2019 PRN Revenue Expenditure

The Environment Agency (EA) has recently released data outlining the expenditure of revenue generated through PRN(PERN) sales throughout 2019 by accredited reprocessors and exporters. As per 2018, total revenue has increased again and this time by an even more substantial amount. The higher revenues are the result of record high average price levels for PRNs experienced across a number of different packaging materials

As a reminder, the PRN system is designed to function in a way that during periods of market pressure and high prices, UK accredited reprocessors and exporters are encouraged (by additional financial gain) to recycle extra tonnes of packaging waste and also, the higher prices will potentially attract new start-up reprocessors and exporters into the market. In theory, such increased recycling activity will increase the PRN supply so that it is more in balance with PRN demand and this should then ease the original price pressure on the market.

This intricate relationship of price rises, additional supply incentives and supply increases was very evident in 2019, particularly for the two materials (Plastic and Aluminium) with the tightest supply. For the majority of 2019, it appeared likely that the UK may well miss its overall recycling targets. However, as described, as prices rose to record levels, more and more reprocessors and exporters were incentivised to handle (process) additional packaging waste materials and by the close of Q4, enough PRNs were generated to ensure the UK hit all of its material recycling targets. This was quite an achievement given the recycling data published throughout the year indicated it was most unlikely. In fact, there was a reasonable amount of surplus from the December 2019 generated PRNs that could then be carried over into 2020.

However, the key difference for 2019 compared to previous years is that the total PRN spend required to hit the 2019 targets, has been significantly higher. In 2019, at their peak, Plastic PRNs reached prices of almost £500 per tonne, and Aluminium surpassed the Plastic milestone, having traded at prices in excess of £500 per Aluminium PRN. The 2019 high prices were also prolonged for around three quarters of the year. In addition, the 2019 recycling targets were higher than previous years, meaning that the total 2019 UK PRN obligation was also higher than in any previous year. The combination of higher prices and a higher total UK PRN obligation, meant that the total cost for UK Producers to achieve compliance was by far the highest we have ever since the regulations were set in place back in 1997.

Figure 1: Total UK PRN revenue 2015 - 2019

Figure 1 shows how in 2019, the total figure of £366,951,972 was generated through the PRN system, compared to the previous high recorded last year, of £130,588,550. An increase of 181%.

As well as releasing information regarding total revenue, this is also detailed by material and then by category of re-investment. This information is available as all accredited UK reprocessors and exporters must detail to the Environment Agency where the money generated through PRN sales have been re-invested back into the UK recycling system. All revenue has to be re-invested for the regulations to succeed, which is why a hard stance is taken on any reprocessors or exporters who either fail to report or are found to be fraudulent in their generation of PRNs or reporting on investment.

Figure 2.1: Total 2019 PRN revenue investments for UK Reprocessors vs UK Exporters

Figure 2.2: Total PRN revenue investments by activity 2019

As with previous years, when reporting this information, reprocessors and exporters must categorise their investment. As you can see from figure 2.1, the categories are still stated as:

  • Infrastructure and capacity
  • Funding collection
  • Reduction in price and developing new markets
  • Cost of complying with the regulations
  • Retained for future investments
  • Developing communication strategies

The results of this year’s reporting highlights show once again, the three most popular and significant categories for re-investment are ‘Infrastructure and capacity’, ‘Funding collection’ and ‘Reduction in price and developing new markets’. However, the proportion of which category is invested in most contrasts between the UK reprocessors generating PRNs and UK exporters generating PRNs.

Figure 3.1: Total PRN revenue investments by UK reprocessors by activity in 2019

Figure 3.2: Total PRN revenue investments by UK exporters by activity in 2019

Figures 3.1 and 3.2 illustrate how UK reprocessors focus most of their re-investment into ‘Infrastructure and capacity’, followed by ‘funding collection’ and finally, ‘developing new markets’. Conversely, exporters re-invest most revenue into ‘developing new markets’, followed by ‘funding collection’ before then investing in infrastructure. This has been the case for the last couple of years, however, this year, the figures indicate that the proportion of investment into ‘infrastructure and capacity’ is down from 33% to 25% despite it still being the most popular category for UK reprocessor re-investment.

It remains to be seen why this is the case, however, it may well be due to the fact that reprocessing in the UK is already developing and that with this injection of cash generated by PRNs, they can start to invest in other more expansive areas to become a much more complete operation. Only time will tell however; judging by the channels of investment alongside the sheer amount of money, it should only be positive news for the UK recycling industry.


More money than ever before passed through the UK PRN system in 2019 and despite this not being a surprise, the final figure of over 360 million pounds is really quite breathtaking. Many commentators might say that such higher costs to Producers are now here to stay as the government looks towards new packaging producer responsibility legislation from 2023 onwards. Estimated costs under the new potential models of compliance in the future are much higher again for Producers than the £360m paid for PRNs in 2019. In fact, they are estimated to be more than double! There seems little doubt that we are in a period of transition now as we move towards the end of the PRN system and towards new regulations.

2019 was indeed an unprecedented year in terms of PRN costs and therefore, a very financially challenging one for UK producers. There is no doubt that the additional costs have been discussed at the highest management levels within Producer organisations and how to move towards more sustainable packaging is now higher on the list of priorities for Producers. It will be the Producers that take action now (more recyclable packaging, recycled content etc.) that will ultimately benefit from lower financial costs when the new UK packaging regulations are implemented in the coming years.

We hope this overview is helpful and informative, as well as bringing some needed transparency for Producers in terms of getting a better feel for just how their PRN spend has been invested. Our goal at Comply Direct is to keep supporting UK reprocessing as much as we can whilst also continuing to deliver competitive PRN prices to our member Producers.

If you have any further queries regarding 2019 PRN revenue expenditure, please don't hesitate to get in touch with our packaging team who will be more than happy to advise - packaging@complydirect.com / 01756 794 951