19 July 2019

Levelling the playing field in plastics recycling

OPINION: Steven Walsh, sales engineer at sorting technology specialist TOMRA Sorting UK discusses how amending a disparity in how PRNs and their export equivalent, PERNs, are claimed could result in a boost in investment in recycling in the UK.


The disparity between the values (packaging recovery notes) that can be claimed for exporting waste packaging material or keeping that material here in the UK for further reprocessing poses a real threat to both our circular economy and our ability to achieve the higher recycling targets set out in Defra’s Resources and Waste Strategy.

Steven Walsh, sales engineer, TOMRA

Under the current PRN system, the value of a packaging export recovery note (PERNs) for one tonne of plastics assumes that the material you export (be that mixed plastics or pre-sorted single stream) is 100% recycled and therefore exporters can claim 100% of the PERN value and pass it through the value chain. On the other hand, if the material is kept in the UK for further reprocessing, and assuming only 70% can be recycled, processors can only claim 70% of the PRN (packaging recovery note), reducing what they can pay for material.

This disparity isn’t new as such, but historically it hasn’t been that much of a concern because as a nation we have been happy to export plastics to the likes of China and the Far East. Now though, with the Chinese National Sword banning plastic imports, Brexit looming on the horizon and plastic recycling (and pollution) very much in the spotlight, it is imperative we focus our efforts on stimulating growth in our domestic plastics recycling markets, rather than favouring the export of lower-quality materials to largely unregulated markets.

Plastic PRN prices have quadrupled in the past two years, putting compliance schemes and obligated businesses under financial strain. In June we saw plastic PRNs reach their highest price so far this year and, other than a few slight fluctuations, they have stayed high ever since.  On top of this, PRF (plastics recycling facilities) operators who are responsible for sorting the plastics are struggling to source enough infeed material at the right price from MRF operators. It’s easy to see why MRF operators are choosing to export the material instead of selling it to PRFs for further processing. When PERN prices are so high there is no incentive to keep the material here in the UK for use in domestic end markets.

Extended Producer Responsibility

Unfortunately, there is no ‘quick fix’ to this problem and in some ways the industry will have to ride out the storm until decisions are made on the Extended Producer Responsibility (EPR) and the legislation takes effect in 2023. EPR will hopefully stimulate growth in domestic sorting of different grades of plastic, but that that’s still four years down the line, so we must take steps now to address this situation. If, for example, lobbying groups can put pressure on Defra to introduce some kind of balancing calculation between PRN and PERN prices, this would go some way towards creating a more level playing field.

The UK has made great strides in increasing plastic recycling rates and improving plastic recycling quality in recent years, but there is a real risk that this progress will be undermined by the inadvertent encouragement to export. There are a number of drivers for keeping our collected plastics material here in the UK and aiming for better domestic circularity. The UK boasts much better environmental controls than almost all of the countries we export to. This means we’re more responsible when it comes to managing the risk of plastic pollution, and we won’t ‘dump’ the unwanted material captured in the recycling process. UK waste companies are also more likely to invest in full-scale infrastructure projects with advanced waste management techniques and technologies due to a consistent volume and composition of materials collected from households. The latest TOMRA sensor-based sorting technology, for example, can capture 95%+ of the target material with 95%+ purity for use in domestic markets. And, by improving the UK’s domestic recycling infrastructure, we will also create job opportunities.

Exporting our plastics opens us up to exchange rate volatility, losing control of the material and the unknow environmental impact of our actions. Why would we choose to damage the infrastructure that we’ve worked so hard to establish and discourage growth in our domestic plastics markets? Irrespective of the fluctuations in the PRN value, the disparity between the amount that can be claimed when exporting or keeping the material for domestic use still exists and must be addressed before it creates even more volatility in the plastics markets.

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