In 2013, China sent shock waves through the recycling world in the west by launching Operation Green Fence, a campaign that rejected at least 800,000 tonnes of substandard recyclable waste imports and withdrew 247 import licenses. This focused minds in the UK, because we have grown dependent on exports of low quality recyclate, which our producer responsibility system accidentally encourages. Unfortunately, no lasting action was taken to fix the problem, and now things look set to get much worse.
UK producers have little responsibility for packaging
Producer responsibility schemes have a simple premise: those who create products and packaging – and who, therefore, control their design – should also be accountable for the environmental and end of life impacts of those products and packaging. It’s an obvious and neat application of the ‘polluter pays’ principle.
The majority of European countries require producers to finance most, if not all, of the collection and treatment costs of their packaging. The UK, in contrast, has a system where packaging producers finance just ten per cent of these costs. The remaining 90 per cent is largely borne by local authorities and, ultimately, by council tax payers. At a time of tightening budgets, this is increasingly unreasonable.
Industry wants reform
Industry criticisms of the UK’s system, which is based on tradable evidence notes, abound. In addition to the unfair distribution of costs, commentators have condemned the scheme’s lack of transparency, its price volatility and, perhaps most significantly, its bias towards export.
In essence, the tradable notes come in two forms: Packaging Recovery Notes (PRNs), issued at the point of actual recycling, and Packaging Export Recovery Notes (PERNs), issued at the point of export, with little more than a promise that exports will end up being recycled. This indirectly encourages poorer collection, as low quality material that can’t be recycled in the UK can instead be shipped abroad. Recycling becomes somebody else’s problem.
This uneven playing field has been implicated in the failure of two of the UK’s world leading recyclers: Closed Loop Recycling, which was the country’s largest supplier of recycled plastic for milk bottles (rHDPE), and Eco Plastics, once one of Europe’s largest producers of food grade recycled plastic (rPET). It’s hard to compete if your competitors don’t have to meet the same standards as you.
Even producers, who would end up paying a bit more for higher responsibility, are starting to advocate for change: Coca-Cola GB, the UK’s largest soft drinks producer, wants “significant” reform of the system.
Odd that Defra thinks the system works
Given the consensus on reform, Defra’s stance is surprising: its post implementation review of the UK’s recycling framework, quietly released earlier this month, says that the PRN system works and should be kept. Perhaps more surprising was the Regulatory Policy Committee’s judgement that Defra’s review was “fit for purpose”, despite the fact that it provided no evidence to support its “claim that there were no unintended consequences from the regulations”.
Arguments for unintended consequences don’t get much more compelling than an unfair burden on the public purse and a disadvantage to the UK’s economy, created by allowing exports of poor quality material to undermine domestic recycling infrastructure, as well as the loss of jobs that well collected, higher quality material could support.
We may have to increase landfill again
Defra’s lackadaisical approach is racking up risks for the UK. China, one of the main destinations for UK exports, is set, once again, to crack down seriously on the quality of the plastics, paper and other materials that we send its way with a more aggressive programme than Green Fence, judging by its name: National Sword.
As part of this operation, China last week notified the World Trade Organisation of its intention to ban the import of “foreign garbage”, exactly the sort of thing the UK’s PRN system creates. Some commentators have claimed the announcement will bring “chaos” in meeting targets, as well as exceptionally high PRN and PERN prices.
If China manages to close the door on our substandard recycling, the industry will be in a pickle: it will have to scramble to find another country willing to accept our “foreign garbage” or we will have to send more to landfill or incineration.
But there is a better option: Defra, alongside many willing and able stakeholders, could take the opportunity to build high quality recycling plants and institute the recycling reforms that we so desperately need. Improving the flawed producer responsibility system that helped to get us into this mess in the first place would be a good place to start.