Re: Duracell’s Response to…

Re: Duracell’s Response to Proposed Amendments to the Batteries Regulation in
Ontario
Dear Minister Khanjin,
On behalf of Duracell, I am pleased to submit comments on the proposed amendments to the
Batteries Regulation (O. Reg. 30/20) Resource Recovery and Circular Economy Act, 2016.
Duracell believes that some additional modifications to the regulation are necessary to provide
increased flexibility, reduce administrative burden, and simplify compliance requirements for
battery producers. These five modifications, which are outlined below, will also harmonize the
Batteries Regulation with that of other leading jurisdictions.
1. Eliminate Recycling Efficiency Rate (RER) and Resources Recovered requirements
for both processors and producers to enable accurate calculation of
collection/management targets.
Rationale: The current reading of the amendments removes the RER and resources
recovered requirements for processors, but not for producers. The initial understanding was
that the RER and resource recovered requirements would be removed for both processors and
producers. We recommend that Section 16 (1) be updated to remove the RER and resources
recovered requirement for producers as well. If the RER is not removed for producers, it will
significantly increase the total aggregate collection requirements. For example, a 50%
RER/resource recovered target is equal to a 62.5% total aggregate collection target.
Also, by removing RER and resources recovered requirements for producers, it will make the
law similar to other jurisdictions. Ontario is the only jurisdiction where, because RER is used
instead of a total aggregate collection requirement, performance outcomes are artificially
understated. Because the Ontario model is different from other jurisdictions, it requires
additional systems to account for recycling, which are more complicated and costly. The
removal of RER would allow resources to be redirected from tracking and reporting to
improving operations, efficiency, and outcomes.
2. Combine reporting targets for single-use and rechargeable batteries
Rationale: Duracell is not in favor of MECP’s proposal to maintain separate management
targets for single-use and rechargeables.
This approach exacerbates the challenge of achieving targets because a surplus of one type
cannot be used to offset a shortfall of the other. Producers, PROs and RPRA are required to
report separately for each category, which takes resources away from core recycling activity.
Keeping the management targets separate will prevent producers from achieving compliance
and will increase the likelihood of further non-compliance orders and significant administrative
penalties.
In aggregate, single-use batteries account for ~80% of sales into the market and total
collection volume, while the rechargeable category represents ~20% of sales into the market
and total collection volume. It is therefore not possible for producers and PROs to “over collect”
in the rechargeable category to meet management requirements if the categories were
combined,
Ontario and Quebec are the only provinces in Canada that separate single-use and
rechargeables. Combining the two would align Ontario’s regulation with most other provinces.
There is precedent for this recommendation. On pages 22 and 23 of the Plain Language
Description of Proposed Regulatory Amendments, MECP proposes to remove reporting
requirements for replacement parts from ITT/AV equipment, meaning producers of ITT/AV
equipment would no longer have to report on supply weight of those parts, and would not have
obligations related to that supply weight. Part of MECP’s rationale for this proposal is to
“reduce administrative burden for producers of replacement parts for ITT/AV equipment”, and it
notes that the change “would not have a negative impact on environmental outcomes as
producers’ collection networks would still have to collect and manage these parts”.
Combining the management targets for single-use and rechargeables would reduce the
tracking and reporting burden for producers without negatively impacting environmental
outcomes of the batteries program.
3. Adjust Collection/Management Targets by year:
Assuming that RER/resource recovery removal is added for producers and singleuse/rechargeable reporting targets are combined, collection/management targets are
achievable using the following framework:
• 2023: 30% (one combined target)
• 2024: 40% (one combined target)
• 2025: 40% (one combined target)
• 2026 onwards: 50% (one combined target)
Rationale: Duracell is not in favor of MECP’s proposal for management targets.
While maintaining the management target at 45% from 2025-2029 instead of increasing it to
50% in 2024 is an improvement, producers cannot collectively achieve a 45% management
target until approximately 2026. This leaves the period 2023-2026 where producers do not
achieve targets and for which they may face further non-compliance orders and significant
administrative penalties.
A successful framework will include achievable targets that are guided by historical actuals and
will include a realistic escalation. The above recommendations follow these guidelines.
The Ontario batteries regulations only came into effect roughly four years ago, during the time
of a major global pandemic that caused significant disruptions to the recycling ecosystem. Yet,
Ontario has the highest targets of the provincial jurisdictions in Canada, and they do not reflect
the province’s historic collection rates. This is highly aggressive when compared to the
collection rates in other Canadian provinces, which have allowed for slower ramp-up of targets
and/or lower initial targets that increased as the program matured. It should also be noted that
the following are aggregate collection targets. If they were RER and resources recovered
targets like Ontario’s framework, these targets would be even lower.
• British Columbia: Year One 12%, Year Two 18%, Year Three 25%
• Manitoba: Year One 11%, Year Two 15%, Year Three 18%
• Quebec: Year One 20%, Year Two 25%, Year Three 30%
In contrast, Ontario’s RER and resources recovered targets are: Year One 40%; Year Two
40%; Year Three 45%.
There is precedent for decreasing management targets in Ontario’s EPR framework. In the
‘Regulation Specific Changes’ section on page 19 of the Plain Language Description of
Proposed Regulatory Amendments, MECP is proposing to reduce the collection/performance
targets for the Tires program by 20 per cent, from 85 per cent down to 65 per cent for 2025-
2029. It goes on to say the rationale is to “align with the results that have been achieved to
date.” Applying this rationale of basing targets on actual historic results, the targets within the
Batteries Regulation should also be adjusted down to those outlined in the previous table.
4. Change the effective date of the regulation changes to 2023
Rationale: MECP proposes using the 2025 performance year as the starting point when
regulatory changes will come into effect. This means that for performance years 2023 and
2024, producers are at risk of non-compliance orders and significant financial penalties
because both years are still open to RPRA’s examination and enforcement.
Several stakeholders have engaged MECP on recommended regulatory changes since 2022
and producers should not be penalized for the length of time the engagement process has
taken.
Duracell requests that MECP apply regulatory amendments retrospectively, coming into effect
for the 2023 performance year onwards.
Otherwise, if MECP decides to use 2025 as the effective date for regulatory amendments, then
RPRA should avoid issuing non-compliance orders and administrative penalties to producers
for the 2023 and 2024 performance years.
I appreciate the consideration of Duracell’s recommendations outlined above. Duracell
believes that with these changes, producers can focus efforts on public participation in battery
returns leading to improved environmental outcomes