(a) (1) By January 1, 2032, a PRO acting on behalf of participants of the PRO’s approved plan shall develop and implement a plan to achieve the 25-percent reduction by weight and 25 percent by plastic component source reduction requirement for covered material sold, offered for sale, or distributed in the state. The PRO shall establish enforceable agreements with each of its approved plan participants to implement this section.

(2) Source reduction shall be achieved by a PRO in the following manner:

(A) At least 10 percent of the plastic covered material sold, offered for sale, or distributed in the state by its participant producers shall be source reduced through shifting a plastic covered material to refillable or reusable packaging or food service ware or through eliminating a plastic component.

(B) (i) The remaining source reduction of the plastic covered material sold, offered for sale, or distributed in the state by its participant producers not achieved pursuant to subparagraph (A) shall be source reduced through concentration, right-sizing, lightweighting, or shifting to bulk or large format packaging that allows consumers to refill home or commercial reusable containers, or shifting from a plastic covered material to a nonplastic covered material. No more than 8 percent of the plastic covered material sold, offered for sale, or distributed in the state by its participant producers shall be source reduced through an alternative compliance formula developed by the PRO, subject to approval by the department, that offers source reduction credit on a sliding scale based on the ratio of virgin plastic to postconsumer recycled content plastic to producers who incorporate postconsumer recycled content into plastic covered material. A producer shall only receive this alternative source reduction credit if the postconsumer recycled content is able to be validated and is validated by a third party, such as the Association of Plastic Recyclers, through its APR Postconsumer Resin Certification Program, or a similar third party approved by the department, and the content does not contain intentionally added perfluoroalkyl and polyfluoroalkyl substances.

(ii) The resulting source reduction of each action taken to optimize, eliminate, right-size, concentrate, shift to bulk or large format packaging, or switch to a nonplastic covered material shall be counted once for the purposes of meeting the source reduction requirements.

(C) By January 1, 2027, the PRO shall source reduce no less than 10 percent of plastic covered material sold, offered for sale, or distributed in the state by its participant producers, with no less than 2 percent of plastic covered material sold, offered for sale, or distributed in the state by its participant producers source reduced through shifting to reusable or refillable packaging and food service ware systems.

(D) By January 1, 2030, the PRO shall source reduce no less than 20 percent of plastic covered material sold, offered for sale, or distributed in the state by its participant producers, with no less than 4 percent of plastic covered material sold, offered for sale, or distributed in the state by its participant producers source reduced through shifting to reusable or refillable packaging and food service ware systems.

(b) By January 1, 2025, the department shall establish a baseline for the 25-percent reduction required in subdivision (a) based on the amount of plastic covered material, including the number of products packaged in covered material, that was sold, offered for sale, or distributed in the state in the 2023 calendar year.

(c) As part of any producer responsibility plan, plan update, or annual report submitted to the department, the PRO shall report the following data, disaggregated by each participant producer:

(1) The amount of plastic covered material and products sold in plastic covered material, including the number of plastic components and weight of plastic covered material, sold, offered for sale, or distributed in the state.

(2) The number of plastic components and the weight of plastic covered material shifted to a refillable or reusable packaging or food service ware.

(3) The number of plastic components and the weight of plastic covered material eliminated.

(4) The number of plastic components and the weight of plastic covered material shifted from a plastic covered material to a nonplastic covered material.

(5) The number of plastic components and the weight of plastic covered material reduced through concentration, right-sizing, and shifting to bulk or large format packaging that allows consumers to refill home or commercial reusable containers.

(6) The amount of postconsumer recycled content used compared to virgin plastic in covered material.

(d) Producers who are members of the PRO shall submit to the PRO individual source reduction plans that include both of the following:

(1) In the first individual producer source reduction plan, the producer shall include any amount of covered material, by number of plastic components and weight of covered material, the producer source reduced since January 1, 2013.

(2) The amount of plastic covered material, by number of plastic components and weight of plastic covered material, the producer plans to source reduce by January 1, 2027, January 1, 2030, and January 1, 2032. The producer shall describe how much will be source reduced in each of the following ways:

(A) The number of plastic components and the weight of plastic covered material shifted to a refillable or reusable package.

(B) The number of plastic components and the weight of plastic covered material eliminated.

(C) The number of plastic components and the weight of plastic covered material shifted from a plastic covered material to a nonplastic material.

(D) The number of plastic components and the weight of covered material source reduced through concentration, right-sizing, lightweighting, and shifting to bulk or large format packaging that allows consumers to refill home or commercial reusable containers.

(E) The amount of postconsumer recycled content used compared to virgin plastic in covered material.

(e) The PRO shall require producers that are participants of the PRO’s approved plan to submit to the PRO the data necessary for the PRO to report the information required pursuant to subdivisions (c) and (d).

(f) As part of the producer responsibility plan, the PRO shall include a source reduction plan designed to meet the requirements of this section. The source reduction plan shall be disaggregated based on the individual producer source reduction plans and shall meet both of the following requirements:

(1) In the source reduction plan, the PRO shall give producers credit for source reduction achieved from the 2013 calendar year to the 2022 calendar year, inclusive. This amount shall not count toward the requirements of subdivision (a). Allocation of this amount, and the requirement for the PRO source reduction plan to meet the requirements of subdivision (a), may require the PRO to require a producer to revise its individual producer source reduction plan.

(2) The PRO may identify material types in the source reduction plan that face significant recycling or end market challenges and would require significant investment to bring into compliance with this chapter by January 1, 2032. Switching an entire identified covered material category to a reusable, refillable, or nonplastic alternative shall be considered source reduction for the purpose of subdivision (a). The PRO may report this source reduction in an aggregated form.

(g) To ensure equity in the market, the PRO shall require a producer with a covered material new to the producer subsequent to the approval of the PRO to optimize packaging and not include unnecessary covered material. The PRO shall assess a malus fee on any producer with a new covered material that is not optimized, as determined by the PRO and approved by the department pursuant to subdivision (j) of Section 42051.1.

(h) To ensure source reductions achieved by January 1, 2032, are not lost after January 1, 2032, while still allowing for businesses to grow, the department shall, beginning in the 2030 calendar year and every five years thereafter, conduct an evaluation of the plastic covered material subject to this section to determine if actions to secure greater source reductions are necessary. If the number of plastic components or weight of plastic covered material has increased, the department shall make this determination. If the department determines that there has been an increase in the number of plastic components or the overall weight of plastic covered material, the department shall take the following actions to secure greater source reductions:

(1) Require the PRO to ensure participant producers increase the rate of source reduction through shifting a plastic covered material to reusable or refillable packaging or food service ware or through eliminating plastic components. In requiring these higher source reduction rates, the department shall consider all of the following:

(A) The feasibility of increased source reduction rates, as determined by evaluating consumer adoption and acceptance, potential impacts to food safety, and infrastructure availability.

(B) The use of postconsumer recycled content.

(C) The degree to which reuse and refill infrastructure investments were made to improve consumer convenience and adoption.

(D) Examples of reuse and refill systems and elimination requirements in other jurisdictions.

(E) Reductions achieved through the other tools implemented by the PRO, including fees and required optimization.

(F) The percentage of growth in the number of plastic components and the overall weight of covered material.

(2) Determine if new packaging types are optimized and, if not, develop optimization requirements through regulations.

(i) Producers of expanded polystyrene food service ware shall not sell, offer for sale, distribute, or import in or into the state expanded polystyrene food service ware unless the producer demonstrates to the department that all expanded polystyrene meets the following recycling rates:

(1) Not less than 25 percent on and after January 1, 2025.

(2) Not less than 30 percent on and after January 1, 2028.

(3) Not less than 50 percent on and after January 1, 2030.

(4) Not less than 65 percent on and after January 1, 2032, and annually thereafter.

(j) The department may adopt regulations to implement this section, including, but not limited to, reporting and collection requirements.

(Amended by Stats. 2023, Ch. 131, Sec. 186. (AB 1754) Effective January 1, 2024.)