Why EU’s DPP mandate will have a big impact on businesses’ sustainability credentials

By Lars Rensing, CEO of DPP Solutions Provider, Protokol 

The European Union continues to put sustainability high on its agenda with the EU Ecodesign for Sustainable Products Regulation (ESPR) passing into law on the 18th July, itself a component of the EU’s wider Circular Economy Action Plan (CEAP).

EU’s DPP mandate impact on businesses’ sustainability

The initiative has come about in no small part because of the EU’s ambition to become the first climate-neutral region globally by 2050. With the metric tonnage for global e-waste stood at 62 million in 2022 and on course to reach 82 million by 2030, there is a need to take hold of the systems that are contributing to our carbon footprint. Factor in the hazardous materials such as lead and mercury often contained in such waste, and the breadth and depth of the problem soon becomes apparent.

The EU’s ESPR is designed to extend product lifespans, boost resource efficiency, and enhance repairability and recyclability as part of its wider sustainability goals. This effort is of particular importance for the electronics and ICT industry as it has been earmarked as a priority product group, primarily due to the amount of e-waste it is responsible for. Mandated as part of the regulation are Digital Product Passports (DPPs), a tool for collecting and sharing product data throughout its entire lifecycle used to illustrate a product’s sustainability, environmental and recyclability attributes.

Irish businesses who are already familiar with the regulation and what it will entail are already on the right path towards preparation, however those who aren’t familiar with the ESPR, DPPs, or how this new mandate will impact them, it’s not too late to begin your journey now.

Opening up access to data to fuel a circular economy

For those who aren’t familiar with DPPs, they can serve as digital records of a product’s journey, holding essential information such as the raw materials used in its construction, right the way through to how consumers should dispose of it sustainably. The data in a DPP can be accessed by scanning a data carrier such as a QR code or barcode affixed to a physical product with a smartphone.

The EU’s initiative aims to curb the environmental damage and health risks posed by e-waste by encouraging businesses to provide the environmental impact data on a product to support sustainable decisions when designing and manufacturing future iterations. It also aims to enable consumers to make more informed decisions about the products they purchase based on reliable, transparent insight.

So if you think about a laptop, a consumer could in theory scan a QR code that is attached to understand the carbon footprint of the manufacturing process of that device to support a purchasing decision, or they would be able to dispose of it safely or correctly when it reaches end-of-life. By having the ability to provide easily accessible information on the exact materials that make up the product (including hazardous materials often present in electrical items) and how to dispose of these materials safely, the EU considers them as a key feature in fostering a circular economy.

What the Irish technology industry can do today

For businesses that are keen to begin preparation, what we know is that regulation officially came into force on 18th July, and we expect that information on delegated acts – specific compliance requirements for each product group impacted – will follow in the coming months. This is also expected to include specific timing requirements for compliance for the priority groups. While this isn’t confirmed, businesses that it will impact would do well to begin thinking about the first steps of preparation now, to ensure they are not on the backfoot once the rules are published as it will likely be a labour-intensive process.

As a first step, this can be assigning one lead or a team that will familiarise themselves with what we know about the business today, and starting to make note of all aspects of the supply chain and current operators that may be impacted by the legislation. Knowing where different types of data that may be part of the DPP requirement is held puts the business in a good place to create a strategy once the delegated acts are published. Having a view of partners that will support your DPP integration, and existing partners that will support relevant data collection would be a useful set-up activity to consider before a strategy stage.

Only when all the unknowns are known via the delegated acts should the business begin to create a more comprehensive strategy, but if the actions above have already been considered, this should fall into place quite quickly.

The EU’s initiative for a circular economy through DPPs marks a significant step toward sustainability. Despite the challenges, the benefits are considerable. Businesses should look forward to the positive outcomes of their efforts, such as contributing to a sustainable future, validating their sustainability credentials, and optimizing supply chain efficiency. Proactive measures now hold the potential to yield substantial gains, with numerous opportunities for those who embrace the initiative soonest and most fully.

About Lars Rensing:

Lars Rensing is CEO and Co-Founder of web3 solutions provider Protokol. He has over eight years’ experience in the web3 industry.

Lars also currently serves as an adviser and board member for a number of startups leveraging web3 technology, helping them devise and enact their web3 strategies.

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