Scotch Whisky Association                            DRS0057

Written Evidence submitted by the Scotch Whisky Association (SWA)

The Scotch Whisky Association (SWA) is the Scotch Whisky industry's representative body. Our 75 member companies comprise around 95% of the industry's distilling and blending capacity. Our membership includes companies of all sizes, from large multinationals to very small enterprises. The SWA works to sustain Scotch Whisky’s place as the world’s leading high-quality spirit drink and its long-term growth globally. This includes ensuring that Scotch Whisky has fair access to all markets worldwide and taking action to prevent unfair competition from fake products.

Submission to the inquiry

The SWA welcomes the opportunity to submit evidence to the Environmental Audit Committee’s inquiry “Next steps for deposit return schemes”.

The Scotch Whisky industry is proud to be an environmental leader and the SWA recently published their Sustainability 2040 strategy in January 2021. This Strategy provides a pathway defined by four themes – climate change, responsible water use, transition to a circular economy and sustainable land use – and throughout the supply chain. We are setting a 20-year timeframe, more ambitious than Scotland’s national timeframe to achieve Net Zero emissions by 2045 and the UK’s by 2050 target.  As such, we intend to underscore our position as a leading sector on addressing sustainability and achieving Net Zero by 2040.

Climate change is the most pressing emergency the world faces today. The climate crisis impacts people’s lives and livelihoods, the planet’s biodiversity and the availability of natural resources. We have a responsibility to help tackle the crisis – both as an industry and through direct action by each of our member companies. 

We will achieve Net Zero emissions by 2040 in our own operations. To do that, we will reduce our carbon footprint in our operations by a further 40% in the next decade to 2030, in comparison with our baseline year of 2018. Generating heat for distillation is the primary source of emissions in the industry. We will harness existing and new technologies such as anaerobic digestion, biomass, hydrogen, and high temperature heat pumps to move towards Net Zero.   We also want to make progress on the sustainability of the packaging material we use. The industry has pledged that by 2040 it will only use net zero carbon packaging materials. The industry will work together with its supply chain, including partners in the packaging industry, to make this happen.

The transition to a circular economy will deliver benefits such as reducing pressure on the environment, improving the security of the supply of raw materials and also reducing greenhouse gas emissions. Premiumisation of Scotch Whisky means some consumers still demand – what they consider – premium packaging. Consumers demand are changing, so now is the time to capitalise on that and turn sustainable packaging into a virtue.  The industry commits to only placing new products on the market with packaging that is widely recyclable, compostable or from a sustainable source by 2025.  We also pledge to develop a Packaging Roadmap by the end of 2021.  The roadmap will set out our actionable solutions to deliver on our overall ambitions. We will collaborate with regulators, NGOs and other food and drink organisations to create a framework that ensures the packaging roadmap is focused, effective and delivers our overall ambitions. As part of this we aim to create a preferred packaging material list. We will also explore technical solutions to meet the target through collaborative research and demonstration projects with both suppliers and government bodies.

The types of waste to be collected under the scheme

The majority of Scotch Whisky bottles are made of clear glass and the industry is determined to increase the levels of recycled glass in our bottles. In order to do so, there needs to be an increase in both the volumes and quality of clear glass being recycled and returned to glass companies so they can be recycled back into quality bottles.

However, the Scotch Whisky industry is concerned that a DRS scheme which includes glass may have the unintended consequence of reducing the amount of good quality recycled clear glass. Concerns have been raised by the glass industry in relation to this and we would urge for caution around introducing glass to any scheme. If, by including glass within the scheme, it results in a reduction of availability, it will create a serious barrier to deliver the sustainability targets set by Scotch Whisky companies.

Scheme design (‘all-in’, ‘on-the-go’ or other models) and the level and scale of deposit charges

Related to this is the possible reduction of future investment into glass production: the glass industry has warned the scheme could undermine the ability of glass plants to be competitive, leading to potential plant closures. This would challenge our ability to source glass and would also result in additional costs and operational impacts for Scotch Whisky companies and other producers.

Scotch Whisky is produced to be enjoyed responsibly and bottles of our product are not consumed ‘on the go’ but at home or in social settings, therefore excluding glass bottles, such as those used for Scotch Whisky, should be considered in any ‘on the go’ scheme.

The obligations on retailers at all levels (including online-only retailers) to participate in the scheme

It is important to ensure that any scheme is proportionate and equitable between physical and online retailers, and retailers of different sizes. Any scheme needs to be sustainable and manageable without any undue burden that disadvantages one retailer over another.

The impact of any scheme on existing recycling and reuse systems

Should glass be included in any DRS scheme the industry recognises the concerns of British Glass and others that it could lead to a reduction in items being placed in kerbside collections, impacting the viability of these kerbside schemes and reducing the total volume of clear glass returning to be recycled. This could have significant repercussions on glass availability for the industry as highlighted previously.

British Glass estimate that 26% of glass packaging will fall outside any DRS system. Much of that is clear glass from food glass packaging e.g jam jars etc and their modelling suggests 95% non-DRS glass (by weight) is clear glass. The glass manufacturing sector needs the kerbside system to continue to be effective to maximum levels of flint glass that can be collected for recycling.

The impact of any scheme on local authority kerbside collections and on local authority revenue streams dependent on the value chain of recyclables

We consider it is essential for any DRS system to add value to the existing collection system of kerbside for domestic and Waste Management Companies for commercial waste. It is also important that a scheme would provide greater access to recycling options for rural locations.

The potential relationship between deposit return schemes and other packaging waste initiatives promoted under the Resource and Waste Strategy, such as the packaging producer responsibility system and consistency in kerbside collections of dry recyclables

The success of kerbside collections in driving behaviour change, and the move by producers to increase the recyclability of packaging, shows significant progress is being made in delivering a consistent and widely adopted recycling schemes. Whilst there remains room for improvement in the uptake of recycling it is important that any DRS scheme does not have a consequence of making recycling, and the reuse of materials, more complicated and costly for individuals and businesses.

How the use of deposit return schemes is likely to affect the UK’s progress towards meeting the targets set in the Resource and Waste Strategy

There has been strong progress in driving recycling rates throughout the UK with increased awareness of reducing, reusing, and recycling. Any DRS scheme needs to be mindful of the impact if can have on other initiatives and the potential for unintended consequences on the cost and efficiency of other measures to reduce waste.  We know for instance that existing kerbside systems in the UK have proven to achieve up to 87.3% collection for glass.

The scope for interoperability between any schemes in England, Wales and Northern Ireland to be established under Schedule 8 to the Environment Bill and the scheme to be established in Scotland under the Deposit and Return Scheme for Scotland Regulations 2020

Any DRS scheme brough in needs to function alongside requirements in other parts of the UK and not create any undue barriers or complexity for businesses or consumers. Any alignment on timing of implementation for any scheme would be welcome and we have continued to call on the Scottish Government to consider the scope and implementation time of their own scheme.

The factors which have contributed to the successful implementation of deposit return schemes in other jurisdictions

March 2021