Additional gratitude is reserved for all the presenters and attendees at the workshop. The excellent preparation by presenters and the in-depth participation of the attendees made the workshop worthwhile. Finally, thanks to Eastern Research Group, Inc. ( ERG), and its staff for their professional meeting support. (ERG provided support under contract to EPA.)

Martin A. Spitzer, J.D., Ph.D.
Executive Director
President's Council on Sustainable Development

Impetus for Convening the Workshop

Under an innovative system of EPR, all participants in the product life cycle designers, suppliers, manufacturers, distributors, users and/or disposers share responsibility for the environmental effects of products and waste streams. "The greatest respo nsibility for EPR rests with those throughout the chain of commerce...that are in the best position to practice resource conservation and pollution prevention at lower cost" (p. 40).

EPR is a principle that can be applied by industry voluntarily or by government as a regulatory requirement. A variety of tools can be used to implement EPR. As the PCSD report stated, "the tools used for a particular product category should be designe d to achieve the desired change at the most appropriate links in the [product] chain, and where possible, by voluntary action" (p.42).

Some businesses in the United States are already implementing EPR for a variety of reasons. Some are responding to mandates abroad. Some wish to forestall similar mandates in the United States. Some are striving to meet corporate goals to "green" thei r products. Some recognize that products can be valuable assets even at the end of their useful life. To showcase some of the many creative and strategic business initiatives already under way in the United States, the PCSD's New National Opportunities Task Force decided to hold a workshop on EPR.

Description of the EPR Workshop

The workshop program included introductory presentations on the concept of EPR and the drivers and obstacles facing businesses and other organizations interested in EPR. Eleven companies presented case studies on how they are implementing EPR to reduce the life-cycle environmental impacts of their products. Some of the presentations included partners (e.g., suppliers, product users, trade associations) in the product life cycle who are helping to make EPR successful. Industry sectors represented in th e case studies included the automobile, forest products, consumer products, building cleaning and maintenance, plastics, telecommunications, office equipment, battery, and carpeting industries. In total, more than 30 companies and industry associations p articipated in the workshop.

Special sessions addressed specific issues on: (1) models and strategies for EPR; (2) the business case for EPR; (3) barriers to implementation of EPR; (4) outreach strategies for EPR (i.e., how to spread the word on the new EPR paradigm); and, finally, (5) next steps that the PCSD and others should take to promote wider implementation of EPR.

Findings

When government institutions decide that it is necessary to set environmental goals or mandates affecting a particular industry or product, government should, when possible, set performance standards, ensure appropriate public accountability for the perf ormance standards, and leave implementation of the objective to the creative forces of the market system. This essentially takes the "control" out of the phrase "command and control." EPR is a process that can be used to meet such government objectives or address a problem before government becomes involved.

During the workshop, some participants suggested that the PCSD definition of EPR should be narrower and that not all of the projects presented at the workshop would qualify as EPR under a narrower definition. Others suggested that, in principle, it may be best to keep a broad definition. Nevertheless, there was general agreement among the participants that EPR is about sharing responsibility and reducing environmental impacts in all stages of a product's life cycle, not just reducing and recovering was te. In addition, participants agreed that a "one size fits all" approach to EPR will not work; by necessity, EPR approaches vary by product, market conditions, and the efforts of participants. Ultimately, many participants decided that rather than rede bating the definition of EPR, it would be more constructive to focus on the key features of EPR as it is being practiced domestically and abroad so that others can build upon or adapt these approaches.

Some of the key features of EPR identified at the workshop included:

• Companies taking on responsibility and addressing the environmental impacts of their products where they have not done so before. For example, the nickel-cadmium battery industry has launched and is paying for a nationwide program to collect and re cycle spent nickel-cadmium batteries. Also, DuPont has partnered with its customers to develop reverse distribution systems to recover postindustrial (and eventually postconsumer) plastic film waste, which it reprocesses into feedstock used to remanufact ure new plastic.

• New ways of thinking about product delivery, such as recasting products as services or functions. For example, as an alternative to the conventional sale of carpet for commercial use, Interface Flooring Systems sells a long-term carpet maintenance a nd replacement service. The company uses replaceable carpet tiles designed to prolong the useful life of the flooring and partners with its suppliers to ensure postconsumer reclamation of its products in a closed-loop system.

• Rearranging institutional relationships throughout the chain of commerce to minimize wastes and the unnecessary consumption of raw materials. For example, the Vehicle Recycling Partnership (VRP) a consortium established by Chrysler, Ford, and Genera l Motors is investing in research to develop the infrastructure and technologies required for recycling and proper disposal of scrap automobiles. Design changes to increase recyclability (e.g., elimination of mercury switches) are being implemented by th e three auto companies as a result of the VRP's work.

• Creating a feed-back loop with customers to drive environmentally sound redesign of products. For example, Rochester-Midland, a manufacturer of institutional cleaning products, is involving cleaning service providers (e.g., WECO Cleaning Specialists ), building owners (e.g., the General Services Administration), and tenants in the design and implementation of mitigation strategies to improve the indoor environment of office buildings. Customer feedback is the foundation for both product reformulatio n and the development of new customer services such as education and joint problem solving.

• Closing the product loop and conserving resources by handling waste products as assets. In many case studies, there was a discernable trend to make waste products an asset. For example, Georgia-Pacific is working with waste managers and processors of waste to collect, sort, and process wood product discards into new products. S.C. Johnson Wax and other aerosol manufacturers, in partnership with suppliers and waste processors, are educating waste management officials and consumers on the benefits o f recycling aerosol cans in order to recover the steel.

• Evaluating and reducing the life-cycle impacts of products. Both Xerox Corporation and Northern Telecom have "design for the environment" programs, which in combination with product life extension and product take-back approaches, are reducing some of the life-cycle environmental impacts of their products.

In discussions, participants identified key drivers and barriers to implementation of EPR. Many of the most common ones are listed below:

Recommended Next Steps

• Step 1: Create and maintain a focal point for promotion of EPR. Participants agreed that maintaining EPR's momentum requires a focal point. This focal point could be a Presidentially-appointed multi-stakeholder "product responsibility " panel, as recommended in the Sustainable America document. Or, it could be a more informal steering committee of volunteers representing multiple stakeholders. Regardless of the final structure, it should have some stability and an adequate sta ff and budget to fulfill its mission.

• Step 2: Continue PCSD involvement. Many participants felt that the PCSD should continue its involvement, regardless of how the focal point is established. White House-level commitment to this issue will help to ensure that it spreads farther and faster to participants and sectors that are not yet engaged in EPR.

• Step 3: Promote further evaluation of case studies and demonstration projects. There seemed to be agreement that the PCSD's recommendation to develop "models of shared responsibility" was accomplished, in many ways, by showcasing case studies at the workshop. EPR could be promoted further by evaluating the potential for expanding individual cases to entire industries, and/or soliciting additional demonstration project proposals. Demonstration projects could attract the attention of p rivate companies and other parties who are interested in obtaining recognition for adopting environmentally sound practices and for creating partnerships. Such projects create opportunities to "troubleshoot" barriers, including regulatory barriers, and t o demonstrate solutions. Some involvement on the part of the PCSD in such a demonstration program would be critical to "draw in" proposals.

• Step 4: Maintain a role for government in EPR. There was general agreement that government has a role in providing incentives for and removing obstacles to broader implementation of EPR. There are several specific possible roles for g overnment:

  Facilitate, educate, and disseminate. Disseminate information and provide education on EPR; bring parties together to explore opportunities for EPR; provide recognition for companies and others implementing EPR; and collect further examples of EP R. Though not agreed on, several participants pointed to the power of government procurement as one way to highlight products that reflect EPR in action and to overcome barriers to customer acceptance of these products.

  Encourage the use of EPR as an efficient framework to solve environmental problems. When governments legislate, regulate, or agree by consensus to establish or mandate an environmental objective, they should try to: (1) set performance standards whenever possible; and (2) leave implementation to the creative forces of the market system (which could be a voluntary EPR framework).

Overall, the workshop provided valuable insights into current EPR practices and provided a forum for discussing key features of EPR, obstacles to its implementation, and ideas for next steps. The enthusiasm of the participants illustrates that EPR has a n important role to play in moving the United States toward sustainability.WORKSHOP PROCEEDINGS

To showcase some of the many creative and strategic business initiatives already under way in the United States, the PCSD's New National Opportunities Task Force held a workshop on October 21 and 22, 1996, in Washington, D.C., at the White House Conferen ce Center. It was co-sponsored by the PCSD and EPA. The 85 people that attended the workshop included representatives from businesses, trade associations, environmental groups, universities, and state and federal government.

The major goals of the workshop were as follows:

• Enhance understanding of the principle of EPR.
• Demonstrate the various models, actors, and industry sectors implementing EPR through presentation of case studies.
• Determine how best to educate the business community, government, environmental organizations, and other nongovernmental organizations about the benefits and challenges of EPR.
• Encourage greater implementation of EPR.

The workshop program included introductory presentations on the concept of EPR and the drivers and obstacles facing businesses and other organizations interested in EPR. Eleven companies presented case studies on how they are implementing EPR to reduce the life-cycle environmental impacts of their products. Special sessions addressed specific issues on: (1) models and strategies for EPR; (2) the business case for EPR; (3) barriers to implementation of EPR; (4) outreach strategies for EPR (i.e., how to s pread the word on the new EPR paradigm); and, finally, (5) next steps that the PCSD and others should take to promote wider implementation of EPR.

Keith Laughlin, Executive Director, The President's Council on Sustainable Development

In February 1996, the PCSD presented its vision and recommendations in a report to the President entitled Sustainable America: A New Consensus. One of the issues the PCSD spoke to directly in the report was the need for EPR: suppliers, manufacture rs, users, consumers, and disposers of products together taking responsibility for promoting pollution prevention and resource conservation. The work of the Council did not end with the report, Mr. Laughlin emphasized. After the release of Sustainable America, the President asked the Council to identify a series of projects that would start the process of implementing its many recommendations. Among the proposed projects were two workshops, one on eco-industrial parks and one on EPR. This workshop begins the critical process of turning the ideas of the Council into reality.

Kathleen McGinty, Chair of the Council on Environmental Quality

This workshop is important, Ms. McGinty emphasized, for three reasons:

• Initiating a dialogue. This workshop brings together the key EPR stakeholders and launches a critical dialogue about the best way to bring together environmental and economic aspirations.

• Collaborating on EPR. Participants at the workshop have an opportunity to demonstrate collaboration instead of confrontation between environmental and economic interests. Waste of any kind is an economic and environmental negative. A collabora tive spirit is critical to the ultimate success of EPR.

• Harnessing our creativity. This workshop will stress the importance of technology for meeting environmental challenges. Key to the development of new or improved technologies is tapping our reservoir of ingenuity and creativity.

The best way to set a framework for the workshop's discussions, began Sergio F. Galeano, is to review the PCSD's definition of EPR. EPR is a principle that uses the life-cycle approach to identify strategic opportunities for pollution prevention and reso urce conservation throughout a product system. A key aspect of this approach is that all sectors in a product's life cycle share responsibility in seeking solutions for the environmental problems that arise during the life cycle.

There is an interesting history to the concept of EPR, Mr. Galeano explained. EPR evolved from the concept of extended producer responsibility a term that first appeared in research conducted by the Organization for Economic Cooperation and Develo pment (OECD). Initially, extended producer responsibility was implemented as a single-point approach to resolving specific waste problems such as packaging waste. The single-point approach meant that responsibility was placed on one sector or a li nk in the packaging chain. Germany's famous packaging law is an example. End-of-life primary packaging under this law became the responsibility of the retailer, while the manufacturer became responsible for end-of-life secondary packaging.

This approach has been shifting recently toward a multiple-point approach in which the responsibility is shared by more product sectors. In the United Kingdom, responsibility under the recent Packaging Act is shared between four sectors: raw materials, c onverting, packaging, and selling. Out of necessity, the allocation of this shared responsibility varies according to specific circumstances (including the nature of the product system and the location in question). According to Mr. Galeano, the producer need not always be allocated the largest share of responsibility. In fact, under the Packaging Act, the parties on their own initiative decided to allocate implementation costs in the following way:

Sustainable development, continued Mr. Galeano, must be socially acceptable, economically viable, and lead to a sustainable environment. EPR fits in perfectly with this paradigm. The products that we use through our system of commerce connect the ecosyst em and the social system and EPR, as a product-related principle, is a means of ensuring that the connection operates within the principle of sustainability. Product stewardship, consumer information, and policy options are all elements of EPR, which in t urn can be an element of eco-efficiency.

Implementing EPR involves drawing from various policy options and tools, both voluntary and mandatory. While voluntary policies are ideal, mandates are often necessary. According to Mr. Galeano, an EPR program has four key features:

• Shared responsibility
• A basis in the product system
• Partnerships
• A variety of policy options

If programs are designed around these features, they will be successful. It comes down to a simple proposition, Mr. Galeano insisted: Take the "control" out of "command and control." Laws and regulations represent the "command" part of this approach to e nvironmental protection, and are properly a function of government. Details of implementation, however the "control" could be established more effectively if stakeholders share responsibility and draw from a variety of policy options. This perspective can help the United States move closer to achieving Extended Product Responsibility.

Extended product responsibility is not the same as extended producer responsibility. They tend to be similar, however: European "extended producer responsibility" policies do not place the entire responsibility on producers; rather, the pol icies embody shared responsibility. The German packaging ordinance, for example, involves shared responsibility between retailers, packaging manufacturers, consumers, and waste managers. One of the goals of EPR is to identify the actors and actions with t he greatest ability to reduce the environmental impacts of the product chain and to provide the necessary incentives to encourage them to accept responsibility and take appropriate action.

Fully understanding EPR, continued Mr. Davis, requires clearly establishing its context. EPR is a principle, meaning it represents the highest level of consensus on a topic. A process is a way of implementing a principle. Life-cycle management and indust rial ecology are both processes. (Policies are another way to implement a principle.) To initiate a process, relationships and tools are needed. Life-cycle partnerships or arrangements among different stages of the product life cycle and multistakeholder partnerships are examples of relationships. Tools include life-cycle assessments, Design for the Environment, and environmental management systems. Tools are often confused with processes and the goal for using tools.

Any type of EPR program whether product take-back, materials selection and management, leasing systems, or some other program offers critical benefits for the individual participating actors, and furthers the drive to establish sustainable development in the United States. Specific benefits include:

• Cost savings, particularly through the process of taking back products, allow manufacturers to recover valuable materials, reuse them, and save money.

• A demonstration of environmental stewardship.

• Product innovation born of end-of-life management of products companies are looking at designing for recycling and disassembly, which in many cases helps them realize how to assemble products more efficiently.

• Increased consumer satisfaction and loyalty.

• Green marketing.

• Take-back mandates and product restrictions (EPR measures are not always voluntary).

• More efficient environmental protections, since product-based environmental strategies often are a more cost-effective method of complying with environmental regulations and avoiding environmental liabilities than existing facility-based programs.

Despite these benefits, however, obstacles to EPR exist. These include:

• Costs of EPR.
• Lack of information and tools to access overall product system impacts.
• Difficulty in building relationships among actors in different life-cycle stages.
• Rigid product specifications that preclude cleaner designs.
• Product liability concerns associated with extension of responsibility.
• Hazardous waste regulations that require hazardous waste permits for collection and take- back of certain products.
• Antitrust laws that make it difficult for companies to cooperate.
• Facility-based environmental regulations that focus company resources on compliance only.

In the time since the PCSD endorsed EPR, Mr. Davis concluded, increasing attention has been focused on this strategy. Some interesting questions we might consider in this workshop include:

• Which models of EPR work best for priority product systems? How do we decide which models work best? How do we spread the word on which EPR models work?

• How do we develop the relationships among actors in the chain that are crucial to EPR?

• How do we deal with product systems in which voluntary EPR is not occurring because the short-term economics are negative for those stages of the product life cycle that can make the most difference?

• What are the next steps for implementing EPR in the United States?

These are the kinds of questions that further explorations of EPR and, most important, real-world experience with EPR programs can help to address. Ultimately, EPR is an opportunity to explore new models of environmental policy that are less costly and m ore flexible.

Xerox's goal is "waste-free products manufactured in waste-free factories," said Jack Azar. Achieving this goal will result in environmental benefits, satisfied customers, improved productivity, and increased global competitiveness. Xerox has developed a number of projects under its Environmental Leadership program, including an asset management program for equipment and parts, a toner cartridge program, and a packaging program. Each represents a different way that the EPR concept can be implemented.

The business factors driving Xerox's Environmental Leadership program, which began in 1993, include the solid waste problem and high landfill costs, the need to utilize natural resources, the proposed European take-back regulations, customer requirements , and Xerox's competitive advantage. In the past, a recycling strategy was not part of Xerox's business process when products were built, they were always new. No process was in place to handle remanufactured products, nor was there any design continuity that anticipated the need to deal with them. Now, the eventual recycling of products is incorporated into the design phase. When equipment comes back, Xerox tries to find a new market for the product or strips it down in a manufacturing facility, then rep airs parts and rebuilds the product. If a product cannot be rebuilt, parts are salvaged and materials recycled. When possible, product modules or components are converted into other products. The company's goal is to send nothing to the landfill.

For example, Xerox examined possibilities for recycling its toner cartridges, which can last for 6 months or more. In early versions of cartridges, frames were welded together with no plans for remanufacture or reuse. Then Xerox found a way to make cartr idge recycling economically feasible. The company offered customers incentives to return the cartridges and now has up to 60 percent recovery. In fact, the company loses money if the equipment is not returned for remanufacture. Xerox also developed an EPR program for its empty toner bottles, which were formerly thrown away. Xerox reduces the raw material in the bottles and manufactures them with postconsumer polyethylene (PET). Xerox also began reusing the bottles.

Factors enabling EPR within the corporation include senior management support, market research, the elevation of environmental considerations among the corporation's goals, and the establishment of a new business process by working with designers, engine ers, and suppliers. Infrastructure development is a particularly important issue. Xerox needs to locate cost-effective regional recyclers and establish an effective return system.

Mr. Azar then responded to a question about whether Xerox's competitors have implemented similar programs. These EPR programs have given Xerox a competitive advantage over foreign manufacturers exporting to the United States, Mr. Azar said, many of which are starting to set up similar systems locally to be competitive.

When asked how Xerox overcame customer resistance to remanufactured products, Mr. Azar stressed that Xerox views consumer education as key. The company communicates the message that its remanufactured products are made with the same workmanship and quali ty as new products. Customers are more comfortable with recycled products, however, than with rebuilt or remanufactured products.

Georgia-Pacific Corporation: Recycled Urban Wood
Presenter: David Kurtz

Georgia-Pacific manufactures particleboard from multispecies wood recovered from commercial disposal or general urban solid waste, began David Kurtz. The company has agreements with five recycling and processing companies that accept or collect wood at v arious sites. The wood is cleaned of contaminants and sent to a Georgia-Pacific particleboard manufacturing plant in Martell, California, or to other end users.

The project involves five stakeholder groups: (1) wood waste producers (e.g., operations involved with construction and demolition [C&D] debris, cut-to-size lumber, commercial wood waste from furniture), (2) collection agents, (3) processors of wood wast e, which make the waste into a product that can be reused, (4) transportation contractors, shippers, and haulers, and (5) end users (e.g., Georgia-Pacific's Martell plant). The project has a variety of goals, including increasing the availability of the w ood supply for particleboard production, contributing to Georgia-Pacific's goals of product stewardship, and contributing to California's mandated reduction in solid waste (e.g., 50 percent reduction by 2000).

Business factors driving the project include the shortage of fiber for the particleboard plant, rising costs of landfilling, and mandated solid waste reductions. Benefits include an expanded fiber supply in the Northwest. Contamination is one of the most significant barriers to the wood recovery program. Often the collected wood is mixed in with metal, plastic, and paper and must be cleared of these contaminants to be usable. The captured paper, plastic, and nonferrous metals are sent to a landfill. Wood byproducts that cannot be used in particleboard processing are sold for use as animal bedding, playground cover, soil amendment, and lawn or garden mulch.

Mr. Kurtz responded to a question about the economics of processing postconsumer fiber. Virgin fiber used in particleboard is often a byproduct from sawmills and is often less expensive than recovered fiber. As wood becomes more scarce, however, the econ omics will even out. The wood waste processing, explained Mr. Kurtz, is performed by local contractors for which Georgia-Pacific provides training and testing.

SC Johnson & Son, Inc. (SC Johnson Wax): America Recycles Aerosols
Presenters: Tom Benson (SC Johnson Wax), William Heenan (Steel Recycling Institute), and Edmond Skernolis (WMX Technologies)

SC Johnson Wax, makers of consumer products such as Pledge , Shout , and Windex , has been one of the key players in the aerosol industry's aerosol can recycling program, Tom Benson said. He noted that the company is recognized as a formulator of environ mentally responsible aerosol products and that it strives to achieve continuous improvement in products to provide quality performance and value with minimal environmental impacts. Upstream, the company has worked with its suppliers to produce lightweight aerosol cans and to use a minimum of 25 percent recycled steel. Downstream, the company has worked to ensure that the empty aerosol container is responsibly handled in the recycling stream.

There are consumer misconceptions surrounding aerosol containers. For example, aerosol cans were regarded as environmental scapegoats in the late 1980s. Many consumers are not aware that aerosols have not contained chlorofluorocarbons since 1978. Becaus e of such misconceptions, many municipal recycling programs originally forbade aerosol can recycling. SC Johnson conducted studies on the safety of processing empty aerosol cans and found there was a tremendous opportunity to recycle them an opportunity t o keep some steel out of landfills and involve consumers in an environmental activity. According to Mr. Benson, results bear this out. In 1991, only one community recycled aerosols; now over 3,800 community programs recycle them.

The steel industry has been involved with the aerosol can recycling program just described, pointed out William Heenan. The Steel Recycling Institute realized it needed to educate municipal recycling managers about aerosol can recycling and provide them with the information they needed to educate their constituency. Recyclers had numerous questions about recycling aerosol cans. They wanted to know whether aerosol cans are traditionally empty when thrown away, whether they are flammable, and what risks are involved in recycling them. Research conducted by SC Johnson Wax, the Steel Recycling Institute, the Chemical Specialties Manufacturers Association, and the Factory Mutual Research Corporation found that the risks associated with recycling aerosols ar e no different than the other risks in a materials recovery facility (MRF). The Steel Recycling Institute also conducted a study to confirm that aerosol cans are empty when handled in the recycling stream.

WMX Technologies, added Edmond Skernolis, has also been involved in aerosol can recycling. WMX was initially concerned about the safety of processing aerosol cans. WMX identified the concerns, worked with the aerosol industry to obtain accurate informati on about the associated risks, and subsequently learned that aerosol cans could be recycled safely by observing basic good management and engineering practices. The company will now include aerosol cans in its recycling contracts.

Aerosol can recycling was made possible, concluded Mr. Benson, through partnerships, communication, information, and education. The key to the success of the program was leadership and perseverance. This program shows that industry can work in upstream a nd downstream partnerships to effectively catalyze eco-efficiency at all junctures in the product's life-cycle.

Rochester Midland Corporation: Office Building Cleaning
Presenters: Stephen Ashkin (Rochester Midland Corporation), James Foley (Environmental Protection Agency), Norma Edwards (WECO), and Nelson Palma (General Services Administration)

Rochester Midland supplies cleaning products to the commercial and industrial marketplaces, explained Stephen Ashkin. The company has 5 manufacturing plants, 30 warehouses, and a total of 1,200 employees. When Rochester Midland realized it was not able t o compete on price to achieve an advantage in the marketplace, the company recognized a growing need for cleaner, safer products. The company commissioned Arthur Andersen and Company to perform a gap analysis, which found that the greatest opportunities f or meeting untapped customer needs were in two areas: safety and environmental impacts. Rochester Midland also realized that making its products safer would increase employee productivity due to reduced absenteeism and increased morale.

Rochester Midland examined both the human health and environmental effects of its products. The company wanted to reduce risk for product users, building occupants, and the general environment. Company officials realized that the availability of safer pr oducts would be of little value without training cleaning personnel on how to use the products properly and safely.

Communication is a key aspect of Rochester Midland's approach to promoting cleaner and safer products. The company needed to obtain the commitment of product users and building owners as well as "buy-in" from occupants because programs are ineffective un less those with a stake in the outcome of these programs are involved. Rochester Midland goes beyond educating its commercial clients by educating the public through speeches and articles in the trade press.

For example, consider a pilot project in a building owned by the General Services Administration (GSA), which is home to EPA's Region 2 Headquarters in New York City. Rochester Midland assembled a team of representatives from the various groups involved (e.g., tenants, building owners, cleaning contractors). The team conducted surveys and identified problem areas, then set about training the cleaning staff. Training cleaning personnel can be difficult because of the high level of turnover in the industry .

EPA's perspective as the tenant in the GSA-owned building adds to this example, noted James Foley. EPA participated in the building's design to incorporate environmental principles. EPA representatives visited INFORM's headquarters in New York, toured th e Audubon Society building, and talked to internal Agency experts including members of the Environmental Response Team from EPA's Office of Solid Waste and Emergency Response. GSA provided samples of various building components, many of which EPA asked to substitute with environmentally safer materials. EPA performed indoor air quality monitoring when the building was empty and full, reduced the lighting load, and installed water-saving fixtures and better air conditioning systems. After EPA moved into th e building, the Agency found that some people were reacting to indoor pollutants. The problem appeared to be related to cleaning agents that were used to clean the furniture and carpeted surfaces. GSA worked with the cleaning contractor, who suggested co ntacting Rochester Midland Company, which had a product line with low VOC emissions.

WECO was the cleaning contractor at the building. Norma Edwards of WECO explained that, traditionally, considerable emphasis is placed on protecting the outdoor environment; however, people spend an estimated 90 percent of their time indoors. As a cleani ng contractor, WECO is committed to giving quality service. The company's commitment to continuous improvement, customer satisfaction, and pollution prevention led to the search for an alternative cleaning product. When EPA complained about the cleaning p roducts being used in the building, WECO contacted Rochester Midland and several other manufacturers looking for products that would solve the problem. They learned that Rochester Midland could supply an alternative formulation that would potentially sol ve the problem.

Nelson Palma of GSA pointed out that GSA, as the building owner, wants to interact with its tenants regarding every aspect of their office environment. One reason for this is that GSA must compete with the private sector and take its customer concerns se riously. Investigating options for an alternative cleaning program provided an opportunity to develop partnerships. At the outset, WECO approached GSA to introduce the notion of identifying an alternative program; WECO then brought in Rochester Midland. G SA performed a cost-benefit analysis and determined that switching to the alternative program would be cost effective.

GSA is now involving other tenants (e.g., the Federal Bureau of Investigation, the Internal Revenue Service) and other buildings in the effort to use safer cleaning products. The project could not have succeeded without a strong team approach that includ ed the involvement of suppliers, the contractor, tenants, and building owners and managers. The project is an example of stewardship, collaboration, and environmental ethics.

The key message of this case study, Mr. Ashkin concluded and the primary reason that EPA, GSA, and WECO were asked to share the podium with Rochester Midland is the importance of shared responsibility and the benefits of forming successful partnerships up and down the chain of commerce.

Safety-Kleen Corporation: Solvent Take-Back
Presenter: Bill Constantelos

In describing his company's parts cleaning service and used oil recycling operations, Bill Constantelos emphasized that rather than providing a product, Safety-Kleen provides a service to its customers to help them manage spent solvent and used oil in an environmentally appropriate manner.

In 1968, Safety-Kleen started leasing and servicing parts cleaning equipment and supplying the associated solvent. The company periodically took back the spent solvent for recycling and, in 1970, began supplying recycled solvent back to its customers, th ereby "closing the loop." In 1993, Safety-Kleen introduced its "cyclonic green machine," which generates 50 to 80 percent less waste solvent, reducing the amount of clean solvent needed. The cyclonic green machine can precipitate solids and heavy grease, allowing solvent to be used two to three times longer. By 1995, Safety-Kleen's customers had reduced their solvent use by 11 million gallons per year, he said.

The company's solvent recycling program involves more than 300,000 customers in operations such as gas stations and bike shops as well as in the steel industry. Business factors that serve as driving forces behind the program are providing safety, conven ience, reliability, and cost effectiveness; Resource Conservation and Recovery Act (RCRA) "cradle to grave" regulations; and the Pollution Prevention Act of 1990. The benefits of the program include improved safety, resource conservation, reduced costs, waste volume reduction, and environmental improvements. Barriers included the lack of a nationwide distribution system in 1970 when the closed-loop recycling system was established, RCRA inflexibility (e.g., paperwork, permitting, and other administrative compliance costs), inconsistencies between the Pollution Prevention Act and the new Combustion Strategy rule, and the costs and limits of new technology.

Safety-Kleen also collects and recycles more than 170 million gallons of used oil per year. The company estimates that out of 1.4 billion gallons generated each year, 900 million gallons are collected (10 percent of which is rerefined and 90 percent is b urned as fuel), and 500 million gallons escape proper handling. Safety-Kleen collects used oils after they are dirty and no longer useful as lubricants, rerefines them at the company's two North American rerefineries, then supplies rerefined oil products to its customers. Project participants in Safety-Kleen's oil recycling program include used oil generators, rerefined oil approvers, and rerefined oil users (e.g., the federal government, blenders, individual consumers).

Project goals, stressed Mr. Constantelos, include economical collection and recycling of used oil and market development. Project drivers included Executive Order 12873 (which addresses federal government purchasing of recycled-content products), the dem and for green products and services, and product liability reduction (i.e., ensuring that used oil does not cause environmental damage). The benefits of the project include cost savings for Safety-Kleen; producing a gallon of rerefined lube oil is 40 to 5 0 percent less expensive than producing a gallon of virgin crude oil. Other benefits include increased customer acceptance of "green" motor oils, reduced environmental impact, conservation of natural resources, and less waste handling.

The barriers to the used oil recycling project included perceived quality issues, acceptance by specification writers, uncontrolled burning, and the fact that used oil regulations do not favor recycling over burning. The project has resulted in improved convenience for users, encouraged conservation and reuse, and satisfaction of consumers' green product demand.

Safety-Kleen's product take-back programs (i.e., solvent and used oil recycling) are, according to Mr. Constantelos, (1) an economical means to recycle, reduce, and reuse, (2) convenient to customers, and (3) profitable to the company.

Mr. Constantelos was asked whether Safety-Kleen's programs are really examples of extended service responsibility. Extended service responsibility, according to him, is a form of EPR. Safety-Kleen provides a service to its customers but also takes back p roducts. He added that the solvent take-back and used oil recycling programs encourage the conservation and reuse of nonrenewable natural resources, provide generators with convenient options to improve the environment by managing wastes appropriately, an d meet a growing demand for green products and services.

Rechargeable Battery Recycling Corporation: Charge Up to Recycle
Presenter: Jefferson Bagby

The Rechargeable Battery Recycling Corporation's (RBRC's) "Charge Up to Recycle!" program is designed to make the public aware that used nickel-cadmium (Ni-Cd) batteries should be recycled, began Jefferson Bagby. RBRC funds and facilitates Ni-Cd collecti on and recycling programs across the United States. More than 200 companies worldwide that manufacture rechargeable products (e.g., cellular phones and laptop computers) for sale in North America fund the program.

Manufacturers pay 5 cents to place an RBRC seal on their batteries. The seal indicates that the batteries can be recycled through the RBRC program. When Ni-Cd batteries no longer work, consumers can bring them to one of numerous retailers who collect the batteries in a cardboard box. When the box is full, the retailer seals the box and sends it via the United Parcel Service (UPS) with a prepaid, preaddressed label to a recycling facility in Ellwood City, Pennsylvania. There, the entire battery is recycle d the cadmium is used to make new batteries, and the other components are recycled into stainless steel.

EPR calls for shared responsibility based on the product system, and it involves partnerships between government, industry, retailers, and consumers. EPR also presents many policy options. The RBRC program is, according to Mr. Bagby, an asset recovery pr ogram, not really a take-back initiative.

RCRA cradle-to-grave regulations were the greatest obstacle to recycling Ni-Cd batteries, Mr. Bagby explained, because batteries are considered hazardous waste. The Universal Waste Rule, which had to be adopted by individual states, could have eliminated this barrier. Battery manufacturers lobbied state officials asking them to adopt the rule so that batteries could be collected for recycling, but, this was a large, time-consuming effort. The battery Act that was passed in 1996 implemented the Universal Waste Rule nationwide for batteries only. As a result, batteries can be dropped off in retail stores, and county recycling programs can include them because they no longer must be handled under hazardous waste regulations.

The RBRC has established an 800 number that soon will appear on batteries and product literature and in television commercials and public service announcements. When consumers call the number (1-800-8-BATTERY), they can obtain the location of the nearest retail store and county dropoff site. By January 1, 1997, 28,000 retail locations were expected to be participating in the battery recycling program.

A question was posed about program financing. Recycling Ni-Cd batteries, conceded Mr. Bagby, is a money-losing proposition. The license fee paid for the RBRC seal funds the UPS shipping and advertising. RBRC intends the 5-cent charge to last through 1997 . RBRC estimates that 25 percent of participants are free-riders (i.e., their batteries are collected and recycled but they do not pay the 5-cent charge). When asked about recycling nickel metal hydride batteries, Mr. Bagby stated that the RBRC hopes to collect them in the near future because they can be recovered profitably.

In response to a question about program drivers, Mr. Bagby explained that Minnesota and New Jersey have passed laws requiring collection and recycling of Ni-Cd batteries. Some European countries mandate collection as well and have proposed a ban on Ni-Cd batteries. The industry believes that unless manufacturers voluntarily collect and recycle the batteries, they will be banned or become hard to sell. Another participant asked whether any design changes in appliances have resulted from the program. State laws have enabled Ni-Cd batteries to be more easily removed from products, answered Mr. Bagby. Power tool manufacturers had to redesign their products to use uniform-sized batteries that can be easily removed for recycling.

Interface Flooring Systems, Inc.: Evergreen Program
Presenters: Joan Reynolds and Graham Scott

Interface's Evergreen program, explained Joan Reynolds and Graham Scott, helps to illustrate some of the principles being discussed at this workshop. Interface manufactures carpet tiles used in commercial and institutional buildings. The company offers c ustomers the Evergreen program, which is a bundled service package that includes design, layout, carpet tile installation, ongoing maintenance, and ultimate removal of carpet tiles for recycling. The program has three 7-year lease cycles. In the first cyc le, the product design is established with long-term objectives. Designers conduct traffic surveys to help recommend designs and choose materials. After being selected, materials are subjected to wear simulations to determine how much wear and tear the ca rpet can withstand. Final design and materials selection are based on these surveys and tests. The chosen design allows for periodic replacement of tiles in areas that get heavy use. The second lease cycle involves the renovation of the 20 percent of the carpet that experiences high traffic. In the third cycle, a combination of new and existing carpet is used to rejuvenate the facility.

Carpet recovered from customers under this program is ground into powder and used in molded products or recycled into carpet backings. This is an important advance because raw material suppliers can provide yarn products with partial postindustrial conte nt but rarely with postconsumer content.

The goals of the Evergreen program are to save nonrenewable natural resources by extending product life, to create a closed-loop recycling standard for the industry, and to implement Interface's cradle-to-cradle philosophy. The driving force behind the p rogram is Interface's Chief Executive Officer, Ray Anderson, who believes that industry has the strongest voice in the creation of a sustainable America. The benefits of the program include the environmental advantages of diverting carpet from landfills a nd producing performance carpet with less nylon face fiber. Another benefit is reducing the need for petroleum-based products. The program's ultimate goal is to recycle old carpet tiles into new ones and eliminate all its waste. A monthly expense can be m ore practical for some customers than a large periodic capital outlay for flooring. In addition, the source lease ensures constant interaction on a regular basis with customers.

Program barriers include the economic justification of the program in the current market structure (i.e., shifting from short-term disposal to long-term use of products). Consumers need to be educated about environmental responsibility and the liability of product ownership. Over a 21-year period, Interface believes it can realize both the environmental and economic benefits of the Evergreen program. Another barrier is the lack of available technology for breaking down carpet tile components and purifyin g the fibers for reuse as raw material for making new carpet fiber. The backing system can be reused, but finding a commercially viable way to reuse the nylon fiber in new carpet has yet to be devised. Interface is researching the possibility of reusing t he materials in other product areas. The low cost of energy is another hurdle; the Evergreen system will become more attractive if oil prices increase. Finding progressive financial partners also has been difficult (i.e., getting them to embrace the leasi ng service concept).

Nortel (Northern Telecom): Product Life Cycle Management
Presenter: Virginia Snyder

Nortel is a supplier of digital telecommunications networks, began Virginia Snyder, offering products for designing and building digital networks for education, communication, and the business world. Nortel provides products and services to businesses, universities, and governments, with approximately 40 percent of its markets outside North America. Nortel is a leader in environmental management. The company's philosophy holds that the product life cycle corresponds to the value chain, which measures th e value of products and services from product design through product end-of-life. Nortel believes that efficiency improvements can be achieved by extending the producer's responsibility.

Nortel is currently pursuing several different projects under its product life-cycle management (PLCM) program. The goal of the PLCM program is to maximize environmental and economic efficiency. The challenge faced in implementing the program is to reori ent the company's business and environmental functions away from being concerned solely with regulatory compliance.

There are four current Nortel initiatives:

• The materials recycling program. Nortel recycles 50 million pounds of equipment annually. This includes cables and components from excess or obsolete inventories. Nortel also accepts trade-ins from equipment sites. The equipment recycling prog ram is profitable: 85 to 90 percent of the revenues are returned to businesses or customers. Approximately 90 percent of the equipment processed at the facilities (by weight) is recovered for reuse or recycling. The company's goal for 1998 is to have only 2 percent of its equipment (by weight) directed to landfills.

• The materials technology program. Nortel has a pilot project to develop a lead-free technology for its electronic component assembly. Lead from electronics is a growing part of the lead found in landfills. Nortel has successfully manufactured two telephone sets with a lead-free printed wiring board.

• The product design program. Nortel is attempting to optimize the efficiency of new product designs by using a modular approach. The company's modular telephone designs allow customers to upgrade their phones by replacing components, avoiding the necessity to buy an entire new unit. In addition to reducing the number of telephones discarded, this system leverages the customer's overall investment.

• The supply management project. The company has initiated a pilot project to develop a new chemical supply model to reduce the use and cost of chemicals. Nortel will be purchasing the services of chemical suppliers for a fixed fee rather than p urchasing according to the amount of chemicals used. Nortel worked with its supplier to examine chemical processes, storage, and disposal operations. Nortel also developed recommendations for improving efficiencies of chemical use and for delivering only the amount of product needed. The cost savings are shared between Nortel and its supplier.

One of the largest barriers to the PLCM program is changing the way people in the environmental department perceive their role and changing the way other people in the company perceive the environment. When asked how Nortel achieved individual business b uy-in to its corporate goal, Ms. Snyder stated that Nortel worked very closely with its four major network businesses to sell them on the idea. Nortel developed its lead-free phone because of the European market and to be prepared for the advent of possib le legislation in the future. The result has been an improved bottom line due to the elimination of costs associated with handling lead.

U.S. Council for Automotive Research-Vehicle Recycling Partnership: Vehicle Recycling Partnership
Presenter: Terry Cullum (General Motors)

Ninety-five percent of scrap vehicles in the United States are processed by a successful, market-driven recycling infrastructure, according to Terry Cullum. This infrastructure consists of the consumer, automotive dismantler, automotive shredder, materia ls reprocessors, and the municipal solid waste landfill. Usually 75 percent of a vehicle by weight is recycled and 25 percent is landfilled, a fraction referred to as automotive shredder residue (ASR). ASR consists of plastics, rubber, fluids, and glass.

One of the Vehicle Recycling Partnership's (VRP's) goals is to reduce the amount of ASR sent to landfills. Chrysler, Ford, and General Motors formed the VRP in 1991. In 1993, the VRP opened the Vehicle Recycling Development Research Center in Highland P ark, Michigan. The research center's goals were to improve upon the existing vehicle recycling infrastructure. Its mission is to develop, implement, and communicate research that promotes an integrated approach to the handling of end-of-life vehicles with technical and economic efficiency.

Formal collaborative agreements are in place with the American Plastics Council, Automobile Recyclers Association, Institute of Scrap Recycling Industries, and the Aluminum Association. Other partners include the American Automobile Manufacturers Associa tion, Argonne National Laboratories, and several other research institutes. The VRP collaborators meet twice a year and have developed a 5-year strategic plan.

The VRP has several projects, added Mr. Cullum, including developing design guidelines, which are common-sense things that businesses should do. Each company in the partnership tailored the guidelines and published its own version. The VRP also has a pil ot project for pyrolysis, which is the thermal decomposition of organic materials in the absence of oxygen. The VRP knows that pyrolysis works technically but is trying to make it work economically. The VRP also has a mercury switch removal project, as we ll as a project to develop methods of removing fluids from vehicles.

The benefits of the VRP's projects include creating a sustainable market-driven recycling infrastructure, reducing solid waste, removing contaminants from automotive recycling, and creating jobs. Obstacles include a recycling infrastructure focused on me tals recovery, which makes recovery of nonmetals difficult.

Ford Motor Company: Bumper Take-Back and Recycling
Presenters: Anthony Brooks and Michael Patalan

Anthony Brooks and Michael Patalan introduced Ford Motor Company's bumper take-back and recycling program. Before implementing its program, Ford identified partners and secured cooperation from agents upstream and downstream, including GE Plastics and Am erican Commodities, an automotive plastics recycler. Ford also worked with the engineering community to educate this group about the quality of postconsumer plastic and to assure them that it is not detrimental to product performance.

The driving factors for the program are profitability and leadership in the automobile industry. Ford issued a vehicle recycling directive stating its intention to be a leader in vehicle recycling in terms of design, materials choice, recycling strategie s and technologies, and materials management. This directive also calls for internal training in recycling. Ford was the first automotive company to develop postconsumer content guidelines. Ford also has guidelines requiring the use of returnable packagin g for its engine manufacturing operations.

Ford uses postconsumer plastic (25 percent minimum) in eight applications, including air conditioning and duct work. This translates into 47 million pounds of postconsumer content used. The company's goal is to manufacture 20 percent of its products with a minimum of 25 percent postconsumer content. Ford has made a commitment to American Commodities to use the plastic that this company is able to recover. According to Mr. Brooks and Mr. Patalan, Ford would redesign products if necessary to incorporate po stconsumer plastic.

DuPont Films: PET Regeneration Technology
Presenter: Len Jannaman

DuPont Films makes film for specialty packaging, computer tapes, X-ray film, and labels, as well as film for the printing industry. Mr. Jannaman indicated that these films are difficult to recycle via traditional routes because DuPont's customers use the m in many different applications. DuPont Films has developed a new technology called "Petretec" (PET regeneration technology), which allows these types of postconsumer PET film to be recycled back into new film. This technology represents a step forward i n PET recycling.

The PET industry is enormous, Mr. Jannaman continued. Some 24 billion pounds of PET were manufactured in 1994. While only about 1 percent of this PET was recycled, PET is one of the most recycled plastics. PET film accounts for 2.2 billion pounds of the total amount of PET manufactured.

For PET film recycling to be successful, DuPont realized it needed to have a new technology and a customer-driven approach. The company has focused on involving its customers in developing a successful recycling program. The customer base of DuPont Films is so varied that the company realized it would need to work with various trade associations. DuPont Films worked with the associations to survey their memberships about the importance to them of recycling, their demand for green products, critical indus try issues, and their willingness to work with DuPont to recycle the films. DuPont realized the recycling program would be profitable only if it integrated business and environmental considerations.

DuPont's vision for the plastic films industry is to put the regeneration technology to work and create a competitive advantage for PET film. Benefits of the program include eliminating the landfilling of PET film worldwide, gaining global recognition fo r meeting consumers' demand for green products, and reducing dependence on oil-derived feedstocks.

A question was asked about the sourcing of DuPont's materials, given the plummeting prices of virgin PET. DuPont is looking at the long term, replied Mr. Jannaman, and the project is still in its start-up phase. DuPont is currently working with used X-ra y film as well as film used to make window shades. There had previously been no use for these plastics because they had too many coatings and thus DuPont's customers had to pay to landfill them.

INFORM's mission is to inform the public debate on environmental policy options. As a nonprofit environmental research organization based in New York, Bette Fishbein explained, INFORM has recently been focusing on a case study approach that highlights b usiness innovation in achieving environmental goals. The organization's particular area of interest is the development of public policies that create economic incentives encouraging businesses to innovate. This work brought EPR to the attention of INFORM. Since then, INFORM has been closely following its development.

There are many different ideas about what EPR is and how it should be implemented. In fact, Ms. Fishbein continued, the case studies presented in the morning session are a good illustration of this. She commented that it would be interesting to have a d iscussion about whether all of these case studies truly represent examples of EPR.

Understanding the international context of EPR can help us all make good decisions about this principle here at home. INFORM has documented the development of EPR not only in Germany and other parts of the European Union but in countries across the globe . An OECD report documenting the implementation of EPR in member countries found that 18 countries had a national EPR policy. That number has probably increased since the issuance of the report. Japan, in particular, has taken an interest in EPR and is pr oviding funding to OECD to support research on EPR.

The programs abroad are generally shared responsibility programs, just like programs in the United States. But programs abroad differ in one important respect: they tend to include cost internalization. OECD's definition of EPR involves shifting responsi bility for waste management from the public to the private sector. In this way, businesses internalize the costs of waste management and recycling, incorporating them into product prices. The result of this internalization is that companies, in order to m aintain competitive pricing, are making less wasteful products.

This shift in the responsibility for waste and the internalization of waste costs are consistent with the life-cycle approach. Waste is an issue not only because of disposal impacts, but because it represents an inefficient use of resources, a squanderin g. The postconsumer stage is the weakest link in the product responsibility chain. It is also the part of the life cycle where industry traditionally had no responsibility. Shifting the responsibility for waste to businesses does more than reduce the amou nt of trash going to landfills it moves beyond the consumer to target upstream impacts. EPR programs that follow this model of cost internalization facilitate a wholesale rethinking within these companies concerning the design of their products and the se lection of materials.

There is no one-size-fits-all model of EPR abroad. There is, however, much to learn from the different models that are available. Most systems abroad, Ms. Fishbein noted, are designed by industry. Government policy shifted responsibility for waste, and industry designed the programs.

The PCSD report emphasized that change is both necessary and inevitable. Managing this change in fact, steering it firmly in the direction of sustainability is the challenge that the United States now faces. Ms. Fishbein insisted that a departure from th e status quo is needed. Profitable recycling has existed in the United States for many years; the challenge is to address materials that have not been profitably recycled. One of the benefits of EPR might be that it is actually driving new recycling marke ts, instead of just responding to current market conditions.

In its report, the PCSD laid out a fairly broad definition of EPR. This definition might be both an opportunity and a danger. If the United States builds on the approaches developed abroad, if taking responsibility for waste is seen as a subset of a life -cycle approach, and if upstream initiatives are included (e.g., if materials are selected based on upstream environmental impacts), then the potential of EPR in this country can be fulfilled. But if the EPR definition is allowed to be so broad that it be comes fuzzy allowing every environmental initiative by a company to be labeled an EPR program the initiative will become diluted. Whether EPR improves the situation will be determined by the changes that actually occur. To ensure that we as a nation are s atisfied with the ultimate result, Ms. Fishbein emphasized, the definition of EPR needs to be further developed.

To illustrate these points, Ms. Fishbein posed a number of questions for the group to consider:

• If companies use postconsumer materials in their products because they are cheaper, is that EPR?
• Is simply providing information EPR?
• Is there a litmus test for EPR, such as internalizing costs?

To help answer these kinds of questions, individuals and corporations might try thinking about the real significance behind the letters "E," "P," and "R." First, "E" addresses the question of to what point in the life cycle is responsibility extended? "P " speaks to the issue of who is taking responsibility. Finally, "R" addresses the issue of what responsibility is being taken and what specific means (e.g., product take-back or leasing rather than selling) are being employed. These are some of the questi ons that need to be considered when debating the definition of EPR.

Ms. Fishbein suggested the following additional questions for consideration:

• Is EPR about sharing responsibility or defining the responsibility that is to be shared?
• What needs to be mandated, and what can be voluntary?
• What does voluntary mean?
• How will we deal with the free-rider problem?

In addition, much of the emphasis in discussions concerning EPR is on responsibility sharing. This remains an important part of the EPR principle. It is also important, however, to differentiate between process and results. The point of EPR is to change the current situation in that light, it is clear that sharing in itself is a process that may or may not result in significant change.

INFORM sees EPR as a tool for creative capitalism, Ms. Fishbein concluded, and as an opportunity to encourage business innovation. We are working to promote initiatives that will result in true innovation and lead the United States to sustainability. Que stions like "What is a product's function?" and "Can the product be delivered differently?" can help us begin thinking about production in new ways. No matter how we gauge results in the future, there is one clear sign of progress today. Every company tha t presented a case study in this workshop is thinking about its product as it becomes waste. This would not have been true a few years ago, and it is a clear indication that we have moved forward. Of course, thinking about it is not enough. We need to con tinue to move ahead and take action. To quote Vice President Al Gore's challenge to the PCSD: "look long, be creative, and think long."

Group 1: Models and Strategies for EPR 1st Discussion
Facilitator: Gary Davis

The purpose of this session was to begin to identify the key features and approaches that exemplify the principle of EPR.

Critical to developing effective EPR strategies is the definition of EPR. One participant stated that a definition needs to be broad enough to encompass many activities but still have boundaries. Another participant suggested that a definition could be a rrived at by working backwards from an example or case study of EPR or by identifying the progression of steps taken in a case. When considering the appropriate objective of EPR, several participants agreed, the goal should be broader than end-of-life res ults. It should encompass the entire life cycle. One aspect of EPR's objective should be to provide guidance for companies and policy makers.

There are three key attributes of EPR: extension of responsibility, the product system approach, and sharing of responsibility.

• Extension of responsibility. EPR implies shifting responsibility, rearranging institutional relationships, and extending responsibility to where it has not existed before. For example, responsibility should be extended to customers to provide feedback along the product chain.

• Product system approach. EPR creates feedback for product designers (e.g., on the use of their products in an entire system). New relationships need to be formed in the product chain. The customer-supplier relationship needs to be redefined, a nd continuous loops of feedback (i.e., from customers back to manufacturers) should be established, rather than a linear chain from manufacturers to customers.

• Sharing of responsibility. If something is everyone's responsibility, it is no one's. A locus of responsibility is needed. "Producer" is not necessarily the right word for this locus. In addition, there are three types of responsibility: physi cal responsibility to take a product back; economic responsibility to pay for a recycling system; and the responsibility to provide information (as in the case of the aerosol can recycling example).

Several participants mentioned that economic incentives are important. In addition, it was pointed out that several of the case studies illustrated how legislative incentives can be effective as well. The group explored the differences between extended p roduct responsibility and extended producer responsibility and discussed whether product sustainability and EPR are the same concept. The meaning of "sustainable products" is not entirely clear, participants noted. In any sort of EPR program, a method for measuring success is needed (i.e., to determine what net environmental benefits were achieved).

Group 2: Models and Strategies of EPR 2nd Discussion
Facilitator: Bette Fishbein

Because there was so much interest among workshop participants in discussing models and strategies of EPR, Group 2 was convened to discuss precisely the same topic as Group 1.

The group generally agreed that a good EPR policy should accomplish the following:

• Establish appropriate pricing. A good EPR policy should include the proper price and cost signals for products.

• Encourage innovation. EPR can drive the development of both technological and design innovation.

• Emphasize preventing environmental impacts.

• Provide a mechanism for assigning responsibility.

• Provide for information and education, which are essential to EPR (e.g., to educate users and suppliers).

• Address the particular product. The policy should not try to be a "one size fits all" model.

The group raised the following issues and questions:

• The term "waste" has too much baggage. It is better to think of EPR as a way to deal with products.

• Doing the right thing costs more.

• EPR should encompass postindustrial as well as postconsumer wastes.

• At present, only large companies have implemented EPR. How should an EPR policy encourage small companies to participate?

• To be sustainable in the long term, EPR must be market driven. In the short term, however, should EPR be market driven or should EPR policies drive markets?

• Responsibility should be assigned throughout the life cycle of the product and shared by all the players.

• What is the consumer's responsibility in regard to owning products?

• Can public policy be a driver?

• Can EPR harmonize economic, environmental, and social factors?

• EPR can encompass programs that sell products as services. This holistic view will cover the life cycle from material selection and design to recycling or disposal (e.g., the leasing of cleaning services).

• EPR is not just about take-back programs, but such programs often are a part of EPR.

• End-of-life products should be thought of as assets. Companies can develop asset recovery programs.

Group 3: The Business Case for EPR
Facilitator: Rick Bunch

This group sought to articulate the drivers and benefits of EPR, to discuss how to make the case for EPR to a business audience, and to determine where within the corporate hierarchy the EPR message should be targeted.

The group identified the following drivers and benefits for EPR:

After developing these categories, the group focused on the following topics in more detail:

• Brand loyalty and marketing. Companies' actions are customer driven. That is, the use of recycled content in a product might encourage certain consumers to purchase the product if all else is equal (e.g., price and performance). Price and perf ormance, however, tend to be the most important factors for customers. One strategy might be to decrease the cost of green products or make the cost of a product proportional to the waste generated. It is not clear how substantial the green market niche i s in the larger marketplace.

• Partnerships. Forming partnerships with regulatory agencies and other entities in the product chain, as well as internal partnerships with other company divisions, is crucial to implementing EPR. Companies are willing to set goals together wit h the government but they do not want to be told what to do.

• Risk reduction. Demonstrating that a certain product reduces risks can be a powerful tool for convincing a company's senior management to support a new product.

• Product innovation. Waste reduction goals can provide a stimulus for innovation. Innovation can also be a way to reduce risk and preempt regulations.

• Clearly stated goal and objective. A company's senior management usually will accept a clearly stated objective with a manageable goal.

• Resource efficiency. Because companies view waste in terms of lost profits, reducing waste is good for business and the environment.

There are several strategies for promoting the EPR concept within a company. Efforts can be directed to three different levels within companies: (1) senior management (e.g., CEO's who tend to set a company's vision), (2) the marketing and/or production m anager, and (3) research and development management. The government should lead by example and should look to pollution prevention programs and voluntary initiatives for ideas about how to implement EPR.

Group 4: Barriers to Implementation of EPR
Facilitator: Catherine Wilt

This group explored the many preceived barriers to businesses embracing the principle of EPR. The group also discussed ways to overcome some of these barriers.

Among the barriers to implementing EPR are the following:

• EPR is too big and might involve "biting off more than we can chew."
• Regulatory barriers antitrust laws, taxes, policies, hazardous waste regulations.
• Harmonization with international treaties and trade.
• Technological barriers.
• Management mindset change, costs, difficulty changing product cycles.
• Economic markets, cost allocation, education.
• Competition, including confidentiality concerns.
• Customer acceptance of a product, product component, or new behavior.
• Infrastructure development (e.g., for products with nationwide distribution).
• Balance of (or lack of) stakeholder involvement. (Note: Only one nongovernmental organization was involved in this discussion group, and no environmental groups were represented in this breakout group.)
• Definition of EPR producer vs. product, broader than end-of-life product.
• Relationship between International Standards Organization 14000 and EPR.
• Education both a barrier and solution.
• Research on understanding the true/net environmental benefits of EPR.

There are potential solutions to these barriers. Some solutions include:

• Regulatory barriers. A potential solution to antitrust laws could be for the PCSD to develop a demonstration project (similar to the Common Sense Initiative) to create an exemption or waiver that would allow companies within an industry sector to work together to craft approaches for reducing environmental impacts. Choosing a concentrated industry sector for a project might be more effective than a diluted group (e.g., cellular phone companies). The PCSD could also examine elimination of virgi n material tax subsidies or establishment of tax incentives for using recycled materials. In addition, the PCSD could analyze how hazardous waste laws affect specific items in the solid waste stream. A major change suggested was shifting EPA's regulatory focus from being prescriptive to being more outcome based.

• Technological barriers. The PCSD could (1) support research and development (R&D) projects, including cooperative R&D, incentive grant programs, and improved industrial processes; (2) provide assistance in determining which industries or mater ials need prioritized support (e.g., R&D, grants); and (3) foster greater communication between stakeholders involved in technological R&D.

• Education. A public forum could be developed (via a World Wide Web site or list server) for the general public, government, and industry representatives providing opportunities to state concerns and discuss possible solutions.

Group 5: Outreach Strategies for EPR
Facilitator: Gwyn Rowland

This breakout group discussed the question of how to promote greater familiarity with the principle of EPR and, thereby, help encourage more implementation of EPR.

More fully characterizing EPR will help encourage the development of strategies for expanding this principle in the United States. One participant stated that EPR entails shifting responsibility from the public to private sectors. Another stated that per haps "partnering" or "collaborating" is more accurate than "shifting." Government, industry, and nongovernmental organizations all need to be involved in defining EPR. A consensus on the definition is necessary before an outreach strategy can be developed . Also, responsibility should not be limited to any one type of player to allow for the most creative and efficient solutions to emerge.

An important question remains, however: Whom should an outreach strategy target? Local government, trade associations, academia, and nonprofit organizations are the most likely targets. One participant suggested approaching local governments with a list of problems or barriers highlighted in the case studies and asking for help in overcoming these difficulties. Another strategy involves developing a needs assessment to identify who will bear the brunt of costs when responsibility is shifted. The focus of the outreach should be prioritized according to the criteria in the PCSD's eco-efficiency report.

Multistakeholder meetings on specific issues should be held. The government should play an integral role in these meetings, not only as a participant but as an instigator, organizer, and catalyst. Also, an incentive should be provided to encourage stakeh olders to participate in the meetings. Businesses will need to be convinced that EPR offers a long-term investment opportunity that can improve their international competitiveness. Consumers product end users should also be included in these meetings beca use they play an important role in the success of many EPR programs. To be successful, the meetings must have a primary focus, whether it is to educate attendees about the problem, educate them about case studies and success stories, or initiate a dialogu e on the barriers to EPR and the government's role in overcoming them.

The government's outreach messages should be:

• EPR presents a challenge and an opportunity
• Success stories exist
• The government will work collaboratively with all stakeholders

Group 1
Facilitator: Gary Davis

This group's discussions are based on the three recommendations in the PCSD's February 1996 report to the President, Sustainable America. The recommendations include (1) developing EPR models and demonstration projects, (2) establishing a product respons ibility panel, and (3) applying "lessons learned" from the first two recommendations, adopting practices to implement EPR on a regional and national scale, and removing legislative barriers.

Discussions about these recommendations yielded the following ideas:

1. Models and demonstration projects. This action should take a bottom-up approach by improving upon existing successful models of EPR. Incentives for businesses to participate in EPR demonstration projects should be the establishment of volunta ry, visible programs. Successful models could then be identified from these projects, and case studies describing the projects could be incorporated in outreach materials.

2. Product responsibility panel. Multistakeholder panels by product sector should be established; a panel could be developed for each product category described in the Eco-Efficiency Task Force Report. EPA and the U.S. Department of Commerce coul d take responsibility for setting up a panel. Other resources that could be leveraged include the National Institute for Standards and Technology's Advanced Technology Program and the Manufacturers Extension Partnerships. In addition, the President could establish an Office of Sustainable Development with a budget to develop demonstration projects and provide for education.

3. Promoting implementation of EPR. Following the evaluation of the demonstration projects, companies could voluntarily adopt EPR principles. The product responsibility panel could analyze the results of the demonstration projects and then recomm end any legislative actions or policy changes that would be needed to facilitate implementation of EPR.

Group 2
Facilitator: Bette Fishbein

Agreement was reached on two points: (1) the PCSD should recommend a multistakeholder panel, and (2) the PCSD should evaluate the case studies using the criteria in the PCSD final report. After analyzing the results of the case studies, the PCSD should i dentify the actors in the product chain that have the greatest ability to affect the environmental impacts in the product's life cycle (e.g., product designers).

EPA also should conduct an assessment of what EPR is in the United States and how it relates to the PCSD's criteria for EPR. If EPR is defined too broadly, it will not result in measurable progress. The findings of the assessment should be presented to t he EPR panel selected by the PCSD, and EPR demonstration studies should be implemented with interested companies.

Group 3
Facilitator: Rick Bunch

Conducting a public relations campaign would increase the visibility of the EPR concept, raise awareness, and communicate concrete case study examples of EPR. There are many possible ways of marketing EPR by communicating the short-term goals of bottom l ine enhancement, innovation, and competitive advantage as well as the long-term goal of sustainability. One possibility is holding a national town meeting on the Internet involving numerous stakeholders.

Demonstration projects should compare non-EPR and full-EPR scenarios for specific products or companies. The projects should identify the costs, common barriers, environmental benefits, and steps to implementation of EPR, and bring other kinds of product s and sectors into the EPR realm. Companies seeking national exposure would likely be willing to participate in such projects, and competition with other companies would also encourage them to participate. The government can help promote the EPR concept a nd give companies the tools they need to implement it. While companies move toward EPR, however, the government should allow them to continue with "business as normal."

The PCSD should not select products to focus on in demonstration projects but rather should publish a broad solicitation to companies for EPR demonstration projects the government would be willing to help implement. Projects would be chosen on the basis of their potential for quantifiable progress within a defined period of time. The multistakeholder panel could assist the demonstration projects by analyzing life-cycle costing mechanisms and brainstorming about how to overcome barriers.

Group 4
Facilitator: Catherine Wilt

In this group's discussion, one participant expressed skepticism about whether the PCSD is at the appropriate point to be considering next steps. Another was troubled that the PCSD might be "firing before it aims," saying that a better understanding of t he life-cycle approach is needed before attempting to implement EPR.

Concerns were also expressed that the goals and priorities listed by the PCSD do not strongly articulate the life-cycle aspect of EPR and are too focused on waste and end-of-life management. Tools are needed for assessing, measuring, prioritizing, and ma king decisions about which portion of the production process has the greatest potential for yielding environmental benefits. Rather than a panel deciding which products should be prioritized, willing partners could take the lead in developing demonstrati on projects that would test barriers to EPR implementation. Incentives for these partners include preempting regulations as well as realizing economic benefits. The panel's first concern should be identifying issues to be tested in demonstration projects, not identifying product categories. In addition, the PCSD needs to establish a framework so that a dialogue between stakeholders can be continued.

Group 5
Facilitator: Gwyn Roland

This group used as its starting point for discussion about the next steps for EPR, the three phases of EPR implementation described in the Eco-Efficiency Task Force Report. Phase 1 entails creating a multistakeholder advisory panel that would prioritize product categories for initial application of EPR policy options. Phase 2 involves undertaking demonstration projects in the product categories. Finally, Phase 3 calls for applying lessons learned from the demonstration projects to develop regional models and national EPR policies. The group discussed how the ideas contained in the first two phases could be further developed:

• Phase 1. Because the PCSD is understaffed, EPA or perhaps the Council on Environmental Quality should be responsible for creating the panel; EPA has both the staff and the expertise to take on this responsibility. A panel under EPA auspices mi ght be detrimental, however, because EPA is typically seen as a regulator. A suggested first step might be determining a budget and timeline for the panel.

• Phase 2. Protecting proprietary information during demonstration projects is important. Demonstration projects should focus on alternative technologies that lead to regulatory innovation. Many case studies exist that should be inventoried and studied. Allowing companies participating in demonstration projects to be exempt from legal and regulatory barriers, it was suggested, might help to ensure that regulatory reform receives a full and open debate.

Considering the proceedings of this workshop over the past 2 days, Thomas Lindqvist emphasized that the European experience with EPR can help individuals and organizations that are working to bring this principle to the United States. The International I nstitute for Industrial Environmental Economics first developed the concept of EPR in 1990. At its core, as envisioned by the Institute, EPR is about creative capitalism. Europe is more market oriented regarding environmental policies than many in the aud ience might think. EPR is needed because companies need assistance in making sound business decisions about how they can reduce the environmental impact of their products. If we could agree on a principle, the principle could help companies enormously. Th is definition must be specific: if it is imprecise, decisions cannot be made based on it.

Companies want to be rewarded for being responsible, Mr. Lindqvist continued. The reward is greater profits and an improved business image. If the reward is spread too thin, however (i.e., everyone shares responsibility), then the incentive is lost. Comp etition, ultimately, is needed to achieve results.

EPR programs should target someone in the product system chain in order to get a reaction and, in most cases, the target should be the producer. The producer is not necessarily the manufacturer. It is the person who will make something happen. Often it m ay not be appropriate to include all players in the decision because different players have different goals.

As has been mentioned, command-and-control approaches should be modified. EPA should command results, but not control how businesses implement EPR. EPA should provide goals and allow companies to decide how to reach those goals. In fact, voluntary initia tives work in Europe just as well as mandates. Any problems with mandates often can be eliminated by arranging the mandates in the right way (e.g., by keeping legislation simple).

Martin Spitzer, New National Opportunities Task Force Coordinator

Martin Spitzer summarized a number of critical ideas and themes about EPR that were discussed over the course of the workshop. He invited participants to consider carefully the work done at the workshop to determine what had been gained and where we shou ld go next. The key ideas raised at this workshop include:

• EPR in the United States is not a theory it's a fact. Many companies are implementing EPR for a variety of reasons. Just communicating this information is an important step.

• Even if we do not agree on what EPR is, all of the companies participating in the workshop submitted case studies that were accepted as EPR. Imagine what the case studies could look like if we could agree on a definition.

• The case studies that have been presented at the workshop need to be distilled to illustrate how they exemplify EPR. This distillation would help clarify the EPR definition.

• A connection exists between EPR and regulatory reform. Perhaps EPR can be sold as a means to advance regulatory reform.

• The next steps in our work on EPR should be identified, and responsibility for this work should be established.

• The PCSD could focus on creating a panel to give EPR some momentum. If such a panel were created, it should have a budget and should be responsible for researching and prioritizing information, soliciting and coordinating demonstration projects, and leading regulatory reform.

• An entity is needed to collect and analyze information on demonstration projects.

• Organizations like the National Academy of Sciences, the National Research Council, and the National Academy of Engineering could be involved.

• Some messages have emerged from this workshop about what needs to be done. Terminology, for example, needs to be clarified. The costing of products throughout their life cycle also needs to be examined to ensure that product competitiveness is mainta ined. A better explanation of the tradeoffs and benefits of EPR is also needed.

Perhaps the best way to conclude this workshop, Mr. Spitzer suggested, is to summarize the PCSD's goals in convening it: namely, to present diverse case studies and focus on available models for implementing EPR (e.g., take-back, leasing, education, trai ning, economic incentives). Workshop participants have presented and discussed a variety of such models and how they relate to the underlying principles of EPR. Key issues discussed include:

• Focusing on products and services.
• Redesigning products.
• Moving beyond waste in our understanding of EPR.
• Recovering and reusing materials.
• Involving people in the full chain of commerce.
• Identifying the key features of EPR.
• Generating ideas for building the business case for EPR.
• Brainstorming about how outreach can help implement EPR.
• Making the PCSD's recommendations real.

Mr. Spitzer then adjourned the meeting, thanking all the participants of the first PCSD workshop on EPR for their attention and dedication to achieving sustainable development in this country.

Organization for Economic Cooperation and Development. 1996. Pollution Prevention and Control: Extended Producer Responsibility in the OECD Area (Phase 1 Report). Paris. OECD Environment Monograph No. 114, General Distribution No. OCDE/GD(96)48. J anuary.

President's Council on Sustainable Development. 1996. Sustainable America: A New Consensus. The White House, Washington, DC.

President's Council on Sustainable Development. 1996. Eco-Efficiency Task Force Report. The White House, Washington, DC.

U.S. Environmental Protection Agency. 1997. Extended Product Responsibility: A New Principle for Product-Oriented Pollution Prevention. (Prepared by Davis, G.A., Wilt, C.A., Thornburg, R., Droitsch, D., and Dummer, C., of The University of Tenness ee's Center for Clean Products and Clean Technologies, in collaboration with Dillon, P.S., of Tufts University's Gordon Center, and Fishbein, B.K., of INFORM, Inc.). Forthcoming (expected in 1997).