Potential Effects of a National Mandatory Deposit on Beverage Containers

A national mandatory deposit law has been proposed as part of a solution to litter, solid waste disposal, and materials recycling problems of the Nation. The primary effects of such legislation on solid waste, litter, and materials and energy and the industry effects on labor and equipment costs were analyzed. The following results would arise from increasing the deposit coverage from about 25 percent to 100 percent: (1) there would be substantially less beverage container litter and somewhat less total litter and solid waste; (2) more containers would be returned and the costs of handling these containers would increase; and (3) the amount of money paid for deposits but not claimed would rise which would increase industry income. Other results of the analysis would depend on how many new containers are manufactured. Alternative assumptions concerning industry response to a mandatory system reflect uncertainty about industry response. The assumption of return rates is one of the most debated technical points of the mandatory deposit issue, but different return rates do not substantially change the main results of the analysis. In addition to primary concerns, a mandatory deposit system would most likely reduce energy and raw material use in the beverage industry.