EPR Now: California's new Source Reduction Requirements

This episode of the Circular Soundbites "EPR Now" series covers California's new EPR source reduction rules. Environmental Compliance Coordinator Kristen Kelly explains key requirements, compliance pathways, and what producers need to do next to meet ambitious packaging reduction targets. 

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Transcript

Welcome to Circular Soundbites, the podcast where we break down the ideas, systems and decisions driving real progress in the circular economy. I'm your host, Leigh Van Akken, coming to you today from just outside of New York City, and today's episode is part of our series called EPR Now, which offers the timely context that you need to adapt to evolving EPR landscapes.

Now, last time, I did promise you the next stop on our EPR Now series was going to be a deep dive into packaging data, and that is still in the works. But meanwhile, we have had a massive update here in the United States from the Circular Action Alliance with big announcements regarding California's source reduction requirements.

Everybody's been waiting for this. And so joining me today is my colleague, Kristin Kelly. She is the EPR compliance coordinator from RLG, and she's gonna talk us through the most salient parts of the update that producers will wanna know. So let's get started. Circular Soundbites, a Reconomy podcast.

Kristin, thank you so much for being here with me today. Yeah. Thanks, Leigh. Happy to be here. So I wanna start with this concept of source reduction, because this is kind of something new that we're seeing in EPR, right? What is source reduction, and what is source reduction hoping to do? Yeah. So you're right, um, it is pretty new to EPR.

Traditionally, EPR has focused on end-of-life management. For example, how to finance and improve recycling in certain states. So source reduction moves that conversation upstream. Uh, it's about preventing waste from the get-go by designing packaging that uses less material or more recycled content, or by switching to reusable formats.

So in California's case, the goal is to drive measurable cuts in the overall tonnage of plastic packaging that's entering the market instead of just managing what happens after use. Um, it's a push to rethink what gets produced at all. Kristin, producers have been really waiting for this update. Why is that, and what's it gonna change?

California is often the trailblazer for packaging policy in North America, so rules announced by Circular Action Alliance give producers their first real look at how ambitious these source reduction targets will be. Until now, companies haven't known whether they'll need a slight packaging tweak or a full design overhaul, so the impact will be significant.

It changes business planning, procurement contracts, and sustainability reporting. So producers now have concrete targets and timelines, which means 2026 is the year to start aligning these strategies. So with this update, we learned that there are essentially five pathways, right, five avenues for source reduction.

What are those five avenues? Can you just talk us through them high level real quick? Yeah, absolutely. So the first one is material reduction, which simply means using less plastic per unit. Then there's shifting to reuse or refill systems. The third would be incorporating post-consumer recycled content, otherwise known as PCR.

And there's also switching to alternative materials with a verified lower environmental impact. And last but not least, design innovation, which means changing product or packaging formats altogether to eliminate any unnecessary components. So each pathway counts differently towards the target, so it's less about one size fits all and more about tailoring the approach to your product portfolio.

Okay. That's a lot of work. Yes, definitely. Which is why it's great to start early or as early as possible. Yeah. So if I have this right, each producer is gonna have their own source reduction targets, right? These unique targets. Who is setting those targets, and how are they being set? California's Department of Resources, Recycling and Recovery, also known as CalRecycle to more, uh, is ultimately the authority.

Uh, but Circular Action Alliance, acting as the producer responsibility organization, or PRO, will propose how producer-level targets are distributed based on market share, packaging type, and recyclability. So they're building a data-driven model, which means the quality of producers' data submission this year will directly affect their baseline and future obligations.

Oh, so there's a lot of pressure on the data from this year in particular. Yes, definitely, 'cause this is when the baselines really do start. Mm. Okay. Are there any aspects of source reduction that have been surprising to producers or caught people off guard? There are definitely two things we're seeing.

First is the speed at which it's happening. The first reduction milestone hits in 2027. That's just a year after most producers registered. I think we can all agree that's a pretty tight turnaround. Um, and second is the accountability structure, so companies can't just offset reductions by funding someone else's improvement.

The rule ties performance to their own packaging footprint, and that's a new level of responsibility and visibility that we're seeing. One last question for you. What should producers be watching for to happen next? Yeah, so what we've seen so far is only, like, part one of the source reduction rulemaking and guidance.

The next phase, which is expla- expected later this year, but not too much later, as we're seeing the speed, will clarify enforcement mechanisms, credit trading, and, uh, reporting templates. So that will tell us how compliance will actually be measured. So for now, producers should ensure their packaging data is solid and that their internal teams, like product design, procurement, and compliance, are all aligned and ready for this pivot.

Um, and as always, at RLG, we're keeping our customers in the loop about all of these updates, uh, so that they can ensure that they're in compliance. Yeah. That's great, Kristin. Thank you so much for explaining all of this today. I, it, it's been fabulous. Yeah, no, thank you so much for having me. And that does it for this episode in our series EPR Now.

We'll have more EPR Now for you soon, but if you need some help with source reduction or any other EPR legislation, write to NorthAmerica@rev-log.com to request a confidential discovery call. This has been a Circular Sound Bites podcast from Reconomy. Thank you to my special guest, Kristin Kelly, and of course, to you for listening.

If you enjoyed this episode, you can listen to more Circular Sound Bites across all major platforms, or watch them on our YouTube channel. For more about Reconomy and the circular economy, find us on LinkedIn or visit reconomy.com.

Circular Sound Bites, a Reconomy podcast.