Research and analysis

Extended producer responsibility for packaging: illustrative base fees (December 2024)

Published 20 December 2024

This document provides updated illustrative base fees for year 1 of the Extended Producer Responsibility (EPR) for packaging scheme. It relates to fees that would be charged to obligated packaging producers by the Scheme Administrator. It does not cover:

• regulator fees and charges paid to the Environment Agency, the Scottish Environment Protection Agency, the Northern Ireland Environment Agency, and Natural Resources Wales
• costs associated with meeting packaging recycling targets e.g. through the purchase of Packaging Waste Recycling Notes

These illustrative base fees for the first time show point estimates as opposed to ranges. Such an approach has been taken following agreement across all four Governments of the final proposed modelling scenario for the total local authority disposal costs that should be recovered through EPR in 2025.

This modelling scenario is the basis for the initial funding allocations sent to local authorities at the end of November 2024. This total figure for the UK amounts to £1.5bn (rounded figure to the nearest £500m), significantly lower than the upper scenario we had previously modelled, which stood at £1.8bn. 

The illustrative base fees are being published in advance of the EPR Scheme Administrator releasing formal communication under the Producer Responsibility Obligations (Packaging and Packaging Waste) Regulations 2024.

This document has been published by the UK Government, the Department for Agriculture, Environment and Rural Affairs in Northern Ireland, the Scottish Government, and the Welsh Government. The term ‘Government’ in this document refers to all four administrations. 

1. Third release of illustrative base fees for 2025 to 2026 (Year 1 of EPR)

1.1 Table 1. Third release of illustrative EPR base fees for 2025 to 2026 for all packaging materials.

‘Other’ includes any materials not listed below. For example, bamboo, ceramic, copper, cork, hemp, rubber, silicone. The fees are rounded to the nearest £5.

Material	Rate (in £ per tonne)
Aluminium	435
Fibre-based composite	455
Glass	240
Paper or board	215
Plastic	485
Steel	305
Wood	320
Other	280

The illustrative base fees are based on the agreed final proposed modelling scenario for the total disposal costs that should be recovered through EPR in 2025. The final disposal costs are undergoing quality assurance checks.

The illustrative base fees use packaging tonnage data submitted to date by producers on the Report Packaging Data (RPD) online portal for the first six months of 2024, with adjustments applied (see below for further details). These fees represent the best possible point estimate of base fees given currently available information.

These illustrative base fees could be an overestimate, as the packaging tonnages used in the calculation do not include:

• data from producers who are required to report their data but have not yet reported
• data from producers who reported after 19 December 2024
• seasonal differences, which may lead to more packaging reported in the second six months of 2024 compared to the first six months of 2024

While illustrative base fees can provide further clarity to support industry with early preparedness, these figures are still subject to significant uncertainty and will change in year 1 of EPR as more data are submitted by producers, and compliance monitored by regulators ^{[footnote 1]}. They will also change in future years.

Final fees for the first year of EPR will be released after 1 April 2025 (the deadline for reporting packaging supplied by registered producers in 2024).

2. Changes in illustrative base fees compared with the previous release

There are changes in illustrative base fees as a result of using 2024 RPD tonnage data, and the final proposed scenario for chargeable local authority costs in 2025 (£1.5 bn). The latest base fees are all within the range published as part of the second release of illustrative base fees published in September, except for ‘Glass’ and ‘Other’ which are within the range of the first release, published in August.

For ‘Other’, this increase in fees is primarily due to the significant increase (36%) in local authority disposal costs for this material, and slight decrease (2%) in the predicted tonnages for this material. Increased fees for ‘Glass’ are due to a slight increase (7%) in local authority disposal costs for this material and a significant decrease in the predicted tonnages.

The September base fees used glass tonnages from the PackFlow Refresh 2023 reports as these were thought to provide a more accurate estimate of the total amount of glass packaging placed on the market than those reported within the 2023 RPD tonnage data (due to Scotland being excluded from the requirement to report drinks containers for the calendar year 2023).

For the illustrative base fees in this publication, we have used glass tonnage data reported by producers through the RPD portal for the first six months of 2024. These data have been adjusted as described below. The adjusted glass tonnages used in the calculation are 23% lower than the glass tonnages estimated in PackFlow.

3. Methodology

Illustrative base fees are calculated by dividing packaging waste management costs (for household packaging waste) and other relevant costs by the total amount of household packaging placed on the market. The result is a fee rate which is expressed in £ per tonne of packaging placed on the market. The following calculation is carried out for each packaging category separately:  

Numerator: (1) Costs incurred by local authorities managing waste of that packaging category (household packaging waste only) minus revenues from material sales plus (2) that packaging category’s share of other costs (Scheme Administrator costs, communication costs, and debt provision costs).

Denominator: Total weight of that packaging category placed on the market (household packaging only). To note that for the first year of Extended Producer Responsibility for packaging (2025 to 2026), costs associated with the management of packaging commonly disposed of in public bins or littered will not be included in the numerator. However, the denominator will include both household packaging and packaging reported as commonly disposed of in public bins or littered. 

You should refer to the first release of illustrative base fees for further details on the principles for calculating illustrative base fees.

4. How this release differs from the previous release

4.1 Tonnages of packaging placed on the market

This release uses the most recent data submitted by large organisations into the RPD online portal system for January to June 2024 (extracted on 19 December 2024) for all materials, including glass. 

The household tonnages in-scope of producer fees for each material category have been calculated by adding together tonnages that producers reported as household packaging and as packaging commonly disposed of in public bins or littered.

Glass tonnages include household drink containers as they are in scope of EPR producer fees (unlike single-use PET, aluminium and steel drinks containers 150ml to 3l in size, which are in scope of a Deposit Return Scheme across the four nations).  

4.2 Adjustments to the 2024 RPD data

Regulators have been undertaking compliance monitoring of data submitted on RPD; this includes engaging with compliance schemes and individual producers to explore changes in reporting patterns between 2023 and 2024. This has included reviewing drops in tonnages reported by individual producers, as well as contacting producers that may have obligations under the regulations but have failed to report packaging data. As a result of this work, we have made the following adjustments to the RPD data: 

• where producers submitted less than six months of data, we have extrapolated the data proportionally up to the six-month equivalent
• RPD data submissions from direct registrants that has been ‘rejected’ by regulators were removed from the dataset given uncertainties in future resubmissions
• RPD data from compliance schemes that have been ‘rejected’ by regulators have been kept in, under the assumption that future resubmissions will not vary significantly from initial submissions
• where producers have not yet reported in 2024 but were fully compliant in 2023, RPD data were also adjusted upward to account for expected increases in tonnage as more producers make submissions into RPD, based on comparing the first six months of 2023 and 2024 data.
• adjusted RPD data were then multiplied by 2 to upscale to a full year. No adjustments were made to account for seasonality

4.3 Regulator checks

These data submissions represent the best placed on market packaging tonnage currently available, but will change as a result of data resubmissions and further data being reported on the RPD online portal.

The regulators have a duty to monitor the accuracy of EPR data submitted into the RPD online portal; these checks are ongoing. Regulators are working with producers and compliance schemes to identify and correct possible data errors. As a result, the data used in the calculations may include reporting issues that have not yet been addressed.

4.4 Local authority costs

Defra’s ‘Local Authority Packaging Cost and Performance’ model (referred to as ‘LAPCAP’ or ‘the model’ in this document) has been used in this third release of illustrative base fees. This model is still undergoing finalisation and quality assurance which may result in some refinements but is the methodology which will be used to calculate fees that will form the basis for invoicing obligated packaging producers from 2025.  

LAPCAP uses a combination of local authority specific data (e.g. tonnes reported in Waste Data Flow) and comparative data (groupings based on reported cost data from a sample of local authorities) to calculate a payment for each local authority in the UK. The total payment to all local authorities calculated by LAPCAP is the ‘Costs incurred by local authorities managing waste’ used in calculation of illustrative base fees, alongside Scheme Administrator costs, communication costs, and debt provision costs.

Recently published guidance explains the methodology and procedure used to determine year 1 EPR payment estimates for local authorities.

5. Next steps

Producers have an obligation to report their packaging data through the RPD online portal.

If you are a large organisation you should report your data for 1 July to 31 December 2024 from January 2025. The deadline for reporting your data is 1 April 2025.

The Scheme Administrator will use this data, together with producers’ data submitted for the period 1 January to 30 June 2024 and the above listed costs to calculate and release the final version of base fees. This is expected to be available in July 2025.

6. Modulated fees to be introduced from 2026

From year 2 of EPR (2026 to 2027), fees will be modulated to ensure packaging materials that are less recyclable incur higher fees. The types of packaging which will be subject to higher or lower modulated fees will be based on recyclability assessments in line with a Recyclability Assessment Methodology (RAM).

The RAM will be published on GOV.UK before Christmas 2024. Defra intends to share outline modulation methodologies for industry engagement and feedback in Quarter 1 2025.

1. The illustrative base fees contained in this document are not intended to amount to advice or information on which producers should rely (including for business planning purposes). Government will not be liable for any financial loss should producers use these illustrative base fees in this document for planning or other purposes. ↩