The Packaging Waste Recovery Note (PRN) and Packaging Waste Export Recovery Note (PERN) system will continue, alongside the introduction of Extended Producer Responsibility (EPR) for packaging, until at least 2026.
In 2022 Government consulted on introducing various administrative and technical changes to the PRN system to help resolve long-standing issues, including price volatility and the potential for fraud. In this article, we outline the changes that were confirmed by government in October 2022 in their official consultation response.
Packaging reprocessors and exporters will be obliged to report both the weight of packaging handled, and their PRN/PERN price data, monthly as opposed to quarterly. This data will be anonymised and published by the regulators.
This should in theory improve transparency, allow for better market predictability, and provide more accurate information on current evidence volumes. In turn, this may alleviate large fluctuations in PRN/PERN prices and availability for producers and their compliance schemes.
Alongside the above, reprocessors and exporters will have to report more detailed revenue expenditure. Whereas now they are obliged to report into six broad categories – such as ‘Infrastructure and Capacity’ – more comprehensive sub-categories will be introduced, such as ‘Purchase of New Assets’ and ‘UK Market Development’.
A key section in the consultation surrounded the inevitable proportion of DRS containers that will still be managed by local authorities, when consumers do not redeem their deposit and discard drinks packaging in household recycling or street bins. The result is a risk of evidence oversupply and depression of the market.
However, none of the proposals to alleviate this will be taken forward. Government have instead decided that producers will continue to buy PRN/PERNs on DRS packaging until the various schemes are live. After this, any containers in-scope of a DRS will be netted off PRN/PERN obligations.
This will mean a simpler approach for producers putting single-use drinks containers on the market, with only one cost per item once national DRS’ are implemented. Note that Scotland is ahead of the rest of the UK and their system will be operational in August 2023.
Reprocessors, exporters, and producer compliance schemes (PCS) will be obliged to undergo an operator competence test to gain regulator approval. Whereas we don’t yet know the detail of these tests it’s hoped they will improve PCS and reprocessor/exporter performance, reduce fraud, and improve public confidence in the system.
For producers, this could mean a better level of service from PCS and a reduced risk of bad actors entering the system.
The consultation ran until 21 May 2022, and government released its response on 28 October 2022. However, the adjustments to the PRN/PERN system will be introduced alongside the wider EPR legislation, in 2024.
The other key change to note in the PRN/PERN system will be the ‘single point of compliance’. Once the new EPR legislation is laid down and the system in operational in 2024, the financial and reporting obligations for a given piece of packaging will rest with one producer.
The current shared obligation approach – where businesses along the supply chain pick up a proportion of the recycling costs – will no longer apply. This means, if you are obligated under EPR as a brand-owner, for instance, you may see a steep increase in your PRN/PERN costs.
On 18 November 2022, we presented a live webinar to run through the changes to the PRN/PERN system, as confirmed by government in their published response to the PRN reform consultation. This included an explanation of the proposals that government confirmed will and will not be implemented and a live Q&A.
As Policy Manager Louisa provides key support to our team, including preparing reports on environmental policy issues and maintaining awareness of new developments.