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.
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.
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.
FLOW OF FUNDS
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.
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.