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Environmental News>

"Biden's emission reduction policy sets the competitive advantage in recycling and reuse rather than low-cost supply, which will bring about an overall qualitative change in the plastics industry."

  • 2021-06-21

At the Earth Day Summit on April 22, 2021, US President Joe Biden pledged to reduce US greenhouse gas emissions by 50% by 2030. Plastics have long been a "special case" when it comes to recycling. Steel, aluminum, glass, cardboard, rubber, and paper typically have recycling rates of up to 70%, but plastics have long been stuck at around 10%. Consequently, President Biden's pledge to reduce emissions will put the plastics industry under pressure from two fronts: accelerating the use of recycled plastics as a raw material. Biden's pledge to accelerate the growth of electric vehicles will necessitate the closure of oil refineries and the elimination of naphtha, the upstream fuel used in plastic production. This will generate nearly 250 million tons of CO2 emissions, equivalent to 50 million vehicles. Additionally, the use of single-use plastics generates nearly 7.5 million tons of emissions and results in waste incineration. Furthermore, consumers and brand owners will face increasing pressure to address the issue of plastic waste. Equate/MEGlobal CEO Ramesh Ramachandran noted that public policy is a mandatory action, restricting the sale and export of raw plastics. Essentially, exports are prohibited unless the pellets contain at least 30% recycled content and are mandatorily recycled at the source. To mitigate and address these changes, new business models based on a circular value chain are necessary. A business model based on a circular value chain (Figure 1) will require high collection rates, effective sorting, and integrated supply chains, including a hub-and-spoke process. Furthermore, focusing on consumer demand is crucial to optimizing the supply/demand balance and price/quality benchmarks. Figure 1: Business model based on a circular value chain Source: NEW NORMAL CONSULTING GmbH References: Biden’s Earth Day Summit puts plastics recycling on the fast track https://www.icis.com/chemicals-and-the-economy/2021/04/bidens-earth-day-summit-puts-plastics-recycling-on-the-fast-track/ Biden’s Earth Day Summit Is US Coming-Out Party on Climate Change https://www.voanews.com/usa/bidens-earth-day-summit-us-coming-out-party-climate-change

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