Adds proposal to stop pre-consumer content from counting towards PPT threshold and elaborates on allocation methodology proposal
The UK government has launched a consultation into the potential for a mass balance approach to be permissible for allocating chemically-recycled content to plastic for the purposes of the country's plastic packaging tax (PPT).
Under current rules, both chemically and mechanically-recycled plastic can contribute towards the 30pc recycled content threshold above which plastic packaging sold in the UK is exempt from the £210.82/t ($275/t) PPT. But mass balance accounting — used to determine recycled content arising from processes such as pyrolysis that produce steam cracker feedstocks, from plastic waste that are then mixed with virgin feedstocks for processing — is not permitted.
The consultation asks for comments on the potential effect on investment in UK chemical recycling and the best ways to communicate inclusion of chemically-recycled content to the public without undermining confidence in the recycling industry.
One area that is likely to generate considerable debate is the choice of rules around how recycled content can be allocated to cracker products. It is difficult to fully align the information provided about the methods proposed with the manufacturing process for polymers, andthe chosen method has the potential to significantly affect the returns that cracker operators could expect from using recycled feedstock, such as pyrolysis oil.
The government proposes to exclude a 'free allocation' approach, which gives companies full flexibility to label any of their cracker products as recycled based on the amount of recycled feedstock used. It said this method is "least aligned with the aims of the tax, which is to encourage the use of recycled plastic in new plastic packing components", but invites responses on this potential exclusion.
It is instead proposing one of three allocation methods. In one, recycled content is allocated equally across all cracker products. In the others, cracker products that are not used for polymer production cannot be labelled as recycled but are accounted for in the calculation as having consumed some of the recycled feedstock, thereby reducing the amount that can be allocated to polymer products.
The government is also seeking to determine how companies will be allowed to allocate recycled content internally within their production systems. It proposes to rule out an enterprise-wide approach in favour of a site or batch-specific approach, whereby recycled content can only be allocated if recycled feedstock is used at the specific production site or in the specific batch.
It also proposed that, alongside acceptance for mass balance accounting, it would move to stop recycled content from pre-consumer waste from counting towards the PPT threshold. This is also likely to provoke considerable debate, as it is common for converters to re-use production scrap from their own processes for new products as a form of recycling.
"Chemical recycling offers a complementary route to mechanical recycling," the government said. "Both approaches are typically preferable to sending waste to landfill or energy from waste facilities."
It said it would be examining the carbon impact of commercial-scale chemical recycling and called for submissions on the comparative carbon impact of chemical recycling with incineration or landfill. The consultation will run until 10 October, and the government will "aim to analyse responses and publish a formal response document as soon as possible after the end of the consultation period."
