The Great Packaging Reckoning

Meera Krishnan | October 6, 2025

For decades, Americans have tossed their recyclables into blue bins with the vague hope that someone, somewhere, would make sense of them. That “someone” has usually been the taxpayer. But a quiet revolution in waste policy is shifting that burden upstream—to the producers who make the packaging in the first place.

The concept is called Extended Producer Responsibility, or EPR: the idea that companies, not municipalities, should bear the financial and operational responsibility for managing the waste their products create. In practice, it means that a shampoo manufacturer or snack company must now pay into a collective body—known as a Producer Responsibility Organization (PRO)—that funds recycling and waste management programs. Those payments are calibrated by how recyclable, reusable, or toxic the company’s packaging is.

In Europe, EPR has been embedded in policy for decades. In the United States, it is only now becoming reality. And as it does, it is exposing the country’s fragmented regulatory landscape, forcing brands to reconsider what they put on shelves—and how much waste they can afford to generate.

America’s Patchwork Revolution

Until recently, EPR was the kind of acronym one encountered only at sustainability conferences. That changed after 2021, when Maine and Oregon became the first U.S. states to pass EPR laws for packaging. Now, with California, Colorado, Minnesota, Maryland, and Washington following suit, nearly one in five Americans lives in a jurisdiction where producers—not taxpayers—will soon foot the bill for recycling.

Each state has its own flavor. Oregon’s version harmonizes local recycling systems and defines a single list of “accepted” materials. Colorado’s law makes producer participation a prerequisite for market access by July 2025. California’s Senate Bill 54, the most sweeping, not only establishes a PRO but also mandates that producers pay $500 million a year from 2027 to 2037 into a state environmental mitigation fund, while meeting strict targets for source reduction and recycled content.

The pace is accelerating. Minnesota’s Packaging Waste and Cost Reduction Act, passed in 2024, obliges producers to pay “eco-modulated” fees—the less recyclable the material, the higher the cost. Maryland and Washington have followed with laws that borrow elements of European design, including recycling-rate targets and statewide data reporting. The details differ, but the direction is unmistakable: the cost of managing packaging waste is being shifted from local governments to corporate balance sheets.

For now, the American version of EPR is a patchwork. Each state defines its own scope, timelines, and enforcement mechanisms; some allow multiple PROs to operate, others just one. The absence of a federal framework means multistate producers must navigate a mosaic of reporting portals, audits, and fees. In effect, companies selling nationally must design packaging that satisfies the toughest rules among them—or risk fines and market exclusions.

The European Contrast

Across the Atlantic, the same principle has matured into something more systematic. The European Union’s Packaging and Packaging Waste Regulation (PPWR), finalized in early 2025, replaces a 1994 directive and applies directly to all 27 member states. The regulation mandates that all packaging be recyclable by 2030, sets quantitative targets for reuse and recycled content, and bans certain single-use formats outright.

Under the PPWR, producers already fund national PROs that operate across Europe. What changes now is consistency: a single set of definitions, labeling standards, and performance metrics. Companies that sell across borders no longer need to comply with 27 different systems. For Brussels, harmonization serves both environmental and industrial goals—curbing waste while nurturing a continental market for recycled materials and packaging innovation.

In short, Europe has a playbook; America has a puzzle. Yet the two systems are beginning to interact, because the same global brands sit astride both. What they learn in Brussels, they must soon apply in Boulder.

The Corporate Repercussions

For American producers, EPR transforms packaging from a marketing detail into a cost center. Under most U.S. state laws, PRO fees depend on material weight, recyclability, and toxicity. Complex, multi-layer films or colored plastics incur higher levies; clear PET, unpigmented HDPE, and mono-material formats earn lower ones. Suddenly, what used to be a branding choice—say, a glossy black bottle—carries a tangible price tag.

Design teams are adapting. Large consumer-goods companies are moving toward “design for recyclability”, trimming labels, simplifying resin mixes, and standardizing closures. Others are experimenting with reuse pilots in anticipation of similar mandates spreading to the U.S. market. Procurement departments are renegotiating contracts to verify recycled content and eliminate additives that disrupt sorting equipment. Even data engineers are being pulled into the fray, tasked with building systems to track every gram of packaging sold.

The cost implications are significant. In California alone, producers will collectively contribute half a billion dollars a year to the mitigation fund. Add eco-modulated fees, reporting requirements, and redesign expenses, and packaging budgets are being rewritten. Smaller brands may struggle to absorb the hit; larger ones will try to spread it across product lines.

The Strategic Calculus

In Europe, regulatory certainty allows companies to plan investments around clear targets. In America, uncertainty reigns. A national standard seems politically improbable; instead, the largest and earliest states—California, Oregon, and Colorado—will become de facto regulators for everyone else. For global firms, the rational response is to design to the strictest denominator: packaging that already meets European thresholds for recyclability and recycled content. It is simpler, and ultimately cheaper, than tailoring designs to each state’s idiosyncrasies.

The risk, however, is inertia. Without federal coordination, states may introduce divergent definitions of “recyclable,” incompatible labeling, or overlapping audit demands. That could blunt the efficiency gains EPR was meant to deliver. In that sense, America’s EPR experiment is both an environmental policy and a stress test of its federal system.

The New Economics of Waste

EPR will not, by itself, make packaging circular. Recycling infrastructure remains underbuilt; consumer behavior is uneven; and the economics of secondary materials still fluctuate with oil prices. But shifting the bill changes incentives. When producers pay for waste, waste begins to look like a design flaw rather than a disposal problem.

Europe has taken a top-down approach, codifying circularity through regulation. The United States is building it bottom-up, state by state, in the only way its politics allow. The result may be messy, but it is movement nonetheless. Over the next few years, as packaging fees start to bite and data from the first PROs rolls in, companies will no longer ask whether EPR is coming—they’ll ask how much it will cost to ignore it.

And that, at long last, may be the price signal recycling always needed.

This article was published with the help of AI.