Ontario proposes to weaken impending new recycling rules over costs to producers

Environmental advocates say the proposed changes let producers off the hook and will mean more materials will end up in landfills or be incinerated. Producers say despite the rising costs, recycling rates don’t actually appear to be improving, so it’s time for a broader rethink.

Environment Minister Todd McCarthy said the proposed changes are about ensuring the sustainability of the blue box system and protecting against unintended consequences such as job losses.

“We want to take what we’ve done and improve upon what already exists, but the costs were a big deal, and so we’re proposing some measures that would bring about cost savings and transparency and improvement to accomplish the goal of recycling that we all want,” he said earlier this month.

The Canadian Retail Council estimates that producer costs have already increased by about 350 per cent in three years and would nearly double again just from this year to next if no changes were made to the impending new rules for 2026.

The government says blue box collection costs could more than double between 2020 and 2030.

“Cost increases of this magnitude were not anticipated when the regulation was passed in 2021 and have jeopardized the stability of the blue box system today,” it says in its proposal to change the rules.

Currently, producers just have to make “best efforts” to hit certain recycling rate percentages, such as 80 per cent of paper and 50 per cent of rigid plastic, and starting next year they are set to be enforceable. Then in 2030 those percentages are set to rise.

But now the government is proposing to delay those 2026 targets to 2031.

As well, Ontario is proposing to allow non-recyclable material that gets incinerated to count for up to 15 per cent of producers’ recycling targets.

Starting next year, producers are also supposed to be responsible for collecting material from more multi-residential buildings, and certain long-term care homes, retirement homes and schools. The government is now proposing to remove that requirement entirely.

The same goes for a rule that would have made beverage producers responsible for containers not just dropped in a residential blue box but also those used outside the home, and a provision for producers to expand collection in public spaces.

The intent behind the initial regulations was to incentivize producers to use less packaging and to use materials that can more easily be recycled, said Karen Wirsig, senior program manager for plastics with Environmental Defence.

These changes would halt any progress on that score, she said.

“Municipalities have been saying for years, ‘Our blue box is getting more and more filled with packaging types we can’t even identify let alone properly sort … because often they’re made with mixed materials that are not easily recycled,’” Wirsig said.

“So because there was that disconnect between the producers who design all this packaging and the municipalities who are collecting it, there was no way to rationalize the system and improve packaging from an environmental and sustainability point of view. These regulations were intended to start doing that, and unfortunately, now all of the incentives are going the opposite direction.”

The recycling of flexible plastics, which includes food wraps, pouches and bags, is a particular bone of contention and the government is proposing to both delay and reduce the target for that category.

In a recycling facility, flexible plastics end up in all sorts of places because they’re so light, getting stuck among paper or falling through the cracks of conveyor belts, said Michael Zabaneh, the Retail Council of Canada’s vice-president of sustainability.

Instead of a recycling target of 25 per cent taking effect next year, a target of five per cent would take effect in 2031 under the government’s proposal for flexible plastics.

That five per cent reflects the estimated current level of flexible plastic diversion, according to the government’s regulatory proposal. It is silent on the current levels for all other materials.

Those current levels are unknown, with the Resource Productivity and Recovery Authority saying it will report on rates once the three-year transition is over. That is a big problem, said Zabaneh.

“We’re all in the blind,” he said. “I think you can’t have a recycling system with accountability, (and not have) transparency and real data.”

The main problem with the government’s current system is that it allows for multiple administrators, said Zabaneh. Producers sign up with producer responsibility organizations, which help them meet their blue box obligations.

There are four such organizations operating in Ontario, which just ends up complicating the system and making it more expensive, Zabaneh said.

“There’s an administrative body to drive collection, but then processing is kind of a competitive thing, and this creates a very fragmented and inefficient system,” he said.

“It limits planning, it prevents collective investment, capital investment, so that’s disincentivized, and you have a lot of added costs from logistics and audits, and that’s why we have escalating costs.”

Retail council members helped found and sit on the board of one producer responsibility organization so they have some idea of recycling rates from that, and based on that limited view the numbers look stagnant, the council says.

Producers welcome the delayed targets, Zabaneh said, but it doesn’t solve the core problem. Having a single producer responsibility organization would reduce costs and allow for greater transparency of recycling rates and financial performance, the retail council says.

Canadian Beverage Association president Krista Scaldwell said their members want the system to be successful because recycling and recovery benefits companies as well as the environment.

“We want the aluminum and plastic back because we can make it into new containers,” she said.

“The members are very committed to sustainability initiatives, and so we need to understand what’s creating the cost so that we can help support some change, so we can see improved recovery without escalating costs.”

Comments on the regulatory registry proposal can be submitted until July 21.

This report by The Canadian Press was first published June 23, 2025.