The Recycling Myth: Big Oil's Solution for Plastic Waste Littered with Failure

July 30, 2021

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by Joe Brock, Valerie Volcovici and John Geddie (Reuters) ... The destination was a company called Renewlogy. The startup marketed itself as an “advanced recycling” company capable of handling hard-to-recycle plastics such as plastic bags or takeout containers – stuff most traditional recyclers won’t touch. Renewlogy’s technology, company founder Priyanka Bakaya told local media at the time, would heat plastic in a special oxygen-starved chamber, transforming the trash into diesel fuel.

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Within a year, however, that effort ground to a halt. The project’s failure, detailed for the first time by Reuters, shows the enormous obstacles confronting advanced recycling, a set of reprocessing technologies that the plastics industry is touting as an environmental savior – and sees as key to its own continued growth amid mounting global pressure to curb the use of plastic.

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Renewlogy said in an emailed response to Reuters’ questions that it could recycle plastic films. The trouble, it said, was that Boise’s waste was contaminated with other garbage at 10 times the level it was told to expect.

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In the past two years, Reuters has learned, three separate advanced recycling projects backed by other major companies – in the Netherlands, Indonesia and the United States – have been dropped or indefinitely delayed because they were not commercially viable.

In all, Reuters examined 30 projects by two-dozen advanced recycling companies across three continents and interviewed more than 40 people with direct knowledge of this industry, including plastics industry officials, recycling executives, scientists, policymakers and analysts.

Most of those endeavors are agreements between small advanced recycling firms and big oil and chemicals companies or consumer brands, including ExxonMobil Corp, Royal Dutch Shell Plc and Procter & Gamble Co (P&G). All are still operating on a modest scale or have closed down, and more than half are years behind schedule on previously announced commercial plans, according to the Reuters review. Three advanced recycling companies that have gone public in the last year have seen their stock prices decline since their market debuts.

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Many advanced recycling projects have emerged in recent years in response to a global explosion of plastic waste.

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Also known as “chemical recycling,” advanced recycling is an umbrella term for processes that use heat or chemicals to turn plastic waste into fuel or reclaimed resin to make new plastic.

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“The potential is enormous,” said Joshua Baca, vice president of the ACC’s plastics division. The ACC this month called on Congress to develop a national strategy to reduce plastic waste, including “rapid scaling” of advanced recycling.

However, the Reuters review found some advanced recycling companies struggling with the same obstacles that have bedeviled traditional recyclers for decades: the expense of collecting, sorting and cleaning plastic trash, and creating end products that can compete on price and quality with fossil fuels or virgin plastic.

Transitioning from the lab to the real-world chaos of dirty and improperly sorted household plastic waste has proven too much for some of these newcomers, said Helen McGeough, a London-based senior plastic recycling analyst at Independent Commodity Intelligence Services, a data and analytics firm.

“People have entered into this, perhaps not understanding the processes properly, the waste that they are handling, and so that’s why some things have failed,” McGeough told Reuters.

Advanced recycling is in its infancy, and as with any emerging technology, setbacks are to be expected, a dozen industry players said.

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The boom is also being fueled by investors looking for the next hot green-tech industry.

Most of the advanced recycling firms involved in the projects reviewed by Reuters use a form of pyrolysis, the process of breaking down matter using high temperatures in an environment with little or no oxygen.

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According to its website, PureCycle uses a “ground-breaking” recycling process developed by P&G, maker of Gillette razors and Head & Shoulders shampoo, to turn a particular type of waste plastic, polypropylene, back into resin. PureCycle is around two years behind schedule on its first commercial plant, which its CEO Mike Otworth told Reuters on March 6 was due to slower-than-expected debt financing and the coronavirus pandemic.

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Renewlogy later this year plans to launch another plastics recycling facility, this one in Phoenix, Arizona, according to its website. Joe Giudice, assistant public works director at the City of Phoenix, confirmed the facility was due to start being set up in August. More taxpayer money is due to flow to the company.

The Arizona Innovation Challenge, a state-funded program, in 2017 awarded Renewlogy a $250,000 grant, funds that will be dispersed when Renewlogy sets up in Phoenix, the Arizona Commerce Authority, which runs the program, told Reuters.

Giudice said Phoenix would not be sending Renewlogy any film plastics due to uncertainty over whether they could be easily recycled.

Renewlogy said it would be “starting very small” and would be “validating each step before scaling up.”

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In March 2019, Enerkem, a Montreal-based advanced recycler, announced that Anglo-Dutch oil giant Royal Dutch Shell Plc had joined a consortium of equity partners in a waste-to-chemicals recycling project to be based in Rotterdam, which they claimed was the first of its kind in Europe.

Enerkem says its technology uses extreme heat to turn plastic and other common household garbage into “bio-methanol,” a fuel for use in the chemical industry and transportation sector. The Rotterdam project was supposed to convert waste from the equivalent of more than 700,000 homes, Enerkem said in a March 2019 press release.

Two sources directly involved with the project told Reuters it was cancelled late last year due to uncertainty about the plant’s ability to secure a reliable waste supply and to turn a profit.

Enerkem said the project was never cancelled, rather “repurposed” to focus on making jet fuel from waste due to high demand for a sustainable product.

Shell will make a decision in 2022 on whether to invest, a company spokesperson said. Shell declined further comment.

UNILEVER’S ‘RADICAL RECYCLING’ FALTERS

Unilever Plc in 2017 announced it was creating a pilot plant using a “radical recycling process” that turns hard-to-recycle plastic sachets into new packaging. Sachets are used to dispense a vast array of products, including fast-food ketchup, shampoo and toothpaste.

The global consumer products giant told Reuters that its CreaSolv process uses chemicals to dissolve plastic waste into a liquid, drains off the impurities, dries it and extrudes it into clean plastic that can then be turned into new products.

Unilever said in its announcement that it would share this technology with its competitors so that recycling plants could be built around the world.

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Agilyx, an advanced recycling firm backed by Virgin Group and its billionaire founder Richard Branson, in 2018 announced a deal to convert plastic waste to jet fuel for Delta Air Lines Inc.

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Current Agilyx CEO Tim Stedman told Reuters in March the project was delayed due to negotiations over contracts and finances and “was eventually killed by COVID,” referring to the pandemic that spread around the world in early 2020. In a June email to Reuters, he described the project as “on hold” and said “we remain optimistic” about its prospects. READ MORE