Compromise possible for PRN battle in light of protocol rules

The European Court is still to to decide on the main argument. However, there is every expectation that the UK's High Court will rule in favour of the five parties – who include the government and steelmakers ASW and Corus – on an interim matter covering monies raised from the sale of PRNs. The five were in court this week to argue against an earlier court ruling.

The earlier ruling found that for an interim period (until the European Court hears the case) the money steelworks raised through the sales of certain PRNs should be put into a bank account and left untouched. This would apply to PRNs sold for material – mainly drums – contained in fragmentised scrap supplied by Mayer Parry Recycling. The scrap is used by the steelworks to make new steel.

Speaking earlier this week to letsrecycle.com, Andrew Mason, environmental controller for Mayer Parry Recycling (now part of EMR),had warned that the company might choose to take packaging material out of grade 3B fragmentised material used in the domestic market.This material would then be added to export tonnages.

This would mean that more packaging material – mainly drums – might be contained in export material and the company would get hold of export-PRNs for the material from overseas steelworks.

But, questions are now being asked as to what extent this would benefit Mayer Parry/EMR. This is because there is a strict protocol agreed with the Environment Agency on how much packaging per tonne is eligible for PRNs.
It is unlikely that the Environment Agency will allow more than the current 4% and so if a tonne of export material contained packaging above this amount it would in effect be lost. Although Mayer Parry would get export PRNs, it might see the price it receives for material in the UK reduced as at least one of the steelworks – ASW – says it has been subsidising the amount it pays for the scrap with the PRN cash.

Now, observers expect the two steelworks and EMR to sit down and try and reach some sort of agreement in a few week’s time.