How Packaging Producers Can Create Value from EPR Fee Analysis
UK packaging producers have the opportunity to create customer value through EPR fee analysis
13 March 2026
Insights
Example Fee Analysis
An illustrative example of analysing EPR fees for product packaging.
Table of Contents
- Turning policy shifts into customer value
- EPR fees as a critical cost driver
- The business case for sustainable packaging
- Supporting product development and innovation
- How Anthesis can help
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Extended Producer Responsibility (EPR) has fundamentally reshaped the packaging landscape. With the introduction of new legislation in the UK, packaging manufacturers no longer share recycling costs with other businesses in the supply chain. There is thus growing pressure to demonstrate that packaging solutions are not only cost-effective to manufacture and purchase, but also remain competitive under the evolving EPR framework.
Packaging manufacturers who understand the full impact that their customers face, in the form of EPR and other compliance fees, will gain a strategic advantage over their competitors. Furthermore, obligated producers who understand the impact of their packaging choices will be able to make informed decisions to mitigate cost without compromising other environmental objectives such as carbon reduction targets.
Turning policy shifts into customer value
With the rise of new policy and regulation, packaging manufacturers are presented with several opportunities to emphasise their long-term value to customers:
- EPR fees will become a critical cost driver for packaging users
- EPR fee reductions will strengthen the business case for sustainable packaging
- Compliance-driven packaging analysis will support product development and innovation
Below, we outline these opportunities in further detail and explore how packaging producers can capitlise on each through careful EPR fee analysis. We also provide a detailed fee analysis example to illustrate how EPR fees can unlock business potential.
EPR fees as a critical cost driver
The fourth version of the EPR base fees was published on 30 June 2025 (Table 1) and more detailed reporting requirements came into effect in October 2025. The base fees are calculated by dividing the total costs of managing household packaging waste, along with other relevant costs, by the total amount of household packaging placed on the market. The result is a fee rate, expressed in £ per tonne of packaging placed on the market, that is applicable for the 2025 compliance year.
In December 2025, the latest version of illustrative modulated fees was shared and will feature in producer invoices from October 2026 to encourage a shift towards more environmentally sustainable packaging design, using recyclability as the key indicator. The level of modulation applied to packaging will be determined through recyclability assessments carried out in accordance with the Recyclability Assessment Methodology (RAM) which can be found here.
Under this approach, all in-scope packaging materials (household packaging) will receive a rating of red, amber, or green, with red representing the least recyclable materials and green representing the most recyclable. According to DEFRA, during the first three years of the policy, the additional funds raised by the application of a higher modulation factor to RAM red-rated packaging material will form a pot of money for redistribution. This fund will then be used to reduce household packaging waste disposal fees for green-rated materials. Amber-rated materials will effectively be charged at the new base rate.
| Material | Year 1 Rate (£ per tonne) | Year 2 Illustrative Rate (£ per tonne) |
|---|---|---|
| Aluminium | 266 | Green: 245 Amber: 270 Red: 325 |
| Fibre-based composite | 461 | Green: 475 Amber: 525 Red: 630 |
| Glass | 192 | Green: 185 Amber: 205 Red: 245 |
| Paper and card | 196 | Green: 190 Amber: 210 Red: 250 |
| Plastic | 423 | Green: 415 Amber: 455 Red: 545 |
| Steel | 259 | Green: 260 Amber: 290 Red: 345 |
| Wood | 280 | Green: 410 Amber: 450 Red: 540 |
| Other | 259 | Green: 205 Amber: 225 Red: 270 |
These costs will have a significant impact on the overall cost of packaging for businesses. Packaging manufacturers that can quantify and compare the fees associated with their products will be better positioned to demonstrate the value their packaging delivers and use their fee analysis as a market differentiator.
EPR fee reductions strengthen the business case for sustainable packaging
Customers understand the need to make the shift to more sustainable packaging but are deterred by higher costs. Understanding the RAM is essential for packaging manufacturers to ensure products meet recyclability standards before entering the market. Packaging which scores poorly under the RAM, such as multi-material packaging or packaging that uses additives that hinder sortation or deteriorate the quality of recycled material, such as plastic packaging dyed with carbon black pigment, will incur higher EPR fees. Conversely, more easily recyclable packaging will be incentivised through lower fees.
This presents an opportunity for packaging manufacturers to design packaging formats with EPR cost mitigation at its heart. By applying the RAM and modelling EPR fees for different packaging formats, manufacturers can showcase how sustainable packaging alternatives not only support environmental goals but also reduce the financial burden for their customers. Obligated producers that opt for more recyclable packaging choices will then reap the rewards of these EPR cost savings when the first invoices using RAM modulated pricing land in 2026.
Packaging analysis supports product development and innovation
The incoming RAM and EPR fee structure creates direct financial incentives for brand owners to reconsider packaging materials, formats, and designs. By understanding and analysing how these factors influence EPR costs, packaging manufacturers can identify opportunities to develop packaging that is both functional and cost-effective within the evolving policy landscape. This approach to product development and innovation extends beyond aesthetics and functionality, focusing on packaging that delivers a smaller environmental footprint and stronger alignment with circular economy principles, while also helping obligated producers reduce compliance costs and meet sustainability targets.
Ultimately, EPR-informed packaging design supports commercial differentiation for producers. Those able to offer packaging solutions with demonstrably lower EPR costs provide tangible value to their customers and gain a competitive advantage in a market increasingly driven by compliance legislation.
How Anthesis can help
Taking a proactive approach to EPR will benefit the long-term business value for packaging manufacturers operating in the UK. Engaging with industry peers, trade associations, and other third parties to collate knowledge and reduce the burden of individual responses to the same challenges will be vital during this time to ensure businesses are adequately prepared.
Anthesis is experienced in helping clients understand, measure, and reduce the impact of their packaging. Our EPR services are designed to support packaging producers in gaining a competitive edge in a continuously changing landscape by providing:
- EPR fee modelling across key markets (UK, EU, North America, and beyond)
- Comparative analysis of existing and alternative packaging formats
- Insights into material recyclability, modulated fee criteria, and regulatory risk
- Strategic recommendations to reduce packaging costs and environmental impact
- EPR cost forecasting supported by statistical models
Anthesis can also provide additional services, including calculating the carbon footprint and other environmental impacts of packaging formats. Providing these comparisons to customers can help companies look beyond pricing alone and consider how each option affects both cost and environmental impact. By reviewing both factors together, businesses can make more balanced and responsible packaging choices.
Our team of experienced EPR, LCA, and Sustainable Packaging experts can provide additional insight for any region by analysing local compliance fees and can include a wide range of environmental metrics, including water and energy consumption. By expanding the scope of analysis, Anthesis can help businesses build a more complete understanding of their packaging’s true cost and sustainability performance to identify opportunities for improvement across the entire value chain.
Finally, being compliant with EPR with full recyclability assessments will become common place in the UK and the EU as the Packaging and Packaging Waste Regulation (PPWR) rolls outs. Assessing your portfolios now will not only support regulatory readiness but can also help reduce EPR fees.
Some packaging producers have struggled gathering sufficient data to conduct full recyclability assessments, resulting in default ‘red’ classifications. Improving data quality through stakeholder engagement campaigns will complement Impact Assessments to ensure producers are taking reasonable measures to understand and reduce their compliance costs.
Anthesis supports our clients by deeply understanding their data and packaging portfolios, assessing impacts against PPWR and recyclability assessment requirements, identifying hotspots of non-compliance, and developing clear, practical implementation plans. This enables us to turn “reds into greens”, improving packaging systems, simplifying compliance, reducing complexity, and ultimately lowering EPR costs, creating business value.
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