European internal market as the foundation for a circular economy.

“The availability of high-quality plastic recyclates is essential for a circular economy for plastic packaging to work. An EU-wide internal market for plastic packaging lays down the conditions for the free cross-border movement of goods that could promote the economy of scales and cost efficiency, set incentives for market actors, and promotes supply and demand for plastic recyclates.”

Dr. Jan S. Voßwinkel, a scientific advisor with CEP, added that we should have more trust in the strengths of the EU internal market and further harmonize incentives on EPR schemes and fees, for example.

“We don’t really have an internal market for recyclates, but we have many small markets, and member states have different regulations. We should try to overcome this fragmentation,” added Dr. Voßwinkel, who is also a professor at the Faculty of Agriculture, Economics and Management at the Nürtingen-Geislingen University of Economics and Environment (HfWU).

He proposed solutions such as a common set of criteria for waste in the internal market. “We could add new standards for non-food packaging, so that we can ensure that we have a common understanding within the EU of what criteria a plastic bottle has to meet, for instance.”

FIPRA Chairman Robert Madelin, who moderated the panel, said: “What would be useful is to establish a common forum where Member States could consult with each other before they set EPR guidelines. It wouldn’t need to be legislated and would redefine the Commission’s upcoming proposal, especially in regard to the Packaging and Packaging Waste Directive.”

Maja Desgrées du Loû welcomed the policy proposals outlined by the study and the suggestions for such a forum to be established.

She noted that within the PPWD revision, adopting a definition of recyclability was one of the Commission’s main objectives but noted the challenging nature of this endeavour: “We want to make the definition of ‘recyclability’ as operational and harmonized as possible. We know that rapid innovation is happening both in recycling and in packaging materials. Discussions are ongoing on how to make it work without hindering innovation.”

Highlighting how dynamic, circular economic policy could ideally function and where companies like Henkel could contribute, Mueller-Kirschbaum said: “Smart technologies with smart regulation, complemented by Green Deal funding to boost circularity, can result in a faster pace for the transformations that are needed. If implemented successfully, companies such as Henkel will be able to deliver the strong commitments set by the year 2025 and 2050.”

On chemical recycling, for example, Mueller-Kirschbaum said that the fast-moving consumer good industry could not make the right pull towards scaling up technologies if there was neither clarity nor a good framework. “It is the typical hen-egg problem,” he said.

Madelin complemented these views, pointing out that “we need to ensure that in other parts of the legislative forest, whether it’s REACH restrictions or the definitions of single-use plastics, we don’t prohibit innovation pathways which can be crucial to the low-carbon recycling economy we’re trying to build.”

In a video intervention, Susanne Zänker, Director General, AISE International Association for Soaps, Detergents and Maintenance Products, called on the Commission to employ the revenues collected from the new Plastics Tax to contribute to create a real circular plastic economy, real single market of secondary raw materials within the EU.

The revision of PPWD is currently going through a consultation process with stakeholders. The draft final report is expected in April 2021 and the Commission legislative proposal will be adopted in Q4 2021.

The rest of the Circular Economy Action Plan-related initiatives will be released throughout 2021 and 2022. Once the initiatives contained in the plan are launched, it will create both incentives and uncertainties for business models in the EU.

It is imperative for such discussions with experts from industry, academia and politicians to exchange ideas and chart a common course for the future of Europe. It was our objective to use the CEP study as an informative baseline on which discussions – with different stakeholders – could take place.

Public consultation about the EU’s efforts to reduce packaging waste can be found here.