British Columbia, Canada
Model Beverage Container
Recycling System

By Helen Spiegelman
Society Promoting Environmental Conservation, Vancouver, BC
Phone: 604-731-8464

Updated October 11, 2001

TITLE
Beverage Container Stewardship Program

OVERVIEW
The regulation establishes a deposit-refund regime within which BEVERAGE BRAND-OWNERS are given control over the design and management of the recycling system while giving GOVERNMENT the role of setting environmental performance standards, monitoring results, and making corrective changes in the event the performance standards are not met. The program is part of British Columbia's Industry Product Stewardship management system for product and packaging discards. For an overview of Industry Product Stewardship in BC see: http://www.elp.gov.bc.ca/epd/epdpa/ips/index.html [off-site]

IMPORTANT LINKS
Legislation:
Beverage Container Stewardship Program Regulation [off-site]
(Waste Management Act)

Government Overview [off-site]

GOALS

• container recovery rate of 85% within 2 years
• all beverage containers must be refillable or recyclable.

RESPONSIBILITIES
Beverage industry: design and operate the program
Brand-owners are responsible for submitting a plan for recycling their containers which must be approved by the environment Ministry. Brand-owners may appoint a third party agency to do this on their behalf, which has been the choice of all beverage brand-owners to date.

The recycling program for non-alcoholic beverage containers is managed by Encorp Pacific Inc. The program for wine, spirit, and import beer containers is managed by the BC Liquor Distribution Branch. The program for domestic beer containers is managed by Brewers Distributor Ltd.

Thus, since the three plans were approved, the container recycling programs have been administered entirely by the three container recycling agencies. The agencies manage all funds, manage contracts with depots, transporters and processing centres, and manages promotion / education, research & development and technical assistance. The agencies are also required to submit annual reports to the provincial environment ministry which report on deposits charged and refunds paid and recycling rates.

Government: set performance measures and provide oversight in the public interest
Public oversight of this industry-operated and industry-funded program is the responsibility of government. The administration of the regulation is carried out by ministry staff (1/2 FTE) who monitor the performance of the program (through annual reports from the container recycling agencies) and participate on the Beverage Container Management Board.

The Beverage Container Management Board is an 11 member voluntary board nominated by each stakeholder group and appointed by the environment minister to represent the full range of interests and provide advice and recommendations.

The environment minister receives recommendations from ministry staff, the Beverage Container Management Board and the public.

BEVERAGE CONTAINERS TARGETED
All beverages included (except milk, milk substitutes and dietary supplements)
All containers included (including paper, aluminum, glass, paper, steel, composites)

FLOW OF FUNDS
Who pays into the system: All Brand-owners are covered by the regulation and the program is entirely industry-funded. Some brand-owners choose to absorb the cost of the program in product prices; others choose to pass the cost on down the supply chain and to the consumer in the form of discrete non-refundable 'recycling fees'.

REVENUES
The beverage container recycling programs are funded by 3 sources of revenue: unredeemed container deposits, revenues from sale of recycled container materials and industry recycling fees, if required. All funds are managed by the container recycling agencies.

The minimum deposit/refund amounts are specified in the regulation. The authorized depots must pay consumers the full refund (no 'half-back') and all unredeemed deposits stay in the program to offset program costs. 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 recycling fees are not established in the regulation. Rather they form part of the non-alcoholic beverage industry's policies and they are charged by container type and size to reflect the shortfall between revenues and expenses for managing each particular container. Other beverage sectors have chosen to include any required recycling fees within the price of the product, rather than require retailers to separately disclose this portion of the product price.

The material revenues are determined by markets. Under the current approved programs, container materials are marketed by the container recycling agencies and revenues flow to the agencies, not the depots or processors.

EXPENSES
How are the funds spent: The beverage industry's container recycling agencies have contract agreements with depots, transporters and regional processors who physically handle the returned containers.

Depot handling commissions: Authorized bottle depots receive per/container handling commissions. The rates were established by private sector negotiation between depots and beverage stewardship agencies or by binding commercial arbitration if agreement cannot be reached. Commissions are based on the costs to handle each container size and type. Depots are not required to sort containers by brand.

RETURN SITES
The regulation requires retailers to accept returns of up to 24 containers per day but specifies a process for deregulating retail returns to 6 containers per person per day and ultimately to zero once an alternative depot-based collection system has demonstrated that it can provide acceptable consumer convenience. To date, one municipality has piloted a reduction to the first de-regulation phase to 6 containers per person per day. However, a protocol has yet to be approved to relieve retailers of having to accept containers.

RESULTS
British Columbia has had a deposit/return program for soft drink and beer containers since the Litter Act was introduced in 1970. Over time the beverage industry introduced a range of products and containers not envisioned in the Litter Act. In October 1997, in response to local government concerns about the cost of recycling and disposing of beverage containers, the province enacted the Beverage Container Stewardship Program Regulation (1997) which replaced the outdated Litter Act. Aseptic and polycoat containers were accorded a one-year exemption, beyond the other newly introduced containers, to October 1999.

Within two years of program expansion when containers for wine, spirits, water, juice, new-age beverages were introduced, the following recovery rates were reported:

• non-alcoholic beverages: 75% (this includes the recovery of aseptic/polycoat containers which had been in the system only three months)
• wine / spirits: 85%
• beer: 95%

The industry-designed program has also been cost-effective. Encorp Pacific Inc. reported an operating surplus of $5 million in 2000.

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