Deposit-refund Systems Research Articles

A deposit-refund system for managing the economical circulation of returnable transport items

While the use of Returnable Transport Items (RTI) is a common practice in supply chains committed to sustainability. An efficient RTI circulation mechanism must be implemented to ensure the profitability of the approach. Within this context, this paper presents a deposit-refund system (DRS) designed for RTI circulation to maximize supply chain profitability. The profit optimization analysis considered three scenarios: the vendor's profit, there tailer's profit, and the overall system profit. Tailored solution strategies are developed for each case, considering retail price components, and leading to the identification of the optimal deposit amount required to maximize RTI circulation. We further examinehow the retail price affects the profits of supply chain actors relative to the RTI return rate and studystudy how changes in return rates influence the profit patterns of supply chain actors. The results are scrutinized via several sensitivity analyses, leading to important implications for the design of deposit-refund systems for RTI. We for example find that the vendor's wholesale price has a significant effect in establishing the decision-maker's optimal policy in designing a DRS for RTI circulation. In other words, the wholesale price is a key component in assessing the economic viability and determining the deposit amount for RTI. Moreover, through a couple of hypothetical, butrealistic cases of RTI applications considering specific parameter settings, we shown that the vendor's position can be either significant or insignificant dependong on the difference between the value of the RTI and that of the goods it holds.

Cost-benefit analysis of two possible deposit-refund systems for reuse and recycling of plastic packaging in Sweden

Plastic packaging is a major contributor to the environmental impacts associated with the linear plastic production and consumption system due to the prevalence of short-lived single-use plastic (SUP) packaging. Deposit-refund system (DRS), as an alternative policy instrument to Extended Producer Responsibility in waste management, is deemed as a potentially promising way to address the failure of the current plastic waste management and facilitate circular plastic packaging production and consumption for food contact use. In this paper, two DRS scenarios for recycling and reuse respectively are explored, with PET trays for food-grade use in Sweden in focus. Their costs and benefits are investigated relative to the business-as-usual scenario over a 25-year period. Results show that the costs are greater than the benefits for the recycling scenario but not for the reuse scenario and that the benefit-cost ratio (1,67) of the reuse scenario is 2.3 times as high as that (0,73) of the recycling scenario. The distributive analysis reveals major cost drivers such as deposit handling and recycling in the recycling case and deposit handling, dishwashing and packaging in the reuse case and major cost takers such as materials industry and hospitality/supermarkets in both scenarios. However, the results are uncertain, as is indicated by sensitivity analysis. Several parameters with high uncertainty are identified and highlighted for system development and innovation. • Deposit return schemes generate environmental benefits • Costs risk outweighing benefits • Need for system innovation

Are deposit-refund systems effective in managing glass packaging? State of the art and future directions in Europe

Glass packaging gives rise to major environmental concerns because it develops more greenhouse gas emissions than plastic packaging and its improper discarding causes the loss of high-quality desired resources.The reuse and recycling of glass packaging reduces greenhouse gas emissions and the use of newly extracted resources sand and soda. To mitigate the environmental impacts of glass packaging, countries have set-up various collection and recycling systems, which are often organized and financed through extended producer responsibility schemes. The most common collection systems are deposit-refund systems (DRS), separate collection in drop-off containers and comingled collection with lightweight packaging waste.By the end of 2035 a minimum of 65 % of glass packaging waste must be prepared for re-use and/or recycled within the EU Member States and thus proper policies and solutions should be adopted to achieve this target. In this sense, the present study aims at verifying if deposit-refund systems and their different configurations affect glass packaging waste reduction and recycling/recovery.To achieve this aim, annual data regarding consumption and recycling/recovery of glass packaging for each European Economic Area/European Free Trade Association (EEA/EFTA) country were extracted over the time period 2010–2019. By using the selected European countries as units of analysis, a hybrid methodology was developed which includes the analysis of variance (ANOVA) and other descriptive statistics.Findings show that the different waste management systems affect neither the amount of glass packaging consumption nor the glass packaging recycling/recovery.In countries which adopt DRS, not more glass packaging per capita was retrieved than in countries which adopt other collection and management systems. In fact, it turns out to be a mechanism that allows for high quality glass packaging collection avoiding its ending up in landfills, but it does not influence consumption choices and the subsequent potential waste production.The adoption of DRS-based collections does not result necessarily in a successful management model for glass packaging. Since setting up additional drop-off collection points and recovering mechanically glass from municipal solid waste (MSW) does not result in glass qualities to be used in glass packaging, DRS represent still the sole progress towards a more circular economy.

Pay as you throw; an exploratory study on a market-based approach to the environmental problems caused by public littering in Nigeria

Abstract This paper provides an overview of environmental policy research focusing on market-based instruments, and their applicability to developing countries, in particular Nigeria. It also addresses more general developments in the field of deposit-refund systems (DRSs) and explores the practicality of a DRS to litter management in Nigeria. A prominent theme of our discussion is economic instruments, where different approaches will be explored to understand the link between compliance and neglect inherent in environmental issues of a developing country such as Nigeria. Where the objective is to reduce littering, a DRS was considered the choice for the framework of this study, after researches detailed its benefits and relevance to the research problem. DRS is subsequently discussed as a policy intervention, and the feasibility of introducing the system in Nigeria is evaluated. By understanding the implementation mechanisms, the economic viability and environmental effectiveness of a DRS, it is concluded that a DRS can support a country’s drive to solve some of its pressing issues of environmental concerns even with the bare minimum of government administration. The consolidation of information from this research can kick-start the conversation on ways to incorporate this system as part of Nigeria’s solid waste management policy.

Closed-loop supply chain under different channel leaderships: considering different deposit–refund systems practically applied in China

Closed-loop supply chain under different channel leaderships: considering different deposit–refund systems practically applied in China

International experience in stimulation of green initiatives in agriculture and directions of its implementation in the national practice

International experience of stimulation of green initiatives in agriculture is summarized in this article, directions of its implementation in national practice are determined. The article proves that insufficient development of green initiatives in agriculture is a result of effect of limiting barriers having economic and economic nature, and low level of development of incentive tools to stimulate agricultural producers. The arguments are given to understand the importance of foreign practice of incentives for agrarian producers to introduce green initiatives in agricultural industry, and to determine directions of its implementation in Ukrainian practice. The article demonstrates that green initiatives in agriculture at the level of commercial entity are possible only in case of targeted, joint and coordinated activities of the state, society, united territorial communities (UTC) and agricultural enterprises. It is proposed to examine green initiatives in agriculture as a systemic process of organization of nature protection activities of the enterprise basing on coordinated actions of agrarian producers, the structures of state power and administration, UTC, connected with use of the complex of tools and measures to stimulate environmentally safe activities. It is summarized that legal acts and regulations governing nature protection activities in EU states include the following incentive tools to stimulate green initiatives: regulatory, informative and economic tools. Economic tools to motivate the enterprises to adopt environmentally friendly activities are determined: they include ecologic taxes, ecologic quotas, ecologic funds, subsidies and taxbenefits, deposit refund systems, etc. The components of information support of manufacturers are described: they include information about applicable laws and regulations for nature protection, statistic data, researches, reviews and analytical reports, strategic programs developed, information about the options of financing, environmentally-friendly solutions for enterprises. The reasons are given to support creation of information system to stimulate green initiatives implemented in agrarian activities in national practice. Keywords: green initiative, incentive tools, agricultural industry, ecologic fees, ecologic taxes.

Operating modes and cost burdens for the European deposit-refund systems: A systematic approach for their analysis and design

Abstract Deposit-Refund Systems (DRS) are one of the most effective methods to collect one-way beverage packaging. Yet, the analysis of their operating modes and related cost burdens for each actor are still evolving. This study analyses the operating modes and the cost burdens of ten European DRS’ using a number of building blocks shared among the different systems. This approach facilitates their comparison and the development of new models. The building blocks are identified through content analysing some relevant reports. The results show that the required building blocks are the four actors in the process – namely the DRS operator, producers, retailers, and customers –, the money-material flows among the actors (operating mode), and the costs and revenues for each actor (cost burden). Using this approach, the ten models in Europe are reduced to four DRS archetypes. Each archetype has a different money-material flow and a different cost burden for each actor. There are in total 18 costs and 9 revenues. This study contributes to the systematic analysis of DRS′ in terms of their operating modes and related cost burdens for each actor. Using building blocks to describe the DRS′ facilitates the comparison of different models and the analysis of their efficiency and effectiveness. Moreover, it provides a tool to develop new, country-specific DRS′ in those areas where DRS’ do not exist.

Municipal solid waste prevention: A review of market-based instruments in six European Union countries.

This article focuses on quantitative prevention of municipal solid waste among the 28 member countries of the European Union. A strict definition of waste prevention is used, including waste avoidance, waste reduction at source or in process, and product reuse, while recycling is outside the scope of this article. In order to provide a solid overview of the European situation, the study selected six countries (Belgium, Bulgaria, Italy, the Netherlands, Romania and Spain). Several selection requirements have been considered, such as geographic location or municipal solid waste per capita production trends from 1995 to 2017. A review of prevention programmes and other national strategic documents has been conducted. Extended producer responsibility, Pay-As-You-Throw schemes, Deposit-Refund Systems and Environmental Taxes implementation among the selected countries have been studied in order to understand how these market-based instruments can be used for the sake of waste prevention. Each market-based instrument has been further analysed using the Drivers Pressures State Impact Response model. Based on the results of this study, the effectiveness of market-based instruments implementation is strictly related to the context they are enforced in. It is particularly important to tailor the market-based instruments based on the implementation area. Nevertheless, market-based instruments, which are now mostly meant to boost the recycling sector of the considered Member States, should be designed to improve waste prevention performances, ensuring the achievement of the highest level of waste hierarchy promoted by the European Union.

A systematic review of the deposit-refund system for beverage packaging: Operating mode, key parameter and development trend

Abstract As an effective means to ensure extended producer responsibility, deposit-refund system can effective transfer waste streams from final disposal to reuse or recycling. Compared with other collection systems, it has better treatment effect on scattered and hard-to-regulate solid waste. Beverage packaging has become a key application area in deposit-refund system because of its large quantity, dispersed consumption and high pollution intensity. In order to better promote the application of the beverage packaging deposit-refund system, the operation mode, key parameters and development trend of beverage packaging deposit-refund system are summarized through investigation and research. Firstly, this paper analyses the operation mechanism of deposit-refund system from the principle of circulation, and classifies the deposit-refund system according to the difference of material flow and deposit flow. Then the paper studies the deposit-refund system of beverage packaging in 40 countries or regions, and describes and compares three typical deposit-refund systems of beverage packaging in Germany, Sweden and South Australia. The key parameters of deposit-refund system are analyzed, including management institutions, deposit amount, unredeemed deposit, material owner, etc. The result shows that although the operation mechanism of beverage packaging deposit-refund system varies greatly in different countries, there are also some common problems in the integration with intelligent collection, promote ecological design and develop a multi-profitable circular business model. Then the development trends of deposit recovery system are prospected: (1) Increasing the application of Internet communication technology and Internet of Things technology to make the whole process controllable and verifiable. (2) Promoting the coupling application of deposit-refund system and ecological design. (3) Focusing on the development of information value and build a diversified profit model. (4) Pay attention to the integration and application of informal recycling enterprises in the implementation process.

Environmental assessment of the food packaging waste management system in Spain: Understanding the present to improve the future

One-way packaging can represent up to half the environmental impacts of the food value chain and thus optimising its management is essential. Collective selective waste collection managed by authorised organisations (Extended Producer Responsibility, EPR), with or without Deposit-Refund Systems (DRS) are alternatives implemented at European level to handle this problem. Since there is no single simple formula that can be applied to every waste management system, this case study is focused on the entire Spanish model of one-way food packaging waste management, from collection of each fraction in specific containers to final treatment, considering eight different materials. For the analysis, six different impact categories were considered: abiotic depletion potential, global warming potential, acidification potential, eutrophication potential, ozone depletion potential and photochemical ozone formation. Results reveal that the recycling stage is the main stage contributing to the environmental impacts, but the environmental savings related to the recovery of materials in this stage compensates these loads and the system must be considered advantageous for the environment. By contrast, sorting plants present the lowest contributions and is the least significant stage. Significant environmental improvements (close to 10%) would be achieved by addressing the total bulk collection flow to mechanical-biological treatment and increasing the selective collection of light and glass packaging waste. This study can serve to identify common drivers that contribute significantly to the development of an integrated approach to waste packaging management and as baseline for comparison studies with alternative waste recovery technologies and systems.

DEPOSIT REFUND SYSTEM FOR BEVERAGE CONTAINERS IN LATVIA: LEARNINGS WITHIN THE BALTIC STATES

INTRODUCTION
 One of the main global environmental problems we are facing is the increasing the amount of waste. There are numerous policy instruments used to reduce the environmental impact of packaging. Many EU member states use producer levies, packaging and resource taxes, deposit-refund systems and producer responsibility systems (Bailey, 2017; Watkins et al., 2017).
 MATERIALS AND METHODS
 In this article we conduct comparative analyses and evaluate the effectiveness of deposit-refund systems for beverage packaging in the three Baltic States: Estonia, Latvia and Lithuania. Data used in the study is obtained from statistical databases of the Central Statistical Bureau, Eurostat and Euromonitor, as well as from stakeholders of the deposit-refund system - beverage manufacturers, retailers and waste management organisations. When necessary data was not available, we made calculations and approximations using analogies with neighbouring countries, e.g. regarding the quantity of different kinds of beverage containers (plastics, glass, cans) delivered to the market, the average weight of containers, changing trends etc.
 RESULTS
 To stimulate the rate of beverage packaging collection and recycling, both Estonia (2005) and Lithuania (2016) have introduced deposit-refund systems. Both are mandatory centralized systems with collection rates over 90%. The strengths of the Estonian system are a result of sophisticated IT solutions, differentiated EAN coding logic, elasticity and good management. The Lithuanian system is one of the most technologically advanced systems. One of its positive features is the lease of taromats, reducing the upfront investment costs for retailers and producers.
 DISCUSSION
 Previous research shows that the introduction of a deposit-refund system increases the collection rate of beverage packaging (Dewey, Denslow, Chavez, Romero, & Holt, 2011; Lavee, 2010) but requires substantial organisational and financial resources. It is more economically viable to introduce a deposit system when separate waste collection system is already in place. The results of this study are similar.
 CONCLUSION
 
 Latvia needs a DRS in order to achieve PET goals and reduce environmental pollution;
 The required score and distribution is about the same
 A DRS has to be operated by a non-profit organisation consisting of manufacturers and retailers;
 The recommended deposit is 10 cents;
 Provision should be made for the inclusion of beverage cartons and alcoholic beverage bottles;
 Provision should be made for the inclusion of refillable glass bottles and jars.

Management of aluminium packaging waste in selected European countries.

By the end of 2025, a minimum of 50% of aluminium packaging waste has to be recycled within the Member States of the European Union. Aluminium packaging can be recovered through different systems (separate collection, deposit refund systems, informal collection, treatment of municipal solid waste incineration bottom ash or mechanical treatment of mixed municipal solid waste). The present article analysed if the agreed targets for the recycling and reuse of aluminium packaging are reasonable and realistic. To this end, the management of aluminium packaging in 16 selected European countries, yielding results for 11 countries, were investigated. The results show that six out of 11 countries recycle at least two-thirds of the aluminium packaging from MSW and only two report very low recycling rates of 20%. The overall recycling rate reported by the different countries cannot be directly linked to the system of recovery. Only the assertion that a deposit refund system together with selective collection leads to a higher overall collection rate seems permissible. This does not necessarily lead to a higher recycling rate as other countries with similarly high recycling rates make up for it with high amounts of aluminium recovered from bottom ash treatment. A direct comparison of the recycling rates within the European Union Member States, however, is problematic for several reasons, such as data that are often differently or incorrectly assigned, incomplete or rely on estimations and assumptions. The authors therefore propose a clearer assignment of the corresponding data and more extensive mandatory reporting on losses and shares of non-packaging, imported and exported waste.

Effectiveness of deposit-refund systems for household waste in the Netherlands: Applying a partial equilibrium model

Deposit-refund schemes (DRS) are basically a combination of two instruments: a tax on the purchase of a certain product, and a subsidy on the separate collection of the same product in its after-use stage. They can be efficient policy instruments to encourage reuse and recycling. However, empirical studies on impact of DRS systems on recycling rates are hardly done. In this paper, we applied the Fullerton-Wu model, a partial equilibrium model, to simulate the impact of introducing mandatory DRS for small electric appliances and batteries in the Netherlands. For small electric appliances, a deposit-refund rate of €5 to €15 per appliance would lead to an increase in the recycling rate (recycled appliances as a percentage of total amount of appliances disposed of) from 60.7% to 64.7% and 76.4% respectively. For batteries, a DRS would increase the recycling rate from 86.9% to between 87.2 and 89.2% depending on the deposit tax level ranging from €5 to €20 per kg and the price elasticities assumed (low and high). Obviously, the performance of DRS in terms of additional recycling is stronger in cases where current recycling rates are relatively low. Moreover, the pre-existence of an infrastructure for separate collection would make small white goods an interesting candidate for this instrument.

Current Status and Issues for Deposit-refund Systems in Environmental Economics and Policy Studies

Current Status and Issues for Deposit-refund Systems in Environmental Economics and Policy Studies

Assessment of economic instruments for countries with low municipal waste management performance: An approach based on the analytic hierarchy process.

Economic instruments provide significant potential for countries with low municipal waste management performance in decreasing landfill rates and increasing recycling rates for municipal waste. In this research, strengths and weaknesses of landfill tax, pay-as-you-throw charging systems, deposit-refund systems and extended producer responsibility schemes are compared, focusing on conditions in countries with low waste management performance. In order to prioritise instruments for implementation in these countries, the analytic hierarchy process is applied using results of a literature review as input for the comparison. The assessment reveals that pay-as-you-throw is the most preferable instrument when utility-related criteria are regarded (wb = 0.35; analytic hierarchy process distributive mode; absolute comparison) mainly owing to its waste prevention effect, closely followed by landfill tax (wb = 0.32). Deposit-refund systems (wb = 0.17) and extended producer responsibility (wb = 0.16) rank third and fourth, with marginal differences owing to their similar nature. When cost-related criteria are additionally included in the comparison, landfill tax seems to provide the highest utility-cost ratio. Data from literature concerning cost (contrary to utility-related criteria) is currently not sufficiently available for a robust ranking according to the utility-cost ratio. In general, the analytic hierarchy process is seen as a suitable method for assessing economic instruments in waste management. Independent from the chosen analytic hierarchy process mode, results provide valuable indications for policy-makers on the application of economic instruments, as well as on their specific strengths and weaknesses. Nevertheless, the instruments need to be put in the country-specific context along with the results of this analytic hierarchy process application before practical decisions are made.

How effective are current household recycling policies? Results from a national survey of U.S. households

This paper analyzes a unique dataset collected during a 2006 national survey of U.S. households to explore the effectiveness of common household recycling policies for metals, glass, and plastics: curbside recycling, drop-off recycling, deposit–refund systems (bottle bills), and marginal pricing for household waste. After estimating either generalized ordered logit or multinomial logit models, we find that the most important determinants of household recycling are people's attitudes toward recycling. Our results also suggest that omitting internal variables (perceived recycling obstacles and benefits as well as moral considerations) may bias policy coefficients. Socio-economic variables are typically not statistically significant, with the exceptions of young adults and of African Americans who tend to recycle less than others. Policies with the largest odds ratios are curbside recycling (which is further strengthened if recycling is mandatory), followed by the presence of drop-off collection centers nearby. Bottle bills are also statistically significant but their odds ratios are smaller, possibly because refunds are relatively small and typically do not change for years. Finally, marginal pricing appears to have a limited impact on recycling. These results suggest avenues for improving household recycling at a time when recycling rates appear to be plateauing.

Optimal Recycling Policy for Used Lubricating Oil: The Case of California’s Used Oil Management Policy

This paper develops a conceptual framework for the management of used oil that encompasses a tax (deposit) on manufactured oil and sector-specific subsidies (refunds) on producers who purchase recycled oil as an input in production. The framework mirrors the deposit-refund systems implemented in the used oil recycling programs of Italy, Spain, Australia and in the US State of California that favor re-refining uses over re-processing routes that lead to combustion of recycled oil as fuel. Our analysis considers environmental damage to arise jointly from improper disposal of used oil and from air pollution created by combustion of used oil. We demonstrate that the optimal policy involves a tax on manufactured oil and a subsidy of equal value on used oil collection irrespective of the ultimate end-use of used oil as re-refined lubricating oil or fuel oil. We derive policy implications to evaluate recently proposed changes to the management system for used oil in California.

Hope or Despair? Formal Models of Climate Cooperation

We review formal (and some more informal) models of climate cooperation derived from economics and political science. These models convey two main messages. On one hand, they suggest that the prospects for effective climate cooperation are bleak: The standard view is that stable coalitions are small and that renegotiation-proof equilibria require that only a few countries participate. On the other hand, there might be light at the end of the tunnel after all. First, more recent work suggests that larger coalitions can be made stable. Second, other recent work suggests that it may be possible to design a renegotiation-proof climate agreement with broad or even full participation. Third, deposit-refund systems might help solve some of the obstacles for effective climate cooperation. Fourth, although the “law of the least ambitious program” pinpoints severe constraints on effective cooperation, this law has its limits. Fifth, countries may use cooperative probes to build trust. Sixth, cooperation might emerge in a completely decentralized fashion. Finally, experiments indicate that some of the conditions for effective cooperation that are taken for granted in most formal models might in fact be overly strict.

E-waste bans and U.S. households' preferences for disposing of their e-waste

To deal with the inadequate disposal of e-waste, many states have instituted bans on its disposal in municipal landfills. However, the effectiveness of e-waste bans does not seem to have been analyzed yet. This paper starts addressing this gap. Using data from a survey of U.S. households, we estimate multivariate logit models to explain past disposal behavior by households of broken/obsolete (“junk”) cell phones and disposal intentions for “junk” TVs. Our explanatory variables include factors summarizing general awareness of environmental issues, pro-environmental behavior in the past year, attitudes toward recycling small electronics (for the cell phones model only), socio-economic and demographic characteristics, and the presence of state e-waste bans. We find that California's Cell Phone Recycling Act had a significant and positive impact on the recycling of junk cell phones; however, state disposal bans for junk TVs seem to have been mostly ineffective, probably because they were poorly publicized and enforced. Their effectiveness could be enhanced by providing more information about e-waste recycling to women, and more generally to adults under 60. Given the disappointing performance of policies implemented to-date to enhance the collection of e-waste, it may be time to explore economic instruments such as deposit-refund systems.

Methods for Economic Examination of Deposit-refund Systems

Methods for Economic Examination of Deposit-refund Systems