PRNs and PERNs explained: what they are, who pays, and what they cost in 2026
A plain guide to packaging recovery notes and packaging export recovery notes: who has to buy them, why plastic PRN prices nearly doubled in 2026 before the market turned in September, and the four places producers lose money without noticing.
- Written by
- David Hitchen
- Published
- Read
- 7 min
- Filed under
- PRN · PERN · Packaging EPR · Compliance
- Plastic PRN, January 2026
- £245–370/t
- Published monthly range at the start of the year
- Plastic PRN, August 2026
- £475–625/t
- The same obligation, seven months later
- UK plastic reprocessing capacity
- 23%
- Share of plastic packaging placed on the market we can reprocess here
If your business handles enough packaging, the law makes you pay for a share of it to be recycled. You do not do the recycling yourself. Instead you buy proof that somebody else did.
That proof is a certificate. A PRN, or packaging recovery note, is issued by an accredited UK reprocessor when it recycles a tonne. A PERN, or packaging export recovery note, is issued by an accredited exporter when a tonne goes abroad to be recycled. One note, one tonne.
You buy the notes, the money goes to the recycler, and the regulator checks at the end of the year that you bought enough. Prices move like any other market. In 2026 they have moved a very long way.
Does it apply to you
Two numbers decide everything
Your packaging tonnage last year, and your worldwide turnover. Those two figures decide whether you are outside the rules, a small producer with a reporting duty, or a large producer who has to buy PRNs and PERNs.
| Turnover | 25 to 50 tonnes | Over 50 tonnes |
|---|---|---|
| Under £1m | No obligation | No obligation |
| £1m to £2m | Small producer: register and report once a year, no notes to buy | Small producer: register and report once a year, no notes to buy |
| Over £2m | Small producer: register and report once a year, no notes to buy | Large producer: register, report every six months, buy PRNs and PERNs, certify compliance, pay disposal fees |
The bill
Three separate charges on one piece of packaging
This is where most people get confused, because the three are often described as if they were one thing. They are not, and they are paid to different places.
Charge one
EPR fee
A per-tonne fee on household packaging that funds council collections. Charged on what you place on the market, whether or not it is ever recycled. Paid to PackUK.
Charge two
PRN or PERN
Evidence that a tonne was actually recycled. Bought on an open market, with the price set by supply and demand. Paid to the recycler.
Charge three
Plastic Packaging Tax
A tax on plastic packaging containing less than 30% recycled content. Avoidable by changing the material. Paid to HMRC.
All three charges are calculated from the same underlying number: the tonnage you declare. Get that number wrong and you pay for the error three times over.
How it works
How a tonne of waste becomes a certificate
- 01AccreditationA reprocessor or exporter applies to its environmental regulator for accreditation, by material and tonnage band. Without it, no notes can be issued at all.
- 02Material inWaste is weighed onto the site. The operator works out how much of it is genuinely UK packaging waste, using its own sampling and inspection plan.
- 03Recycling, or exportA UK reprocessor puts the material through the recycling process. An exporter ships it to an accredited overseas reprocessor, and since January 2026 must wait for confirmation it arrived before raising a note.
- 04Note issuedOne note per tonne, entered on the regulator's system, stamped with the material and the compliance year.
- 05SoldDirectly, through a compliance scheme, or through a broker or trading platform. Around a quarter of all notes pass through brokers.
- 06Obligation dischargedThe producer, or its scheme, holds enough notes to cover its obligation for each material and certifies compliance for the year.
The money runs the other way: from the producer, through the note, to whoever did the recycling. That is the whole point of the mechanism, and it is worth holding on to when you read arguments about scrapping it.
What it costs
PRN prices in 2026, and how far they moved
| Material | January | August |
|---|---|---|
| Plastic | 245 to 370 | 475 to 625 |
| Wood | 8 to 22 | 60 to 85 |
| Steel | 8 to 20 | 50 to 82 |
| Aluminium | 30 to 85 | 50 to 80 |
| Paper | 2 to 6.50 | 8.50 to 14.50 |
| Glass, remelt | 110 to 130 | 95 to 99 |
Plastic gets the headlines because the pounds are big, but in proportional terms wood and steel moved furthest, going from almost nothing to a real cost line: wood multiplied by 4.8 and steel by 4.7 between January and August. Glass was the only material that fell.
Prices did not rise because recycling collapsed. They rose because the supply of evidence seized up. The old reporting database was switched off on 31 December 2025, its replacement could not issue notes until mid February, and on the same day the rules changed so exporters had to wait for proof of arrival overseas. Three administrative decisions, one compounding shortage.
The market then turned in September. Plastic came off sharply inside a few trading days and levelled out, on nothing more than the expectation that government would step in, before anything at all had been published. The September figures appear in the first week of October and will be the first confirmation of that in the public series.
Two things follow from that. A spot price quoted to you today may be a long way from the published monthly range, in either direction, so ask which one you are being shown. And a fall on expectation is not the same as a fix: nothing about it changed how much material the UK can actually reprocess.
Which is the harder number underneath all of this. The UK can only reprocess about 23% of the plastic packaging it puts on the market each year, so in a tight year there is nowhere for the demand to go.
Where the money leaks
Four places businesses lose money without noticing
Your tonnage is probably too high
Old pack weights, discontinued lines, components counted twice, imported packaging in the wrong category. Every over-declared tonne is paid for twice, once in notes and once in EPR fees. When the regulator audited producers in 2025, four out of five audits ended with the data being resubmitted.
Missing data defaults to red
Under the modulated fee system, packaging rated red pays a multiplier on the base fee. If you do not submit the recyclability assessment, you are rated red by default. A pure paperwork cost with nothing behind it.
Buying late in a rising market
If your scheme spot-buys your obligation in the last quarter, you pay whatever the market is that week. Schemes that buy forward across the year pay closer to the average. Most producers have never asked which one theirs does.
Nobody owns the number
Packaging data usually sits between procurement, finance and technical, and belongs to none of them. That is how a tonnage figure goes five years without anybody checking it.
Do this
Five questions to put to your compliance scheme
If you are a large producer and you ask nothing else this year, ask these. The answers tell you whether your bill is a market problem or a management one.
- What percentage of my obligation for this year is already covered?
- What average price did you pay for it, by material?
- What is my exposure on the balance if it has to be bought in the fourth quarter?
- Do you offer forward, fixed-price or capped arrangements, and did you offer me one this year?
- When did you last challenge the tonnage figures I give you?
Reform
The bits that are still moving
- Defra consulted on reforming the PRN system between 24 March and 5 May 2026. The proposals include a single measurement point for reprocessors and exporters, a time-limited review of the standard assumptions used in place of measurement, a power to cancel notes issued improperly, registration for brokers and trading platforms, and a last-resort mechanism for years when evidence genuinely is not available. The government response has not been published.
- A Regulatory Position Statement was expected in late September 2026, understood to set enforcement thresholds by material for producers and schemes that cannot meet their obligation. It had not landed at the time of writing.
- Retail bodies are pressing to fold PRNs into the EPR fee entirely. More than twenty recycling and reprocessing organisations wrote to the Chancellor in May 2026 opposing that.
- Deposit return schemes will eventually remove in-scope drinks containers from the PRN obligation in each nation as they go live.
Practical consequence: do not build a 2027 buying strategy on 2026's rules, and be careful about committing heavily at the top of the market while mitigation is still being written.
Glossary
PRN and PERN jargon, defined
- Obligation
- The tonnage of each material you are legally required to fund the recycling of this year.
- Accredited reprocessor
- A UK recycler approved by its regulator to issue PRNs.
- Accredited exporter
- A business approved to issue PERNs on material sent abroad for recycling.
- Compliance scheme
- A company that registers, reports and buys evidence on your behalf for a fee.
- Compliance year
- The calendar year your obligation is calculated and discharged against.
- Carry-forward
- Evidence issued in one year and used against the next year's obligation, within limits.
- Modulated fee
- An EPR fee adjusted up or down according to how recyclable the packaging is.
- RAM
- Recyclability Assessment Methodology. The scoring that decides green, amber or red.
- Protocol, or AAIG
- A standard assumption about how much of a waste grade counts as packaging, used instead of measuring.
- Sampling and inspection plan
- The operator's own written method for deciding what proportion of incoming material qualifies.
- gov.uk guidance on packaging waste producer responsibilities, 2026
- Environment Agency, packaging waste compliance data, 2026
- Defra, consultation on reform to the PRN system, 24 March to 5 May 2026
- letsrecycle PRN price series, 2026
- The Environment Exchange market reports, 9 September 2026
Questions
Frequently asked
What is a PRN?+
A PRN, or packaging recovery note, is a certificate issued by an accredited UK reprocessor when it recycles one tonne of packaging waste. Obligated producers buy PRNs as evidence that recycling was funded on their behalf. One note represents one tonne of a specific material in a specific compliance year.
What is the difference between a PRN and a PERN?+
A PRN is issued when the material is recycled in the UK. A PERN, or packaging export recovery note, is issued when the material is exported to an accredited overseas reprocessor. They count the same way against your obligation. Since January 2026 an exporter has to wait for confirmation that the material arrived overseas before raising a PERN.
Who has to buy PRNs?+
Large producers: businesses handling more than 50 tonnes of packaging a year with a turnover above £2m. They register, report every six months, buy PRNs and PERNs, and certify compliance. Businesses under 25 tonnes or under £1m turnover have no obligation, and those in between are small producers who register and report but buy no notes.
How much does a PRN cost in 2026?+
It depends entirely on the material. Plastic opened 2026 at £245 to £370 a tonne and reached £475 to £625 by August, before the market turned in September. Wood went from £8 to £22 up to £60 to £85, and steel from £8 to £20 up to £50 to £82. Paper remains cheap at £8.50 to £14.50, and glass remelt was the only material to fall. Those are published monthly ranges: a spot price quoted to you today can sit well outside them in either direction, so ask which one you are being shown.
Why did PRN prices rise so much in 2026?+
Not because recycling collapsed, but because the supply of evidence seized up. The national reporting database was switched off on 31 December 2025 before its replacement could issue notes, roughly six weeks passed with no notes issued at all, and new rules required exporters to wait for proof of arrival overseas. Underlying it, the UK can only reprocess about 23% of the plastic packaging it places on the market.
Did PRN prices fall in September 2026?+
Plastic came off sharply inside a few trading days in the second week of September and then levelled out, on the expectation that government would intervene, before anything had been published. It is not evidence that the system is self-correcting: nothing about those days changed how much material the UK can actually reprocess. The September figures reach the published series in the first week of October.
Are PRNs the same as the EPR fee?+
No. They are separate charges paid to different places. The EPR fee is a per-tonne charge on household packaging paid to PackUK that funds council collections. A PRN is evidence of recycling bought on an open market and paid to the recycler. Plastic Packaging Tax is a third, separate charge paid to HMRC. All three are calculated from the same declared tonnage.
What happens if I do not buy enough PRNs?+
You cannot certify compliance for the year, which is an enforcement matter for your environmental regulator. A Regulatory Position Statement setting enforcement thresholds by material was expected in late September 2026 but had not been published at the time of writing, so producers who cannot meet their obligation should take advice rather than assume forbearance.
Written by
David Hitchen
Founder, Eco Loop Global
David has spent more than fifteen years in the recycling industry, trading recovered materials and auditing waste and packaging streams for manufacturers, brokers and multinationals.