The Deposit Return Scheme(s) (DRS) is one of four ongoing areas of reform to the UKs waste and resources strategy. This legislation comes alongside Extended Producer Responsibility (EPR), Plastic Packaging Tax (PPT) and consistency of waste collections. These policies will have a phased implementation from 2023 and will impact those who place packaging onto the UK market.
What is a Deposit Return Scheme?
Deposit Return Schemes are popular policy tools used to increase the recycling of single use drinks containers, improve the quality of recycling and reduce litter. These schemes incentivise positive consumer behaviour change around sorting their waste.
What are the benefits of a Deposit Return Scheme?
- 90% recycling rate for the specified materials.
- Prevents litter and could save over £46 million of public money spent on clearing litter from streets, parks, county paths and town centres.
- Promotes the circular economy by incentivising behavioural change and tackles the single-use, throwaway culture we have adopted.
Who will be affected by the DRS?
Producers and retailers
Producers and retailers who place single use drink containers onto UK markets will be affected by the scheme.
Producers will be legally responsible for providing collection points (Reverse Vending Machines) and the waste management of drinks containers in preparation for reprocessing. Retailers will be the link between producers and users of the schemes.
Retailers that sell drinks will have a legal obligation to accept returns of eligible drinks containers. This includes online retailers of drinks as well as in store.
Consumers under the UK Deposit Return Scheme will pay a deposit fee when buying beverages, which they can recover by returning empty containers. This incentivises recycling and potentially leads to cost savings for those who participate.
When will the UK Deposit Return Scheme go live?
The Deposit Return Schemes in the UK have an implementation deadline of October 2025, this includes England, Scotland, Northern Ireland and Wales’ schemes. However, with the recent timetable change of EPR, this could impact the DRS’ deadline with October 2025 becoming a stretching deadline which could be subject to change.
Which drinks container materials will be in-scope for DRS?
In each of the three jurisdictions, across England, Scotland, Wales and Northern Ireland, the DRS will apply to relevant containers of between 50ml and 3l. This is a so-called ‘all-in’ approach as compared to one only including ‘on-the-go’ containers of under 750ml in size and excluding those sold in multi-packs.
Why are in-scope materials different for different UK nations?
Waste management is a devolved matter from the national UK government to the local ad¬ministrations in Scotland, Wales and Nothern Ireland.
Glass bottles will not be captured by the DRS in England and Northern Ireland as the respective governments believe the addition of glass will add additional complexity and challeng¬es to the delivery of DRS, in particular for the hospitality and retail sectors, as well as additional consumer inconvenience. Given concerns raised on managing glass in a DRS, delivery of the scheme will focus on plastic bottles and aluminium/steel cans in England and Northern Ireland.
Whilst not in scope of the DRS in England and Northern Ireland, glass drinks bottles will be covered by the Extended Producer Responsibility for packaging scheme in both nations, which will place targets on producers in relation to glass recycling. Northern Ireland will keep under review the inclusion of glass when the DRS is fully operational to ensure glass bever¬age containers are meeting the relevant recycling targets.
Scotland intended to include Glass in their scheme however, with the UKs introduction of the UK Internal Market Act, the UK government granted Scotland an exemption from this act for DRS however, this exemption only applies to PET plastic drinks containers and steel and aluminium cans, preventing Scotland from including glass drinks containers within the scope of its DRS.
In assessing the range of materials to be included, the Welsh Government has considered the impact of a DRS against the baseline recycling rate in Wales, and the statutory requirements of the Well-being of Future Generations (Wales) Act 2015 alongside the overarching commitments to become a net zero carbon and zero-waste nation by 2050. Acknowledging the 2022 consultation responses, which emphasised the importance of including a broad range of materials and with the advancements in digital DRS technology, the Welsh government believe there are viable solutions to facilitate bottle deposit returns through existing kerbside collection systems. This approach would aim to reduce the dependence on return-to-retailer reverse vending machines. When comparing the economic impact assessment of the Welsh DRS, including glass in the scheme results in a higher overall rate of return and enhances the recycling rate compared to a baseline scenario.
The Welsh Government is therefore progressing with the option as set out in the consultation to introduce an all-in DRS in Wales which includes polyethylene terephthalate plastic, steel and aluminium cans, and glass bottles.
Will there be any labelling requirements for DRS?
Defra, the Welsh Government and the Department of Agriculture, Environment and Rural Affairs in Northern Ireland intend to mandate the use of both a mark to identify the product as part of a DRS and the use of an identification marker such as a barcode or QR code to enable the container to be recognised at the return point. The specific details and design of these markings would be for the Deposit Management Organisations (DMOS(s)) to decide.
Labelling could include:
- A mark to identify the product as part of a DRS
- An identification marker that can be read by a return point within the scheme
What is a DMO and who will be appointed for this?
The Deposit Management Organisation(s) will be appointed through an application pro¬cess set out in the regulations.
There will be a DMO for each respective scheme. The DMO(s) will be responsible for man¬aging the overall operation of the DRS as well as for meeting the collection targets set out in regulations, which the DMO(s) will fulfil on behalf of all registered producers. The DMO(s) will be an independent, not for profit and private organisation(s).
How will the Deposit Return Scheme(s) work for consumers?
Once the scheme(s) goes live, consumers will pay a 20p deposit when they buy any drink in a single- use container.
Once the costumer consumes the drink in their single use container, they will return the bottle or can to a registered take back point and will be awarded back their 20p deposit. The can or bottle will then be collected and treated for reprocessing.
How will the Deposit Return Scheme(s) be paid for?
There are three streams of funding coming in to pay for the running of the scheme:
- Unredeemed deposits
Many of the materials eligible for the DRS are likely to the recycled of disposed of elsewhere.
- Revenue from the sale of materials
There is a very strong demand from reprocessors for high quality materials who are willing to pay a substantial amount for good quality PET, glass, aluminium and steel.
- Producer fees
Producers are likely to pay a fee on each item they place onto the market. This will cover the collection and recycling of drinks containers which will be paid to the scheme administra¬tor(s).
As a producer, will I pay an EPR Local Authority Waste Management fee on in-scope DRS materials?
Producers of DRS packaging will not be required to pay the disposal cost fees under Extended Producer Responsibility for their packaging ending up in household waste or in street bins. The government does not consider it desirable to obligate producers of DRS packaging to pay disposal costs under Extended Producer Responsibility for the intervening period.
In the intervening period before the DRS commences, glass bottles sold into Wales will be covered by the Local Authority collection cost obligations under Extended Producer Responsibility, making this consistent with the requirements for glass bottles in England and Northern Ireland. Producers will be required to pay an EPR fee on this material during the intervening period between Welsh DRS and EPR implementation. Once the DRS in Wales goes live, glass drinks bottles in Wales will be exempt from EPR Local Authority Waste Management fees.
Will I need to continue purchasing PRNs on in-scope DRS materials?
Producers of packaging due to be captured under the DRS will be required to continue to meet recycling obligations by acquiring Packaging Recovery Notes and Packaging Export Recovery Notes, however for in-scope DRS materials sold into Scotland, you will not be required to purchase PRNs/PERNs on this material.
Will it cost me to operate a take back station?
No. Once a consumer takes back their empty container to a return point the deposit is paid back to the consumer from the retailer’s funds which will then be invoiced back to the retailer by the DMO.