Data indicates that 87% of Americans support the concept of recycling. Yet only 21% of potentially recyclable material from residential sources is collected, the rest going to landfills. Overall recycling rates in the US have been stagnant for over a decade.

Trying To Fix a Broken System

Current recycling programs are underperforming at best and flat out failing at worst. To improve recycling programs, seven states have enacted Extended Producer Responsibility (EPR) programs. These programs are designed to fund and implement systems to increase overall recycling rates. At their core, these new programs aim to transfer the financial burden of recycling to the producer of the product.

A favored target of current EPR legislation is single-serve beverage packaging. For good reason: over 86 billion plastic water bottles were sold in 2021 and less than 33% were recycled. Aluminum can sales reached 107 billion that same year, with 45% recycled. Glass totaled 35 billion containers sold, with 72% of those going to landfills.

Why Single-Serve Packaging Is in the Crosshairs

Based on consumer demand, single-serve beverage packaging has increased dramatically, and all signs indicate this trend will continue. Recycling systems simply have not been able to keep up. Americans voice concern over the environmental impact of single-serve packaging, but that concern has not changed purchasing behavior. EPR regulations represent the idea that solutions for single-serve packaging will have to come through government regulations and producer responsibility.

In theory, EPR legislation will penalize users of environmentally unfriendly material, such as plastic, and drive producers towards packaging materials that are easier to recycle, contain significant recycled content, and increase recycling rates, such as aluminum. In a perfect world, EPR legislation might even stimulate the development of new packaging formats.

Where Craft Brewing Stands

Meanwhile, craft brewers primarily use what is considered by many to be the most eco-friendly packaging available: the aluminum can. Some would argue that craft brewers’ second choice for packaging, the glass bottle, has a different set of characteristics that make it more eco-friendly. There is merit in those arguments, but for now, the abysmal recycling rates of glass gives aluminum the advantage.

Craft brewers might be able improve the environmental impact of their packaging around the margins, such as reducing the amount of paper or carboard used or avoiding plastic materials, but game-changing improvements that will create a significant reduction in EPR fees are out of reach.

What does the cost and availability of aluminum cans look like for craft brewers if Coca-Cola switches the packaging of Dasani water from primarily plastic to aluminum?

EPR regulations may already be having an impact. Recent industry data reports a 5.7% drop in the use of plastic for single-serve beverage packaging along with a 9.2% increase in the use of aluminum. Volatile and sometimes in short supply, what does the cost and availability of aluminum cans look like for craft brewers if Coca-Cola switches the packaging of Dasani water from primarily plastic to aluminum? Aluminum smelting capacity in the U.S. is in critical long-term short supply. Aluminum can manufacturing capacity remains under intense pressure to meet demand. Building the infrastructure to meet the growing demand for aluminum is a long term and expensive undertaking. The immediate goals of EPR regulation are mismatched to the current capacity of the aluminum industry in the U.S.

A Mismatch Between Goals and Capacity

Another theory holds that increased aluminum can recycling will reduce the cost of aluminum for can manufacturers, which in turn will reduce the price of cans. That said, brewers should not hold their breath waiting for a reduction in the price of the cans they are buying because of EPR.

The U.S. certainly needs to find ways to decrease waste and improve recycling. EPR programs for single-serve beverage packaging are new with many questions surrounding their efficacy yet to be answered. In the short term, deadlines for registration and implementation for brewers selling products in the seven states that have passed EPR regulations is neigh. While all seven states that have enacted EPR have varying exceptions for small businesses, many craft brewers are facing compliance in the form of financial and administrative obligations.

More information on approaching deadlines and small-business exemptions is available:

• Extended Producer Responsibility Deadlines Approaching
• States with Extended Producer Responsibility Laws

Additional state legislatures are considering new EPR laws. See where your association is tracking and working on legislation in the states.

Time will tell the full extent of the positive impact or the unintended consequences of state level EPR programs.