The Producer Responsibility Obligations (Packaging Waste) (Amendment) Regulations 2014 bring measures first outlined by the government in March 2014 (see letsrecycle.com story) to cut the targets for 2014-17 into force. They also see the percentage of the target which has to be met through remelt increased (see table).
The changes include reducing the glass target for this year from 81% to 75%. This target will then rise 1% per year up to 2016, when it will reach 77%.
Intended to cut the costs of buying PRNs for obligated businesses while still meeting the requirements of the EU Packaging and Packaging waste Directive, the move has already seen the price paid for glass PRNs fall from highs of £60 for remelt in February 2014 to as low as £19 last month, while prices for aggregates have fallen from highs of £45 in February to as low as £18 in October.
Lost revenue
However, an impact assessment for the changes released at the time of the announcement highlights how glass reprocessors and exporters were subsequently expected to lose £106.9 million in lost PRN revenue, while material recycling facility (MRF) operators were also due to lose out.
In an explanatory memorandum published yesterday (November 3) alongside the amended regulations, the department for Environment, Food and Rural Affairs said that the majority of respondents to a consultation in December 2013 were in favour of reducing the glass targets and claimed that the amendments would deliver estimated net benefits of £2.23 million over four years.
Costs
The impact assessment accompanying the amendments said: “The adjustments are required because of new information on the flow of glass packaging and the discovery of fraud in previous years. This evidence reveals that the business targets set for packaging producers had been set too high causing high costs and significant overachievement against the EU targets. The intended effect is to reduce costs for packaging producers and reduce the social costs associated with the current targets.”
The Packaging Waste Regulations require businesses to pay towards the costs of recycling waste packaging, based on the target for the year in question as well as they amouth they handle and the category of business they fall within.
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