Waste Home Appliance Recovery: Accelerated Construction of a Recycling System and Implementation of Extended Producer Responsibility (EPR) System
The quality of life in China has consistently increased alongside rapid economic development and the home appliance industry has already plateaued. With the recovery of waste home appliances setting the stage for the incoming new age, several serious environmental issues have been gradually garnering attention. On top of this, the Chinese government has consistently and actively promoted laws, regulations and policy preparation work related to the recovery and disposal of household appliances since 2009.
During the 13th Five-Year Plan (2016-2020), the theoretical scrap volume for waste home appliances in China grew year-on-year. The Catalog of Waste Electrical and Electronic Products for Disposal (2014), a joint publication by the National Development and Reform Commission (NDRC) and five other ministries and commissions, came into effect on March 1, 2016, and has since seen the addition of nine categories on top of the original five (televisions, refrigerators, washing machines, air conditioners, and micro-computers). Data from the Ministry of Commerce shows that the recovery volume of waste electrical and electronic products increased year-on-year in China during the 13th Five-Year Plan, but that growth then flattened out. In 2020 approx. 167.81 million waste electrical and electronic products with a total weight of approx. 3.92 million tons were recovered, which, when compared to the theoretical scrap volume of 5.46 million tons, demonstrates that there is a recovery gap of approx. 1.54 million tons.
The national recovery rate of waste electrical and electronic products is still relatively high at this stage; however, the recovery gap cannot be ignored. Home appliances have a vast base and new product types are constantly being released, so issues such as increasing the recovery rate, decreasing the recovery gap, realizing reasonable recovery and disposal, and better advancing the development of a circular economy all deserve focus.
In response to the above issues, China issued a series of related legal regulations, standards and policies as part of the 14th Five-Year Plan in order to guide a new era of recovery policies for waste home appliances. In July 2021, the NDRC issued the 14th Five-Year Plan for Circular Economy Development, which included proposals to: standardize the circulation and transaction of second-hand products by establishing and improving standards for the appraisal, evaluation, and grading etc. of second-hand home appliances; standardize management and environmental supervision of recovery and disposal enterprises; further drive the development of home appliance recovery by naming the construction of a recovery system for urban waste materials one of the Five Key Projects and the improvement of behavior towards the recycling of waste electrical and electronic products as one of the Six Key Actions.
1. Major Policies, Regulations and Standards released in Recent Years
A summary of all major policies, regulations and standards issued by the Chinese Central Government and relevant pilot provinces and cities in recent years can be found below.
Table 1 Major Waste Home Appliance Recycling Policies Post-2019
| Document Name | Issue Date | Issuing Authority |
|---|---|---|
| Regulations on the Administration of the Recovery and Disposal of Waste Electrical and Electronic Products | Revised again March 2019 |
State Council |
| Implementation Plan regarding Improving the Waste Home Appliance Recovery and Disposal System to Promote the Renewed Consumption of Home Appliances | May 2020 | NDRC Ministry of Industry and Information Technology Ministry of Finance Ministry of Ecology and Environment Ministry of Housing and Urban-Rural Development Ministry of Commerce State Administration for Market Regulation |
| Notice on Fund Subsidy Standard Adjustments for the Disposal of Waste Electrical and Electronic Products | March 2021 | Ministry of Finance Ministry of Ecology and Environment NDRC Ministry of Industry and Information Technology |
| 14th Five-Year Plan for Circular Economy Development | July 2021 | NDRC |
| Notice on Encouraging the Self-directed Implementation of Recovery Targets by Home Appliance Manufacturers | July 2021 | NDRC Ministry of Industry and Information Technology Ministry of Ecology and Environment |
| Guidelines for Environmental Management and Pollution Prevention regarding the Disposal of Nine Types of Waste Electrical and Electronic Products including Range Hoods | September 2021 | Ministry of Ecology and Environment |
| Guiding Opinions on the Accelerated Construction of a Recycling System for Waste Materials | January 2022 | NDRC Ministry of Commerce Ministry of Industry and Information Technology Ministry of Finance Ministry of Natural Resources Ministry of Ecology and Environment Ministry of Housing and Urban-Rural Development |
| Notice on the Organization and Implementation of the Self-directed Implementation of Recovery Targets by Home Appliance Manufacturers | February 2022 | NDRC Ministry of Industry and Information Technology Ministry of Ecology and Environment |
| Notice Regarding the Successful Self-Directed Implementation of Recovery Targets by Home Appliance Manufacturers in 2022 | May 2022 | General Office of the NDRC General Office of the Ministry of Industry and Information Technology General Office of the Ministry of Ecology and Environment |
1.1. The 14th Five-Year Plan: Major Waste Home Appliance Recovery Targets and Tasks
The Regulation on the Administration of the Recovery and Disposal of Waste Electrical and Electronic Products was amended as per the March 2nd, 2019 Decision of the State Council to Amend Certain Administrative Regulations to clarify that the creation of policy and collaborative implementation measures for the recovery and disposal of waste electrical and electronic products and the supervision and administration of waste electrical and electronic products disposal is the responsibility of industrial and information technology administrative authorities. The Regulation states that the Nation encourages manufacturers to recover waste electrical and electronic products by either contracting qualified enterprises or by carrying out the work themselves.
Regulation on the Administration of the Recovery and Disposal of Waste Electrical and Electronic Products (Revised again March 2019)
NDRC, Ministry of Industry and Information Technology, Ministry of Finance, Ministry of Ecology and Environment, Ministry of Housing and Urban-Rural Development, Ministry of Commerce, State Administration for Market Regulation: Implementation Plan regarding Improving the Waste Home Appliance Recovery and Disposal System to Promote the Renewed Consumption of Home Appliances (May 14 2020)
(1) Major Targets
To use approximately three years to further perfect industry standards and policy systems and establish the foundations of a Waste Home Appliance Recovery and Disposal system that is orderly, operates smoothly, and is both collaborative and efficient.
To promote a round of extensions of manufacturer responsibility, “IoT + Recovery”, innovations in disposal technology and other typical proposals and superior empirical practices; significantly increase the standard recovery volume for waste home appliances; optimize sales channels for waste home appliances; and significantly strengthen the ability to facilitate consumer upgrading of home appliances.
(2) Major Tasks
- Perfect a Recovery and Disposal System. Establish a complete Recovery Network, optimize recovery channels, and enhance disposal capabilities.
- Facilitate Consumer Upgrading of Home Appliances. Develop and arrange promotions to trade-in old appliances for new ones, facilitate accelerated upgrading of home appliances, and seek out new consumption models for home appliances.
- Organize and Implement Conventional Promotions. Promote conventional recovery models while cultivating progressive models in industry.
- Enhance Regulatory Enforcement. Enhance regulatory supervision of waste home appliances and strengthen enforcement and investigative powers.
- Raise the Level of Industry Administration Establish complete relevant standards and regulations, optimize dynamic management systems, and strengthen the management of industry professionals.
- Additional Guarantee Measures. Increase capital support, enhance publicity and guidance, and enforce responsibilities.
1.2 Accelerated Construction of a Recycling System
Waste home appliances contain a significant amount of recyclable resources — such as plastics and non-ferrous metals — that can be transformed into renewable resources such as manufacturing materials or fuel with efficient dismantling and disposal. The improper recovery of waste home appliances includes the thoughtless disposal of parts with a low recovery value, a practice which creates environmental damage. In the new era, China has issued a series of requirements for the construction of a complete and perfected formal Waste Home Appliance Recycling System.
Regulation on the Administration of the Recovery and Disposal of Waste Electrical and Electronic Products (Revised again March 2019)
The Regulation clarifies that the National Government will establish a Waste Electrical and Electronic Products Disposal Fund to subsidize recovery and disposal costs for waste electrical and electronic products. Manufacturers and importers of electrical and electronic products or their agents must make mandatory contributions to the Waste Electrical and Electronic Products Disposal Fund.
Recovery and disposal must be embedded in the entire lifecycle of home appliances from manufacture to purchase and use: home appliance manufacturers must use designs that facilitate both the comprehensive utilization of resources and safe disposal, and must list all toxic and hazardous substances contained in the product and their amounts in the user manual as well as instructions on recovery and disposal; those who sell, maintain, or provide after-sales services for electrical and electronic products must display instructions for the recovery and disposal of waste electrical and electronic products in a prominent position at their place of business; and the National Government encourages disposal enterprises to build long-term collaborative relationships with relevant electrical and electronic product recovery channels.
The Regulation also states that disposal enterprises must comply with informationization requirements by establishing a digital information management system for waste electrical and electronic products and reporting basic waste electrical and electronic product disposal data and status updates to the ecology and environmental authority of the local Municipal People’s Government. All basic waste electrical and electronic product disposal data must be retained for a minimum of three years.
Ministry of Ecology and Environment: Guidelines for Environmental Management and Pollution Prevention regarding the Disposal of Nine Types of Waste Electrical and Electronic Products including Range Hoods (September 7, 2021)
The Guidelines provide regulatory guidance for the performance of dismantling and disposal work of the nine types of waste electrical and electronic products added to the Catalog of Waste Electrical and Electronic Products for Disposal (2014) by the Regulation on the Administration of Waste Electrical and Waste Electronic Product Disposal: range hoods, electrical water heaters, gas water heaters, printers, copiers, fax machines, security cameras, handheld mobile communication devices, and telephones.
The Guidelines stipulate basic requirements that apply to the plants, storage sites, disposal sites, equipment and personnel of disposal enterprises. The Guidelines also provide reference standards for five operational links (dismantled product management, pollutant emissions, equipment operation, environmental response, and data and information management systems) based on the Technical Specifications for the Control of Pollutants in Waste Electrical and Electronic Product Disposal (HJ 527).
NDRC, Ministry of Industry and Information Technology, Ministry of Finance, Ministry of Ecology and Environment, Ministry of Housing and Urban-Rural Development, Ministry of Commerce, State Administration for Market Regulation: Implementation Plan regarding Improving the Waste Home Appliance Recovery and Disposal System to Promote the Renewed Consumption of Home Appliances (May 14 2020)
The Plan lists the perfection of a Recovery and Disposal System as one of the Five Key Tasks and issues requirements focusing on recovery networks, recovery channels and disposal capacity that must be met by home appliance manufacturers, sales, recovery enterprises and e-commerce platforms. The Plan clarifies: that IoT information technology must be used to construct a Waste Home Appliance Recovery System that integrates online and offline aspects, integrates municipal functions with professional services, and connects cities, streets, communities, and homes while gradually driving the inclusion of each service into a “Smart City” service system; that existing channels must be used to develop reverse logistics and establish a smooth, collaborative recovery and disposal process; and that the capacity of disposal enterprises must be increased to further facilitate damage-free, efficient, harm-free, and high-value disposal.
Cities and provinces responded to the publication of the Plan positively by compiling or printing an distributing relevant policy plans, and the specific tasks set forth in the Plan resulted in actual work being carried out at a local level across the nation. 2021 and 2022 have seen the relevant local policies passed in cities, provinces and autonomous regions such as Chongqing, Zhejiang, Shaanxi, Shanxi, Shandong, Inner Mongolia, Jiangxi, Jiangsu, Jilin, Hubei, and Henan.
NDRC, Ministry of Commerce, Ministry of Industry and Information Technology, Ministry of Finance, Ministry of Natural Resources, Ministry of Ecology and Environment, Ministry of Housing and Urban-Rural Development: Guiding Opinions on the Accelerated Construction of a Recycling System for Waste Materials (January 17, 2022)
The Opinions focus on waste substances in general, and similarly provide requirements for recovery networks, usage levels for processed renewable materials, second-hand product transactions and policies, and guarantees for remanufacturing industries and the circular use of waste substances. Regarding waste home appliance recovery specifically, the Opinions allow for certain areas to establish second-hand home appliance transaction markets and zones subject to focused regulations, and encourage enterprises that manufacture home appliances and similar products to develop models that integrate recovery, processing, and use.
1.3 The Extension of Manufacturer Responsibility
Looking at the current home appliance situation in China, home appliance manufacturers will be integral to the process of building a Waste Home Appliance Recycling System and realizing the national goal of a cyclical, harm-free waste recovery model for the future. As such, the responsibility of home appliance manufacturers now extends to cover the entire lifecycle of home appliances — from manufacture to recovery and disposal — and manufacturers must utilize their existing channels and resources together with the various forms of support available (including government support) to assist our nation in constructing a complete Waste Home Appliance Recycling System.
NDRC, Ministry of Industry and Information Technology, Ministry of Ecology and Environment: Notice on Fund Subsidy Standard Adjustments for the Disposal of Waste Electrical and Electronic Products (March 22, 2021)
The Waste Electrical and Electronic Products Disposal Fund is funded by levies placed on manufacturers and importers of electrical and electronic products or their agents and enforced by the State Taxation Administration and Customs, and is used to facilitate the recovery and disposal of waste electrical and electronic products. The fund began operating in 2012. The actual levies imposed are adjusted as needed by the Ministry of Finance together with departments such as the Ministry of Ecology and Environment the NDRC, and the Ministry of Industry and Information Technology.
These Opinions took effect on April 1, 2021, and reduced subsidy amounts from 2016 levels.
Table 1 Waste Electrical and Electronic Products Fund Subsidy Levels (2021)
| Waste Electrical and Electronic Products Fund Subsidy Levels | ||||
|---|---|---|---|---|
| Product Name | Type | Subsidy Level (RMB/Unit) |
Notes | |
| 1 | TVs | Monochrome and color CRT TVs between 14” and 25” | 40 (Reduced to 20) |
No subsidy provided for monochrome and color CRT TVs smaller than 14” |
| Monochrome and color CRT TVs larger than 14”, plasma TVs, LCD TVs, OLED TVs, and RPTVs | 45 (Reduced to 25) |
|||
| 2 | Micro-computers | Desktop micro-computers (both computer and display), desktop micro-computers with integrated displays, and portable micro-computers | 45 (Reduced to 25) |
Subsidy levels for tablet computers and palmtop PCs determined separately |
| 3 | Washing machines | Single-barrel washing machines, spin dryers (capacity: min. 3kg max. 10kg) | 25 (Reduced to 10) |
No subsidy provided for washing machines with a capacity under 3kg |
| Double-barreled washing machines, fully-automatic pulsator washing machines, fully-automatic agitator washing machines (capacity: min. 3kg max 10kg) | 30 (Reduced to 15) |
|||
| 4 | Electronic refrigerators | Fridge-freezer units/cabinets, freezer units/cabinets, refrigerator units/cabinets (capacity: min. 50L max. 500L) | 55 (Reduced to 25) |
No subsidy provided for refrigerators with a capacity below 50L |
| 5 | Air conditioners | Integrated air conditioners, split air conditioners, multi-split air conditioners (including window and wall-mounted models) (cooling capacity: max. 14,000W) | 100 (Reduced to 30) |
|
NDRC, Ministry of Industry and Information Technology, Ministry of Ecology and Environment: Notice on Encouraging the Self-directed Implementation of Recovery Targets by Home Appliance Manufacturers (July 27, 2021)
The Notice clarifies that the objectives of self-directed implementation of recovery targets are: to develop a round of demonstrative benchmarks for the self-directed implementation of recovery targets by home appliance manufacturers, to aggregate replicable and promotable recovery and disposal models and empirical practices, to significantly improve the standard recycling rate of key home appliances, to significantly increase the capacity and professionalism of the waste home appliance recovery and disposal market, to continuously improve the incentive mechanisms that support home appliance manufacturers in meeting their disposal obligations, and to establish a consensus within the home appliance industry and make it common practice for manufacturers to better fulfill both their extended responsibilities and social responsibilities, all by 2023.
The Notice also stipulates that implementation should begin with manufacturers of TVs, refrigerators, washing machines, and air conditioners and encourages enterprises to utilize existing channels and networks to develop reverse recycling. Enterprises are encouraged to optimize storage facilities, transport networks and flow management to increase their disposal capabilities. However, the Notice also issues requirements for the use of renewable resources by enterprises and government assistance policies.
NDRC, Ministry of Industry and Information Technology, Ministry of Ecology and Environment: Notice on the Organization and Implementation of the Self-directed Implementation of Recovery Targets by Home Appliance Manufacturers (February 2022)
NDRC, Ministry of Industry and Information Technology, Ministry of Ecology and Environment: Detailed Rules for Implementation of the Self-directed Implementation of Recovery Targets by Home Appliance Manufacturers (Appendix) (February 2022)
The NDRC and other authorities issued the Notice on the Organization and Implementation of the Self-directed Implementation of Recovery Targets by Home Appliance Manufacturers in 2022 in February 2022 to enable traditional home appliance manufacturers to participate in more matters related to home appliance recovery. The Detailed Rules for Implementation of the Self-directed Implementation of Recovery Targets by Home Appliance Manufacturers is an appendix to the Notice that provides detailed instructions on operational matters such as application submissions, documentation, reporting, local auditing, third-party assessments, and results publication for manufacturers implementing self-directed recovery targets. The Details Rules cover matters such as applicable scopes, target confirmation and documentary evidence, data reporting, as well as local auditing and third-party assessments.
NDRC, Ministry of Industry and Information Technology, Ministry of Ecology and Environment: Notice on Successful Self-directed Implementation of Recovery Targets by Home Appliance Manufacturers (May 11, 2022)
The Notice confirms the six enterprises that have implemented self-directed recovery targets in 2022 (these enterprises are listed below together with their reported targets) and requires local authorities across the nation to continue efforts to push key projects, improve action plans, strengthen organizational guarantees, and provide technological support and information services to facilitate the successful implementation of self-directed recovery targets and optimize the construction of a waste home appliance recovery platform and system.
Table 2 2022 Enterprises Participating in Self-Directed Recovery Targets and their Recovery Targets
| Enterprise Name | Target Recovery Volume (Unit: 10,000 units) | ||||
|---|---|---|---|---|---|
| TVs | Electronic Refrigerators | A/Cs | Washing Machines | Total | |
| Haier Smart Home Co., Ltd. | 35 | 220 | 130 | 215 | 600 |
| Zhuhai Gree Electric Appliances Co., Ltd. | 290 | 80 | 62 | 80 | 512 |
| TCL Industries Holdings Co., Ltd. | 104.1 | 50.2 | 140.2 | 146.5 | 441 |
| Sichuan Changhong Electric Co., Ltd. | 65 | / | 20 | / | 85 |
| Midea Group | 1 | 8.5 | 9 | 21.5 | 20 |
| Hisense Marketing Management Co., Ltd. | / | 18 | |||
2. Future Policy Direction
China will continue to perfect a system of regulations and standards governing waste home appliances during the 14th Five-Year Plan, with specific focus placed on: expanding the scope of Waste Electrical and Electronic Products Disposal Fund subsidies, pushing manufacturers to accept responsibility for home appliances over the entire lifecycle of such products, and encouraging foreign companies to fulfil their social responsibility regarding resources.
(1) Expanding the Scope of Waste Electrical and Electronic Products Fund Subsidies
At present the Waste Electrical and Electronic Products Disposal Fund only offers subsidies for the five major product groups originally included in the Catalog of Waste Electrical and Electronic Products for Disposal. However, the Catalog of Waste Electrical and Electronic Products for Disposal was expanded during the 13th Five-Year Plan to include nine additional categories which, if also subsidized, would have a significant positive impact on the disposal capacity of disposal enterprises.
This is particularly evident when the role of the fund and its subsidies in launching development of the waste electrical and electronic products industry is considered; still, enterprises must cultivate self-reliant continuous development models for the industry to achieve healthy growth, and this is a key factor for the completion of a waste electrical and electronic product recycling system.
(2) Push Manufacturers to Accept Responsibility over the Entire Lifecycle for Home Appliances
As required by policies and standards, the environmental responsibility of Chinese home appliance manufacturers has already been extended past the manufacturing stage to include product design, circulation and consumption, recycling, waste disposal and other stages of the product lifestyle. This change is also in line with the gradual implementation of self-directed recovery targets. Capable enterprises must cultivate qualified subsidiary disposal enterprises and take full responsibility of their own recovery and disposal in a move that will transform future Chinese home appliance manufacturers for the better.
(3) Encourage Home Appliance Trade-Ins and Grow Market Demand
In 2020 the China Household Electrical Appliances Association (CHEAA) published the Safe Service Life for Household Electrical Appliances series of standards clarifying that the safe service life of products such as refrigerators, air conditioners, washing machines, range hoods and water heaters is between 8 and 10 years. These standards both increase user safety and promote users to exchange their appliances for newer models. In addition, the gradual implementation of the new round of Home Appliances Going to the Countryside (HAGC) and Trade-in policies has already began to result in a steady expansion of demand in the waste home appliance recycling market.
