Lorax EPI

Eco-modulation - what is it, and where is it being used?
by Annis Mapleston at 15:12 in Circular Economy, Packaging, Emerging

​​Eco-modulation is a concept which is being talked about (and implemented) increasingly frequently by governments and stewardship/EPR schemes. But what is it? At the most basic level, eco-modulation is the concept of penalising the use of materials that are less environmentally friendly, and rewarding the use of those which are better - for example, through charging a higher rate of tax for products that are harder to recycle, or offering fee reductions for materials which can be easily recycled.

money stack.jpg Two examples of eco-modulation being implemented in packaging include:

  • ​​​The Portuguese scheme ​Sociedade Pontoverde (SPV), which introduced penalty fees in 2019 for ​three types of packaging that ​'disrupts the recycling process': PET bottles with a metal cap; glass bottles with non-removable stoppers; and PET bottles with PVC labels. Fees for all the materials contained in this type of packaging is subject to an increased fee, with the aim of encouraging producers to move to more easily recycled product designs.
  • The Italian scheme CONAI​, which has four bands for plastic packaging: packaging with an effective recycling process (industrial); packaging with an effective recycling process (household); packaging with a developing recycling process (industrial); and packaging with a developing recycling process (household). Fees are then set for materials contained in the different bands, with lower fees for those which can be easily recycled.

​We can expect to see more countries (especially European ones) starting to introduce eco-modulated fees over the coming years. At one point it was expected that the European Commission would issue guidance to EPR schemes in 2019, and while this has not happened, some countries have clearly decided to move ahead anyway: for example, the UK Environment Bill (currently working its way through Parliament) will enable eco-modulated fees to be introduced in the UK. The concept is also not limited to packaging and EPR: for example, Sweden has introduced a rebate scheme for environmentally friendly car purchases (and an increased tax surcharge for diesel vehicles).

If you have any questions about eco-modulation or how specific countries are using it, please contact us​ to speak to one of our consultants.
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