Recycling in the European Union is about to get interesting, and David Attenborough, the iconic BBC documentarian, may bear some responsibility for what’s happening.

In 2017, Attenborough narrated the film Blue Planet II, which warned about the problem of plastic in the oceans. The story became a catalyst for the EU to draft its single-use plastic directive in 2019. Deadlines for new legislation and taxes that sprung from that directive are coming due, and they promise to remake the continent’s plastic recycling industry, especially PET plastics.

On the Nature of Polyethylene Terephthalate (PET)

Polyethylene terephthalate, or PET, is a ubiquitous plastic found in consumer product packaging like soda and water bottles, personal care products, and more. PET is considered a very friendly plastic because it’s easy to recycle back into packaging, unlike polyethylene and polypropylene plastics, which tend to be downcycled into other products.

There are more than 160 recyclers in various sectors across Europe that sort, grind, hot wash, and process used PET plastic into flakes to be remade into new bottles and packages. Some large bottling companies, like Coca-Cola, have also created joint ventures in the recycling business.

Many products made from PET are manufactured with some recycled material, which has a much lower carbon footprint than virgin material that’s derived from crude oil. Thus exists a robust marketplace for post-consumer material.

Recycling Challenges

But lately, getting the post-consumer material has proved challenging for many companies. Feedstock for the recyclers was down about 20% post-COVID-19 because fewer people were buying on-the-go beverage items. Also, demand for recycled material surged in the wake of the Attenborough documentary and the EU single-use plastic directive, as consumers and brands tried to find a salve for the impactful pictures of trash in the ocean.

Right now, companies that pick up recycling from the curb seem best positioned to succeed because they have access to raw materials at a time when those elements are scarce. But the curbside collectors won’t always have the upper hand.

Recycling: Government-Imposed Reforms

A new wave of government-imposed reforms is coming soon. They include new taxes and policies aimed at improving recycling collection rates and how that recycled PET is reused.

The EU’s single-use plastic directive created new taxes and standards, and it requires member states to enact their own legislation.

In terms of quality, the EU directive calls for newly created packaging content to contain 25% recycled PET by 2025 and 30% recycled plastics by 2030. Hefty taxes on virgin PET, which can be easily used in food-grade production, mean that the post-consumer material will remain in high demand. It also means that mechanical processing equipment and facilities will need to be improved.

The EU also wants to collect more recyclables from its population. It’s looking for a 77% collection rate by 2025 and a 90% collection by 2029 from its member states. European countries currently average 50% to 60%.

Deposit Return Schemes

Getting to those levels of collection will be difficult without deposit return schemes (DRSs), so expect them to return with force.

These schemes are nothing new — they are programs designed to recover the material needed for bottling sodas and waters. A deposit must be paid as part of the purchase price for the beverage container; however, after consumers have finished with their bottle, they will take it to a reverse vending machine for collection and receive their deposit back in return. When glass was the predominant bottling material, most recycling was done this way. But when PET plastic arrived in the 1980s and ’90s, DRSs were not adopted for those materials, except for in Germany.

Germany, which has a collection rate of about 85%, introduced a single-use deposit return system in 2001 when one-way bottles were introduced (10 years later than in the rest of Europe) that worked alongside its container return system for glass and aluminum recycling. Germany’s program was not an overnight success, however, and it took two to three years to implement.

Under Germany’s scheme, ownership of the collection kiosks or vending machines resides with the retailers. But the DRSs in the EU directive are being left to individual EU member states to roll out.

So what will the rest of Europe do? The UK, France, Spain, Italy, bottlers, government ownership, retailers — it’s all up for grabs. It’s not clear who is going to own the materials.

The one certainty is that thousands of reverse vending machines will come out in the next three to five years.

Even with those aspirational collection goals, post-consumer feedstock will likely remain under stress because of the rising quality requirements.

Un-demonizing Plastic

Danone and Coca-Cola were already in this space and are ahead of the game. Coca-Cola had been looking at 50% food-grade PET well before 2019, and in Sweden, Coca-Cola is now boasting 100%. Other major brands, like Nestlé, Pepsi, and even Procter and Gamble (which doesn’t require food-grade PET), are racing to release statements about reaching 50%.

All these changes will have a dramatic effect on pricing, quality, and industry investment. Hopefully, they will help to un-demonize plastic because plastic is one of the most brilliant packaging materials ever invented. It’s fit for purpose, and it’s there for a reason. It’s cheaper to produce than glass, aluminum, and cartons in terms of carbon footprint, and nearly all plastic can be recycled.

The only issue with plastic is its post-consumer afterlife. It shouldn’t end up in oceans; the truth is only 2% of plastic in the oceans comes from the U.S. and Europe, and 82% comes from Asia (Ed. note: The U.S. exported 1.21 billion pounds of scrap plastics to other countries in 2021, but that number is declining). Ten of the largest rivers in the world, which are from countries that don’t have waste collection systems, are the source of 88-95% of the total plastic waste transported by rivers into oceans. The solution to the problem is to collect and recycle plastic. Perhaps the rest of the world can learn from Europe’s moves.

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About Martin Hargreaves

Martin Hargreaves is an independent consultant. He was previously Managing Director, Europe at Plastipak Europe. Before this, he was Managing Director, Europe at Appe Europe; Vice President, Finance and Administration at Amcor PET Packaging Europe and Asia; and Finance Director at Schmalbach-Lubeca PET Containers/Amcor PET Packaging UK.

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This plastics industry article is adapted from the GLG webcast “PET Recycling Ecosystem — Pressures and Opportunities.” If you would like to speak with plastic industry experts like Martin Hargreaves, or any of our approximately 1 million Network Members, please contact us.