Introduction Product Stewardship and How it Moves Costs from Local Governments to Consumers and Manufacturers Sego Jackson NW HW Conference June 2003 A presentation by the Northwest Product Stewardship Council on Product Stewardship & Electronics

Toxic substances in electronics Toxicity in all phases of product life Production – mining and manufacturing Use – off-gassing of flame retardants Recycling and disassembly – potential for worker exposure and toxic releases Disposal – lead, copper, mercury, etc. TOXICITY

The Case for Product Stewardship

Electronics Product Stewardship Manufactured Globally

No economic incentive for manufacturers to minimize environmental Impacts. Product Management – The Old Edition Manufactured Globally

Disposed Locally GO DIRECTLY TO LANDFILL. DO NOT PASS GO. Product Management – The Old Edition

Disposed Locally Should local governments and rate payers cover the costs of handling electronic wastes? Product Management – The Old Edition

Linear Lifecycle The Linear Lifecycle of Consumer Goods Product Management – The Old Edition

The New Edition

Create Economic Incentives Create economic incentives for manufacturers to redesign products to make them greener.

Closed Loop Lifecycle The Closed Loop Lifecycle of Consumer Goods

Japanese Model JAPANESE MODEL Mandated Responsibility Manufacturers set front-end fees for end-of-life management Retailers collect fees Fees cover orphan & historic waste Consumers return products to retailers or municipalities Manufacturers compete to lower fees Manufacturers and recyclers are financially linked

Old/New Editions Local governments manage product end-of-life. Rate payers and local government cover product end-of-life costs. Manufacturers responsible for product take-back. Costs of product end-of-life are included in price.

Old/New Editions No incentives to alter current design. Continuing toxic legacy. Incentives to redesign products to make them greener. Upstream thinking.

Review Goals: Shift costs from Governments/Taxpayers to Manufacturers/Customers IN A WAY that drives product and system design to be more environmentally sound

Government provides free collection Manufacturer, retailer and customer have no role No design driver to reduce toxicity up or downstream, make more recyclable. No driver for industry to develop markets for recovered materials No driver for industry to assist in making system function smoothly Every government is on its own - very inefficient

Government Charges End of Life Fee Costs shifted to user instead of taxpayer. Stockpiling continues, illegal dumping increases All other problems remain, but funds are raised to cover costs.

Manufacturer Charges End of Life Fee Shift costs from Governments/Taxpayers to Customers Governments still stuck with illegal dumping Must be very convenient. Mail back programs arent. Manufacturer may have some incentive to reduce costs of system

Visible Advance Recovery Fee (pay $10 when buy computer, government collects) Shift costs from Governments/Taxpayers to Customers Manufacturers/retailers have no role No incentive for design or system efficiency

Invisible Advance Recovery Fee (fee is passed from manufacturer to retailer, included in price, but not shown as stand-alone charge) This begins to bring about design drivers due to price competition Need to be alert to cutting corners

Full Cost Internalization (fee is incorporated into price by manufacturer. Manufacturer pays for end of life management) Can create strong design drivers Manufacturer concerned about functioning of entire system Need to be alert to cutting corners

Partial Cost Internalization (fee is incorporated into price by manufacturer for portion of system, which manufacturer pays for.) This brings about design drivers due to price competition Manufacturer doesnt care about functionality of rest of system Rest of system costs return to governments/taxpayers

$$$ Scope of Issue $200,000 per year = Snohomish County $210 million - National annual cost of collection, consolidation, transport, processing of NEPSI electronics (not including education, etc.)

EOL vs Front-end Financing Snohomish County television = $20 (losing $) 30,000,000 televisions sold annually $210,000,000 /30,000,000 = $7 fee on new televisions to pay for entire system for recycling computers, monitors, tvs and more!

Instead of paying, governments and other collectors get paid! Advanced Recovery Fee system includes collection cost payment to collector on per pound basis Allows diverse and extensive collection infrastructure including repair shops, charities

What to watch out for... Government pays all programs. You dont charge for HHW, why would you charge for our electronic products! You dont make other producers pay for their product management. This is unfair! Settling for any opportunity, no matter how inconvenient, as good enough. If one location in the county is good enough for really hazardous things like pesticides, your politicians have decided thats all thats needed. Why do we need more convenient electronics drop-off!? We already steward our products. We have a mail back system where the customer pays.

What to watch out for... Partial Cost Internalization (HP Model) If you get full truck loads of our brand and transport it to our recycler (in California), well pay for the recycling. Agreements without measurable goals and without environmentally sound management requirements. Customers and Citizens are the same. They are going to pay one way or the other so whats the difference!? Take the Money and Run. Cost shifting that provides funding to governments but doesnt provide design and system incentives.

Introduction THATS ALL FOLKS!