Philippine towns, cities are paying high cost of waste management. Plastic producers should help

Quezon City is paying an average of P1.6 billion annually for solid waste management. An imperfect new law mandating plastic producing companies to collect their materials – if strictly implemented – could reduce waste in landfills and provide financial respite to LGUs.

By ELYSSA LOPEZ / Philippine Center for Investigative Journalism (PCIJ)

Last of two parts

Tucked in the corner of the Dultra family’s garage are sacks full of used plastic packaging. There are water bottles, and bubble wraps—remnants of the family’s daily living consumption. 

“Our family has made a practice of keeping our plastic waste in one bag,” said Sarah Dultra, the family’s matriarch. “So when the barangay official comes we can easily hand it in.” 

In her barangay, located in the province of Rizal, east of Manila, officials visit households twice a month to retrieve segregated plastic wastes. Each household earns an entry into the barangay’s year-end Christmas raffle, where winners may bring home small appliances or a sack of rice. 

The barangay has also set up a materials recovery facility (MRF), equipped with a machine that can shred plastics into tiny pieces that can be molded into an eco-brick. Each piece can be sold for P26. 

The whole practice has been so successful that it has helped the barangay employ four more employees, and add more revenues into their coffers. It’s all part of the barangay’s solid waste management program, and in theory, what the Ecological Solid Waste Management Act of 2000 envisioned each barangay would be. 

But as of 2022, the Dultra family’s barangay was a mere outlier.  

More than two decades after its passage, local government units’ (LGUs) compliance has been found wanting. There are only 318 sanitary landfills (SLFs) nationwide for the 1,715 LGUs in the country, and 16,418 MRFs for 42,036 barangays.

“Our waste problem is such because we lack the proper infrastructure needed to process them,” said Dr. Tonette Tanchuling, director of the University of the Philippines Institute of Civil Engineering.  

 Financial respite for LGUs 

A ban on single use plastic would have had an immediate result. The country’s “sachet economy” has often been cited as one of the reasons for the country’s waste problem. 

Aside from convenience, sacheted products are the cheapest and most accessible products for many Filipinos. But because the materials used in the production of such are unrecyclable, they often clog landfills, or worse, leak to the environment.  

The EPR law, while it’s not the ideal solution for environmentalists, should reduce the plastic wastes that end up in landfills and offer financial respite to LGUs. 

A PCIJ analysis showed that from 2017 to 2020, LGUs in the National Capital Region (NCR) alone spent an average of P384 million over the four-year period on waste management. The analysis is based on the financial statements of the NCR’s 16 cities and one municipality, which include expenditure for “environment and sanitary services.” The item includes an LGU’s expenses on garbage collection and disposal and other sanitation programs. 

The huge amounts spent by LGUs on waste management are still far from the ideal, said Miko Aliño of Break Free From Plastic.

A Flourish chart

“If a particular city tries to upgrade its waste management infrastructure, it would cost as much as 20 percent of its annual budget. That’s how much waste management [should] cost, in an ideal world,” he said. 

Based on PCIJ’s analysis, current spending on waste management of LGUs in NCR is less than a tenth of their annual budgets.  

Sen. Cynthia Villar’s original bill in the Senate would have been more favorable to LGUs. SB 1331, before she filed substitute bill SB 2425, called for corporations to coordinate with municipal and city waste management offices so that the LGUs may benefit from direct incentives. This was removed in her substitute bill. Instead she listed  “possible” EPR programs that obliged enterprises may adopt. This language was eventually maintained in the final version of the law. (TIMELINE: EPR in the Philippines: Law pushed by plastic producers took 15 months to hurdle Congress)

 PH’s EPR law is ‘polluter friendly’ 

The EPR law could still provide aid to LGUs if it’s implemented strictly. 

Under the EPR law, a company must recover 20% of its plastic wastes by year-end of 2023, a target that increases by 20% a year until it reaches 80% by the end of 2028. The company is required to register its EPR program with the Department of Environment and Natural Resources (DENR) for proper audit. It may undertake its own EPR program or tap another party called the producer responsibility organization (PRO), such as PBSP and PARMS, to do this. 

These obliged enterprises and PROs are free to choose however they wish to “recover” the waste they produce, as long as these activities are the ones cited under the IRR of the EPR law.  For instance, it encourages enterprises to redesign their products for better recyclability, and to establish recycling facilities themselves. 

But for civil society groups, the EPR Act of the Philippines is “polluter friendly” because it only provides plastic waste recovery targets for manufacturers, and not a clear timeline for phaseouts of plastic products. 

Case in point: Plastic Credit Exchange (PCX), one of the more popular organizations that have registered as PRO, employs a “waste diversion” scheme that had long been frowned upon by environmentalists: co-processing.

The organization, like PARMS, connects companies with waste recovery firms for a fee. The company’s website says it has helped Unilever recover plastic waste for $350 per ton. It collects plastic wastes that could, later on, be fed as feedstock in cement kilns. This process requires incineration, which is technically illegal under the Clean Air Act. But administrative orders issued by the DENR over the years have allowed such facilities to keep operating. 

A PCIJ report earlier revealed that government monitoring of such facilities is not at par with the country’s Asian neighbors. The emission standards for these sites have also not been updated ever since the Clean Air Act was passed in 2001. 

“It [the policy] encourages unsustainable and false solutions to the waste crisis such as chemical recycling, cement kilns, and waste-to-energy incinerators. Recycling alone will not solve the waste and climate crisis,” Kabataan Partylist Rep. Sarah Elago said when she voted against the bill. 

EPR was intended to create a market for waste processing facilities and contribute to the establishment of a circular economy, where companies are incentivized to adopt a “holistic eco-design’’ of their products, according to the World Wide Fund. 

The policy of circular economy, introduced in the 1980s, “aims to make producers responsible for the environmental impacts of their products throughout the product chain, from design to the post-consumer phase.” 

Since then it has been widely adopted by affluent countries, such as Japan, South Korea, and the European Union state-members. At least 400 EPR schemes are used worldwide, according to the Organisation for Economic Co-operation and Development (OECD). 
It’s a welcome development since it comes at a time when governments worldwide are committing to lowering greenhouse gas emissions to slow down global warming. The main component of plastic is fossil fuel, the main culprit for the planet’s rising temperatures over the last few years. At least 75 percent of the world’s greenhouse gas emissions are due to fossil fuels. 

 The Philippines’ EPR needs time to be effective?  

Crispin Lao, executive director of PARMS (Philippine Alliance for Recycling and Materials Sustainability),  said the industry needs time to show results. He has maintained that the industry is  supportive of the EPR law despite its complaints about the gaps in the government’s information dissemination. 

After all, for Lao, the law provides a “certain level of flexibility” that allows companies to comply. For instance, the law allows enterprises to lead clean-ups in coastal areas and public roads and register collected plastics in these activities as part of their EPR program. It also encourages them to put up water refillable stations to reduce plastic production in their supply chain. 

But these activities are what environmentalists have frowned upon as it could lead to “false solutions” to the waste problem. “If you look at the framework of the EPR,  it tackles plastic pollution but sees it as a litter problem, not as a production problem,” said Aliño of Break Free From Plastic.   

This could then lead companies to focus on collecting and recovering wastes, instead of crafting a plan that would lead them to reduce plastic in their supply chain altogether. 

 “We have to be really cautious to stay true to the principles of EPR of making polluters pay. If we don’t take strong measures, it would be business as usual,” said Salamat of EcoWaste Coalition. END

The Philippines is finally going after plastic producers but some companies are not cooperating

‘There are some companies, which may not have sustainability as a priority, that are still in denial that they are mandated to do the EPR law,’ says Crispin Lao, executive director of the Philippine Alliance for Recycling and Materials Sustainability.

By ELYSSA LOPEZ / Philippine Center for Investigative Journalism (PCIJ)

Environmental groups in the Philippines have long advocated for a single-use plastics ban, and hundreds of proposed laws and resolutions were filed in Congress in the past decade to support the call. Nothing prospered. 

Instead, Congress required the country’s biggest plastic-producing companies to pay to collect and recycle their materials. 

The Extended Producer Responsibility (EPR) Act of 2022 mandates companies with more than P100 million assets to develop a scheme to recover the same amount of plastics they produce or face a fine of at least P5 million.

It’s been a year since the law took effect, but the implementation remains short. The Philippine Center for Investigative Journalism (PCIJ) learned the companies continue to exhibit a “wait-and-see” attitude on how the administration of President Ferdinand Marcos Jr. will implement the measure, casting doubt on the country’s ability to tackle its growing plastic waste problem. 

Unclear guidelines are leading companies to have a cautionary approach to the law, according to the Philippine Business for Social Progress (PBSP), tapped by 29 corporations to capture their plastic packaging wastes from the environment under the EPR law.

“The main challenge right now is that the guidelines for implementation are still in flux,” Elvin Yu, PBSP executive director, told the PCIJ.   

“It’s still unclear what the guidelines are for the compliance audit of obliged enterprises, for example, and we are seven months into the year. That’s going to be a problem,” he added.

The National Ecology Center under the Environmental Management Bureau (EMB) has yet to issue a compliance auditing manual for these enterprises, he said.  The Department of Finance, specifically the Bureau of Internal Revenue, is also silent on the tax incentives for the enterprises. 

“So many companies are in a wait-and-see attitude. They want to know how the DENR (Department of Environment and Natural Resources) would really implement the law,” Yu added.  

Crispin Lao, executive director of PARMS (Philippine Alliance for Recycling and Materials Sustainability), observed that some companies remained confused about the kind of EPR programs to adopt and the kind of benefits to avail of.  

“There are some companies, which may not have sustainability as a priority, that are still in denial that they are mandated to do this [EPR],” Lao added. 

“Kita naman na nangangapa pa sila (It’s clear they’re groping in the dark),” Lao said, when asked on how the EMB has handled the EPR implementation so far. “It would have been better if there were more discussions, more talks with the private sector so they could be prepared.” 

If the government was clear on the tax incentives, “it could have been one way to encourage registration and compliance of obliged enterprises,” said Ferth Vandensteen Manaysay, deputy manager at the Climate Reality Project Philippines. 

PCIJ reached out to the DENR and the EMB, but has yet to receive a response. 

 Low registration among companies 

In a forum with business leaders two months ago, Environment Secretary Antonia Yulo-Loyzaga pleaded with the enterprises to register their EPR plastic recovery program with the government given the relatively low number of registrants.  

“We need your help [so more would be] registering in the EPR. This is extremely important for us to bring down the amount of solid waste that is released into our environment,” she said then.   

As of July, only 662 of around 4,000 enterprises registered with the Department of Trade and Industry had submitted to the National Solid Waste Management Commission their programs for the proper management of their plastic wastes. 

Under the EPR law, a company must recover 20% of its plastic wastes by year-end of 2023, a target that increases by 20% a year until it reaches 80% by the end of 2028. 

The company is required to register its EPR program with the DENR for proper audit. It may undertake its own EPR program or tap another party called the producer responsibility organization (PRO), such as PBSP and PARMS, to do this. 

Enterprises face minimum fines of P5 million on first offense and P10 million on second offense, and suspension of business permit on third offense.  

The industry’s slow compliance has prompted the DENR to implement the EPR law in mostly urban areas, such as Metro Manila in Luzon, Cebu in Visayas, and Davao in Mindanao this year. These areas, after all, would have the most available  facilities for waste processing. 

LOOK: Where the EPR Law is implemented

Gaps in the law 

For environmental groups, the industry’s lukewarm reception reveals gaps in the new law.   

“We initially wanted higher fines, for example, because P5 million could easily be the annual salary of the top executives [of these companies],” said Coleen Salamat of the EcoWaste Coalition.  

A longer consultation with stakeholders could have led to a stronger, more effective policy, she said.

The law is problematic because companies may still continue producing plastic waste and not have clear commitments on plastic reduction, said Miko Aliño of Break Free From Plastic.

“Under this law, as long as you are collecting waste, whatever you do, whether you burn it in cement kilns, or recycle, you are compliant… The law allows them (corporations) to operate business as usual,” Aliño said.

“It’s what my colleague Von [Hernandez] would say as a ‘polluter-friendly’ policy’.” 

Salamat said she and her colleagues were “shocked” by the speed of the deliberations. It was “quick’’ in comparison with other environmental laws, he said. (TIMELINE: EPR in the Philippines: Law pushed by plastic producers took 15 months to hurdle Congress)

“Meanwhile the Single Use Plastics Ban bill had not made progress, when it was vocally supported by former President [Rodrigo] Duterte,” Salamat said right after Congress passed the EPR law.

PARMS, which counts some of the biggest fast moving consumer goods (FMCGs) companies as members, was one of the industry groups that lobbied for the passage of the EPR law. Its members include Coca-Cola Philippines, Monde Nissin, Universal Robina, P&G and Unilever.

“Before, the conversation was geared towards the banning of single-use plastic applications, but Congress could not provide an alternative [to the material],” Lao said. “So yes, the industry is supportive of the EPR.” 

The measure was first introduced in the Senate in February 2020, right before the pandemic, by Sen. Cynthia Villar. According to a Reuters report, Unilever had directly lobbied Senator Villar to push for its passage.  

A year later, the senator’s daughter, Las Piñas Rep. Camille Villar, also introduced the EPR bill in the House of Representatives. Congress deliberated the measure as the Covid-19 pandemic raged and saw its passage within 15 months, from the first time a Senate joint committee first conducted a hearing on the measure. 

Duterte was supportive of the ban on single-use plastics, according to his spokesperson Salvador Panelo. While presidents have the power to veto bills, Duterte sat on the measure. He left his post without approving or rejecting the proposed EPR law.

Marcos Jr. succeeded Duterte. In his inaugural speech, he vowed to “clean up” the country’s plastic waste problem. “We are the third biggest plastic polluter in the world, but we won’t shirk from that responsibility. We will clean up,” he said. 

Marcos could have vetoed the EPR law, too, but he didn’t exercise this power. He also sat on the measure until it lapsed into law in July 2022, during his first month in Malacañang, 

A year into his presidency, during his second State of the Nation Address on July 24 this year, Marcos asked Congress to pass a law imposing excise taxes on single-use plastics. 

Environmentalists are afraid it may still not be enough. END