Packaging Recovery Notes (PRNs) for plastics could rise more than ten times their current value to around £65 if ministers introduce proposed new recycling targets, packaging experts have predicted.
Duncan Simpson, marketing director of leading compliance scheme Valpak, predicted PRNs for plastics could rise to between £35 to £65 a tonne as targets rise betwen 2013 and 2017.
“We think there would be a shortfall in PRNs with the plastic target but not to a massive extent. We think prices could rise to £35 to £65 a tonne,” said Simpson during a Westminster debate hosted by the Associate Parliamentary Sustainable Resource Group.
Simpson stressed it was extremely difficult to accurately predict the increase in PRNs values and that it was therefore crucial ministers were not dogmatically wedded to the targets.
“It is important that there is a bi-annual review of the targets and that ministers are not afraid to adjust them accordingly,” he told MRW.
The MRW materials pricing report recorded plastics PRNs at between £5 and £6 a tonne as of 2 March.
Defra’s consultation on recovery and recycling targets for packaging waste for 2013 – 2017, has outlined plans to increase the plastics recycling target by 5 percentage points per year, from 32% in 2012 to 57% by 2017.
Ministers have pledged to announce a final decision on new “tougher” packaging targets - opened to consultation in December 2011 - in this month’s Budget.
The PRN system has come under mounting criticism by reprocessors who have urged ministers reform it.
Reprocessors said increasing the targets without a more balanced system for issuing PRNs and packaging export recovery notes (PERNs) could have perverse effects.
Consultant Paul Levett, who advises plastics reprocessor Closed Loop Recycling, said: “We have raised the issues surrounding the PRN system with the Government on numerous occasions. We would very much like to see a review announced in the Budget.”
Plastics leacers say the existing PRN/PERN system has provided an unfair advantage to the exporters of plastic scrap over domestic reprocessors.
ECO Plastics managing director Jonathan Short said: “If 20 tonnes goes into a container then 20 tonnes of PERNs can be issued. When we process material through our plant [weight] loss rates start at 10% and often surpass 30% by the time we have a product upon which we can claim a PRN,” said
While PRNs are very lowly valued this makes little difference, said Short. But as they rise in value – which is likely to happen with the increase in targets – then domestic reprocessors would become disadvantaged.