The European Commission presented on 30 March a package of European Green Deal proposals to make sustainable products the norm in the EU, boost circular business models and empower consumers for the green transition. The new rules would make almost all physical goods on the EU market more friendly to the environment, circular, and energy efficient throughout their whole lifecycle from the design phase through to daily use, repurposing and end-of-life.
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Why is the Commission proposing an Ecodesign for Sustainable Products Regulation?
In our daily lives we use a variety of products, often without thinking about what their production and consumption means for climate and the environment. Products use up massive amounts of materials, energy and other resources and cause significant environmental impacts throughout their lifecycle, from the extraction of raw materials, to manufacture, transport, use and end of life. Half of global greenhouse gases and 90% of biodiversity loss are caused by extracting and processing primary raw materials. Negative environmental impacts include significant resource depletion, generation of greenhouse gas emissions, and pollution. A recent JRC study demonstrated that global planetary boundaries are close to or are already being surpassed in several impact categories. The EU needs to act now to reverse these trends.
The objective of the Commission’s Ecodesign proposal is to make sustainable products the norm on the EU market and reduce their overall environmental and climate impacts. The ‘take-make-use-dispose’ model can be avoided, and much of a product’s environmental impacts is determined at the design stage.
While there are already some sectorial EU rules to make products greener and more energy efficient, a broader framework for setting harmonised rules on environmental sustainability is needed to accelerate the transition to a climate neutral, resource-efficient and circular economy and fully use the leverage of the EU Single Market, while avoiding its fragmentation. The initiative will have environmental benefits by reducing pollution and resource use. It will have a strategic benefit for the EU by increasing our resource independence, also in the context of the current geopolitical situation. It will strengthen the Single Market, make the EU a standard-setter in sustainability and create economic opportunities for innovation, notably in remanufacturing, recycling and repair. Finally, it will foster job creation in the areas of maintenance, reuse, recycling, refurbishment, repair and second-hand sales. Such activities are estimated to create 30 to 200 times more jobs than landfilling and incineration.
What are the main actions proposed?
The proposal follows the same approach as the current Ecodesign Directive, which has been driving efficiency gains for energy-related products in the EU for over a decade. In 2021 alone, existing Ecodesign requirements saved EU consumers 120 billion in energy bills.
The new proposal will apply to the broadest possible range of products and will use the successful ‘Ecodesign approach’ to set product-level requirements that not only promote energy efficiency but also circularity and overall reduction of environmental and climate impacts.
Such requirements will be set in product-specific legislation and will include rules to make them more durable, reliable, reusable, upgradable, reparable, easier to maintain and refurbish, and energy and resource efficient. They could also address the substances that inhibit circularity or amount of recycled content products contain, as well as ways to make them easier to remanufacture and recycle.
This proposal will also enable information requirements to be set for products to know more about the impacts of the products on our shelves and make more sustainable choices along the whole value chain. Digital Product Passports will be rolled out for all regulated products. The product information can also take the form of ‘classes of performance’ for instance ranging from ‘A to G’ – to facilitate comparison between products, possibly displayed in the form of a label. This would work in a manner similar to how the widely recognized EU Energy Label currently works, and be for instance used for a repairability score.
The proposal incentivises sustainable products and enables mandatory green public procurement criteria to be set, making use of contracting authorities’ economic power. It will ensure that material value is retained, via measures to prevent the destruction of unsold consumer goods, including far-reaching transparency requirements for those choosing to discard unsold goods, and the possibility to ban their destruction for relevant product groups. The new measures will also strengthen market surveillance and enforcement, boost compliance and ensure a level-playing field for all placing products on the EU market.
Until the broadened framework is in place, the Commission will continue its work under the existing Ecodesign Directive. The new Ecodesign and Energy Labelling Working Plan for 20222024 will include new energy-related products, and update and increase the ambition of those already regulated.
Which are the products covered by the proposal cover?
The proposal will enable rules to be set for any physical good placed on the market, or put into service, including intermediate products. Only a few sectors, such as food, feed, and medicinal products, are exempted. To ensure the right priorities are set in a transparent and inclusive way and ensure involvement of relevant parties, the Commission will launch a public consultation on the categories of products to be selected under the first Ecodesign for Sustainable Products Regulation working plan by the end of 2022. A preliminary assessment by the Commission has identified that product categories such as textiles, furniture, mattresses, tyres, detergents, paints, lubricants, as well as intermediate products like iron, steel and aluminium, have high environmental impact and potential for improvement, and may thus be suitable candidates for the first workplan.
To take into account individual characteristics and specificities of products, rules will be set product by product. However, where sufficient commonalities across certain products exist (such as electronic appliances or textiles), rules covering groups of products at a time may be set. Once set, rules will apply equally to all products placed on the EU market, regardless of their origin – produced in the EU or imported.
How will rules for products be laid down?
The proposed regulation sets a framework that will enable product-level rules to be laid down in a second stage, through delegated acts, product by product or for groups of products if appropriate. This builds on the approach proved successful under the current Ecodesign Directive.
In all cases, the development of these rules will be underpinned by thorough preparatory processes, including inclusive stakeholder consultation and impact assessment, also as regards affordability for consumers, impacts on competitiveness and administrative burden.
How will the proposal address destruction of unsold consumer goods?
The proposal contains several measures to prevent the destruction of unsold goods destined for consumers.
Firstly, it will significantly increase transparency: large businesses that discard unsold products will have to disclose their number per year, the reasons for the discarding and information on the amount of discarded products that they have delivered for preparing for re-use, remanufacturing, recycling, energy recovery and disposal operations in line with the waste hierarchy. They will have to ensure this information is made available, either on a freely accessible website, or via other means. This measure will apply to all concerned economic operators as soon as the regulation enters into force. The proposal explicitly prohibits circumvention techniques, such as a big company selling to small companies (which are normally exempted) to make them destroy products.
Secondly, the proposal enables the Commission to ban the destruction of unsold consumers goods outright, where it proves to be a particular problem for specific product categories.
What will the new law mean for manufacturers and companies?
The proposal will support the decoupling of economic growth from resource use and increased transparency across the supply chain.
Materials are vital inputs to Europe’s industries, typically accounting for more than 40% of the input costs of EU manufacturing companies. Their efficient use is important for competitiveness along all 14 industrial ecosystems. Manufacturing more circular and sustainable products leads to important cost savings and has reputational benefits as products increase in quality, with many companies already adopting this logic.
The proposed Regulation will provide a level-playing field for businesses aiming to sell their products on the EU market. Harmonised rules will ensure that diverging national sustainability requirements do not result in market fragmentation, thereby widening existing markets, reducing compliance costs and administrative burdens for those operating across the EU. In addition, strengthened enforcement will protect compliant business while ensuring the environmental aims are met.
What will the revision mean for consumers?
The proposal provides consumers with access to better information and higher quality products. The costs for manufacturing the products that will be regulated are expected to increase, with possibility that some may be being passed on to consumers. The experience under the current Ecodesign Directive, however, is that increased manufacturing costs are more than offset by financial savings for consumers over the long term. Improved product performance and longer functionality will reduce the need to replace products, and lead to overall cost savings, including through lower energy and resource consumption (for example water for washing machines and dishwashers), better performance, durability, upgradability and reparability, as well as higher value at the end of life. Continuing to set ecodesign rules for energy-related products will lead to continued energy savings especially important given the ongoing hikes in energy prices.
What are Digital Product Passports?
Digital Product Passports are tools that can significantly enhance the end-to-end traceability of a product, complementing information provided in product manuals or labels. It should help consumers make informed choices by improving their access to product information, allow repairers or recyclers to access relevant information, and improve enforcement of legal requirements by authorities.
The information to be included in the product passport will be determined when preparing product-specific rules. It may include information such as the environmental footprint of a product, information useful for recycling purposes, the recycled content of a certain material, information about the supply chain, and others. Moreover, access to information will be granted on a ‘need-to-know’ basis. Different people will have access to different sets of information, based on access rights defined for each product group regulated. It will be based on a decentralised data system, set up and maintained by economic operators.
How will the new Ecodesign/Energy Labelling Working plan 2022-2024 help Europeans face high energy prices or poor product performance?
The existing ecodesign and labelling requirements alone are estimated to have saved Europeans more than 120 billion in bills in 2021. The projected energy savings will increase in the coming decade as the existing stock of appliances is gradually replaced by models meeting the EU requirements. The actions outlined in the new working plan will further contribute in various ways:
- Reviews of current rules will in many cases increase the energy savings or other benefits to be expected: upcoming new rules for products such as space and water heaters and tumble dryers will strengthen minimum efficiency requirements but also add requirements in areas such as spare part availability.
- New rules will cover product groups not regulated now, such as smartphones, tablets and photovoltaic solar systems.
- A set of new product groups such as low temperature emitters, electric vehicle chargers will be assessed.
- Actions to support effective national Market Surveillance and help manufacturers, importers and retailers comply will ensure that there will be less “lost savings” due to non-compliance.
- A web tool helps consumers find efficient alternatives to their existing, old appliances and facilitate green procurement for authorities and businesses.
How does the initiative contribute to the EU’s strategic autonomy in terms of critical raw materials and energy use?
Despite significant efforts to improve resource and energy efficiency, the EU faces strategic dependencies for many materials and fossil fuels. As a result, it remains vulnerable to supply shocks, price volatility and the pressures of the longer-term global acceleration in consumption. Several recent events including the COVID-19 crisis and Russia’s invasion of Ukraine have brought global supply chain vulnerabilities dramatically to the fore. About 20% (1.53 Gt) of the raw materials we use are imported, including notably high-value metallic minerals, short-lived fossil fuels and critical raw materials that are scarce in Europe.
By making materials last longer, ensuring their value is retained for as long as possible and boosting the use of recycled content in products, the proposal will promote decoupling of economic development from natural resource use and reduction of material dependencies thus fostering EU open strategic autonomy and resilience.
Chapeau communication on making sustainable products the norm
Source: European Commission
