- President Luiz Inácio Lula da Silva has launched a new recycling credit program that seeks to correct deeply flawed regulations inherited from the previous government.
- The credits will be used as a means for environmental compensation and will also allow companies to fulfill their compliance with reverse logistics targets.
- The main flaws in the previous decree, according to experts, were the failure to prioritize individuals and collectives working in informal waste collection as beneficial operators, and the ineffective criteria for measuring compliance and verification of results.
- Nevertheless, doubts remain over how far the credit system will go toward creating a sustainable and inclusive waste management system in Brazil.
Reverse logistics, a principle introduced in Brazil in 2010 in the Brazilian government’s National Policy for Solid Waste (PNRS), is an approach that seeks to minimize levels of waste generated after the consumption or at the end of the life cycle of consumer products, such as electronics, light bulbs, tires and packaging in general. It’s meant to be an all-of-society responsibility, especially for the private sector, to ensure that waste material is recycled or processed in some other environmentally appropriate way.
“Reverse logistics was created in order to make the producer responsible for dealing with the environmental impact generated by the products it produces” at the end of the production chain, says Jacqueline Rutkowski, a researcher in the field of waste management and member of the Observatory for Inclusive and Solidarity Recycling.
Regulations and reverse logistics targets exist for every type of waste, which much be met by the private sector, including manufacturers, importers, distributors and traders. For general packaging, for example, the current target requires companies to recycle 22% of the volume of packaging placed on the market each year.
To make it easier for the private sector to comply, the government in April 2022 created the Recicla+ program, along with the Recycling Credit Certificate. However, the new administration, which took office at the start of 2023, has moved to revoke these policies and launched a new program this past February under the name Reverse Logistics Recycling Credit Certificate (CCRRL).
Under the new scheme, each metric ton of recycled waste is eligible for one recycling credit. Companies can buy credits to show that they’ve met their reverse logistics targets. The recycling credit system is an instrument for environmental compensation similar to the carbon credit system that’s used to meet emissions reduction goals, though less widely known.
Mongabay spoke with three experts about the main flaws with the old Recicla+ decree, and what can be hoped for from the new CCRLR program, including the advantages and disadvantages of this reverse logistics support tool.
Any legal entity that carries out the collection, sorting and return of recyclable materials to the business sector is allowed to participate in the recycling credit program as an operator, and will be remunerated for these services, upon the presentation of invoices for verification purposes.
The new CCRLR decree, however, has established a new order of priority, which will benefit Brazil’s catadores, or informal waste collectors. “The electronic invoices issued by the operators will originate, preferably, from the trading operations of recyclable materials by individual waste collectors, cooperatives and associations of waste collectors,” the new decree reads. “Credits may be acquired from other operators, once the invoices issued under the provisions [above] have been exhausted,” it adds.
According to Fabrício Soler, a lawyer specializing in environmental and waste law, it’s important for the catadores and their organizations to be prioritized since, on top of being an express provision of the National Policy for Solid Waste, it can also help structure the recycling chain and promote social development. Since this “prioritization” wasn’t stipulated in the old Recicla+ decree, such a change was expected to take place, he said.
Despite the essential role played by Brazil’s catadores being recognized in the new decree, it continues to require the issuing of electronic invoices to access credits — something that could make the involvement of these workers more difficult for two reasons, according to Rutkowski.
Some 55% of Brazil’s informal waste collectors are either illiterate, innumerate, or haven’t completed elementary school, Rutkowski said. That means they’re unlikely to have the necessary computer skills or even internet access needed to produce electronic invoices. On top of this, many individual catadores and the catador cooperatives still work on an informal basis, without any invoices or other paperwork for the services or transactions that they carry out.
This problem has also been highlighted by Carlos Henrique de Oliveira, a professor of environmental management at the Methodist University of São Paulo. According to Oliveira, who worked on the team that developed São Paulo’s Integrated Solid Waste Management Plan, an estimated 80% of the individuals and organizations responsible for the collection or sorting of recyclable materials in Brazil’s largest city don’t have a taxpayer identification number (CNPJ) and don’t issue invoices.
As a result, recycling credits as they’re currently being proposed will be inaccessible to the majority of workers in the sector, due to their current working conditions. This, Oliveira said, “could mean that little improvement is made in the results,” both in terms of recycling and social inclusion.
Verifying the results
According to Soler, the previous decree established “an important figure,” the independent verifier, whose job was to verify the workability and results of the program, helping to bring “traceability and compliance” to the reverse logistics chain. However, Soler also noted that the lack of representatives from public institutions in the performance monitoring process left some “deficiency.”
Rutkowski, meanwhile, noted that a “serious flaw” in the previous decree was to allow both managing and verifying entities to be represented exclusively by companies or industry associations, leaving it up to them to “inspect whether or not they themselves are complying with the law.”
It should instead be up to the public authorities, working with experts from different sectors, to verify all the program’s processes, as is done in Europe, and to ensure that “the results are satisfactory,” said Rutkowski, who recently carried out a comparative study on reverse logistics of packaging in Europe and Brazil.
The new decree establishes the position of a “verifier of results,” a legal entity that will be appointed and supervised by the Ministry of Environment and Climate Change. This entity will be responsible for the “verification of the results of product or package recovery and the approval of the electronic invoices issued by the operators.” The Ministry of Environment and Climate Change will also be responsible for “verifying the efficiency of the program and how the fulfillment of the reverse logistics goals develops.”
Oliveira said it’s important that the federal government carry out the “following-up and monitoring of the results” as well as the “communication and clarification with the public.” He also said, however, that the National Information System on Waste Management (SINIR), a federal government database on the program, “is still flawed.”
Conformity and governance
A key change in the new decree is the removal of “energy recovery,” or the conversion of waste into fuel or energy, from the stock options eligible for recycling credits.
This was previously a “very serious flaw” in the old decree, Rutkowski said, since energy recovery, which usually involves incineration, isn’t environmentally advantageous compared to recycling. It’s not even considered one of the priority waste management actions in the National Policy for Solid Waste.
Even so, Rutkowski said the new recycling credit scheme could limit, rather than increase, the recycling of certain waste products, depending on their market value. Therefore, “we need to have a correct diagnosis of what we recycle, in order to identify the bottleneck points,” said Rutkowski, who is also involved in the development of the Brazilian Atlas of Recycling.
Oliveira noted another possible limitation: the ease and relatively low costs of acquiring credit may disincentivize companies from implementing priority waste management actions, such as the “non-generation” and “reduction” of waste in the production chain, on top of the manufacturing of “products with recyclable components and longer service life,” both of which are fundamental to the development of a circular economy.
As well as the Reverse Logistics Recycling Credit Certificate, the Lula government has announced two other new initiatives: the Certificate of Structuring and Recycling of General Packaging, and the Future Mass Credit. Experts say it remains to be seen whether these new initiatives will help to significantly increase the recycling rate across the board of recyclable waste products, as well as reduce the accumulation of waste in the country — and the environmental and social impacts that result from it.
“I hope that the federal government, this new administration, engages in dialogue with society at large so that we can contribute toward making effective progress in waste management in Brazil,” Oliveira said.
Banner image of catadores, or waste collectors, in the old Estrutural dump in Brasília. Image by Leopoldo Silva/Agência Senado (CC BY 2.0).