Ontario's 2026 Packaging EPR Reform: Waste Operators Seize the Initiative

Ontario's 2026 packaging EPR overhaul: Waste operators move early to seize opportunities

Companies such as GFL Environmental and WM have already invested heavily in Ontario's new packaging EPR model, but the province may face transition pains after the January 1 launch.

Author: Megan Quinn

• Published on December 22, 2025

On January 1, 2026, Ontario's updated packaging EPR program will officially launch, bringing new business opportunities for MRF operators and haulers. The province's long-term plan formally transfers management of this extended producer responsibility program, also known as the Blue Box program, making packaging producers fully responsible for the collection and recycling of materials, replacing the previous model where municipalities and producers shared costs and responsibilities.

Multiple changes are expected to boost the waste industry. Municipalities will no longer manage recycling collection themselves, and companies such as GFL Environmental, Miller Waste Systems, Emterra, and WM of Canada have secured new collection contracts across the province. Some small businesses that previously received municipal recycling services will no longer have that service starting in January and must arrange private recycling on their own in 2026, creating another significant business opportunity for waste operators.

According to Circular Materials, the Blue Box producer responsibility organization, MRF operators (including WM and GFL) are expected to benefit from the updated EPR program, with collection volumes increasing significantly. Circular Materials has promoted the program changes as aimed at improving collection rates and has expanded the list of materials accepted under the curbside program to include items such as paper cups, black plastic, and toothpaste tubes. However, the anticipated changes in collection volumes also raise questions: Is there a stable end market for the new materials?

The EPR transition process began in July 2023, with communities gradually moving into the new producer-operated program. As of January 1, 2026, all 383 communities and 12 First Nations in Ontario will have fully completed the transition.

Circular Materials CEO Allen Langdon said in a statement announcing the new program that this change "marks an important milestone and progress for Ontario's recycling industry."

Waste companies and municipalities adapt to new collection contracts

The replacement of municipal contracts is a key feature of the Blue Box transition. In an email to Waste Dive, Langdon said Circular Materials has executed 948 collection contracts, some already underway and the rest set to begin on January 1.

"Some of these changes present huge opportunities for certain private contractors," said Calvin Lakhan, director of research on the economic impact of recycling programs at York University's Circular Innovation Hub. With collection no longer managed by hundreds of individual municipalities, "there will be only a few players in the space, and they can manage materials more efficiently," Lakhan said. "There will be a lot of logistics optimization and operational optimization."

Many municipalities have provided community services for decades. Although Circular Materials says residents should not experience service disruptions, Lakhan noted that new companies need to familiarize themselves with the specific needs of new communities and address any growing pains.

GFL will be one of the major companies involved in the transition. The company did not respond to inquiries about its new 2026 collection footprint, but on its Q3 earnings call in November, executives said new EPR contracts across Canada contributed to record-high adjusted EBITDA margins. GFL expects this tailwind to level off in the coming quarters.

Several municipalities that previously managed their own recycling collection have announced GFL will take over services, including Georgina and Peel near Toronto, and the town of Kenora in the western part of the province. Other established waste companies will also gain new contracts: Emterra will take over municipal recycling services in towns including Simcoe; Miller Waste will take over services in cities including Richmond Hill; Emterra and Miller Waste will each serve parts of the Waterloo region; Norfolk Disposal Services will take over collection in Haldimand County; and WM of Canada began collecting in Guelph in January 2025 as part of the rollout.

Many companies may gain new commercial contracts through the Blue Box transition. Some small businesses that previously received recycling collection from municipalities will need to arrange private waste and recycling services on their own starting January 1. For many waste contractors, "this is a new market," Lakhan said. But the change has upset some municipalities, which lobbied the Ontario government to allow businesses to receive the same contracted services.

It is unclear how many businesses will need to comply with this new commercial collection requirement of the EPR program. The Greater Oshawa Chamber of Commerce, representing the area east of Toronto, estimates about 3,000 businesses in that region alone will be affected.

MRFs make major investments, but end-market questions emerge

In January, WM is expected to open two brand-new recycling facilities in the province to handle higher volumes of recyclable materials. One is in the Waterloo region southwest of Mississauga, and the other is in the Greater Napanee area in southeastern Ontario, both equipped with AI sorters and other automated equipment. A WM spokesperson said in an email that once completed, these new facilities are expected to process 30% of Ontario's Blue Box volume under contracts with Circular Materials.

Circular Materials says GFL Environmental is also undertaking major renovations and upgrades at one of its facilities in the Toronto area. The PRO first reached an agreement with GFL in 2023 to use the Arrow Road facility to handle the growing volume of materials from the Blue Box program in the region, calling it a "key milestone" in the EPR transition. Langdon said these three MRFs together will handle about half of Circular Materials' Blue Box processing volume in the province.

Circular Materials has also reached agreements with six existing MRFs that will continue to process the remaining 50% of the volume. "These facilities have made and will continue to make ongoing investments in system upgrades to support improved recovery rates of target materials," Langdon said.

Circular Materials says one factor driving MRF throughput is the new uniform list of recyclable materials. Residents across the province will be able to recycle the same types of materials, which the PRO says simplifies the recycling process and reduces confusion. In addition to common cardboard and aluminum cans, the expanded list includes deodorant containers, ice cream tubs, frozen juice containers, and coffee cups.

"Because of material standardization, MRFs can make strategic investments. They know they have to find ways to sort black plastic and toothpaste tubes," Lakhan said. The uniform collection list gives MRF operators assurance that their investments in expensive sorting equipment will be supported by corresponding collection volumes. He added that the uniform list also "creates a level playing field across the province for the materials MRFs are trying to capture."

But Lakhan noted that some new materials on the list have limited end markets, raising questions about how MRFs will cope if they cannot find buyers—and what role producers need to play if significant end-market gaps emerge. Circular Materials says the uniform list is part of the EPR program's overall goals to drive recycling and packaging innovation and strengthen producer accountability. For certain items such as paper coffee cups, the PRO added them after conducting specific recycling pilots. WM recently announced it will accept paper takeout cups, citing specification changes and a push from major paper mills.

But other items such as toothpaste tubes have more limited end markets and dimmer prospects for innovation. "At least in the short term, I don't see many viable end products being created, but that could change over time," Lakhan said. "It depends on whether they can get critical mass of material and convince enough people that it has value."