EPR: Several questions still unanswered
Obligated producers in England, Northern Ireland and Scotland must now legally collect data which is to be reported to the Environment Agency. Producers had from 1 January 2023 to yesterday (28 February) to begin collecting appropriate data under Extended Producer Responsibility for Packaging (pEPR).
Obligated producers classified as ‘large organisations’ with a turnover of greater than £2 million and who handle more than 50 tonnes of packaging each year must meet the reporting requirement to give this data to Environment Agency twice a year, starting from 1 October 2023.
These producers will have to pay a fee to an environmental regulator and buy packaging waste recycling notes (PRNs) or packaging waste export recycling notes (PERNs) to meet recycling obligations under pEPR. A PRN or PERN is a certificate proving that packaging waste has been recycled properly.
Producers will have to pay an administrative fee and a waste management fee to scheme administrators for the packaging they handle and supply that is collected by local authorities from households or street bins from April 2024.
Environment Minister Rebecca Pow said: “We need to stem the flow of packaging which goes unrecycled and instead is lost forever to landfill and incineration.
“As set out in our Environmental Improvement Plan, these reforms will encourage businesses to increase their use of recyclable materials, shifting costs away from the taxpayer and supporting our work to protect the environment from the scourge of waste.”
At this important milestone in the implementation of an historic scheme, we take stock on what form the scheme will take, where we are at in terms of status, and how it will all work
The background to pEPR reporting requirements
Defra says that in 2020, 12 million tonnes of packaging entered the UK market. The scheme was announced as part of the 2018 Resources and Waste Strategy to be implemented in 2023 but was delayed until 2024.
Producers will collectively contribute an estimated £1.2 billion per year once EPR is fully operational. This will go towards the costs of collecting and managing household packaging waste, the responsibility for which is currently carried by local authorities.
Claire Shrewsbury, Director of Insights and Innovation at WRAP, said: “The introduction of an EPR for packaging could be a game-changer. If done effectively, it could reduce the impact packaging has on the environment by regulating material use and increasing recycling.
“For EPR to work it must serve all – producers, local and central government, recyclers, and the public. We’ve been working with these key groups since 2018 to help collaboration on pEPR.”
Final details of pEPR are yet to be determined with Defra saying that ‘before decisions are made about the final shape of the scheme, we need to gather information from businesses that will be affected’. The department is hosting several industry-wide sprint events, deep dive sessions and fortnightly forums to collect this data and keep the industry informed.
How much funding will local authorities receive?
One of the main motivators for EPR is the shift of financial responsibility away from local authorities and towards producers. No details on how the intended full net cost recovery payments to local councils will be determined or calculated have been released.
In November last year, the Blueprint Coalition identified EPR delays as having a knock-on effect and a ‘high-cost burden’ on local authorities.
Deep Sagar, chair of the Advisory Committee on Packaging, commented on the benefit pEPR could have for local authorities: “Packaging materials that are not recycled back into new packaging harm our natural environment. Councils have to spend more managing that waste and the public cannot enjoy spaces such as parks and high streets as they should.”
The Blueprint Coalition also identified that EPR delays mean that councils are absorbing the costs for waste innovation or are delaying innovation, setting themselves behind on climate goals.
When will EPR officially start and what will the waste management fees for 2024 be?
The scheme is scheduled to start in 2024, but the exact date is still to be confirmed – it is likely to be around April given that producers have been told this is when waste management fees will begin.
Defra says that the data it is currently collecting will provide the basis for establishing the packaging waste management fees individual producers will pay next year and that more information on the fees will be provided ‘as soon as we can’.
It had indicated that from 2025 the waste management fee will vary depending on the type of materials producers have reported. The fee will be lower for materials that are easier to recycle.
Small organisations with an annual turnover will also be liable to record and report data, and pay fees to an environmental regulator from 2024, but will be excluded from buying PRNs or PERNs, and paying administrative and waste management fees. These are classified as producers with an annual turnover between £1 million and £2 million and are responsible for supplying between 25 and 50 tonnes of empty packaging and packaged goods through the UK market.
When will producers in Wales need to start collecting data?
It still needs to be confirmed when reporting requirements in Wales will come into force, although Defra states that the nation will follow the rest of the UK ‘shortly’.
In a Welsh Government memorandum, it acknowledges that Welsh producers will be required to collect and report data from 2023, in order to inform the calculation of fees in 2024. It implies elsewhere that collection of packaging data will ‘become mandatory in March 2023’.
What are the penalty fees and how will enforcement work?
Defra has acknowledged that small and large organisations that miss their respective deadlines for packaging data reporting requirements will be liable to pay a penalty fee, but no information on the sum of these fees have yet been released.
Penalty fees will also be made if producers miss reporting requirements for nation data. Nation data – which country in the UK packaging has been sold, hired, loaned, gifted or discarded in – for the 2023 calendar year must be reported by 1 December 2024. It applies to producers which:
- Supply filled or empty packaging directly to consumers in the UK;
- Supply empty packaging to UK organisations that are not legally obligated under the regulations;
- Hire or loan out reusable packaging;
- Own an online marketplace where other organisations sell their empty packaging and packaged goods to UK consumers;
- Import packaging to the UK that you discard without selling or exporting it.