This month, the European Commission will publish one of the most awaited and discussed proposals of the year – the Sustainable Products Initiative – aka SPI in the EU jargon. Aiming to reduce the environmental footprint of products throughout their lifecycle, the SPI will help to achieve another objective under the EU’s flagship Circular Economy Action Plan. The legislative proposal will extend the scope of the Ecodesign framework beyond energy-related products, while also considering additional sustainability principles to regulate the environmental impact of goods.
The new framework will be very broad and is expected to drive the biggest shift in product policy the EU – but possibly the globe – has seen in the last decades. The impact for almost all sectors will be enormous. Earlier this week, a preview of the draft SPI circulated among the Brussels bubble, sparking debate about the complexity of the proposal and the consequential implications for the whole value chain. With more than 3 weeks to go, the proposal is still subject to change. However, drastic turnarounds are quite unlikely. To help you navigate through the storm of information and avoid being caught by surprise, we identified the top 8 points to expect.
The SPI will have a multitiered structure, giving already an idea of how broad and complex the whole framework will be. Such a structure is also a reminder that with the adoption of the SPI, work will not be over, but the real game will actually only have just begun, and with this we can already expect lively ‘battles’ among policy makers & stakeholders for years to come. This is how the framework is expected to look like:
- On 30th March, the European Commission will publish its legislative proposal on the SPI, which will serve as a general legislative framework, laying down new sustainability principles for products, and expanding the scope of the ecodesign directive beyond energy related products.
- The legislative proposal will be accompanied by a working plan, listing the product groups to be tackledin the coming years, through secondary legislation. Likely priority product groups include textiles, electronics, furniture, and high impact intermediate products such as steel, cement and chemicals.
- This legislative framework will be further developed and completed by secondary legislation (so calleddelegated acts) that will be adopted in the course of the next (6?) years. These acts will enable the implementation of the technical aspects of the SPI, tailored to specific product groups, depending on the specificities of each sector.
2. A revised Ecodesign Directive: broader scope & new sustainability principles
The core objective of the initiative will be to widen the Ecodesign framework to cover the broadest possible range of products. Not only the scope of products impacted by the new framework will be extended, but also, new sustainabilityprinciples will be set with a view to ensure that sustainable products become the norm in the EU. These new principles will include product durability, reusability, upgradability and reparability, as well as checks on the presence of substances of concern, energy and resource efficiency, recycled content, remanufacturing and high-quality recycling, and carbon and environmental footprints. Each of these principles will be clarified through secondary legislation, depending on the characteristics of each sector. In other word, durability criteria for a t-shirt will not be the same as those of a laptop!
3. Life cycle is the new rule
The methods to assess the setting of the eco-design requirements will be selected and, as appropriate, further developed, based on the nature of the product, its most relevant aspects and its impacts over its life cycle. The choice of methods will take account of the Commission’s experience and the continuing efforts to develop and improve science-based assessment tools, such as the update of the methodology for eco-design of energy-related products, and the Product Environmental Footprint (PEF) method. Ca va sans dire that LCA will be the must have for the years to come… at all levels of the value chain!
4. Chemicals in the spotlight
Following the trends set by the Chemicals Strategy for Sustainability, one key component of the SPI proposal will be the newly introduced attention to chemicals in products. Chemical safety will be recognised as an aspect of products’ sustainability, starting from the design phase. However, safety will no longer be enough, as chemicals will also have to be safe and sustainable by design. The SPI will not enable the restriction of substances based on chemical safety, as this is already addressed by other chemicals legislation. However, under certain conditions, substances present in products or used in their manufacturing processes could be restricted, if they negatively affect products’ sustainability primarily for reasons other than chemical safety.
SPI will also pay close attention to “substances of concern”, adopting a fairly broad definition. The concept is likely to even include those substances that negatively affect the re-use and recycling of materials in the product. This coupled with information requirements, enabling the tracking of substances of concern throughout the products’ lifecycle, is likely to put a strain on chemical and product manufacturers to comply with the rules.
5. Digital product passports
The SPI will make digital product passports a reality. The new tool will be mandatory for any products falling under the scope of the SPI, aiming to improve the flow of electronic information between the supply chain actors, authorities, and consumers. While the SPI framework will only provide general and technical requirements, delegated acts will have to establish product-specific rules on the information and accessibility of the digital product passports, as well as on the period of availability and the actors, empowered to modify the information, taking into account the characteristics of each sector. However, digital product passports will not replace physical labels at the point of sale, which will continue to play an important role for consumers.
6. No more destruction of unsold goods
Minimising the generation of waste is a priority embedded in the Circular Economy Action Plan. Through SPI, the Commission will be empowered to adopt delegated acts, prohibiting economic actors from destroying unsold consumer goods within the EU. To further curb the practice, transparency obligations will be introduced, requiring economic operators to disclose information on the number and type of unsold goods, as well as the reasons behind the decision to destroy them. In order to reduce undue administrative burden, SMEs will be exempt from the obligation. However, for bigger economic operators this could pose additional strain on their activities.
7. Self-regulation remains an option
Industry-led self-regulation is also on the cards. SPI will include provisions, allowing two or more companies to propose alternatives to the Ecodesign delegated acts. However, this will be no easy feat. In fact, such self-regulation measures will have to demonstrate alignment with the objectives of SPI. In addition, proposals for alternatives to the delegated acts will have to be supported by signatories, the market coverage of which is at least 80% of the units of products covered by the measures.
With the stick there is also a carrot! And among all the new requirements, targets and principles, the SPI is also expected to provide incentives for the production of sustainable products. As it is well known that the shift in consumer behaviour towards more sustainability could be limited if the more sustainable products on the market are not affordable enough, the SPI will encourage the Member States to make use of incentives to reward the best performing products in the market, for example by including mechanisms such as eco-vouchers and green taxation. In addition, Green Public Procurement (GPP) will also play a key role to achieve the SPI’s objectives, by leveraging the weight of public spending to boost the demand for better performing products. Revised, potentially mandatory, GPP criteria integrating the new sustainability principles will be defined through secondary legislation.
The proposal is currently under preparation by the European Commission, before its publication on 30 March 2022.The list of ingredients is long and the dish is not quite ready yet. Some spices will be added in the upcoming months, when the legislative proposal will be under the scrutiny of the European Parliament and the Council of the EU. In the meantime, there will be plenty of opportunities for stakeholders to engage in the process, and make sure that the final result will be not too salty!