Size of prize in plastics recycling is $120bn, with $47bn in polymers – investor

BOSTON, Massachusetts (ICIS)–The size of the overall prize from recycling plastic waste is $120bn in products, ranging from polymers to intermediates and fuels, a project director at a circular economy investment firm said.

“There is a real demand for recycled plastics and other materials across the supply chain,” said Paula Luu, project director at the Center for the Circular Economy at Closed Loop Partners.

“We are at an inflection point, with never-before seen interest from consumers, governments and brands to address post-consumer plastic waste,” she added.

Luu spoke at the ICIS World Chemical Purchasing Summit.

Of the total $120bn prize from products coming out of the plastics recycling stream, polymers comprise $47bn, monomers and intermediates $56bn and petrochemicals and refined hydrocarbons $17bn, she said.

In North America, recycled polypropylene (PP) is only meeting 2% of the demand for the recycled material, resulting in $4.2bn in “lost revenue” opportunity, said Luu.

Closed Loop Partners sees demand for recycled plastics increasing to 5.75m tonnes by 2030.

Mechanical recycling has its limitations as it doesn’t address the full waste stream. Chemical recycling is needed to tackle difficult problems such as multi-layer films and contaminated plastics.

“We believe chemical recycling should be part of the suite of solutions,” said Luu.

Chemical recycling technologies are being focused in three key categories – purification, decomposition and conversion.

Purification involves processes to clean and sanitise material to reloop into the value chain. This includes removing colours, smells and additives without changing the physical characteristics of the resin so that you’re essentially left with virgin polymer.

In decomposition, material is broken down either chemically or thermally into monomers or intermediates.

And in conversion, waste plastics are brought back into the hydrocarbon state and fed into fuel supply chains.

“There is really no one-bullet solution for plastic resin. In most cases, technologies can be applied to multiple resin types and the outputs are flexible. These technologies are highly flexible and the outputs varied,” said Luu.

On average, it takes 17 years to bring a technology to commercial growth stage, but that is far too slow for consumer brands. Thus Closed Loop Partners is seeking to accelerate the process, she said.

Closed Loop Partners analysed 60 of these technology providers and saw they are engaging with about 250 partners and investors.

“In isolation, these technology providers can’t do anything. They need collection, sorting, and to be able to push the end products into the plastics or petrochemical supply chains,” said Luu.

More infrastructure investments are needed for collection and sorting, with some advances already being made in robotics and AI (artificial intelligence) to improve and accelerate sorting, she said.