January 5, 2004

Ontario approves Blue Box program funding plan, takes aim at 60% materials recovery rate

The Ontario government has finally approved a Blue Box recycling program funding scheme developed and submitted last year by Waste Diversion Ontario (WDO) and Stewardship Ontario. Moreover, Environment Minister Leona Dombrowsky said the government intends to increase the recovery of blue box materials to 60% by 2008.

The plan will direct industry to pay 50% of the net cost of municipal Blue Box programs, with Stewardship Ontario responsible for collecting fees from brand owners and importers, beginning early this year. Municipalities will continue to operate the blue box recycling system. In addition, the province has asked Waste Diversion Ontario (WDO) to submit a plan by this March to expand the recovery of material suitable for blue boxes from the current 45% per cent to 60% by 2008.

The plan is designed to ensure the continuing development and operation of Ontario's Blue Box recycling system. It sets out specifics regarding diversion of Blue Box wastes and how industry will pay for half the net costs of municipal Blue Box programs. The plan details how funds will be collected from industry, distributed to municipalities and used to pay program costs and to make the overall recycling system more efficient and effective. Part of the funding will be used for market development, promotion and education as well.

Stewardship Ontario has been designated as the Industry Funding Organization (IFO) for the Blue Box program. WDO, created by the Waste Diversion Act in June 2002, is a permanent, non-Crown corporation made up of industry, municipal, non-government and government representatives. WDO and Stewardship Ontario are responsible for implementing the program. Stewardship Ontario is made up of "industry stewards", i.e. brand owners or first importers of products which result in Blue Box wastes. Glass, metal, paper, plastic, textiles or any combination of them are prescribed as Blue Box waste by Minister's Regulation O Reg. 273/02. (The final decision on the regulatory proposal for the Blue Box waste diversion program and designating regulation for Stewardship Ontario may be viewed on the Environmental Bill of Rights registry, www.ene.gov.on.ca, reference number RA03E0011.)

This month, Stewardship Ontario will begin putting into motion the mechanisms designed to help obligated stewards identify and collect data on their obligated materials, and report and register with Stewardship Ontario. A pre-registration system was set up last summer in anticipation of the funding program approval (ELW August 11, 2003). Between January 6 and 9, official "Letters of Notification" and information brochures are to be sent to more than 25,000 potentially obligated stewards in Ontario. On January 12, pre-registration will begin on the Stewardship Ontario Web site. Through pre-registration, stewards will receive guidebooks to help them determine their obligations and register their companies. They will also be sent a passcode allowing them access to Stewardship Ontario's on-line data reporting and management system. On January 21, 2004, a "How to Register" workshop and Webcast will be held to help stewards come into compliance with their new obligations as quickly as possible.

More information, including the Blue Box Program Plan and on-line registration for industry stewards, may be viewed on Stewardship Ontario's Web site, www.stewardshipontario.ca. A copy of the plan can also be obtained by calling WDO at 416/226-5113 or Stewardship Ontario at 416-594-3456.

While the plan has widespread support from municipalities and a number of industry sectors, not everyone is delighted. In a letter to the Environment Minister last month, PPEC, the Paper and Paperboard Packaging Environmental Council expressed its concerns about the sustainability of the funding plan, although the Toronto-based group remains firm in support of the 60% waste diversion target.

The plan, PPEC argues, discourages increased recycling because the fees are so closely tied to the net cost of the system. Materials already collected in the system pay most of the costs, while materials not widely collected or recycled or that go straight to landfills, pay little or nothing. The group is also critical of the lower recovery targets set for plastics and aluminum, although the latter has a far higher revenue value for the Blue Box program.

Another significant concern for PPEC is the funding plan's failure to give credit for recycled content in Blue Box materials. Paper and paperboard, it notes, are the only Blue Box materials made from a renewable resource and are higher than most materials in recycled content. The plan, however, treats paper as if it were 100% virgin material. Compounding the problem, adds PPEC, is the fact that recycled-content paper has a lower market value and thus a higher net cost to municipalities for collection. A higher net cost means a higher levy on the industry and could discourage recycling, which is not the intention of the Waste Diversion Act.

Finally, the group notes the Minister's indication that she wants some tighter controls for the next (2004) schedule of Blue Box fees; PPEC considers this the sole ray of light relating to the approval announcement.

More information is available from PPEC, 416/626-0350, FAX 416/626-7054, E-mail ppec@ppec-paper.com, Web site www.ppec-paper.com.

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