1. Driving Waste Management towards Recycling Estonia’s experience 25-26.11.2013, Kiev TAIEX workshop Peeter Eek Waste Department, Ministry of the Environment of Estonia peeter.eek@envir.ee

2. General background 1) EU 5-level Waste management Hierarchy - reduce, avoid - re-use - recycle - recover (energy recovery, back-filling for mineral materials) - disposal (incl. Landfilling) Also: 'Zero-Waste' (~ 'no landfilling!) and 3R (Reduce, Reuse, Recycle) concepts on International levels, where main aim/principle is the same

3. Why to recycle? Arguments for recycling are mainly Environmental, but also economical (substitution of the virgin materials, partly also jobs creation etc.) On real economy, there is always a Question – Why to recycle, as disposal or even 'other recovery' are cheaper The aim should be 'high-quality recycling' – not easy to distinquish from the 'down-cycling' Recycling could only be developed in combination of requiremenst/targets and/or economic instrumenst

4. Economic intruments in use 1) Landfill tax 2) Packaging excise duty 3) Deposit-refund scheme for certain drink packages 4) Extended producer responsibility principle applied on packages in general, vehicles, electric- and electronic appliances, batteries and accumulators, tyres

5. Background Environmental Charges, incl. 'Landfill tax' was introduced on 1991 On that time, were the Environmental Charges considered as main source of Income to the 'Environmental Fund' (since 2000 Centre of Environmental Investments), which have been main financial institution for Environmental Projects, until the EU funding was opened after 2001 (ISPA, CF, ERDF etc.) - the aim to Drive Waste management, was not primary on this time The landfill tax was applied to all type of waste (incl. industrial, thus with differentiated tax levels. As absolute majority of the landfilled waste was related to the oils- shale industry, then was tax level for Household was 'very low'

6. Landfill tax tax levels

7. The use of revenues from landfill tax Paid to the Environmental Investments Centre Fund - redivided to the different Environmental projects The landfill tax revenue is not 'earmarked' for waste projects only The income from total landfill tax ca 15M€ (> 10 €/inh/y), allocated for the waste projects ca 7-8 M€ (remaining part to environmental awareness, nature conservation etc). 75 % from the landfill tax for municipal waste, was* paid back to the municipality, where the was was collected, for the waste management related costs (first of all the costs related to the recycling yards) * There is nearly no landfilling of the Municipal waste on 2013, all is recycled or recovered, so far even treatments residous are recovered

8. Lessons learned: Landfill tax (I) Very powerful option to drive waste towards recovery, instead of landfilling. Could achieve several aims at once: 1) motivate to imply better the waste management hierarchy 2) to 'trigger' private/municipal investments to the recovery operations and facilities and hence to support internalisation of the external costs (or 'polluter pays principle‘) Ca 130 M€ Investmenst to the MBT facilities and incinerator (ca 100 €/inhabitant) without any State support – this could be mentioned just because all major projects, both as landfills, but also on recycling side, have been developed with massive State support (incl. EU funding) alone Such a investmenst have supported also application of ‘polluter pays’ principle.

9. Lessons learned: Landfill tax (II) 3) Was a very helpful measure to come trough the period 2000-2009, when 'old' and 'new' landfills co-existed 4) yields a good revenue, to be used for the Environmental projects or as general income to the budgets Problems so far: The re-payment part of the landfill tax to the municipalities have reduced their interest for source separations and recovery – municipalities/regional authorities should be supported in other forms Tax level have not created visibly ‘wild dumping etc’, but there are attempts of ‘sham-recovery’, especially of the MBT residous

10. Energy recovery of the MSW with the separation of the metals from the Incineration bottom ash (IBA)

11. Agened IBA is used for reclamation of landfilling areas

12. Treatments of wate oils to 'base oil' for further treatment in oil refineris

13. Thresholds for Packaging excise Duty Introduced on 1996, as first step to the alcohol packages, on 1998 to non-alcohol beverages, on 2005 to all sales packaging, on 2009 to all kind of packaging Principle: The Packaging excise Duty act sets the compulsory recovery/recycling targets – from the amount, which remained missing from the target, should be paid the duty. It is not a 'automatic tax to be paid, when packages are put to the market',- it should only be paid, if the recovery targets are not fulfilled In fact whether packaging enterprises should pay the duty, depends from themselves

14. Thresholds for Packaging excise Duty The rates of the duty, calculated initially to be ca 4 times higher, as collections recovery service prices on the market Revenues are unsignifant, as major part of packaging companies prefer to dela with recovery

15. Lessons learned: Packaging excise duty (I) Until 2005 : The 'recovery certificate system', where X companies entered to the contacts with Y waste managements companies, producing Z recovery certificates- it’s a nightmare of supervision (the same experience from several EU Countries) Since 2005: Reporting for ‘put on te market’ and about the recovery goes mainly trough Packaging recovery organisations, just smaller part aside – situation improved, but supervision have remained an issue

16. Lessons learned: Packaging excise duty (II) An option, where certain part from the Duty should be paid, when packaging brought to the market (5-10 % from total ?) would be preferred, as would guarantee routine supervision from behalf of the Tax Department Generally have encouraged companies to join with the Packaging recovery organisations and to build up Country- wide take back schemes etc: Problems so far: no signs of motivations to use mor reuseable packages or reduce of the packaging amount. The directly ‘payable part’ could be more influencial.

17. Aftersorting facility for source-separated packaging- and paper waste

18. Different plastic packaging materials for recycling

19. Deposit-refund scheme Mandatory deposit for glass, PET, metal can with non-alcoholic beverage(up to 6 %). beer, non-alcoholic beverages was introduces in July 2005 The deposit value, initially ca 3 and 4 euro cents, since 2011 raised to 4 and 8 euro cents, will be paid separately in all steps of sale - retail shop will charge it from the consumer. The deposit value is set by Minister of the Environment, based on proposal of the producers The 'empties' are returned mainly to the retail shops, where taken back mainly with the Reverse Vending Machines (RVM). The Deposit System (Non-profit Company, owned by industrial and retailers associations together), decides upon the service fees of the producers and take-back compensations, paid for the retailers in addition of deposit value. Smaller shops are exempted from the take-back obligations, from 200 m2 sales area is it compulsory, if the shop itself sales the deposit packages

20. Deposit system – results Return rates on one-way pac, also refillables around 90 % On 2011 ca 13 th t of high quality packaging materials were collected (doe's not include refillables, as those are returned directly to the fillers). From the whole packaging amount, put to he market, is deposit packaging ca 10 %, From the all recovered packaging makes it ca 15 % Yet it is 100 % consumer packaging, most costly to collect in container system

21. Comparison of the Producers fees Deposit system v 'Green Dot‘ From July 2012 Conclusion: the deposit system is currently by costs far more cheaper for the producers as container collection system – it have not all the time been so.

22. Lessons learned: Deposit-refund system PRO: very effective, collection rates 80-90 %, very clean material, suitable near 100 % for high quality recycling Visibly reduces littering in public places, but also in nature Gives an option to keep also refillable bottles on the market, hence helps to 'avoid waste' Producers fees have changed in time, and on certain period been on €/kg bases even higher, then in container collection, but currently are remarkably cheaper (0 – for metal can!) due to the higher material prices and unredeemed deposit CON: retailers refused the take back obligation in shops at the starting phase, the higher economic motivation could motivate also fraud

23. Extended produrecer responsibility Applied for: All packaging materials, vehickles (cars), tyres, electric-electronic equipment (EEE), batteries and accumulators Common requirements: to set country wide collection network (different requirements for each product), to guarantee free of charge take back of respective waste, recovery and recycling targets for each type of waste Obligations to register by Ministry of the Environment, special labeling requirements for certain type of goods (EEE, batteries and accumulators etc) Some additional requirements, to motivate establishing of Producer Responsibility Organisations (PRO) For all covered product types (except the vehicles) there are several PRO-s in operation.

24. Collection of the 'Products of Concern' waste

25. Dismantling and treatments of the WEEE

26. Lessons learned: Extended Producer Responsibility (I) PRO: cost are covered by producers, reduced need for public spendings - but the cost are added to the products, when put to the market Free of charge take-back improves collection,

27. Lessons learned: Extended Producer Responsibility (II) CONTRA: The producer responsibility organisations are sometimes non-transparent, ie controlled by very small group of producers → the proper use of recovery fees remains sometimes unclear The legal requirements for wide and representative PRO-s are crucial, the EPR model ‘as such’ does not guarantee sucess Some companies hide from the obligations (free riders) – to participate in collective schemes, reporting, recovery obligations etc → The EPR sets high requirements for supervision, registering and reporting solutions Division of costs of the 'historical WEEE' (requirement from the EU Directive 2002/96/EC) is problematic.

28. Thank for Your attention!