Designing Economically Sustainable EPR Programs

Extended producer responsibility (EPR) legislation has reshaped how governments and producers think about recycling. Across the U.S., new laws are moving rapidly from concept to statute and signaling a clear shift in how responsibility for materials management is allocated. While passing EPR legislation is a critical milestone, it’s only the beginning.

The long-term success of EPR programs depends far less on legislative intent than on how programs are implemented, particularly how they are designed to function economically in real-world recycling markets.

The implementation gap in EPR programs

As EPR programs move into implementation, many face a common challenge: translating high-level policy goals into programs and systems that are financially sustainable, equitable, and defensible over time.

In practice, programs often struggle with:

• Incomplete or outdated assumptions about recycling system costs
• Fee structures that are difficult to explain or defend to stakeholders
• Misalignment between program funding mechanisms and actual market conditions

When these issues surface, programs often encounter instability, stakeholder resistance, and regulatory friction – all of which are conditions that undermine both environmental and economic objectives.

Why economics matters more than ever

At the heart of every successful EPR program is a clear understanding of the underlying economics of recycling. That understanding includes the full range of costs associated with collection, processing, transportation, administration, and market volatility.

Without this foundation, even well-intentioned programs can inadvertently create:

• Underfunded systems that strain recyclers and local governments
• Inequitable cost burdens across producers or material categories
• Incentives that fail to support desired recycling outcomes

By contrast, programs grounded in defensible economic analysis are better positioned to adapt to changing markets, while maintaining regulatory and stakeholder confidence.

What economically sustainable EPR programs do differently

Programs that perform well over time tend to share several characteristics, including:

• Data-driven cost assumptions based on actual system conditions
• Transparent fee and reimbursement frameworks that stakeholders can understand
• Built-in flexibility to adjust as markets, materials, and participation evolve
• Clear governance and accountability structures

Along these same lines, our EPR team helped implement the state of Oregon’s Plastic Pollution and Recycling Modernization Act, which is a leading example of how thoughtful economic design can support ambitious EPR goals. By grounding implementation decisions in detailed cost analysis and system assessments, Oregon has established a framework that balances producer responsibility with environmental sustainability and operational feasibility.

Building systems that endure

As recycling systems evolve, durability matters. Programs designed with a clear understanding of materials, markets, and economics are better equipped to adapt to change without sacrificing performance or trust.

For both industry and government leaders, the path forward lies in designing systems that balance accountability with practicality so that EPR and recycling programs remain effective, resilient, and aligned with real-world conditions. Programs that invest early in rigorous cost analysis are better positioned to withstand market shifts, maintain stakeholder confidence, and deliver lasting environmental outcomes.

Key questions for EPR leaders

As EPR programs move from policy to practice, leaders should be asking::

• Are program fees aligned with real, current recycling costs?
• Can the economic logic behind funding mechanisms and fee structures be clearly explained and defended?
• Do program structures support long-term stability, not just near-term compliance?

Answering these questions early and revisiting them regularly can make the difference between programs that struggle and those that set durable and resilient national benchmarks.