PRN crowdfunding site launched to bring transparency to recycling industry
Circularety, the company’s new online platform, was launched yesterday (27 September) and has been designed to help producers invest in ‘concrete’ projects and programmes.
Under the Producer Responsibility Obligations (Packaging Waste) Regulations, introduced in 1997, producers that have a turnover of more than £2 million and handle 50 tonnes of packaging or more every year must provide evidence that a proportion of the packaging that they have supplied has been recycled on their behalf.
To fulfil these obligations producers have to purchase a packaging recovery note (PRN) or Packaging Export Recovery Note (PERN) from an accredited reprocessor or exporter for every tonne of material supplied.
At present, compliance schemes like ecosurety purchase PRNs from reprocessors and then sell them on to producers, with no connection between the two parties. Over £565 million has been spent on PRNs since the system became electronic in 2007.
However, through the Circularety platform, ecosurety plans to allow producer clients to invest their obligatory fees in specific reprocessor projects, with the aim of providing producers with more value.
Kickstarter for the waste industry
James Piper, Managing Director at ecosurety, explained to Resource that the Circularety platform will operate like crowdfunding sites like Kickstarter, with reprocessors listing projects that they need help to fund with information on the company and project. Users will be able to see the progress made towards the reprocessor’s goal and how many tonnes of PRNs are needed to fund the project.
Producers will be able to search for projects according to material and PRN type, investment opportunity (whether it is for new equipment or facilities, awareness campaigns or similar), project location, and the deadline a project needs to be completed by.
Those that invest in a completed project will receive a report detailing where and how their PRN money has been spent, which ecosurety says will enable them to communicate about their investment in the recycling industry to their stakeholders.
Piper said: “The PRN system is a good one in itself, because it has helped the UK to significantly increase its recycling rates over the years. However, producers and industry bodies have expressed concern about the system, which does not encourage transparency, particularly in relation to what happens to PRN money once obligations have been purchased.
“Producers want to see where their PRN obligation money goes, and reprocessors want to plan their investments strategically and get value from their evidence.
“Circularety means for the first time producers will be able to choose exactly where their PRN money is spent, and reprocessors will be able to put forward concrete investment projects that will benefit the recycling industry.”
Piper says that through improving the transparency of the PRN system, over time the Circularety platform could help to “remove price volatility from the PRN system caused by uncertainty over PRN supply and demand”.
The platform has also been designed to allow reprocessors to showcase their projects and attract larger sums of investment. All reprocessors that sign up to the system will be regulated to ensure they are delivering the project, and given a star rating, much like eBay, to show producers which have completed projects successfully.
Reprocessors will be required to make up the difference on any of their projects that do not receive complete funding. There will also be penalties at a contractual level to ensure reprocessors do not renege on their promises.
The website has launched in a beta state, allowing producers and reprocessors to try out the system with dummy PRNs and projects. The company hopes for the site to go live in January 2017.
More information can be found on the Circularety website, which is currently in beta.