A new protocol requiring packaging recovery notes (PRNs) to be issued for end of life vehicles (ELVs) could be set to greatly increase the burden on de-pollution sites.
The Environment Agency (EA) is said to be looking into whether any part of the body of a car can be considered as packaging and therefore, if ELV sites should be required to issue PRNs after the component parts have been broken down for recycling.
An industry insider said: “Between 0.5% and 10% of any commodity can be considered as packaging and the EA has employed an organisation to look through the car body to see if they can find any packaging in it.
If the EA finds just half a percentage of a car’s body can be considered as packaging, the implications will be massive for companies that process vehicles. Currently, aluminium PRNs are trading between £100-£140 per tonne, and for those yards that process thousands of cars a year, the sums involved could run into six figures.
The PRN system is the accepted way for obligated companies to demonstrate their investment in recovering and recycling their packaging waste.
For every tonne recycled, a PRN is placed on the open market as evidence of the process, with companies calculating their obligation under the Packaging Waste Regulations and purchasing the equivalent number of PRNs to demonstrate they have met their obligation.
While any money received for a PRN is reinvested into the re-processors business, guaranteeing a continuous stream of investment flowing into packaging recovery and recycling, any new legislation would add further demand to a practice that already requires a waste management license.
With a new protocol possibly encompassing all forms of scrap metal, this could also have an effect on the value of aluminium and steel PRNs.
With the current trading price of aluminium PRNs said to be unrealistically high, analysts believe the value will drop considerably from its current high of £140-a-tonne.