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Closing the circle on packaging in Europe

A circular economy could offer a logical solution to the problem of packaging waste. Yet, even in Europe, where recycling capacity is improving, there are still barriers to overcome

The move towards a circular economy in Europe, in terms of packaging waste, is gaining traction. Spot prices for recycled polyethylene terephthalate (PET) have almost doubled in 2021, as demand increases. Spanish infrastructure services company Sacyr has teamed up with Honeywell to recycle 30,000 tonnes of plastic annually in Andalusia. And plans are afoot for a Dutch facility that will handle 55,000 tonnes of plastic packaging waste a year.

But, as with every step taken towards improved sustainability, there is still much left to be done.

Europe’s recycling capacity has risen substantially over the past decade, with the amount of plastic packaging waste recycled in the EU up from about 10kg per person a year in 2009 to almost 15kg in 2019, according to Eurostat figures.

However, over the same period, the amount of plastic packaging waste generated rose even more, from around 28kg to more than 34kg per person per year. Plastic makes up “a growing proportion” of marine pollution, says John Duncan, Global Lead for the No Plastics in Nature initiative at the World Wide Fund for Nature (WWF).

In theory, with the right technology, a lot more plastic could be recycled – but, as Duncan says, “the economics don’t work” in practice.

Recycling of most types of plastic is more expensive than landfilling or burning it, and recycled plastic costs more than virgin product, partly because of a lack of infrastructure and joined-up processes.

Because of this, Duncan espouses implementation of what is known as “extended producer responsibility” (EPR) policies, which see the manufacturers of products pay fees for every kilogram of packaging that they put onto the market. These fees, collected by a central fund, should then, in theory, be used to ensure that packaging is collected, sorted and available for recycling.

Duncan explains: “With EPR, you can stimulate changes in companies’ behaviour via ‘eco-modulation’ of the fees – you charge a lot for the things that are hard to recycle, and companies will naturally shift away from those materials.” There is, therefore, a lot of potential to not only increase the amount of funding available for waste management, but also to incentivise improved design and investment in better materials. However, much of this potential is not yet being realised in practice, as EPR schemes are only functioning in a limited number of countries around the world at present.

Consumer packaged goods companies, such as PepsiCo, are also keen to see changes in EPR fee structures in order to finance the investment needed to improve infrastructure so that more materials are processed for recycling.


“You need to have a fee that is in line with the value chain of a particular packaging,” says Silviu Popovici, Chief Executive Officer of PepsiCo Europe. This would ensure that the EPR fees cover the cost of the harder-to-recycle materials.

Innovation can also create inroads to tackling more problematic waste. Through the HolyGrail 2.0 Digital Watermarks consortium, PepsiCo, along with more than 80 different partners, is trialling new invisible codes that will be printed onto its packaging and are only detectable when scanned by a high-speed camera in a waste processing plant. These codes include information about the packaging that ensures more efficient sorting of waste, and ultimately open the door for more to be recycled and at higher quality.

For Bertrand Swiderski, Chief Sustainability Officer at the supermarket giant Carrefour, a circular economy also begins with the packaging that is put out by companies: “It's key to make sure that, in the future, they won't create packaging that we do not know how to recycle.” He goes on to explain that it takes time to help people to understand how to sort and dispose of different types of packaging, and that the consumers are a critical link in the circular chain, ensuring there is recycled material to process.

Models do exist that have helped encourage consumers to recycle more. Deposit return (or refund) scheme concepts are widely used across a range of industries, and have been shown to result in PET bottle recycling rates of more than 90 per cent in Germany, Norway and Sweden. Deposit schemes work best when they are readily available and make returns as convenient as possible. Archana Jagannathan, Senior Director for Sustainable Packaging at PepsiCo, states: “If we make it easy enough for consumers to recycle, ultimately all consumers will do the right thing.”

Consumers engaging in recycling through gamification at a sponsored event

Another factor that can help to raise levels of recycling is building demand for recycled material. In Europe, says PepsiCo’s Popovici, “it’s important that packaging contains a certain percentage of recycled material. When you have this, you create the market for recycled content.” This was underscored by a recent European mandate requiring at least 25 per cent of PET to come from recycled sources by 2025. “This gave a massive boost to the recycling industry, because it helped to create demand – though it’s vital, when setting targets, that the right infrastructure is in place in order to support the goal,” says PepsiCo’s Jagannathan.

This kind of policy intervention could be the final enabler that closes the circle on recycling in Europe, helping to build an ecosystem in which recycling becomes the first choice for waste management in the region. 

Jagannathan emphasises: “We definitely need the right policies in place to encourage recycling. We need higher recycling targets, we need bans on landfills, we need higher fees for incineration. And where it has been done effectively, you can really see change happening.”

What is clear is that there is no single pathway to realising a circular economy for plastic packaging waste in Europe. But, with the obstacles clearly identified and the tools to overcome them at hand, experts believe it should be possible to make significant strides over the coming decade. And, while recycling is not the only answer, with these changes taking place, a circular economy could provide a near-term solution to get to a more sustainable future for packaging.

A circular economy could offer a logical solution to the problem of packaging waste. Yet, even in Europe, where recycling capacity is improving, there are still barriers to overcome.

Hero image: Photo courtesy of dansk retursystem: The Holy Grail 2.0 digital watermark trial hopes to improve sorting of waste in Europe. It involves 80+ companies and is driven by AIM – the European Brands Association and is powered by the Alliance to End Plastic Waste.

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