06 November 2012 20:23 [Source: ICIS news]
BERLIN (ICIS)--European policymakers need to level the playing field between bio-based materials and biofuels if the industry is to develop, the chairman of industry association European Bioplasticss said on Tuesday.
Speaking to ICIS on the sidelines of the association’s annual conference in Berlin, chairman Andy Sweetman said that subsidies granted to the biofuels sector were distorting the market and left other industries that utilised feedstocks such as biomass and cellulosic crops uncompetitive.
“The level of subvention for biofuels means that if you’re a feedstock producer, your first port of call is the biofuels industry, because you know that they’re there waiting to buy from you,” European Bioplastics chairman Andy Sweetman said.
“When it comes to any other industrial use of a bio-based feedstock, there is no supporting mechanism whatsoever,” he added.
Sweetman said that he was not necessarily asking for bio-based materials to receive the same subsidy levels that the biofuels industry currently receives, but that the biofuels subsidy could be reduced, and that level of funding could be matched for both industries.
“This is not an anti-biofuels call, it’s simply a call to level the playing field, so that if you’re producing these feedstocks, industry can access them as well,” he said.
Sweetman also welcomed news that the European Commission (EC) is considering a €4bn ($5bn) public-private funding model for the development of bio-based materials, denying that a push for the industry based primarily around private sector capital indicated that the commission was reneging on its pledge to back the industry. The EC had marked the bio-based products sector for prioritisation in its recent industrial policy report.
“You have to be realistic – there isn’t a lot of money around. They can’t just throw money at the problem, so we have to work within the scope of reality. What I think is important is the risk that we’ll do too much talking for too long, when what we need is action,” he said.
Bioplastics output is likely to increase almost fivefold between 2011 and 2016, according to the association, driven primarily by drop-in solution versions of bulk plastics such as polyethylene (PE), which differ from their conventional counterparts only in terms of their renewable raw material base.
However, bioplastics are higher in price than conventional plastics, a situation that is likely to continue for the time being, Sweetman said.
“What I think we’ll see for the foreseeable future is blends – where you start to introduce a level of renewable raw materials into otherwise conventional materials,” he said.
The industry is likely to be buoyed by the cost of conventional plastics, which are forecast to increase alongside falling bioplastics costs as the industry matures and economies of scale come into play, Sweetman concluded.
“[Competitiveness] is going to come with economies of scale. This is a very young industry, many of these polymers weren’t around ten years ago. I think the single largest producer of bioplastics today has an output of around 150,000 tonnes. If you make polyethylene, you’re talking million of tonnes. The scale is completely different.”
“Plastics are also expected to continue to rise in price. So you’ll have economies of scale bringing down the cost of bioplastics, while the price of conventional prices continues to rise. There’ll be some levelling out,” he added.($1 = €0.78)
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