Ellen MacArthur Foundation
Plastics 101: Blue Economy Opportunities and Considerations to Reduce Ocean Plastics
Vanessa Fajans-Turner Plastics & Pollution
Overview
Plastics are the most common form of marine debris. They originate with a variety of land and ocean-based sources across industries; enter the water in many ways; and negatively impact the ocean and Great Lakes. Once in the water, plastic debris never fully biodegrades.
There is no silver bullet solution to the plastics crisis and comprehensive approaches to addressing it must involve strategies to not only recycle but also redesign, reuse, repair, and compost materials, too. What’s more, the trade-offs for using plastic materials and their replacements vary across use cases and must always be assessed in their specific social, environmental, and economic contexts to ensure materials are kept in circulation at their highest value and best use case for as long as possible.
Yet the outsized challenges that reducing plastic waste present go hand in hand with outsized opportunities for remunerative and positive impact. As public awareness of the downside of plastic pollution grows, consumer preferences and demand for alternative choices is rising fast.
The value of just 20% of the global market for single-use plastics is estimated to be over $10B, with the biodegradable plastic industry’s size estimated by some to be nearly $7 billion by 2025. The investable opportunities in the plastics industry can be categorized according to whether they focus on how plastic materials are produced, replaced, used, or disposed of.
The term plastics and, particularly bioplastics, is used to refer to a wide range of materials that can obscure subtle differences with important ramifications for whether or not the material is sustainable for its context or use case.
“Bioplastic” can refer to material that is:
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Bio-based, but can become chemically-identical to petroleum-based plastics after manufacturing. If they do so, these plastics are intended to be recycled alongside traditional petroleum-based plastics at end-of-life;
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Biodegradable at end-of-life, meaning it can be consumed by microbial activity (bacteria and/or fungi) into carbon dioxide, water vapor, and microbial biomass.
These two properties are not mutually exclusive, and neither is definitively sustainable. Yet they are distinct from “biopolymers.”
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“Bioplastic” can also refer to biopolymers––a set of polymers, distinct from traditional plastics, that are biologically-derived and biodegradable.
Biopolymers can loosely be classified as bio-based (PHAs, PLA, Bio-PBS, TPS), petroleum-based biodegradable (PBAT, PCL), naturally-occurring (Cellulose, Chitin, Proteins), and other (PVOH & PVA, and PEF).
Production: Material Replacements & Innovations
The landscape for opportunities in material innovation is arguably the most buzzworthy, complex, and crowded among pillars in this space.
Ventures in this arena are generally focused on bioplastics (which are intended for recyclability) and biopolymers (intended for compostability) to replace plastic as the primary material in single-use utensils and straws with bamboo and seaweed.
Material Breakdown
Material breakdown is concerned with the development of novel solutions to advance the degradation of plastic in the natural world.
Solutions in the realm of material breakdown generally feature the longest-time horizon, are capital intensive, and are uncertain; yet, this pillar also represents the highest level of financial upside if a viable solution is reached. One example of an exciting, yet limited advancement in this field is the usage of wax moths to consume plastic. In France, scientists have created a mutant enzyme that can break down plastic bottles for recycling in hours. Though solutions through this pillar are promising, there is a long time horizon for new, capital intensive products that are all but a certain solution.
Chemical Recycling
Chemical recycling is a process in which a polymer is reduced to its base form and then remade into a new plastic product. Recently, brands such as Adidas, Unilever, and P&G have begun contracting chemical recycling firms to engage in this process. The chemically recycled plastics industry has been estimated to be worth $120 bn in the U.S. and Canada, with significant opportunities in recycled polymers; refined hydrocarbons, petrochemicals, and fuels; and monomers and intermediates. Though promising, this solution is relatively inefficient: up to 50% of carbon is lost in chemical recycling, and in some cases, the plastics are transferred into fuel (dumping the problem onto atmospheric climate change).
Generic Disposal & Recycling
Generic recycling refers to the process in which used plastic is collected, sorted, and then repurposed into new use cases. This process is extremely inefficient, it is estimated that less than 10% of plastic is ever recycled. Nations often lack the infrastructure to recycle at scale - this represents a massive opportunity for investment in supply chain and logistics as it relates to plastics. As such, there is a significant opportunity to build new supply chains for the recycling and disposal of plastic. On the product side, the key offenders to recycling plastics are frozen fruit packaging, sachets/plastic bags, snack bags, etc. These plastics can’t be sorted by machines, representing room for innovation in recycling design and supply chain.
Disposal refers to the placement of plastic in proper channels, such as landfill or incineration, while also putting preventative measures in place that capture plastic from appearing in the ocean through runoff.
Redesign
Product redesign refers to efforts to (1) reduce the total volume of global plastics production by consciously designing systems and products to use fewer plastic materials in their production, packaging and delivery, and (2) design products and packaging that are intended to be recyclable or otherwise sustainably processed at their end-of-life.
Reuse, New Delivery models (going local), Recapture:
Reuse solutions keep plastic products in play for longer and are intended to increase the recoverability of materials after use via design practices such as monomateriality. On a commercial level, reusable solutions are the implementation of products that can be used for recurring visits, in lieu of plastic.
Recapture refers to the process of acquiring plastic that has found its way to our oceans and seas. Recapture processes generally require high energy expenditures which can undermine their benefits, and more research and innovation is needed to further develop the organics processing infrastructure needed to recapture plastics materials properly after their use. Programs that incentivize recapture include Plastic Exchange, a program that incentivizes citizens to trade in plastic for rice.
Recent Developments
The market for plastics and their alternatives is governed, in part, by a growing range of regulations and reduction targets at the global, national, state, city, and local levels. Many of these proposals aim to shift responsibility for dealing with plastic waste to the companies that produce it, a concept known as extended producer responsibility, something that is already required by law in parts of Canada and Europe.
Venture & Startup Space
Circulate Capital closed a $106 million dollar fund in 2020 focused on the circular economy, waste management, and recycling. A multitude of startups related to the oceanic plastic economy have formed in SE Asia, especially in Singapore, India, and Indonesia.
Closed Loop Partners is a New York-based investment firm that provides equity and project finance to scale products, services and infrastructure at the forefront of the development of the circular economy. One of its four areas of focus is on investments in plastics and packaging solutions to reduce plastic waste.
Legislation
A few specific pieces of US legislation - proposed, pending, and/or passed - that would impact markets for plastics and increase demand for their alternatives include the:
Break Free from Plastic Pollution Act
This bill is currently pending in Congress. It sets forth requirements related to waste and recycling collection systems for a variety of products and materials, including plastics.
California Circular Economy and Plastic Pollution Reduction Act
The California State Legislature came close to passing this groundbreaking legislation in 2020, which would have required that products sold in plastic packaging in the state have a proven recycling or composting rate of 75% by 2032. The proposal is still very much alive, and if the Legislature doesn’t pass it in 2021, a similar proposal is likely to be on the 2022 statewide ballot.
Targets
The Ellen MacArthur Foundation and UN Environment Programme have established ambitious targets to reduce plastic waste by 2025, drawing on support from 16 governments, 26 financial institutions, and more than 150 companies that produce or consume plastic packaging. The signatories have pledged to eliminate unnecessary plastic and to ensure those remaining plastics are designed to be safely reused, recycled, or composted. Signatories from the consumer goods sector include Coca-Cola, Nestlé, PepsiCo, Unilever, L’Oréal, and Mars.
Corporate Targets. In response to growing pressure from consumers, some major companies have set notable plastic-reduction targets that have and will continue to drive up demand for alternatives including commitments from:
Walmart, the largest retailer in the world, hopes to reach 100% recyclable, reusable, or compostable packaging status for its private-label brands by 2025. It is also phasing out single-use plastic bags and is incorporating recycling labels that inform consumers on where to dispose of certain materials.
Kellogg’s is aiming to switch to completely reusable, recyclable or compostable packaging by the end of 2025, while also adopting compostable and paper foodservice products in its plants and offices. It is already working to swap out plastic cereal pouches in its European products for recycle-ready materials by the end of this year.
Hershey is striving to achieve zero-waste-to-landfill at its facilities and a 95% recycling rate by 2025.
Unilever is also taking a proactive stance on plastic packaging and investing in circular economy initiatives that ensure plastic packaging components can be reused, recycled, or composted.
Multi-Sector Collaborations
RePurpose has launched a platform to help advise and facilitate business efforts to reduce their plastic footprints.
Parley AIR is an acronym for the organization’s strategy to partner with the private sector to avoid, intercept and redesign away from reliance on plastics. Parlay has created partnerships with several firms to raise awareness for plastic pollution, one of our favorites is its partnership with Adidas. In collaboration with the Maldives, Parley has constructed a proof-of-concept for a circular, sustainable economy as it relates to plastics.
Want to learn more about Plastics?
Browse our collection of Quick Dips (short articles) and Deep Dives (longer articles) in the Investable Oceans Plastics Zone. Please also share additional content about the growing oceanic plastics sector with us by emailing us.
With Special Thanks to:
Winnie Lau, Senior Manager, Preventing Ocean Plastics, The Pew Charitable Trusts
Léa d’Auriol, Oceanic Global
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