Whisper it softly within the walls of Moscow’s Kremlin. But the rest of Europe is tired of being held hostage by its need for Russian oil and gas. Parents don’t want to have to choose between feeding their family and heating their home in winter because of Russia’s invasion. And last week saw another move to reduce its dependence.
Earlier this year, even the fossil fuel-friendly International Energy Agency called on governments to accelerate the use of Electric Vehicles (EVs) and recycled plastic. As we noted here, this means:
“Geopolitical, economic and sustainability goals are all pointing in the same direction.“
EV adoption is certainly racing ahead in Europe. More than 20% of all cars sold in Q3 were plug-in or battery EVs. And a further 23% were hybrids. And the trend is likely to accelerate further with sales of new gasoline/diesel cars now banned from 2035.
Few people, after all, will want to buy one from 2030, knowing that the resale value will likely have collapsed when they come to sell it 5 years later. All the evidence suggests that people actually prefer driving EVs, and appreciate their lower maintenance costs.
And now last week, the European Commission announced a revision of the Packaging and Packaging Waste Directive. As the chart shows, it includes new mandatory rules to reduce packaging waste. It also sets new targets for reuse of take-way cups and materials used for online deliveries. As Reuters reports:
“The planned legislation proposes minimum targets for recycled content in plastic packaging, such as 30% for drinks bottles by 2030 and 65% by 2040. Certain plastic packaging, such as tea bags, coffee pods, very light plastic bags and sticky labels for fruit and vegetables, will need to be compostable.
“The Commission is also proposing the phase-out of single-use plastic items such as the bags and nets used for food in shops and cafes and the mini shampoo bottles found in hotels. EU members will also be required to have deposit return systems in place for plastic bottles and cans.
“The proposal also lays out minimum targets for reuse of packaging, such as 20% of take-away cups by 2030 and 80% by 2040 and respectively 10% and 50% for packaging used to deliver online purchases.”
Essentially this means, as the chart shows, that the plastics industry is now being “squeezed” from both ends of the value chain:
- Upstream, its supplies of naphtha feedstocks are starting to disappear as refineries close due to the move to EVs
- Downstream, demand for virgin plastic is starting to disappear as consumers focus on recycled plastic
As the chart shows, major brand owners have realised there is money to be made by meeting consumer demand for recycled packaging. Or, to put it another way, consumers now prefer to buy a product using recycled plastic.
That’s a potentially big boost for market share if your company can supply this need – and competitors can’t.
The good news is that plastics companies are now moving forward in a major way to switch from virgin to recycled plastic. Pioneered by the Ellen MacArthur Foundation, with support from the World Economic Forum’s New Plastics project, major change is now underway:
- Dow Chemical now plans to produce 3 million tonnes of recycled plastic by 2030
- OMV have announced “a fundamental shift from a linear to a circular business approach“
- The Alliance to end Plastics Waste is sponsoring the Digital Watermarks project to enable efficient sorting of waste plastic
- And, of course, negotiations have just begun on the proposed new UN Treaty on plastics pollution
Plastics companies have the technology and expertise needed to make advanced recycling of plastics a major success. And this is critical for their future, as well as for the important task of tackling plastic waste. Curbs on the production of virgin plastics are clearly on the way.