In what has come to be known as the "latte tax", Britain's MPs are calling for a 25p charge on takeaway coffee, with the ultimate goal of banning disposable cups in five years' time. As a result just six million - 0.25% - are recycled.
"We found that this did not move the needle in the way we thought it might".
"We recognise that there is growing concern about the number of single-use paper cups being used and that our customers are interested in ways that we can help them reduce, reuse and recycle".
ACE also stated that it is working with local authorities and waste management organisations to include disposable cups in kerbside collections.
"If they were recycling it themselves, they'd bring reusable cups with them".
From next week, Greggs Bakery will offer 20p off hot drinks for customers who bring their own cups.
Martin Kersh, Executive Director of the Foodservice Packaging Association, said that with the industry willing to fund greater recycling, a charge isn't necessary: "The recycling of paper cups is set to increase fast as the coffee cup industry and its customers have introduced a large-scale recycling facility".
"I am an expert in making fantastic coffee, but they (the cup manufacturers) are the ones with the knowledge and resources to be able to change".
Following publication of the report, global coffee giant Starbucks says it will try out a 5 pence (5.6 euro cents) cup charge in some of its London coffee shops.
"There's going to have to be a change to the recipe of the cups to make them degradable".
Leader of the Liberal Democrats Vince Cable said the 5p plastic bag charge is proof that "these levies work".
The committee also wants producers to pay more for packaging which is hard to recycle, and to improve labelling to educate consumers about how best to dispose of their cups.
On the same day that MPs have recommended a 25 pence charge be added to all drinks sold in a disposable paper cup in the United Kingdom, environmental campaign charity Hubbub has announced plans with Starbucks to put the suggestion to the test. "The government must do the same and introduce the levy as soon as possible".
In a statement Friday, the committee said that revenue from the levy should be invested in reprocessing facilities and recycling "binfrastructure".
The Government has shown itself to be receptive to calls to tackle problem packaging, setting the tone with a charge for plastic bags, and promising further legislation to protect the environment and animal rights.
Costa Coffee, which operates over 2,000 stores in the United Kingdom, said the government should consider "a mix of measures to address this issue with a focus on improving.... waste and recycling infrastructure".
The Grocer has contacted Pret and Costa for comment.