Alberta, Canada
Model Beverage Container
Recycling System

By Jeff Linton
Executive Director, Alberta Bottle Deposit Association
Phone: 780-975-4736 Fax: 780-962-5227

Updated January 7, 2002

OVERVIEW
Alberta's Environmental Protection and Enhancement Act contains the Beverage Container Recycling Regulation. This regulation establishes and empowers a Delegated Administrative Organization, which is mandated to oversee the registration of all beverage containers (except milk) that contain a ready-to-serve drink and a deposit-refund program for the collection and recycling of all beverage containers sold in the province.

The Delegated Administrative Organization is called the Beverage Container Management Board (BCMB) and is comprised of 12 seats, 4 for each of three sectors: public, manufacturers, and depots. Through bylaws the Board is charged with a broad range of functions governing the system and its stakeholders relative to container recovery. The BCMB is funded through a levy on every container recovered, equally split between the manufacturer and the depot. The BCMB is required to submit a business plan annually to the Minister responsible and the regulation is reviewed once every 5 years.

The recovery of containers is effected through a province-wide network of 214 depots who reimburse the consumer the full deposit and prepare the containers for processing by material stream (there is at present no return to retail in this program). A common agent for all manufacturers facilitates the collection, processing and marketing of these used containers. All containers must be either refilled or recycled.

IMPORTANT LINKS
Legislation: Beverage Container Recycling Regulation (AR 128/93)
Overview | Text

KEY BENEFITS
Alberta's Redemption program offers legislators a comprehensive program including all container types, manufacturers a level playing field, and consumers a convenient and efficient means to deposit refund.

Deposit legislation is opposed by retail because they end up being the one to subsidize the program. In Alberta there is no cross-subsidy period. Not between material types and not between manufacturers.

Manufacturers oppose deposit legislation because of competitive advantages and disadvantages, not because of cost or stewardship. Alberta's program allows autonomy and privacy among manufacturers and treats each container equally on the basis of material type.

Deposit legislation using redemption centres becomes an economic instrument creating employment and small business investment. And in a franchising model actually maximizes efficiency and minimizes taxpayer's cost by allowing industry to manage itself.

GOALS

• container recovery rate of 85% within 2 years
• no cross subsidization between materials
• continuous improvement of efficiency

RESPONSIBILITIES
The Manufacturers are responsible for appointing an agency to act as their Common Collection Agent (CCA). The CCA is approved by the BCMB and is responsible for collection of materials from depots, processing, marketing and administration of the cashflow of the system.

Industry stakeholders are required to appoint members for representation on the BCMB and the BCMB appoints public sector representation with the exception of one seat assigned by the Minister of the Environment. The BCMB staff permits depots and monitors the entire system from the retail point through to the dispensation of scrap materials to market.

Depots are the only point of entry for empty containers and are required to pay full deposit on all regulated beverage containers. Depot permits are awarded for 5 years and include a comprehensive set of operating standards, which include minimum operating hours, lighting, customer service space, and parking.

BEVERAGE CONTAINERS TARGETED
All beverages except milk
All containers including paper, aluminum, glass, bi-metal, aseptic and other composites

FLOW OF FUNDS
All Manufacturers are covered by the regulation and the program is entirely industry-funded. Unredeemed deposits and scrap material value are offset by handling commissions to depots, transportation, processing and administration. The equation is balanced on a variable basis by the ecology charge added to the deposit submitted by the Brand-owner bi-weekly along with the reporting of sales into the province.

Containers sized 1 litre or less carry a $0.05 deposit, over 1 litre $0.20, and all beer containers have a $0.10 deposit.

Depots pay full deposit on all regulated beverage containers, prepare for shipping to CCA, and are reimbursed the deposit plus a handling commission specific to each material stream. Municipalities or their contractors must return refundable containers to an authorized depot to receive refunds (there are no payments to municipalities based on estimates of containers recycled in curbside or drop-off programs).

The ecology charge is established quarterly and are charged by container type and size to reflect the shortfall between revenues and expenses for managing each particular material stream. To date all beverage sectors have chosen to internalize these charges within the price of the product, rather than require retailers to separately disclose this portion of the product price.

RESULTS
Alberta has had a deposit/return program since the Litter Control Act was introduced in 1972. At that time domestic brewers were afforded an exemption from this regulation due to the fact that they only distributed in a refillable bottle and had a pre-existing deposit program in place for their container. Since then this exemption has been removed (November 2001) and the system has continuously expanded to included juice (September 1997) and non-carbonated beverages as well. The exemption for dairy products still remains but that industry has been charged with a mandate to achieve increasing levels of recovery for all container types sold in the province or loose the opportunity to continue to operate under an agreement with the government.

Return rates have declined over the past several years in the mainstream categories as well as containers introduced in 1997, which struggle with below average return rates in all categories.

The aluminum pop can accounts for 1/3 of all containers returned in Alberta and achieved a return rate of 83% in 2000 with all 5 cent deposit containers (51% of all returns) averaging 76%. Over 1 litre PET container dropped to 91% recovery in 2000. The overall return rate for 2001 is expected to dip to just under 80%.

While the return rate struggles the cost per container to run the system continues to improve. On average the net cost after scrap value and unredeemed deposits was eight-tenths of one penny in 2000 for every container recovered (6/10's of 1 cent per container sold) and with return rates dropping 2% points for 2001 this figure could approach zero based on sales for that same year. With lower return rates there is more unredeemed deposit to pay down the average cost of the system. The cost to introduce an aluminum pop can into Alberta is already at zero because the scrap value plus unredeemed deposits from an 80% return rate cover all costs associated with running the beverage container return system in the province of Alberta. This is not a strong reason to encourage dropping return rates but is a strong incentive to introduce legislation at a lower deposit and increase it when and if able.

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