Eco-Modulated Fees 2026: What Your Packaging Will Actually Cost Under pEPR

If you produce, import, or sell packaged goods in the UK, the cost of your packaging just changed. From the 2026/27 assessment year, the fees you pay under the packaging Extended Producer Responsibility (pEPR) scheme are no longer flat rates. They are now modulated based on how recyclable your packaging is.

This means two identical-weight packs made from the same material can attract very different fees, depending on their design, components, and real-world recyclability. Here is what you need to know.

How eco-modulation works

In the first year of pEPR (2025/26), all producers paid flat base fees per tonne of material. Plastic was charged at £423 per tonne, glass at £192, and paper and card at £235, regardless of how recyclable the individual packaging item was.

From 2026/27, PackUK’s modulation framework adjusts these base fees using the Recyclability Assessment Methodology (RAM). Every piece of packaging is assigned a traffic-light rating:

• Green (Recyclable): Your packaging passes all five RAM assessment stages and is widely recyclable in practice. You pay a reduced fee — approximately 9% below the Amber rate.
• Amber (Conditionally recyclable): Your packaging faces barriers at one or more stages but is not fundamentally unrecyclable. You pay the standard base fee.
• Red (Not recyclable): Your packaging fails one or more RAM stages and is not currently recyclable in the UK system. You pay a surcharge above the base fee.

PackUK has published a three-year escalation path. The modulation factors for Red-rated packaging will increase progressively: 1.2x in 2026/27, 1.6x in 2027/28, and 2.0x in 2028/29. This means the financial penalty for non-recyclable packaging will double over three years.

Illustrative fees by material

In December 2025, the government published illustrative Year 2 fees showing the impact of modulation for the first time. While final fees for 2026/27 are expected to be confirmed by June 2026, the illustrative figures give a clear picture of the direction:

Note: these figures are illustrative and rounded to the nearest £5. Final confirmed fees may differ. Source: PackUK illustrative Year 2 fees, December 2025.

What this means in practice

Consider a food manufacturer placing 500 tonnes of plastic packaging on the UK market annually. Under the illustrative fees:

• If all packaging is rated Green: £207,500 in fees
• If all packaging is rated Amber: £227,500 in fees
• If all packaging is rated Red: £272,500 in fees

The difference between an all-Green and all-Red portfolio is £65,000 per year — and this gap will widen substantially as the Red modulation factor escalates to 2.0x by 2028/29. For businesses with mixed portfolios, even converting a portion of Red-rated packaging to Green can deliver meaningful savings.

What you can do now

The fees are designed to change behaviour, and there are practical steps you can take:

• Audit your packaging portfolio: Map every packaging item against the RAM criteria. Identify which items are likely to be rated Amber or Red and why.
• Prioritise the quick wins: Some changes are straightforward — removing carbon black colouring, switching adhesive types, or simplifying multi-material constructions. These can shift a rating from Red to Amber or Amber to Green without fundamental redesign.
• Get your data right: Fees depend on accurate reporting. If your data is incomplete or miscategorised, you risk paying more than necessary — or facing enforcement action. Hundreds of businesses were reportedly affected by data issues in the first year.
• Talk to your packaging suppliers: The FuturePack directory lists sustainable packaging suppliers across all material categories. If you need alternative materials or redesigned formats, start those conversations now.
• Read the RAM in detail: Our Regulatory Hub provides a full plain-English guide to the five RAM assessment stages and how they determine your rating.