Hidden number? EU revenue from non-recycled packaging flows slower than expected

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The EU's own resources based on non-recycled plastic packaging waste (plastic own resources) have evidently been struggling with issues since their introduction in 2021...

The EU's own resources from plastics are intended, on one hand, to contribute to the repayment of loans taken for the EU's coronavirus aid package. On the other hand, they are meant to create an incentive to reduce the consumption of single-use plastics, increase recycling rates, and thereby boost the circular economy in the plastics sector, it is reported. The plastic own resources are made up of a national contribution calculated at 0.8 euros per kilogram of non-recycled packaging. However, because the relevant data are always available only after two years, the contributions are based on forecasts that must be adjusted afterward—a vulnerability! Last year, revenues from plastic own resources totaled approximately 7.2 billion euros, which only represents four percent of the total revenue of the EU.

Auditors call for intervention by the EU Commission

The auditors note, given the shortcomings, that only five EU countries have timely implemented the directive on packaging and packaging waste into national law. Therefore, the European Commission has initiated infringement proceedings against the remaining 22 countries. One of these proceedings was still pending at the time of the audit. After implementation into national law was complete, an external contractor carried out conformity checks. In most cases, the results showed that at least one key provision (such as the definitions of plastic and packaging or the calculation of generated and recycled plastic waste) was not properly implemented. Addressing these issues may now take years. Until then, the auditors believe that EU countries are likely to continue using inconsistent definitions and inappropriate methods for data compilation, which will affect the calculation of their contributions. Only six EU countries reported recycling data that were collected at the beginning of the process, as required by regulations. The rest mostly used data that were captured at the output of sorting facilities, which were calculated with average loss rates. This makes the EU countries' recycling estimates difficult to compare, and there is no adjustment for deviations. Therefore, the auditors are demanding that the European Commission now intervene.

Gap in plastic own resources runs into the billions

In the first year of implementing the plastic own resources (2021), 22 EU countries forecasted an amount that was lower than what was later calculated based on the final data. The total amount of non-recycled packaging waste projected for 2021 was 1.4 billion kilograms less than the actual amount reported in 2023. As a result, the plastic own resources for 2021 were underestimated by 1.1 billion euros—nearly a fifth of the 5.9 billion euros collected that year—and the shortfall had to be replaced from another revenue source to balance the budget. Due to insufficient controls, there is a high risk that some of the packaging waste may not actually be recycled. If waste declared as recycled is instead burned, disposed of, or sent to landfills, this not only constitutes a real environmental crime but also leads to an unjustified reduction in own resource amounts.

“This article was first published on our sister portal "MM MaschinenMarkt" (German Edition), Vogel Communications Group.“