A new independent report commissioned by the Aluminium Packaging Recycling Organisation (Alupro) is the first attempt to measure, using rigorous econometric methods, whether the packaging recovery note (PRN) system has delivered what it was designed to do.
For the aerosol sector, where aluminium cans pass through municipal recycling streams alongside drinks cans, foil trays and every other form of aluminium packaging, the PRN system has quietly shaped the economics of collection and reprocessing for more than two decades.
What is a PRN and how does the system work?
Under the UK's producer responsibility regulations, businesses that handle packaging — manufacturers, importers, sellers — are obliged to ensure that a proportion of the packaging they place on the market is recovered and recycled. They discharge this obligation by purchasing packaging recovery notes (PRNs) for domestically reprocessed material, or packaging export recovery notes (PERNs) for material sent overseas. Each PRN or PERN represents one tonne of packaging waste that has been recycled.
Accredited reprocessors and exporters issue PRNs and PERNs when they receive packaging waste, and sell them to obligated companies or compliance schemes. The price is set by the market: when recycled tonnage is plentiful relative to the target, prices fall; when it is scarce, they rise. The revenue from PRN sales is supposed to flow back into the recycling system, funding collection infrastructure, sorting capacity and communications campaigns that ultimately bring more material in.
The system has been in place since the late 1990s, but it has never been subjected to a comprehensive, independent statistical analysis — until now.
The study
Alupro's report draws on 156 monthly observations for each of seven packaging materials — aluminium, glass (other), glass (remelt), paper and board, plastic, steel and wood — covering the period from January 2013 to December 2025. That gives 1,092 material-months of price and tonnage data in total, split between domestic reprocessing and export routes.
PRN prices were sourced from the t2e exchange (the main trading platform for PRNs) and adjusted for inflation using CPI, giving real prices in 2015 terms. Received tonnage data came from the National Packaging Waste Database (NPWD). The econometric models controlled for a range of external variables including UK GDP, energy costs (gas and Brent crude), statutory recycling targets, the volume of packaging placed on the market, and external shocks such as China's National Sword policy, Brexit, Covid-19 and the introduction of extended producer responsibility (EPR).
The study set out to answer three questions: whether higher PRN prices are associated with higher recycled tonnages; whether PRN prices respond rationally to surpluses and shortfalls in recycling evidence; and whether domestic reprocessing and export markets respond differently to price changes.
Finding one: higher prices do drive more recycling — modestly
Across six of the seven materials studied, the analysis found a statistically significant, positive association between higher real PRN prices and higher received tonnages, in both the long run (across the full 2013–2025 period) and the short run (within individual compliance years). The relationship held at 95% or 99% confidence for all materials except steel, which showed no significant response to PRN price movements at all.
Plastic emerged as the most price-sensitive material. A 10% rise in the plastic PRN price is associated with a 0.87% increase in received tonnage in the long run. Glass remelt showed the strongest symmetrical response, meaning price rises and falls have an equivalent effect on tonnage in both directions.
For aluminium, the picture is more nuanced. The relationship is asymmetric: PRN price increases are significantly associated with higher recycled tonnage, but price decreases show no significant downward effect. In practical terms, a 10% rise in the aluminium PRN price is associated with a 0.4% increase in received tonnage — and when the price subsequently falls, those gains are not lost. The implication is that once the investment in collection infrastructure and behavioural change has been made, it persists even when the financial incentive weakens. For aerosol can recycling, where consumer awareness campaigns and kerbside collection access are the primary drivers of participation, this is an encouraging finding.
However, the report is clear that PRN prices are far from the most important variable. For aluminium, a 1% increase in GDP is associated with a 1.8% rise in received tonnage — compared with just 0.04% for an equivalent increase in the PRN price.
The recycling target coefficient is also larger. The report concludes that while the PRN price incentive is "real, quick and small", it operates within a much larger economic context. Investment in infrastructure, energy costs, appropriate targets and the strength of the economy all matter more.
Steel's non-response is worth noting. The report stresses this does not mean PRNs are unnecessary for steel recycling — only that steel recyclers are not incentivised to recycle more or less by PRN price movements. Steel scrap has its own commodity value and its own collection economics, largely independent of the PRN system.
Finding two: prices respond rationally to scarcity
One of the longest-running criticisms of the PRN market is its volatility. Prices can swing dramatically from month to month, and critics have argued this reflects speculation, market manipulation or fundamental dysfunction rather than genuine supply-and-demand signals.
The report pushes back firmly against this view. Using regression models that measure the association between monthly PRN price changes and year-to-date evidence surpluses or shortfalls, the analysis found a rational, inverse relationship across every material except wood. When recycled tonnage runs ahead of the compliance target (a surplus), PRN prices fall. When it falls behind (a shortfall), prices rise. The mechanism works as economic theory predicts.
For aluminium specifically, a 1% improvement in the evidence surplus is associated with PRN prices being 1.48% lower than they would otherwise have been. The effect strengthens towards the end of the compliance year, when the consequences of a shortfall become more immediate — prices become more rational as the deadline approaches.
A separate descriptive analysis found that aluminium PRN prices moved in the rationally expected direction 65.4% of the time on a monthly basis, significantly above the 50% baseline that would indicate random movement.
The report's conclusion on volatility is pointed: sharp PRN price movements have generally reflected genuine tightness in the market, not market failure. The perception of dysfunction, it suggests, may itself be a misreading of the data. Improving the quality and frequency of published recycling data — moving from quarterly to monthly reporting, for example — could reduce unexplained volatility by giving the market better information to price against.
Finding three: higher prices push aluminium to export, not domestic reprocessing
This is the finding with the most significant implications for the UK aluminium and aerosol packaging sector.
Across every material for which a valid model could be constructed — aluminium, glass remelt, paper and plastic — higher PRN prices were associated with a stronger increase in exported tonnage than in domestically reprocessed tonnage. Export markets, the report concludes, act as a "release valve" when compliance targets are under pressure and domestic reprocessing cannot respond quickly enough.
But aluminium stands alone in one critical respect. It is the only material in the study where higher PRN prices are associated with a decrease in domestic reprocessing tonnage alongside an increase in export tonnage. For glass remelt, paper and plastic, both routes rise when prices increase — exports simply rise faster. For aluminium, the data shows material being actively redirected away from UK reprocessors and towards overseas buyers when the PRN price spikes.
Since 2020, the share of aluminium tonnage being exported has risen and remained elevated, and the time-series data shows the export ratio tracking PRN price movements closely. The scatter plots in the report make the relationship visually stark: domestic reprocessed aluminium tonnage shows a flat trend line against PRN price, while exported tonnage slopes clearly upward.
The report raises an uncomfortable policy question. If the objective of the PRN system is to increase the total volume of aluminium packaging recycled, regardless of where, the mechanism is working. If the objective is to build and sustain domestic reprocessing capacity in the UK — and there are strong strategic, environmental and economic arguments for doing so — a higher PRN price alone does not appear to be the instrument that delivers it.
For the aerosol sector specifically, this finding is relevant because it speaks to the long-term viability of the UK's aluminium recycling infrastructure. Aerosol cans collected through kerbside and bring-bank schemes enter the same material stream as all other aluminium packaging. If that stream is increasingly being diverted overseas in response to PRN price signals, the business case for investing in domestic sorting and reprocessing capacity — including the specialist handling that aerosol cans sometimes require due to residual contents — becomes harder to make.
The bigger picture: £2.93 billion in reinvestment
One dimension of the report that is easy to overlook amid the econometric detail is the sheer scale of the PRN system's financial footprint. Total PRN and PERN revenue reinvestment across all seven materials amounted to £2.93 billion between 2013 and 2025. Funding collection accounted for £928 million of that total, and infrastructure and capacity for £895 million. Together, those two categories represent 62% of all reinvestment.
The mix of reinvestment channels has remained remarkably stable even as the market grew roughly tenfold over the period, suggesting that the system scales up without fundamentally changing where the money goes.
What happens next
The report's timing is deliberate. The UK is in the early stages of implementing extended producer responsibility for packaging, a reform that will reshape how producers pay for the collection and recycling of their products. Future reforms to the PRN system itself are expected, and the political debate over whether PRNs should be retained, reformed or replaced has been intense.
Alupro has positioned the report as a neutral contribution to that debate — evidence rather than advocacy. Stephen Devine, the organisation's membership and business development manager, said: "Amid ferocious debate regarding the value of the UK's PRN system, we wanted to present a balanced analysis of the incentive and understand the relationship between PRN pricing and recycling tonnages. Rather than supporting or dismissing PRNs, we've simply collated a factual base of evidence to better understand the scheme's performance over the past decade."
He added: "By digging deeper into the data, we've been able to answer a number of important questions. As the UK navigates a period of regulatory change, including future reforms of the PRN system, we hope that this report acts as an evidence base for consultations."
The report's three headline conclusions — that the PRN price incentive works but modestly, that price volatility reflects rational market signals rather than dysfunction, and that higher prices steer material towards export rather than domestic reprocessing — each carry implications for how the system might be reformed.
For aluminium packaging, the asymmetric finding is significant. It suggests that the recycling infrastructure and participation gains achieved during periods of high PRN prices are not easily reversed. That is good news for aerosol can recycling rates, which have benefited from decades of investment in consumer awareness and kerbside access.
The less comfortable finding — that the PRN system as currently designed does not incentivise domestic aluminium reprocessing — is one that policymakers will need to grapple with as EPR reshapes the landscape.
