Challenges for recycled polymers in Europe

BRANDS' sustainability pledges and EU and national legislation are putting increasing pressure on the recycled plastic supply chain in Western Europe. Focus has been on the recycled polyethylene terephthalate (R-PET) market meeting the EU Single Use Plastic (SUP) Directive target for 2025. Improved standards in waste collection and sorting alongside sufficient recycling capacity and high-quality end recycled product are proving to be increasingly difficult to achieve. However, the legislation announcements and targets also refer to plastic packaging beyond PET. This largely involves polyethylene (PE) and polypropylene (PP) polymers whose recycling markets are less mature than R-PET and have their own challenges to be able to contribute significantly to achieving sustainability goals.

The 2019 EU SUP Directive requires all PET bottles to contain 25% R-PET by 2025 and all plastic bottles to contain 30% recycled content by 2030. Members of the EU Circular Plastics Alliance have committed to using 10m t of recycled plastic to make new products every year by 2025. The EU Green Deal and coronavirus pandemic recovery package have further indicated that attention will not be moving away from topics of sustainability and the circular economy, and from 1 January 2021 an EU levy of €800/t (US$955/t) will be applied to all non-recycled plastic packaging waste. Italy is introducing a €450/t tax from 30 June 2021 on all single-use non-recyclable packaging excluding compostable bioplastics and recycled materials. Spain too is discussing a similar tax rate of €450/t on all non-reusable plastic packaging. Also, the UK plastic packaging tax of £200/t (US$276/t) on all plastic packaging with less than 30% recycled plastic is coming into effect in April 2022. Therefore, the strive for 100% recyclability of plastic packaging and raising usage of recycled plastics in wider groups of end markets is vital in the focus on circularity of plastics in Western Europe.

Brands have responded to consumer and regulatory pressure by announcing more ambitious pledges related to sustainability of products and packaging. Major retailers and FMCG companies for food and drinks, cosmetics and personal care products have committed to 100% of their packaging being reusable, recyclable or compostable, and a minimum average of 25% recycled plastic content by 2025. Exemplified by Danone, Unilever, Nestlé and Reckitt Benckiser with a goal of 25% recycled plastic content, Henkel and Mars 30%, Aldi 50%, and L’Oréal 50% recycled or biobased content. Aside from PET beverage bottles where brands are aiming to contain an average of 50% R-PET before 2025.

State of the nations

The ICIS Recycling Supply Tracker has identified over 720 mechanical plastic recyclers of PET, PE and PP plastic in Western Europe with a total recycling capacity of just over 11m t/y using post-consumer and post-industrial waste feedstocks. 70% of the recycling capacity is allocated to reprocessing polyolefins, with PE having the largest share. The PET, PE and PP plastic recycling plants represent 21% of total virgin and recycled production in the region, to be shared across all industry sectors and applications.

However, only 49% of capacity of polyolefins is produced using post-consumer (PC) feedstocks unlike 85% for PET. Therefore, in specific applications such as packaging where feedstock requirements are focused on post-consumer volumes, limited availability potentially restricts brands’ abilities to achieve their sustainability pledges.

The EU requires all recycled plastic used in food contact applications to have received a favourable opinion from the European Food Safety Authority (EFSA). One of the requirements for EFSA approval is 95% of the PC waste feedstock used to produce food grade (FG) recycled pellets must originally come from food contact applications. While FG R-PET is more readily available and capacity continues to expand, currently, only 100,000 t/y of PC HDPE is available to produce FG R-HDPE. The majority of which is found in the UK where there is a discreet closed loop waste stream for milk bottles. This FG supply does not exist for any of the other polyolefin products.

Not only is the availability of FG recycled polyolefins (R-PO) constrained, but further pressure is added to supply by brands producing non food and beverage products also looking to source FG material because it is the highest quality recycled material available. In addition, as per the EFSA 95% requirement, once the FG material is used in non-food applications such as cosmetics and personal care products, it can no longer re-enter the waste stream to produce more FG material in the future, hindering the circularity of plastics.

This demonstrates how much development and investment in infrastructure is still necessary to set up the R-PE and R-PP supply chain to not only increase the feedstock into and production of recycled material but to the standards required by the differing applications of the end markets. Before end market sustainability targets boomed, the FG R-PO market had difficulty in growing because the level of investment was not seen to carry sufficient returns. Also, many countries within the EU have not encouraged the use of food grade recycled plastic in food contact applications. Only in H2 2020 did Italy approve the use of more than 50% non-virgin material in PET plastic bottles produced domestically.

Brands using virgin PET are also considering switching to FG R-PET to develop more sustainable products and packaging. There are around 500,000 t/y of R-PET supplied into the food contact bottle market in Western Europe and is the more developed part of the recycled plastic industry. However, it too is under pressure as supply can only reach a maximum 15% of recycled content at present, short of the SUP Directive 2025 target of 25%.

2020 saw many announcements for chemical recycling initiatives, which brands such as Mars and Nestlé view as being able to contribute to sustainability targets. However, the EU is yet to give approval of chemical recycling as a contributor to recycling targets and is currently seeking independent LCAs to evaluate the impact on the environment. Therefore, chemical recycling is not anticipated to drive increased recycled content levels in the mid-long term, leaving the focus on the mechanical recycling supply chain.

Brands and legislation are including all plastic packaging in sustainability targets and mechanical plastic recycling continues to prove to be a key contributor to achieving circularity in plastics. The recycling industry could benefit from shifting the best practices of the R-PET sector into other polymers such as PE and PP.  Overall, the sector needs to address investment in collection, sorting and recycling infrastructure, supply chain challenges, design for recycling and the market fragmentation in the region. The size of the PO market means it cannot be ignored and 2025 is approaching fast, however re-creating the value R-PET holds in alternative markets is not without its challenges.