A call to action: End markets and EPR

If you follow plastic news at all it is almost impossible to avoid the acronym EPR. As plastic waste surges from a not-so-mere 500 million tons per annum in 2025 to an expected 1 billion tons in 2050, states are looking to extended producer responsibility (EPR) plans to solve this plastic waste crisis. 

My state in particular, Colorado, has enacted and implemented EPR policy, known as HB 22-1355. This bill, one of only 7 in the United States addressing plastic packaging waste, is lauded as one of the most comprehensive packaging EPR programs in effect. 

As is typical of state-level policy framework for packaging EPR, Colorado’s final plan, as drafted by the producer responsibility organization (PRO) Circular Action Alliance (CAA) is meant to increase plastic recycling rates and place the cost of recycling onto the backs of the producer, not the consumer.                               

As a constructionist I see all legislation as something that evolves over time as society progresses. However, I note that Colorado’s framework does not create demand in the same direct way that a mandatory recycled-content law would. By focusing entirely on the supply side of recycling and simply incentivizing, not mandating, the use of recycled content, one worries about the actual use of recycled content in plastic packaging. 

The success of Colorado’s EPR incentive program, and the use of recycled content by packaging companies, greatly hinges on cost. Today, recycled resin ranges from 20% to over 100% more expensive than its virgin counterpart. Figure 1 details the average cost premium of utilizing recycled resin instead of virgin. 

To understand whether Colorado’s EPR policy will increase recycling rates from the current 15% statewide cited in the legislation, we must compare paying a premium for recycled resin to paying EPR fees. Figure 2 explores this for the four most common packaging polymers, broken out between currently recyclable with today’s existing infrastructure or not, identified in the EPR legislation.

Using these figures, we see that in only 25% of cases it makes financial sense to offset virgin resin with recycled content rather than simply paying the annual EPR tax. It also remains to be seen if, in the case of non-recyclable PET packaging, saving 10% is worth an internal operational change.

Diving deeper, despite the high premium placed on recycled resin, very few post-consumer recycling firms are thriving, with several recently shutting down operations. This year alone 25% of facilities processing PET bottles into RPET closed, citing lack of brand demand, oversupply in the market, increased imports and cheap virgin resin. Will a few state-level EPR laws addressing only the supply side turn this around? Microeconomics 101 informs that supply without demand leads to market collapse. 

History has seen this before, and not too long ago. Despite being a former beacon for climate action in Europe, Germany recently faced a paradox. Overproduction of solar energy hit the country’s market due to an overuse of feed-in tariffs that provided guaranteed fixed rates. Production surged, and in May 2025, electricity prices in Germany dropped to negative levels, reaching as low as -€250.32/MWh. This situation arose because solar generation exceeded demand, forcing producers to pay consumers to take excess electricity off the grid. 

But history has also seen successful environmental policy. In the United States the use of Renewable Portfolio Standards (RPS) have been seen as widely rewarding. Since the first RPS policy was enacted in Iowa in 1983, 38 states have implemented varying forms.      

RPS policy mandates that every utility operating in a state must offset a percentage of their annual electricity load with varying forms of renewable energy as defined by that state. Rather than mandate that a utility participate in a complicated tax scheme, like EPR does with large packaging companies, it simply creates demand that supports infrastructure investment from both the utilities and third-party developers. The market does the rest, and the auditing programs are simple. 

Although improvements can be made to RPS policy, such as targeting emissions reductions rather than energy generated from a specific technology, its success is acclaimed. In addition to reducing CO2 emissions by up to 175 million metric tons within seven years of implementation, RPS policy has also created 4.7 million job years of employment and has positively impacted US energy independence. As of today, over 95% of utilities meet their RPS requirements each year. 

As detailed above, there is concern as to whether Colorado’s EPR policy will actually increase recycling rates. Understanding that current penalties do not financially justify widespread use of recycled resin, and the chance for recycled resin over supply and market collapse, it is imperative that Colorado follow California, Washington and other states that incorporate recycled-content mandates into the final EPR plan.