October 2010 Management Briefing – Drinks Packaging - Part II
Drinks packaging recycling becoming increasingly common worldwide
Sustainability is becoming increasingly important in the beverage industry, and worldwide companies have been embracing environmentally-conscious initiatives.
In the Canadian province of Ontario, for example, The Beer Store (TBS), a protected retailer under Canada’s regulated drinks sales system, collects empty packaging, and boasts of a return rate of 94% between 2008 and 2009. The store charges CAD0.10 (US$0.10) deposit on every beer bottle, which is then returned to breweries, where it can be reused 12 to 15 times before being recycled. Since 2007, TBS has also collected empty wine and spirits bottles, which are subject to a CAD0.20 deposit at the provincial government-owned Liquor Control Board of Ontario (LCBO) wine and spirit monopoly. Between 1 May 2008 and 30 April 2009, TBS collected 1.4bn beer bottles for refilling and 470m beer bottles for recycling. It also collected 259m other beverage containers such as wine and spirits bottles, with a 73% return rate – up 6% from 2007-2008. It also recycled more than 27,000 tonnes of secondary packaging such as cardboard boxes and six-pack plastic rings.
“Globally, societies are seeking ways to ‘green’ their economies – that is, to reduce the environmental impact of the economy while creating green jobs,” says TBS' president, Ted Moroz. “The Beer Store packaging management system is the perfect example of a cradle-to-cradle environmental management system that does just that.”
Of the approximately 2bn beers sold by TBS, about 1.4bn or 70% are sold in refillable bottles – but since the bottles can be refilled up to 15 times, it only takes about 93.4m bottles to meet the 1.4bn refillable servings. This means the system avoids the creation of 1.3bn bottles annually, saving enough energy to heat more than 25,000 Ontario homes for a year, according to TBS.
The company has also spearheaded the creation of an industry standardised refillable bottle (ISB), which 48 Canadian breweries use to cut time and energy losses caused by using alternately-shaped bottles. The introduction of the ISB has been so successful, TSB claims, that today it is the most returned package in the world.
Germany is also a well-known trailblazer on recycling drinks packaging. It has had a nationwide deposit system, with a EUR0.25 (US$0.35) deposit on all PET, glass and aluminium beverage packages, since May 2006. Germany was also the birthplace of the ‘green dot’ system, which Duales System Deutschland GmbH (DSD) began using in the 1990s. The system helped inspire European Union reforms such as the 1994 packaging and packaging waste directive. Today, DSD still operates Germany’s dual collection system, which collects marked household packaging alongside regular waste. To use the dot, companies pay a licence fee, the rate of which is dependent on packaging weight and type. According to DSD, approximately 2.75m tonnes of packaging were recycled in Germany in 2009, saving about 60bn megajoules of energy.
Neighbouring Switzerland’s recycling rates are also incredibly high, and beverage packaging greatly surpassed its 75% recycling targets in 2009, according to Switzerland’s Federal Office for the Environment. Glass maintained a 95% return rate and aluminium a 91% rate, while PET recycling rates rose from 78% in 2008 to 81% in 2009, mainly due to 2,600 new recycling bins being placed in busy areas.
That said, recycling rates vary considerably across Europe, from 79% in Belgium to 11% in Malta, as of 2006. The EU-27’s average recycling rate was 56% in 2006. According to a report from the European Organisation for Packaging and the Environment (Europen), Ireland had the strongest growth, jumping from 15% in 1998 to 55% in 2006. The UK’s performance was also strong, doubling from 28% in 1998 to 58% in 2006, the organisation says.
Encouraging these recycling programmes is often better than embracing biomaterials that cannot be recycled, says Terry Robins, from Robins Packaging Consultants in Wales. “Beverage bottles often use polyester materials, which are easily recycled and easily collected,” he says. “So, why would someone want to change to a biodegradable material, if you’re going to destroy that recycling scheme? It’s become a little bit of a cliché.”
Europen’s director Julian Carroll agrees that the benefits of biomaterials are sometimes overstated. “I think it was a dream of every beverage company to put their products in bio-based packaging – that it would be the answer to their prayers,” he says. “But, you still have to do something with it – it doesn’t disappear in a puff of smoke.”
Robins believes that reducing energy and water consumption, light-weighting materials and encouraging proper recycling schemes is often a better path to sustainability.
“If you look at glass bottles,” he says, “the glass industry has actually been brilliant in their systems for using lightweight glass. They were also one of the first industries to introduce recycling in a big way. The same can be said of the aluminium and steel industries - they are encouraging recycling, aluminium in particular.”
Sourcing recycled materials also makes packaging more eco-friendly. According to the Container Recycling Institute in the US, it takes 270m British thermal units (MBTu) to replace the aluminium landfilled in the US – the annual energy consumption of about 1.8m US households.
But, there are pitfalls to using recycled materials in drinks packaging. “If the source of recycled material isn’t available, for heavens sake don’t start importing it from halfway across the world merely to have a ticket on your bottle saying the material is 20% recycled,” Robins warns.
Princes, a UK-based food and drinks company, recently installed air recirculation systems at its largest UK plant to reuse excess compressed air needed to blow PET beverage bottles. This has created a 22% energy saving, according to the 2010 sustainability report from trade body the British Soft Drinks Association (BSDA).
Meanwhile, Switzerland-based Tetra Pak has teamed up with the UK’s Alliance for Beverage Cartons and the Environment (ACE UK) to initiate a food and drink carton recycling network. Cartons can now be recycled across 86% of the UK, the BSDA says.
These initiatives are cropping up all over the world, and Jane Bickerstaffe, director of the Industry Council for Packaging and the Environment (INCPEN) in the UK, believes that there is a reason companies make the news, not governments.
“Companies are ahead of the regulators,” she says. “The big companies have comprehensive sustainability programmes that actually look at where they’re sourcing materials from, how they’re using them, and how they can get value back from them after use. Governments are still in danger of taking a piecemeal approach, and creating unintended consequences.” Focusing on one harmful practice "could unintentionally create worse environmental impacts somewhere else on the chain”, Bickerstaffe says.
Soft drinks manufacturers are especially ahead of the game, she claims, because packaging plays such a large part in the product's offering. “It’s no coincidence that soft drinks companies have been very keen to promote recycling programmes, because by getting some of the materials back they support their larger supply chains,” she says.
Coca-Cola Enterprises, for example, has taken this to heart, partnering with the Waste and Resources Action Programme (WRAP) and Recoup, a recycling charity, in the UK to set up a number of ‘recycle zones’ in busy areas. This kind of initiative ultimately creates sustainability, according to Carroll. “There has been a big rush to bring in ‘sustainable packaging’ even though we can’t define it,”he says. “But, we shouldn’t throw out the baby with the bathwater. We shouldn’t walk away from eminently environmentally-friendly materials just in the name of so-called sustainability.”
- Are we kidding ourselves over craft spirits?
- What's behind Brown-Forman's Irish whiskey plans?
- Is Brown-Forman doing a Jack Daniel's in Ireland?
- How good a sustainability fit are ABI and SAB?
- Interview - Heineken global activation director
- Diageo, Treasury Wine Estates quiet on wine sale
- Chandon to become "third pillar brand" for MH
- Brown-Forman silent on Southern Comfort report
- Pay freeze anger threatens Carlsberg UK site
- Stoli appoints international marketing director
- The IWSR Duty Free/Travel Retail Report 2015
- Future growth opportunities for global spirits
- Global gin insights - market data, product innovation and consumer trends research
- Global non-Scotch whiskies insights - market forecasts, product innovation and consumer trends research
- Global Scotch whisky insights - market forecasts, product innovation and consumer trends research