Under the regulations, which were introduced in March, businesses in the packaging chain with an annual turnover above £5 million and using at least 50 tonnes of packaging per year must register with one of the environment agencies or with a compliance scheme by 31 August. Up to March, three schemes - Valpak, Difpak and Wastepack - had been proposed (ENDS Report 266, pp 19-22 ).
If the schemes are not operational by August, "obligated" companies will have to register directly with the agencies for 1997/98. Such a delay would not necessarily be a bad thing for them, as they would have more time to examine the schemes on offer.
But a delay could create problems for Valpak and make it more difficult for the UK to meet its recovery and recycling targets. The early establishment of a dominant compliance scheme to plan what would effectively be a nationwide recovery programme was central to the Government's strategy for meeting the targets set by the EC Directive on packaging.
Valpak's Chief Executive, John Bell, says he is confident his scheme will be up and running by August. But if Valpak misses the deadline, companies may be tempted to wait until the next registration deadline of 1 April 1998 before deciding whether to join. About 200 firms have now joined Valpak, including Coca-Cola & Schweppes Beverages, J Sainsbury, Nestle, Procter & Gamble and Smiths Industries.
In May, the glass material organisation (MO), Glasmo, announced plans to set up Glaspak, a compliance scheme exclusively for the eight UK glass container manufacturers. After fulfilling their recycling obligations, the scheme will give surplus packaging recovery notes (PRNs) to Glasmo free of charge. This establishes a more active role for an MO in increasing current recycling levels, but the proposal will have to meet OFT requirements on competition.
Glasmo will sell the PRNs to compliance schemes and obligated businesses, and channel the funds raised into glass recycling. This may include grants for commercial collections from restaurants and pubs and for "bring" banks.
Glasmo will sell its PRNs at a set annual fee reflecting the cost of reaching a 50% recovery rate. Like the other MOs, Glasmo is not obliged to aim for this target. But according to Political Liaison Officer Alison Morris, "it will be very difficult for the Government to achieve its targets unless we do this." The MO expects PRNs to cost £10-20 per tonne in 1998, falling to half that level or less in three or four years.
Other schemes are on the cards, mainly from the waste industry. The sector sees the packaging regulations as a significant commercial opportunity, and is unhappy with Valpak's emphasis on channelling funds into reprocessing operations - such as paper mills - rather than directly into collection and sorting infrastructure.
Biffa is setting up its own scheme - Bifpack - which would obtain PRNs for its members by increasing the recycling it carries out for its existing customer base. Biffa submitted its proposal to the OFT at the end of May.
Other large waste management businesses are considering setting up compliance schemes. UK Waste told ENDS that it will decide in June whether to do so. Its other options are to provide PRNs as a service to its existing customers, or to work as a regional contractor for compliance schemes.
Schemes already declared, meanwhile, are firming up their plans. Difpak, launched by the Dairy Industry Federation (DIF), intends to limit its membership to firms in the dairy and food industries and has already recruited members. From 1998, its membership fees will be based on the size of a company's recovery and recycling obligation.
Valpak's main rival so far, Wastepack, has sent its draft business plan to the Scottish Environment Protection Agency. ENDS understands that its backers - waste broker Wastelink, which has 22 waste management companies as members - initially approached the Department of the Environment and the Environment Agency, but received a lukewarm response. Wastepack wants its retailer members to instruct their packaging suppliers to buy waste packaging collectively through the scheme, which may cause problems with the OFT.
Speaking at a recent conference organised by the UK Agricultural Supply Trade Association, Wastelink's Managing Director, Barry van Danzig, said he was confident that the collective strength of Wastepack's members could secure it attractive deals with paper mills. "There's a way of negotiating with the reprocessors - with our foot on their necks."
Wastepack's draft business plan is confident that the scheme will attract 60% of the 4,000 companies which are subject to the regulations, with a further 20% choosing to go it alone. But some observers in the waste sector argue that Wastepack will be unsustainable because Wastelink's 22 members do not have the necessary collection and sorting facilities.
Wastepack has ambitious plans for a series of recycling facilities linked by the rail network. It hopes to contract with Railtrack to build transfer stations at railway depots in the next 18 months. But it will be difficult to secure planning consent for these in time, and the draft plan admits that "alternative solutions" must be considered in case the "railink" project fails.
There are also doubts whether rail transport will be cost-effective when waste will be handled more often than if moved by road. If railink fails, says the draft plan, Wastelink's members will have to expand the collection infrastructure themselves, which would be "more costly".
Glasmo's control over the sale of glass PRNs will also cause problems for Wastepack, which has sought to woo members with the offer of free PRNs obtained from the waste firms belonging to Wastelink.
Wastepack intends to set a registration fee for members of £100-£600 to cover its own registration costs. Annual fees will be based on turnover. Except for companies with a turnover above £250 million, the fees are slightly higher than Valpak's.
In addition, Wastepack says that material levies - of unspecified size - may be imposed on members failing to "persuade" their suppliers to use the packaging waste collected by the scheme's waste management companies.