OECD defines Extended Producer Responsibility (EPR) as an environmental policy approach in which a producer’s responsibility for a product is extended to the post-consumer stage of a product’s life cycle. An EPR policy is characterised by: (1) the shifting of responsibility (physically and/or economically; fully or partially) upstream toward the producer and away from municipalities; and (2) the provision of incentives to producers to take into account environmental considerations when designing their products. While other policy instruments tend to target a single point in the chain, EPR seeks to integrate signals related to the environmental characteristics of products and production processes throughout the product chain.
Since 1994, OECD has published several reports and in 2001 a Guidance Manual for Governments, which provides information about issues and potential benefits and costs associated with EPR. Drawing on the experience of OECD countries, it provides a set of principles to guide policy makers as they make decisions about EPR policy and programmes. The Guidance Manual also identifies several policy instruments for implementing EPR: take-back, economic instruments e.g. advanced disposal fees, deposit-refund, a combined upstream tax/downstream subsidy and standards.
As EPR policies develop in OECD countries, a systematic economic analysis and assessment is required more than ever. To this end, the OECD organised a workshop in 2002 on Economic Aspects of Extended Producer Responsibility. Some important questions answered by the workshop concerned how to set economically sound objectives, devise cost effective EPR policy instruments and ensure that appropriate evaluation and feedback mechanisms are in place to verify.
To help governments make more informed decisions about EPR implementation and assess the social costs of such policy, an OECD report proposes a framework for analysing the costs and benefits of such programmes: “Analytical Framework for Evaluating the Costs and Benefits of Extended Producer Responsibility Programmes”.
By placing responsibility for a product’s end-of-life environmental impacts on producers, EPR policies are also expected to push them to redesign their products for environment. Such change, while reducing waste management costs, should as well reduce materials use and enhance product reusability and recyclability. A recent OECD report , “EPR Policies and Product Design: Economic Theory and Selected Case Studies”, discusses the potential Design for Environment impacts of EPR policies and provides practical examples of the extent to which some EPR programmes are contributing to ‘Design for the Environment’.