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The second phase of a UK-wide consultation for a new packaging Extended Producer Responsibility (EPR) scheme was open until 4th June 2021. As of 2023, the proposed EPR scheme will alter  the way we deal with packaging waste.

The current EPR emerged from The Producer Responsibility Obligations (Packaging Waste) Regulations 2007. The fundamental idea of this existing framework is to ensure that producers pay for the full cost of sorting packaging materials at the end of their life. This scheme places the responsibility on producers who put packaging on the market to guarantee that post-consumed materials are managed properly. Under the current scheme, producers must buy Packaging Waste Recovery Notes (PRNs) or Packaging Export Recovery  Notes (PERNs), traded by reprocessed packaging organisations, in order to offset their obligations using the ‘producer pays’ principle. This, in turn, offers a guarantee that an amount of packaging, analogous to the categories applied in their products, has been recycled.

The price of PRNs fluctuates, depending on market conditions. In practice, producers do not contribute enough towards the costs related to managing packaging waste, as the funds raised only  cover 10%, on average, of waste management costs.

In other words, the current scheme has not been effective, as producers are far from contributing towards the full costs linked to sorting the  packaging materials that they release onto the market. This means that Local Authorities, other organisations and the Public in general are the ones who are paying for the majority of these costs.  Furthermore, although the funds raised by PRNs are expected to improve the packaging waste management infrastructure, it is not often clear whether this is happening.

There is also a certain lack of clarity around how the materials are being reprocessed, particularly when they are exported, and therefore it is difficult to ascertain whether end of life packaging is  being reprocessed correctly. Another reason that this scheme is not deemed to be effective is because PRNs are not associated with the recyclability, environmental impact or the full life cycle of  the packaging materials used. Moreover, the scheme does not promote the necessity of developing the design of new sustainable packaging, nor does it penalise producers for opting for materials  that are problematic to recycle. Consequently, very often products are sent to landfill or incineration after just one single use.

The proposed EPR will require producers to pay the full net cost of  treating packaging materials that they make available on the market. This new approach will also push towards a more sustainable packaging design and concepts and aims to generate less waste  at source. It also envisages having an impact on compliance, labelling, export, and on report and data requirements.

The new EPR scheme for packaging is intended to promote various other environmental advantages, such as reducing material use, improving packaging recycling and helping in litter prevention – which also constitutes a crucial contribution to achieving a more circular economy in the UK. It is also worth mentioning that this new scheme implies a UKwide approach. All the devolved  governments, along with their support agencies, are working together with the Westminster Government (acting for England) to inform the development of a new EPR scheme for packaging. The  UK Government will also report the overall recycling rates separately for England, Scotland, Northern Ireland and Wales. However, there is plenty of scope for the devolved nations to make some modifications that take into account their regional demands and priorities. For example, Scotland’s Deposit Return Scheme (DRS), which will come into force in July 2022, and will be complementary to the UK-wide packaging EPR scheme, where the main goals are to improve recycling rates, will increase the quality of recycling materials and significantly reduce litter.

The new EPR proposal covers all types of packaging employed in relation to the distribution and supply of products that are on sale in the UK, both single-use and reusable packaging. This will encompass packaging waste from households (and householdlike waste), commercial and industrial packaging arising from public sector sites, retail, hospitality and other commercial and industrial premises. The only materials that are exempt from the new proposal are drinks containers which are able to be recovered through Scotland’s DRS: exclusively for PET plastic, glass, steel  and aluminium. A similar scheme is being devised for England, Wales and Northern Ireland but is still under consultation. All other associated items are covered by the EPR scheme, for example:  plastic wrapping, cardboard and so forth.

The recycling target for packaging EPR equates to 73% by2030, and with the DRS the overall UK packing recycling rate  will be 78%. The new scheme will aim to focus on the following materials:  plastic, wood, aluminium, steel, paper/card and glass. Targets for fibre-based composites are being considered.

The new scheme proposes six types of obligated producers: brand owners, importers, distributors, online marketplaces, sellers and service providers. They will be required to pay fees to cover the costs of managing packaging waste: collection, sorting, recycling, and litter  and refuse costs. They will also be required to pay costs related to regulators, scheme administrators and national campaigns. The fees will be established by the regulator. Modulation method and  rates will also be set, according to the type of materials and how easy it is to recycle or upcycle them. An appointed valuechain led Scheme Administrator will participate in this process.

The proposal is for the new scheme to be implemented in two phases. Phase 1 will begin in 2023, while Phase 2 will start in 2024. In Phase 1, the focus will be to appoint a Scheme Administrator and  establish procedures; in Phase 2, fees will be raised from producers to compensate local authorities for the management of packaging, household waste and litter. Other steps will be, for instance,  the introduction of reuse and closed loop targets, the collection of plastic film and the introduction of the Mandatory Cup Takeback scheme.

Altogether, the new packaging EPR scheme will help to reduce the aforementioned issues, as well as driving a shift towards a more circular economy, ensuring that materials are used for longer and reprocessed to higher value use.

Auditel’s Carbon Strategy Group will keep you abreast of this hot topic and help you in making the right decisions.

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