Beverage companies operating in Connecticut have just two more months to prepare for a sweeping expansion of the state’s bottle laws, which will extend the five cent deposit on packaged drinks to cover the vast bulk of beverage categories and packaging formats effective January 1, 2023.
Under the current law, a five cent deposit is added on to the price of all beer and malt beverages, carbonated beverages (including mineral water and soda) and non-carbonated bottled waters and enhanced waters. However, the updated bill – passed by Connecticut’s state legislature and signed into law in June 2021 by Governor Ned Lamont – is set to add the deposit on to nearly all ready-to-drink beverage categories including hard seltzer, hard cider, juice, tea, coffee, kombucha, plant-infused drinks, sports drinks and energy drinks.
Most packaging formats – including cans, glass and plastic bottles, jars and carton containers – are subject to the deposit, depending on size. Exemptions include containers smaller than 150 mL, carbonated beverages larger than 3L and non-carbonated beverages larger than 2.5L.
The deposit price is also set to increase to 10 cents, effective January 1, 2024. The increase will make Connecticut only the third state in the country to require a 10 cent deposit on beverage sales, alongside Michigan and Oregon.
The shift in the law will be felt immediately come January, as products already on shelf in stores will be subject to the deposit, in addition to new products shipped to distributors and stores.
Unlike the previous iteration of the law in which 100% of unredeemed deposits were returned to the state, the updated bill has some financial upside for beverage distributors. Beginning this year, distributors were allowed to keep 5% of unclaimed deposits and that amount will increase annually beginning in fiscal year 2023 and 2024, when distributors will keep 35% of unclaimed deposits, followed by hikes to 45% in 2024/2025 and finally 55% the next year.
But those benefits come with an increase in handling fees that beverage distributors must pay to redemption centers, with beer fees jumping from one cent per can for beer and two cents for all other beverages to 2.5 cents for beer and 3.5 cents for all other beverages.’
The change will require labeling updates for brands selling in the state. An August order by Connecticut Department of Energy & Environmental Protection commissioner Katherine Dykes approved new labeling requirements for newly eligible containers to either include the words “Redemption Value” or “CRTV” on the packaging.
“Flexibility is important in this moment of transition to a new redemption value in order to minimize disruption to product distribution and avoid any potential supply chain disruptions that could harm consumers,” Dykes said in the statement. “It is also imperative that consumers are made aware of the changes to the law. The Department, in conjunction with this order, will work with manufacturers and retailers to execute a campaign to educate consumers on the new types of beverages covered by the bottle bill and the correct redemption value.”
The updated bottle bill passed amid a decade-long decline in redemption rates, which according to Container Recycling Institute president Susan Collins was exacerbated by the pandemic. The institute reported that bottle redemption in Connecticut fell to 43.6% in 2020, down from 50.3% in 2019 and 63.8% in 2009. Although the state saw a mild rebound to a 46.2% redemption rate last year, the updated bill is aimed at encouraging consumers to participate more in the program.
“When Connecticut’s deposit law was enacted in 1978, a nickel was worth what 20 cents is today,” Collins said in a statement, after the bill’s passage last year. “While the COVID-19 pandemic played a part in declining redemption in 2020, the downward redemption trend over the last 10 years is unmistakable proof that 5 cents is no longer the financial incentive it once was for consumers to return containers instead of throwing them away or littering them.”
And it appears that parts of the bill already in effect are beginning to show their worth. A five cent deposit on 50 mL alcoholic “nips” began in October 2021. According to CT Insider, between October and April the state reported more than 37.6 million nip sales, passing along over $1.8 million to cities and towns.
With the biggest change to Connecticut’s bottle bill fast approaching, it may prove to foreshadow other states’ actions. In March, Oregon passed a small expansion of its bill to cover canned wines. Meanwhile, of the ten states with bottle bills on the books, four have recently debated potential changes to their own laws, WasteDive reported.
California is exploring several potential bottle bill updates and this spring Massachusetts legislators debated an expansion similar to the Connecticut update, which would include a deposit increase to 10 cents covering most beverage containers including nips. Vermont legislators have also looked into adding additional beverage categories including water, wine and hard cider to their law.
Meanwhile, Iowa approved changes to its bottle bill in June, which includes a provision that allows retailers to opt out of redeeming bottles and cans.