1. Extensive usage of non-biodegradable plastic shopping bags in retail outlets Szilvia Hosser – November 29, 2007 ESPM 4242

2. Problem description Background information Goals for policy proposal Existing programs worldwide, US, Twin Cities Alternatives Evaluation criteria Proposed solution

3. Description of the problem Plastic bags are polluting to the environment and the cost of discarding them imposes high costs to society

4. Background information Plastic bag use in USA 100 billion annually Less than 1% of USA plastic bags are currently being recycled (EPA) Polluting to the environment Lethal to animals Un-recycled plastic bags go into littler stream Collecting, and transporting to landfill represent high costs to society

5. Background information Extensive use of fossil fuels for production and transportation Interferes with state’s energy reduction efforts Takes a long time to fully break down, are hard and costly to recycle “Free” plastic bags are costly to the customers (incorporated into prices) Cost to economy

6. BUT Plastic bags are popular with consumers and retailers Convenient Functional Cheap Hygienic Lightweight Easy to transport food and other products

7. Goals Reduction of non-biodegradable single-use plastic bags used by customers in Minnesota in grocery stores (with that reduce the number of bags going into litter stream) Achieve a long-term goal of customers using other types of bags (biodegradable, reusable, canvas) Achieve environmental goals that is supported by the community, economically efficient and practical.

8. Existing programs in other countries, and US states Voluntarily approach in Australia Ban in Bangladesh Ban, Taiwan Ban in Bombay, India Tax in Denmark Consumer levy in Hong Kong Levy program in the Republic of Ireland Consumer levy, Italy Consumer levy, Northern Ireland Supplier levy, South Africa San Francisco: The Plastic Bag Reduction Ordinance (ban at supermarkets and chain pharmacies) New Jersey: tax to the manufacture, wholesale, distribution and retail of ‘ litter generating ’ products.

9. Existing programs efforts in the Twin Cities "It's in the Bag" program (2003): Recycling consumer and business plastic film material. Bins at several collection points. Merrick, Inc. collects and sorts bags & Trex Company recycles into wood-polymer material used for decking and railing (for homes). Initiatives of retailers: ie. Target (offers biodegradable bags for a charge), Ikea (charge for bags), Mississippi Market etc. (1c rebate per unused bag).

10. Alternatives Voluntary approach Voluntarily (consumer levy) programs with retail stores signing up Manufacturing & purchase of plastic bags still continue, but likely to be lower Highly dependent on the scale of retailer participation

11. Alternatives Supplier Levy Taxing of producers and importers Problem: Suppliers will likely to transfer the costs coming from the higher tax to consumers Thus no direct impact on customers (no awareness of problem, no incentive to change behavior, litter problem remains) Difficulty in collection and enforcement (e.g. if supplier comes from out of state)

12. Alternatives Consumer Levy Charging customers for using non-biodegradable plastic bags The purchase of plastic bags still be allowed, but there would be a charge at the checkout-counters Manufacturing & transporting the plastic bag waste to landfills remains but lower

13. Alternatives A complete ban Total elimination of overall plastic bag use Drastically reduces the demand for plastic bags Drastically reduces the number of plastic bags manufactured / imported Plastic bag waste problem solved Problem: Resistance by consumers and business by restricting of choice

14. Evaluation criteria Effectiveness Social acceptability & Equity issues Costs

15. Effectiveness Voluntary approach Expected low reduction of plastic bag use demand, waste (~50%) Supplier levy Scale of reduction depends on # of participants Consumer levy Higher reduction of plastic bag use (~70%) Decrease in demand for disposable bag (~ 90%) Ban ~ 100% reduction

16. Voluntary approach Expected high acceptability from retailers and customers alike Question equity among retailers Supplier levy Expected supplier resistance Customers may not be aware of levy (unless they are informed via education and / or media) Social acceptability and equity issues I

17. Social acceptability and equity issues II Consumer levy Low(er) initial acceptance by customers and retailer alike: Customers used to convenience of ‘free’ shopping bags Retailers foresee they need to change their operations Ban Low social acceptability: creates resistance

18. Costs Voluntary (levy) Consumers: lower than other options if not all retailers sign up Retailers: structural changes: training, change facility, time (similar to ban and levy) Supplier levy Consumers: passed on costs Retailers: none expected Suppliers: costs to comply initially but costs are likely to be passed on to customers

19. Costs Consumer levy Customers: high costs (~ 5 times higher than voluntary option) Retailers: Structural changes: time and money spent on training employees, change facility (~ 1.5 times higher than voluntary) Slower operation expected esp. in the beginning Lower costs later as demand decreases Cost to stakeholder that needs to report (supplier or retailer) Ban Customers: high costs Retailers: high costs Administrative: high, local government, reporting

20. Evaluation Effectiveness Ban Equity & social acceptability Voluntary effort Consumer levy together with educating public Lowest costs Voluntary option

21. Proposed solution Consumer levy & education programs to increase environmental awareness Charging of 10-15c on use of plastic bags starting with grocery stores Exceptions: bags for non-packed goods (e.g. fruit, vegetables, fresh meat etc) Revenue to an environmental fund to support waste management, environmental & education programs, supporting materials Fine those who not comply Enforced by a local authority Retailer needs to keep track and report sales

22. Consumer levy & education Advantages: Decreased demand for disposable bags (~90%) thus less costs to produce, transport, & amount of litter reduced Customer awareness high Consumers pay thus motivated to recycle and reuse Socially acceptable with use of education programs and promotion materials Encourages manufacturing reusable or/and biodegradable, canvas bags

23. Consumer levy & education Possible problems: Lost convenience of ‘free’ bag Low income customers (they need to convert to long-life bags right away to avoid charges) Experience shows that demand for trash liners can increase

24. Questions?