Boosting the circular economy with circular carbon feedstocks
The green and digital transition includes the transition from a linear economy towards a sustainable circular economy. This calls for an array of complementary technological options and business models.
To meet the ambitious European objectives, there is a key role for the different circular carbon feedstocks in the transition of the EU chemical industry, such as recycled feedstock, bio-based feedstocks and CO2 as a feedstock.
Increasing the use of circular feedstocks will require a rapid scale up of their corresponding technologies: chemical recycling for recycled feedstocks, Carbon Capture and Utilisation (CCU) for CO2 as feedstock, and biomass conversion and upgrading technologies for bio-based feedstocks.
An enabling predictive and supportive EU policy framework can drive these technologies by creating the push and pull for more circular products and incentivising investments. It is essential to ensure coherence among the various regulations driving circularity. Environmental, circular, and feedstock objectives should align seamlessly with policies on environment, climate, energy, and competitiveness.
Chemical recycling, bio-based technologies and CCU must be recognised across all relevant EU legislation as enablers of the circular economy.
Incentivising circular products
Legislation is a key lever to boost the circular economy by incentivising the uptake of circular products
Significant efforts have already been made in the EU regulatory frameworks on products regulation —including on recycled content targets in the Packaging and Packaging Waste Regulation (PPWR) —which are essential to create a market for circular products.
Pull mechanisms are crucial to increase demand for circular products, as in the recycled content targets and collection rate target in the Single Use Plastics Directive (SUPD), the Packaging and Packaging Waste Regulation (PPWR) and proposed End-of-Life Vehicle Regulation (ELVR).
The End of Life Vehicles (ELVR) directive is an opportunity to introduce recycled content targets, where both mechanical and chemical recycling can contribute. To reduce the dependency on fossil sources, the ELVR proposal should also consider the use of bio-based and CO2-based feedstocks to be used in materials, plastics and chemicals for vehicles.
Businesses should be incentivised to keep carbon in the products loop. There is currently no measure under the current EU legislative framework to incentivise the production of chemicals and polymers from CO2 captured from industrial sources. � Businesses should be incentivised for keeping carbon in the products loop through the utilisation of all types of alternative carbon feedstock.
Well-designed targets on circular content could facilitate the deployment of new technologies driving circular feedstocks. They should be technology neutral, not too overregulating or too narrow, leaving the possibility for manufacturers to invest in the appropriate recycled, bio-based or CCU based products.� The market uptake of circular carbon products should be encouraged by increasing transparency on circular carbon (bio-based, captured CO2 based, recycled based) content of final products.
The Implementing Act under the Single Use Plastics Directive (SUPD) is the first opportunity to establish clear rules on calculation and verification of chemically recycled content.
The Ecodesign for Sustainable Product Regulation (ESPR) will be an important overall circularity driver. in the secondary legislation following the ESPR. The ESPR should put additional emphasis on the use phase and provide guidance on re-using, refurbishing and remanufacturing for producers and brand owners to further drive the transition.�
Enabling the circular economy by scaling up chemical recycling
Existing waste legislation across all Member States must be implemented and enforced to divert plastic waste from landfilling, export, or incineration towards (novel) recycling routes such as chemical recycling, when it cannot be mechanically recycled. Given the wide range of quantities and qualities of plastic waste, no single recycling system can cover all the waste streams. Therefore, a combination of complementary solutions � including chemical recycling and mechanical recycling technologies � is needed to achieve high recycling rates for plastics.
Improving Europe’s � chemical and mechanical � recycling capabilities play an important role in lowering emissions by 55% by 2030, and contributing to EU Green Deal ambitions around circularity and climate neutrality. To increase the use of circular feedstocks, much more plastic waste needs to be collected, sorted, and prepared for recycling. Additionally, a broader range of markets need to be supplied with plastic products containing recycled content. Hence, there is a need for the rapid scale-up of both mechanical and chemical recycling technologies, which will also enhance the EU’s strategic autonomy.
All waste should be considered as a source of recycled content, beyond only post-consumer waste, to include pre-consumer waste as well. This would incentivise investment in technologies that bring more recycled feedstock to the economy, encouraging the development of technologies and processes such as chemical recycling. Chemical recycling, complementary to mechanical recycling, can transform more types of waste into usable materials, thereby increasing the availability of recycled feedstock in the economy.
Incentivising Circular Products
Legislation is a key lever to boost the circular economy by incentivising the uptake of circular products
Significant efforts have already been made in the EU regulatory frameworks on products regulation —including on recycled content targets in the Packaging and Packaging Waste Regulation (PPWR) —which are essential to create a market for circular products.
Pull mechanisms are crucial to increase demand for circular products, as in the recycled content targets and collection rate target in the Single Use Plastics Directive (SUPD), the Packaging and Packaging Waste Regulation (PPWR) and proposed End-of-Life Vehicle Regulation (ELVR).
The End of Life Vehicles (ELVR) directive is an opportunity to introduce recycled content targets, where both mechanical and chemical recycling can contribute. To reduce the dependency on fossil sources, the ELVR proposal should also consider the use of bio-based and CO2-based feedstocks to be used in materials, plastics and chemicals for vehicles.
Businesses should be incentivised to keep carbon in the products loop. There is currently no measure under the current EU legislative framework to incentivise the production of chemicals and polymers from CO2 captured from industrial sources. � Businesses should be incentivised for keeping carbon in the products loop through the utilisation of all types of alternative carbon feedstock.
Well-designed targets on circular content could facilitate the deployment of new technologies driving circular feedstocks. They should be technology neutral, not too overregulating or too narrow, leaving the possibility for manufacturers to invest in the appropriate recycled, bio-based or CCU based products.� The market uptake of circular carbon products should be encouraged by increasing transparency on circular carbon (bio-based, captured CO2 based, recycled based) content of final products.
The Implementing Act under the Single Use Plastics Directive (SUPD) is the first opportunity to establish clear rules on calculation and verification of chemically recycled content.
The Ecodesign for Sustainable Product Regulation (ESPR) will be an important overall circularity driver. in the secondary legislation following the ESPR. The ESPR should put additional emphasis on the use phase and provide guidance on re-using, refurbishing and remanufacturing for producers and brand owners to further drive the transition.�
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Developing a market for recycled content with the mass balance approach
The chemical industry is committed to boosting the circular economy by delivering recycled content which is urgently needed to strengthen the EU’s strategic autonomy in raw materials and meet climate targets. This requires a clear and enabling EU legislative framework which increases the recycled content of materials in a cost-efficient and transparent manner with limited environmental impacts, while taking into account the complexity of chemical processes.
A speedy adoption of an appropriate allocation model for a mass balance accounting system for recycled content represents an opportunity for a more comprehensive development and application of recycling technologies.
Specifically, the recognition of a credit-based mass-balance chain of custody with a fuel-use exempt model in legislation. Combined with ambitious recycled content targets in product regulations, this model would incentivise the uptake of chemically recycled material in circular products, complementary to mechanical recycling.
Recognising this model would also allow chemical recycling to contribute to recycled content targets in EU legislation, as part of the secondary legislation under the SUPD and the PPWR.
Mass balance methodology is an accounting method to track the amount of circular material in the value chain and attribute it based on verifiable bookkeeping.
It is one of the well-known and widely used “chain of custody� models, as defined in ISO standard 220956. It is already successfully deployed in other sectors, such as biofuels, fairtrade cacao and coffee.
To deliver recycled content in line with sustainability goals, the mass balance method should be based on the following pillars:
- Third-party certification: °®ÓÎÏ·Öйú¹Ù·½ÍøÕ¾ sees credible third-party certification schemes and their standards as indispensable to guarantee the correct and transparent use of appropriate chain-of-custody methods along the value chains, avoid double booking, substantiate the claims and provide credible and transparent information to the market and consumers.
- Allocation models: °®ÓÎÏ·Öйú¹Ù·½ÍøÕ¾ supports the ‘fuel use exemptâ€� model as a way forward for how the recycled content can be assigned to the outcome products. It should allow a credit-based mass balance method using actual conversion factors to correct for process losses and outputs consumed as fuel. Restrictive models, such as proportional and polymer-only, would hamper the acceleration of the circular economy, as they would lead to low amounts of recycled content for technologies and processes with several outputs.
- Restricted credit transfer:
- °®ÓÎÏ·Öйú¹Ù·½ÍøÕ¾ supports that restricted credit transfer is only used under very specific conditions: same product, same parent company and within specified geography. This avoids unnecessary transport of intermediate products along the value chain and associated environmental impacts.
- Establishing a mass balance method under these conditions will help ensure that recycled feedstock progressively replaces more and more fossil-based virgin materials in the production of plastics and a broad range of chemicals and products in Europe.
CO2 as alternative carbon feedstock
The utilisation of captured CO2 as feedstock is one of the options that can be considered by the chemical industry to increase carbon circularity while reducing the climate footprint of chemicals and polymers and contributing to Europe� strategic autonomy.
Many technologies have been developed for CO2 capture and purification as well as for the utilisation of CO2 as an alternative carbon source for the synthesis (e.g. via various technologies including catalytic, electrochemical, biotechnological) of various platform chemicals, fine chemicals and polymers.
Next to recycling carbon from waste streams, from sustainable sources of biomass, the utilisation of captured CO2 as feedstock has been recognised as contributing to carbon circularity in the . Despite this recognition there is no enabling policy framework that support the business case for investment in scaling up technologies for the production of chemicals and polymers from CO2 captured from industrial point sources. In the recent revision of ETS, the CO2 emissions avoidance from the utilisation of captured CO2 as feedstock is only recognised if the CO2 is then permanently stored in products including during their end of life. Therefore, the CO2 captured from an ETS installation and used for the production of polymers and chemicals with no emission during their use phase but with a limited lifetime is still considered as emitted under ETS.