OBSERVER: Not for the first time, a directive wending its way through the EU law making labyrinth will have a major effect on the way in which we live and work. The European parliament last week voted through proposals for a directive on waste from electrical and electronic equipment, an unwieldy title shortened to the "WEEE Directive" Donal Buckley reports

The effect of this directive when it comes into force, probably in 2004, will be to require companies that produce electrical and electronic equipment to recover and recycle defined percentages of the waste products when they have reached the end of their useful life. These products include computers, telephones, televisions, radios, mobile phones, fridges, and washing machines.

In effect, householders will be entitled to return waste electrical and electronic equipment free of charge either to the place of purchase or to an authorised collection point. In the commercial sector, producers will have to arrange for the collection and recovery/recycling of used equipment. In addition, the directive will set an annual target of between four and six kilogrammes per household, to be recovered and recycled.

In Ireland this will amount to a staggering 6.1 million tonnes of waste electrical and electronic equipment to be recycled every year. Quite how that will be done in a country where collection and disposal of waste is dogged by continuing chaos is unclear.

The final details of the directive have yet to emerge, but it is clear that producers of electrical and electronic equipment will have to finance the recovery and recycling process. Currently, debate rages around whether financing will be on an individual basis, where each company takes responsibility for its own waste, or whether a collective scheme is better.

The European parliament, and indeed the industry, favours the former, while the Council of Ministers favours the latter. From an industry perspective, companies are utterly opposed to financing on a collective basis as there is every possibility that unscrupulous companies will dump electrical and electronic goods on the European market and disappear, leaving responsible companies to pick up the tab for recovery and recycling.

Some European countries have already begun to look at ways of dealing with this type of waste. In the Netherlands, for example, producers of these goods have initiated a voluntary scheme for recovery and recycling of equipment. A recycling fee is charged to the consumer on every item of electrical equipment at point of sale.

This directive is an example of a new type of legislation emanating recently from the European Union. Recognising that the "command and control" type directives of old have not been achieving the levels of environmental protection or the behavioural changes required, the law-makers have decided to thrust the responsibility for achieving targets onto business itself.

Grouped under what are called "producer responsibility" directives, the intention is to allow producers themselves to come up with initiatives to achieve targets set out in law.

Packaging waste is an example in Ireland where industry, coordinated by IBEC, set up the REPAK scheme, which in effect requires businesses to contribute funds to achieve recycling targets set out in the Packaging Directive. The scheme has been successful, achieving the national target of 200,000 tonnes of recycled waste in 2001.

Producer responsibility schemes are not without cost to industry, with REPAK, for example, collecting Irish businesses over €11 million in 2001. Targets will increase in the coming years, with consequent cost increases for industry. Similarly, the motor industry is charged with developing a scheme for take-back and recycling of vehicles at the end of their useful life; the construction industry is dealing with construction and demolition waste; and newspapers may also be targeted at national level.

While the objectives of reducing and recycling waste products are laudable, there are some difficulties from a business perspective. First, the costs associated with such high levels of recycling have to be borne by industry and add to the costs of doing business in the EU.

Second, Ireland suffers from a major infrastructural deficit in terms of waste-management infrastructure, and does not have the infrastructure in place to deal with the levels of collection recovery and recycling envisaged in these directives. Third, as a small open economy, Ireland does not have the necessary economies of scale for recycling of many materials to be economically efficient.

On the positive side, there are also opportunities arising from the new recycling directives. Recyclers will find new sources of raw materials. However, the challenge will be to stimulate the markets for reconditioned and recycled goods. The waste-management industry and the local authorities are beginning to take this challenge seriously and to provide separate collection and segregation services to household and commercial consumers.

However, these services cost money, and the costs will be passed on to consumers. It seems clear that the cost of disposing of waste either by recycling or other means will continue to soar. Management of these costs in the Irish context will be important if we are to continue to remain competitive in an increasingly difficult environment.