In July 2021, the EU directive on single-use plastics came into effect. Aimed at reducing marine litter and assisting in the development of a circular economy, vast amounts of single use plastics (such as cutlery, straws, cotton bud sticks, etc.,) are now banned. The directive lays out a number of measures aimed at reducing the amount of single-use plastics and increasing the share of plastic that is recycled that must be met by 2030. In addition to recycling targets and extended producer responsibility, a key requirement is that member states must collect 90% of all plastic bottles by 2029. Producing new bottles is expensive for beverage manufacturers and consumes significant amounts of energy and virgin materials. Therefore, it makes sense to reuse or recycle them. While many Europeans are conscious of plastic waste and want to play their part, how easy will it be to achieve a 90% collection rate? What structures need to be in place for this requirement be achieved?

A key solution for reaching the 90% collection goal may be to emulate the Danish return and deposit system for disposable bottles and cans containing beverages (alcohol, soft drinks, juice, mineral water etc.,).

The origins of Denmark’s return and deposit system stretch back to over 100 years ago, where it was commonplace to collect and refill glass bottles. Since a nation-wide system came into effect in 2002 that covers single use cans and bottles made from plastic, glass, and aluminium, a 90% collection rate has been consistently achieved.

The way the return and deposit system works is that beverage producers in Denmark charge consumers the price of their product as well as an additional amount known as a deposit (‘pant’ in Danish). Consumers can then return the empty bottle or can if it bears the necessary symbol indicating that the receptacle participates in the return and deposit system to any supermarket or kiosk and receive their deposit in return as cash – regardless of where they initially purchased the now-empty beverage.

A privately owned, non-profit organisation known as the Danish Return System was established by the breweries in Denmark and approved by the Danish Ministry of Environment to operate the deposit and return system. It is the Danish Return System that bears responsibility for collecting, processing, and returning the empty bottles and cans to producers to be recycled. When sending beverages to shops, the producers send a corresponding deposit to Danish Return System. Shops and supermarkets refund deposits to the consumers and then receive the corresponding amount from Danish Return System in return once the empty bottles and cans are collected and counted. Essentially, the deposit money flows continuously throughout the system, so that it breaks even, rather than making a profit. Unclaimed deposit money, however, is kept by Danish Return System, which is used to finance and develop the system.

At larger supermarkets, special machines scan the cans and bottles, separate them, compress them, and then the packaging is collected by the Danish Return System to be prepared for recycling at the two sorting plants Danish Return System operates, so that they can then be transformed into new cans and bottles. Smaller shops and kiosks without these kinds of facilities return the cans and bottles whole.

The lure of a cash bonus at the end (even though the consumer is really only receiving back the deposit they have paid when purchasing the beverage) secures a high rate of return on the consumer side. For producers, it can be  cheaper to produce new cans and bottles from old ones, which means they have an incentive to participate in the system and are spared the headache of having to develop their own logistics systems to collect their empty cans and bottles. This also ensures a dynamic market for canned and bottled beverages.

The Danish deposit and return system occupies a special place in the heart of the Danes. Many a child or teenager has gone around their neighbourhood collecting empty cans and bottles to return at the machines installed in supermarkets and kiosks in return for coins, which they often will use to buy treats such as sweeties or ice-cream, or even new soft drinks. The system is so central to Danish culture that there is even a verb for the process of going scavenging for empties and then returning them in exchange for coins: “at pante”, where it is not uncommon for children or teens to ask each other or their parents if they may “pante”.

Recent innovations to the deposit and return system include so-called ‘Drop and Go’ machines, which are capable of handling up to 300 empties at a time. Drop and Go machines, which were implemented in 2018, are available at selected locations such as shopping malls and used for large events such as at music festivals. The system, which initially covered soft drinks and beer, has been expanded several times to include a wider array of beverages, with the latest addition to the scheme being fruit juice bottles in 2020.

Furthermore, in 2022, the Danish pictogram system, which helps citizens sort their waste correctly, was expanded to include five individual pictograms covering cans and bottles. The additional pictograms intend to further increase the number of cans and bottles that are returned for recycling, as companies, municipalities and large event organisers have experienced that bottles and cans that are part of the system are not always sorted correctly, but instead are thrown into the bins intended for the recycling of plastics, or even into general waste rubbish containers.

The deposit and return system for cans and bottles containing soft drinks or alcohol represents a closed loop production system, where the high value of glass, metal and plastic is preserved. Refillable bottles that are sold and deposited in Denmark are reused up to 30 times, while the cans and single use plastic bottles and glass bottles are melted and used to produce new ones. The ‘bottle to bottle’ and ‘can to can’ loop preserves the value of the materials, saves virgin resources and emits less CO2.

Since the inception of Denmark’s common deposit system in September 2002, the share of cans and bottles that can be returned and deposited in Denmark has steadily climbed from zero to 92%. In addition, in 2021, the return percentage of disposable packaging in Denmark reached 93%.

A key factor in this high rate of return is due to the common system in place across Denmark, which large and small supermarkets and kiosks participate in; it is easy for consumers to return their used beverage containers, no matter where they were initially purchased. Furthermore, the packaging can easily be recycled into new cans and bottles, which offers both environmental and financial benefits.

While the rate of recycling for cans and bottles has remained stable over the last 20 years, where 90% of all cans and bottles sold each year have been deposited, a new record was reached in 2021. 1.9 billion bottles and cans were deposited for reuse, which amounts to an overall return rate of 93%. The figure differs slightly according to whether glass, plastic, or aluminium is used.

The record high rate of return and recycling in 2021 also means that 14% less CO2 was emitted per collected can/bottle when compared to 2020. Recycling the 1.9 billion bottles in 2021 also saved 210,000 tonnes of CO2 being emitted.

The deposit and return system creates circular economy benefits.  Producing cans from recycled materials uses 95% less energy than it would if they were produced using virgin materials. Recycling the cans means that less bauxite needs to be extracted to produce aluminium (the material that the beverage containers are made of). Furthermore, the cooperation between producers, consumers and Danish Return System is effective, which results in a high rate of return.

Productivity increases in Danish Return System have also meant that the fees paid by manufacturers for the Danish Return System to take responsibility for the empty packaging have more than halved in the last five years.

The success of the Danish return and deposit system may be instructive for other EU countries aiming to meet the 90% collection goal, as well as for other countries seeking to increase their recycling rates of drink cans and bottles. Danish Return System has published a white paper, The story of a deposit system for a circular economy, which details the Danish experience with developing a deposit and return system, including how to structure the system.