Wasting Less; But We’re Still Left Wanting More From The Proposed Latte Levy

How the Latte Levy, combined with other legislative changes, can tackle takeout coffee cup waste. A summary for the specialty coffee community and a response to the Environmental Audit Committee’s report, ‘Disposable Packaging: Coffee Cups’.

Last week the media widely reported on a parliamentary committee proposal to introduce a 25p ‘latte levy’ on coffees sold in takeout cups in an attempt to tackle the a) high, and growing, levels of use, and b) the low rates of recycling.

How good is your knowledge about recycling? Which of these takeout coffee packaging items can actually be recycled?

The backdrop is reasonably well reported elsewhere but, to avoid confusion, here are the key, headline figures that map out the issue:

  • There are 2.5 billion takeout coffee cups used in the UK each year, and the volume is growing
  • The majority of these cups have a plastic lining, to make them suitable to hold liquids
  • There are only three recycling facilities in the UK that are able to separate the plastic lining from the paper component of cups.
  • Cups need to be collected as a distinct waste stream: when included with general recycling they need to be separated due to their mixed material composition; when included with paper not only do they need to be separated but they can contaminate paper, preventing it from being recycled.
  • Consequently, just 0.25% are recycled.
  • There is significant consumer confusion about whether cups can be recycled and how they should dispose of coffee cups. 9 out of 10 consumers place their takeout cups into recycling bins, presumably with the expectation that they will be recycled.

Our response

We have taken the time to summarise the paper, highlight issues and draft a response because we believe it to be necessary to a) help to accurately communicate the report’s findings and proposals to the specialty coffee community, b) facilitate community discussion and action, c) highlight key issues and legislative challenges with the current proposal, and d) communicate these to a wide audience, including the Environmental Audit Committee.

Many consumers believe takeout coffee cups to be readily recycled. In fact, only 0.25% currently are.

Industry Takeaways

Information, insights and challenges to the specialty coffee community, which may also be of general interest to the public and the Environmental Audit Committee.

Specialty coffee is now a key player, has grand ambitions, believes there ought to be a solution – and is ill-equipped to tackle the challenge.

Specialty coffee has entered the mainstream and now makes up a significant proportion of the UK’s coffee sales, but the data is not clear on specialty’s proportion of the overall market. To paint a picture of specialty’s present prevalence, there are now over 400 ‘independent’ coffee shops in central London (London’s Best Coffee); more retail fascias than Starbucks. There are obviously hundreds more independent coffee outlets around the UK, primarily located in the UK’s urban centres. Our combined impact and influence – both on consumer habits and environmental impacts – are significant, but the combination of a) limited resources, b) highly fragmented ownership of outlets, and c) a lack of a industry body with the expertise to deal with such challenges means that it is extremely difficult for the specialty coffee community to be represented in the process, influence the proceedings or make a meaningful contribution to a solution.

The Environmental Audit Committee took written and verbal evidence from academics, NGOs, coffee companies, packaging producers and local authorities. The sole connection to the specialty coffee industry, that we know of, was Dr. Jennifer Ferreira, who we know from our Barista Life project. There may have been others, and if so, please add them as comments (free Medium account required), or email us, and we’ll revise the text.

Some people within specialty coffee feel that their perspectives were ignored. The community probably was under-represented, but this raises the larger industry issue regarding who actually speaks for the community. In short, the Environmental Audit Committee need to be able to invite an individual, and there is presently no point of contact for our part of the industry. Our lack of representation is our own fault for not being sufficiently well organised.

An Industry Body

Of course, specialty coffee does have an industry body, the Specialty Coffee Association UK Chapter (SCA UK). However, unlike the core competencies of many other beverage industry bodies, the SCA UK does not seems well-equipped nor have a focus on a) monitoring legislative developments, b) lobbying for the interests of its members, c) establishing and sharing best practice or d) implementing industry-wide programmes.

As the specialty coffee industry matures and grows in size an industry body to carry out such functions will be both necessary and advantageous. If the SCA UK does not wish to perform these tasks, then it’s probably time for the industry to ask itself how and who can best represent its interests in such matters in the future. This is not the first time or the only issue which an industry body should be engaging with the political process in the interests of its members. Business rates, cascara and training are several areas that immediately spring to mind. And now is an excellent time to start that conversation as there will inevitably be future issues the industry will have to work with legislators and regulators on.

Getting in on the action

In the absence of an industry-wide process or position, baristas and businesses have seized the opportunity to represent – and even promote – themselves. It is not our place to judge motivations, but it seems few people who have commented this week on social media or in the media have actually read the Disposable Packaging: Coffee Cups report. If you are interested in this topic and want to make a meaningful contribution, it’s worth taking the time to read it.

Cutting waste: Getting our own house in order first

Coffee shops use many takeout coffee cups each day, but not all of them are used by consumers. Widespread informal practices such as using cups to quickly safeguard grinder and espresso machine parts during cleaning and service, purging grounds, mixing hot chocolate and temporarily storing liquids all increase their use.

Another widespread practice that increases use is double-cupping. Some drinks, such as Long Black (aka Americano) and filter, are often too hot for customers to comfortably held (mainly when using single wall cups) so it is commonplace for baristas to serve these drinks in two cups – obviously, doubling the takeout cup usage for these beverages.

If specialty coffee businesses were to change these practices we could reduce the number of cups going into landfill immediately.

Does anyone in the industry have data on what proportion of drinks consumed in their shop are served in a takeout cup?

Educating Consumers

Many specialty coffee businesses pride themselves on their consumer education initiatives. The Environmental Audit committee correctly identifies clarifying the widespread consumer confusion about the actual recycling opportunities for takeout coffee cups as a key part of any solution. The committee seems to believe that the national coffee chains have cynically created or maintained consumer confusion to obfuscate their responsibility in tackling the issue.

We are not aware of similar sentiments within the specialty coffee community and it seems like an opportunity for the community to take a leadership role by clearly communicating the situation to our respective customers. While implementing programmes to provide alternatives would be desirable, we see much benefit in specialty coffee businesses immediately and clearly presenting the present conundrum to consumers and giving them the choice between take out (with associated waste) and drinking in.

In short, the present lack of a good solution or viable alternatives should not delay or hinder the specialty coffee community raising the issue with their customers and encouraging them to drink in.

We believe that a significant proportion of customers will change their coffee drinking habits solely on the basis on being better informed.

Developing viable alternatives and creating solutions

This is the most challenging aspect for the industry as each of the present alternatives have significant economic, operational or environmental drawbacks. In summary, the core present actions are:

Reduce
Use less takeout cups internally, educate consumers, encourage consumers to drink on site. Hopefully, we can all get behind this.

Reuse
Reusable cups may prove to be part of the solution, but are clearly not a silver bullet as their wider use will create new operational, environmental, legislative challenges. This is covered in more detail below.

Recycle 
As most coffee shops are not suitable locations to introduce takeout cup collection points, we’ll need to work with government and commercial partners to develop and implement a solution.

Biodegradable yes, but potentially more harmful 
Takeout cups made from materials other than paper and plastic are increasingly available. There is a price premium on some of these items, but more concerningly some probably have greater embedded energy than standard takeout cups. Since carbon emissions are a greater environmental pressure point than waste, it would be ill-advised to lobby for their widespread adoption — this would lead to the same amount of landfill and greater carbon dioxide emissions.

An industry wide solution
Other industries, such as British milk producers and soft drinks manufacturers, collaborated to develop and implement the widespread use of single material, plastic milk bottles and soft drink cans (this is why they look the same regardless of brand). These initiatives have been heralded for significantly upping the recycling rates, but presumably have done little to reduce overall consumption. The coffee industry’s, and especially the specialty coffee community’s, fragmentation makes this route for a solution less likely. The industry will be dependent on the packaging industry or the larger coffee companies to develop new packaging materials, designs, or recycling solutions.

An industry wide, single material designs have significantly increased recycling rates for soft drink cans and milk bottles. A similar approach is probably needed for takeout coffee cups.

Furthermore, as a community we need to better communicate how delicately balanced many coffee shop businesses are. There is a widespread perception, which seems to extend to the Environmental Audit Committee, that coffee shops can readily afford to absorb the proposed latte levy of at least 25p; this is clearly far from the reality for may specialty coffee businesses.

Building Knowledge

If you have facts or insights which would benefit the industry, write a the comments (free Medium account required), or email us, and we’ll revise this article with appropriate credits.

Committee Response

Feedback to the Environmental Audit Committee on its report ‘Disposable Packaging: Coffee Cups’, which may also be of general interest to the public and industry.

The Environmental Audit Committee deserves credit for pursuing the issue over a sustaining period of time and bringing it to parliamentary and public attention.

The issue is large in scale, pressing and most likely requires a legislative response. More specifically, we broadly agree that the wider coffee industry is not able to create a satisfactory response to the present challenge, however, we would suggest that this is due to the large number of operators in the industry, the various sale channels, as well as a wide variety of consumer aspirations (rather than a commercial cynicism which is implied in the report). Indeed much of the specialty coffee community is deeply concerned about environmental issues and have already undertaken a wide variety of actions to both reduce and mitigate their environmental impacts.

Indeed, it is worth noting that, one of the reasons why this issue is attention-grabbing is that many consumers identify greater environmental concern and social commitment as core values of many of the small, independent coffee shops that trade in the UK.

However, there are a number of facets which we need to encourage the committee to either re-examine or widen their thinking on. In particular, the report fails to consider why the UK has high levels of take out cup usage and therefore what might best be done about it. Here are three reasons that the committee should consider as well as specific feedback on the proposed latte levy.

Green lighting: Planning Issues

The prevalence of takeout in the UK isn’t cultural, it’s legislative. Under the current system most coffee shops operate in A1 use class premises, which are designated by planning law for use as shops and retail outlets; rather than A3 premises, which are designated for use as food and drink sites. The definition and borderline between A1 and A3 is somewhat grey, but the requirements to trade in an A1 site are that a) at least 50% of the trade is consumed off site, b) and food is not cooked to order.

It is worth noting that A3 sites are generally larger, and are dominated by restaurant businesses. This is because A3 sites are more scarce and consequently they typically command higher rents as well as a premium to acquire the lease of a site, costs which restaurants have been better positioned to absorb into their business models. The current coffee shop model is not viable within most A3 sites. Additionally, a wide variety of food retailers trade in A1 sites, including the high street businesses Pret, Greggs, Itsu among many others, as well as the high street coffee chains and independent coffee shops.

Many coffee shops would actually prefer consumers to drink in, but because they operate in A1 premises they are forced to create concepts that ensure at least half of their customers consume off site.

It seems the current planning laws did not foresee, nor have they facilitated, the rise of casual dining — the larger trend that the rise in coffee shops has been a part of over the past decade. The use class requirements determine that entrepreneurs and operators develop concepts which are designed for the majority of their sales to be consumed off site. This impacts shop layouts, seat counts and shop facilities, all of which are used to encourage consumers to opt for takeout. The committee noted that, “almost half of all coffee and hot drinks are now sold in disposable cups” (Environmental Audit Committee, 2017, p.3). For most coffee shop operators to be compliant with planning law, it should be over half.

This legislative requirement for coffee shops to sell the majority of products for consumption off site is clearly in tension with the UK’s current environmental commitments and targets and needs to be addressed as part of the solution.

Until the noughties it was Whitehall policy to disrupt traffic flows by programming traffic lights to be out of sync. The additional stopping, standing, and accelerating imposed on drivers led to increased fuel consumption by their vehicles, and therefore increased tax revenues. This nonsense was finally replaced with greenlighting, a policy to reduce carbon emissions through facilitating steady traffic flows. If the government wishes to get serious about disposable coffee cups they need to greenlight on site food and drink consumption by making the use class system fit for purpose for life in 2018 and beyond. In our opinion, this change – above all others – has the ability to reshape consumer behaviour by reforming business models and concepts to reduce the use of takeout packaging, including coffee cups. And without it, the agenda to encourage consumers to drink their hot beverages on premises risks putting many operators in breach of planning law.

Why do consumer use takeout coffee cups?

As well as the industry pushing consumers towards takeout, consumers have requirements and aspirations which are met through takeout packaging. We note that apart from estimates of the quantity of paper cups consumed, there was:

  1. No examination in the report on how or why consumers use takeout cups
  2. What an appropriate use of takeout packing might be (and therefore where cuts in use might be most readily made)
  3. Whether there are significant differences in urban versus non-urban patterns of use (we think there probably are)
  4. Or information on the percentage of coffee cups as part of a larger category of plastic-lined cardboard packaging which is widely used by supermarkets, convenience food retailers, takeout food restaurants, for their packaging of soups, salads and sandwiches as well as noodles, gelato, curries and sushi.

Anecdotally, consumers primarily wish to use takeout coffee cup when a) commuting, b) consuming coffee outside (so they can smoke or sit in a park, for example), c) take back to the office.

Consumers drink coffee at key times, including their commute, but the report failed to identify why or where consumers opt for takeout. A better understanding is required in order to create solutions that tackle the problem.

Without an identification of use, it is difficult to develop policy to reduce consumption or introduce the infrastructure to capture used takeout cups from other recycling and waste streams (what the committee calls “binfrastructure”). The committee notes the futility of one high street operator’s initiative which offered in-store paper cup recycling bins. Without a better understanding of consumer habits, we risk such a misstep – but at a much larger scale. We would suggest many paper cups are disposed of:

  1. once consumed in the office
  2. on entering public transport stations (and to some extend exiting, but consumers are reluctant to travel with coffee during peak hours due to congestion)

This means the solutions will have to involve both private and public collection of takeout coffee cups.

By the committee’s own admission, they have picked up on this issue following a media investigation and public campaign. While coffee cups are a major issue, it is just part of an even larger, and faster growing, issue: the increased use of plastic-lined takeout packaging in general. Personally, we are happy that the visibility of takeout coffee cups has become a force for change, but the solutions need to be directed at this entire category of packaging to be effective.

Consequently, it is a fair criticism of the report that at times it goes for the sensational (it measures the volume of coffee cups in notable buildings or by the length of coffee cups lined up) rather than an investigation of the scope of the problem. If parliament and Whitehall are not well placed to do this work, then we do not know who is.

Conflating the issue, scope and costs, makes the logic by which the committee proposes “a minimum 25p levy on disposable cups” to cover the cost of processing used takeout cups ill-conceived, poorly-considered and has made the issue sensational. This risks taking us a step away from creating an implementable solution. A more well-considered response is required.

While action to address the issue is of the imperative, we can’t endorse the current proposal as fit for purpose.

Consumables supplier Vegware states that their takeout cups have 72% less embedded carbon.

Reusable Cups

The committee proposes that re-useable cups are part of the solution, and indeed they might be, but there are significant issues to still overcome.

Embedded energy
Based on an enquiry to the plastic, reusable coffee cup manufacturer KeepCup in 2010, we understand that there is approximately 22x the embedded energy in their standard cup compared to a paper cup. The amount of embedded energy sets the environmental breakeven for reuse as carbon emissions are a more pressing environmental issue than waste. It is imperative that any move away from plastic-lined paper cups reduces overall carbon dioxide emissions, not inadvertently increases emissions.

Hygiene
The report does well to note that there are restrictions on the re-use of paper that have been previously used to package food and drink in recycled food and drink packaging – and that further investigation is required to ascertain the public health risk.

However, it neglects to identify that coffee shops have a legal and moral responsibility to not make their customers ill. While currently only a tiny proportion of coffee sales currently use reusable takeout cups, nearly every barista has experienced being handed a dirty or unwashed reusable cup by a customer.

Wider implementation of reusable coffee cups needs to be thought through clearly to prevent the spread of disease (germs or toxins passed from cup, to barista or equipment, to staff or other customers). At present food businesses have to meet various safety and hygiene requirements; consumers using reusable cups should be required to adhere to the same standards to ensure the health and welfare of baristas and other members of the public.

This is potentially trickier than checking to see if a reusable cup is dirty; coffee shops have to sterilise reusable crockery (regardless of whether it was first hand or machine washed) and it may be difficult for consumers to meet the same standards.

Crockery needs to be both washed and sterilised before reuse. How will reusable takeout cups reach the same standard to protect barista and the public’s health.

A lead could be taken from reusable, glass soft drink bottles programmes in various countries, including the Nordics and Australia. Under these schemes, consumers pay an additional charge when purchasing a bottle, and receive a credit when they return a bottle to a facility or drop off point. Returned bottles are then cleaned by the respective brands, re-filled and sold afresh.

The Latte Levy

The report is less than clear about how the proposed 25p levy was arrived at. Using the figures within the report:

  • £550 million: the total cost currently incurred by local authorities for the collection and sorting of packaging material (p.15)
  • £111 million: revenue currently generated from the packaging producer compliance scheme (2013 figure, p.15)
  • proposed minimum 25p levy on take out cup use to consumers (p.30)
  • £438 million: forecast revenue generated from the introduction of a 25p latte levy (cited by the committee from Eunomia Research and Consulting’s figure, which was based on 30% reduction in take out cup use, p.23)

Using the report’s figures, the introduction of the proposed 25p latte levy would cover all the costs currently incurred by local authorities for the processing of ALL packaging material – and still leave a surplus of millions of pounds.

The 25p figures seems to have been arrived at by the committee by observing the level of discount offered by a high street business; rather than an identification of the costs.

At the current proposed level, the latte levy is not an example of user pays, but makes coffee consumption a revenue stream for the treasury and aligns drinking coffee with the sin taxes of alcohol and tobacco.

In effect, the latte levy, at its current proposed rate, would a) subsidise other forms of packaging, b) subsidise other food types, and c) generate excess cash for the treasury. While a latte levy might be desirable, and even necessary, we can’t endorse a proposal that simultaneously subsidies the consumption of other foods and lines the government’s coffers.

Conclusion: Right direction of travel, but please continue to develop your thinking

The committee deserves praise for tackling this pressing issue and is right to think that the issue cannot be left to the market to resolve.

This is because of the industry’s fragmentation, current planning requirements, a lack of clear alternatives, downsides that need to be managed for each of the alternatives, and the level of coordination required across the variety of private and public actors that would need to be involved to significantly increase the recycling rate.

Despite these challenges, we believe there to be widespread support for solutions that reduce waste and increasing recycling infrastructure of takeout coffee cups from the specialty coffee community, and our customers, even if a levy is required to fund it. However, any levy needs to be part of a broader set of legislative changes and recycling initiatives that will actually tackle the root causes of takeout packing use as well as being proportionate to the cost.


About United Baristas

United Baristas was started in 2015 when we launched a Marketplace for the peer-to-peer sale of used, specialist coffee equipment with the objective of reducing environmental impacts by keeping equipment in use for its full working life. In 2016, we launched United Baristas Workshop, a directory of coffee equipment engineers to help the coffee community better maintain equipment so that it’s working life might be extended. While we employ market-based solutions to tackle these and other industry-wide problems, helping the specialty coffee industry achieve lower environmental impacts and a forge a sustainable and viable future is at the core of our DNA.