The High Court ruling on a case brought by Valpak and the Environment Agency determined that brewers should no longer be obligated as the 'seller' under UK packaging regulations (see letsrecycle.com story)
. It is thought by some compliance schemes that a significant proportion of the UK's glass obligation has been lost as a result of this – leading to a drop in demand for glass PRNs.
One compliance scheme insider told letsrecycle.com that with the 'seller' obligations passing to individual pubs, clubs and bars, many businesses would be too small for the packaging waste regulation threshold. Under the UK's rules businesses that handle more than 50 tonnes of packaging a year or have a turnover of more than 2 million are obligated to ensure a certain amount of packaging waste recovery takes place.
This would mean that a significant amount of glass packaging from alcoholic beverages would no longer need to be recycled under the UK's regulations, and some compliance scheme clients would no longer need to buy glass PRNs. A fall in demand would lead to a drop in value for glass PRNs – adding to the weakening affects of the announcement of next years' targets and the Environment Agency's announcement of obligation figures for the first half of 2002.
Reeling
Glass reprocessors are still reeling from the effects of DEFRA's “kick in the teeth” announcement that 2003 packaging waste targets would be the same for the UK as those in 2002. However, although there has been an “ominous” drop in value for glass PRNs since that announcement, there has so far been no noticeable drop in demand as far as reprocessors have seen. But one reprocessor said that whatever the truth about glass PRN demand, the picture is already fairly gloomy.
One independent analyst also allayed fears of a drop in demand. He said that although there might be a decrease in the amount of glass recycling needed to meet the UK industry's material specific target (currently at 19%), there would always be the demand for more glass recycling to help meet the overall recovery target (currently at 59%). Glass is a material that local authorities find comparatively easy to collect because of its density compared to other materials such as plastic.
The expert said that although figures from the Environment Exchange suggested a slight weakening in the glass PRN last week, such an isolated figure couldn't prove that prices would continue to move that way and was no evidence that the demand for glass PRNs was being affected by the brewers' ruling at the High Court. Research carried out by letsrecycle.com has confirmed that the price that glass PRNs are changing hands has dropped slightly over the last few weeks.
Unaware
Graham Margetson, director of Foresite Systems, a company that produces software to assist companies in working out their compliance, warned that some companies who were handed obligations by the High Court ruling still don't know that they are obligated.
“Companies that were previously unobligated will now have to comply with the regulations and many will be unaware of the substantial fines they risk if they do not comply. Unfortunately, ignorance is no defence,” he said. “Examples calculated by Foresite’s National Packaging Database show that one tonne of weight is not hard to accumulate in a busy club – it is approximately equal to only 4,000 bottles of beer.”
Newly obligated companies have until December 2002 to register with the regulator of the packaging waste compliance system in England, the Environment Agency. Those companies must register compliance retrospectively from January 2002. It is thought that the Environment Agency will have quite a task to track down all the companies that do need to register before the deadline.
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