Defra has confirmed that its officials are looking at ways to “alleviate the pressure” that the high price of wood packaging recovery notes (PRNs) is having on the packaging waste sector. But, any swift action is not thought to be likely because Parliamentary time is limited for changes and a consultation would need to be made with the devolved administrations.
The confirmation of Defra’s involvement came in a statement after a recent meeting of the Advisory Committee on Packaging, where the packaging recycling targets for wood and rising PRN prices were discussed.
Wood PRN prices have risen from around £8-9 in January to approximate £70 at the moment. And, there is some concern that targets for next year might be met as there will be few wood PRNs to be carried over into 2019 and that high values could potentially encourage bad practice or even fraud.
Commenting on the market pressures, a Defra spokesperson said: “Following a meeting of the Advisory Committee on Packaging, where the packaging recycling targets for wood and the increase in prices for wood PRNs were discussed, Ministers have been notified of the impact this is having and Defra officials are exploring what can be done to alleviate the pressure this is having on industry. Officials will continue to liaise with the ACP as this work is taken forward.”
The move to potentially reassess the UK wood recycling targets, which Defra increased to 38% for 2018, rising to 43% next year and 48% in 2020, comes around a year after the EU actually cut wood recycling targets by around 50% because of the strong biomass demand for waste wood (see letsrecycle.com story). Back in April letsrecycle.com reported that there was uncertainty about future wood targets for the UK but since then Defra has been very reluctant to get involved.
However, the high prices of the wood PRNs and the fact that wood goes to biomass, which is seen as green energy, has prompted officials to raise the issue with recycling minister Therese Coffey although she is thought to think there is no easy answer and that a modified PRN system will be proposed in the forthcoming Resources and Waste Strategy.
As outlined in the table below, the EU-set targets were initially set out in 2015, requiring countries to hit much higher targets, however, under the latest target proposals which were finalised in the winter of 2017 the wood recycling numbers have been hugely reduced.
The UK has to meet the overall packaging target but does not have to adopt the targets for individual packaging categories, meaning it can keep its own targets if it would like to.
A higher PRN price has led some to say that this means that wood recycling will be largely increased and move further “up the waste hierarchy”, which prioritises recycling over biomass and energy recovery.
Julia Turner, executive director of the Wood Recyclers’ Association, said the issue will be raised at a board meeting next month.
“The WRA supports the waste hierarchy of reuse, recycle and recovery and we believe that PRNs are driving up the recycling of packaging which is what they were originally designed to do,” she explained.
Mrs Turner added: “We will of course monitor the situation and are due to have an indepth discussion about PRNs at our next Board meeting in December.”
Meanwhile, others in the industry have said they feel the market will naturally balance out over time, and any changes need to ensure that clean waste wood is recycled as much as possible.
Geoff Hadfield, managing director of Hadfield Wood Recyclers, explained that the high wood PRN ensures more packaging is recycled.
“The increase in prices for wood PRNs has been put in place by the Government to drive packaging materials into recycling rather than recovery, which is part of the agreed waste hierarchy and something we would support,” Mr Hadfield said.
The priority has to be ensuring as much clean packaging waste as possible is recycled.”Geoff Hadfield
Hadfield Wood Recyclers
The Hadfield’s MD added: “The increased targets for wood packaging have been well publicised since last year so they shouldn’t have come as a shock, and the current wood PRN price is no different than plastic PRNs have been for a number of years. I think the market will find its own level over time and will settle down, but the priority has to be ensuring as much clean packaging waste as possible is recycled.”
Another wood recycler and WRA board member, Jamie Plevin, of Plevin & Sons, remarked to letsrecycle.com that he considered the best way to help the market would be to ensure wood is recycled and not sent to biomass.
He said: “In my opinion the best way to “alleviate the pressure” regarding wood PRN’s would be for all generators of wood packaging waste to work with companies like Plevin who can guarantee the wood is recycled and processed into animal bedding products, rather than being lost to recovery through biomass.”
Robbie Staniforth of the compliance scheme Ecosurety, added that the clash between the subsidies offered in the Energy Renewable Heat Incentive and the high PRN price is worrying.
“The fact that there is conflicting government policy is bad news, and I think it is a great concern. I think its sensible to look at the situation, and while I don’t claim to have all the solutions I have been talking about this for many months,” he explained.
Mr Staniforth added: “I think whatever happens; the government needs to give justification either way. It is a very complicated system with many differing incentives.
“Another big concern is that the 2019 market is open. People have made forward deals and therefore urgency is key here. The PRN market operates on conjecture, for sure, but the last thing we need is even more. It is good to hear it is being looked at but need to be resolved quickly.”