The Economics of Plastics
Plastic Credits and EPR Certificates
How India's plastic EPR system lets companies meet recycling targets by buying certificates from recyclers, and why fake certificates became a problem.
India’s Plastic Waste Management Rules use extended producer responsibility (EPR) for plastic packaging.
How it works
- Producers, importers and brand owners must ensure collection and recycling of a share of the plastic packaging they sell.
- Targets rose over time.
EPR certificates
- Registered recyclers generate certificates for plastic they process.
- Brands buy these certificates to meet their obligations, through the Central Pollution Control Board portal (from 2022).
Market for credits
This creates a market: recyclers earn extra income, and brands pay for recycling without doing it themselves.
Fraud
- Investigations found fake certificates generated by recyclers that didn’t actually process plastic.
- The CPCB cancelled certificates and penalised firms.
Economic view
Tradable certificates can lower compliance costs, but need strong verification.
Comparison
Similar to carbon credits, they depend on trust in measurement.
A snack company buys EPR certificates from a recycler equal to the tonnes of plastic packaging it sold, meeting its legal target.
Fake certificates were found.
- Plastic EPR makes brands responsible for recycling.
- Recyclers generate certificates brands can buy.
- Fake certificates were a problem.
- Verification is essential.
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