No conference, no trade fair, no presentation without the circular economy. The concept is as simple as it is convincing: keep materials in circulation and thus reduce the need for new raw materials.

Maximize reuse, minimize waste. Especially in the chemical and plastics industry, this kills two birds with one stone: less plastic waste at the end of the value chain, fewer fossil resources at its beginning. The two biggest challenges of the industry mastered in one fell swoop?

Quite rightly, the circular economy is a much-discussed topic when it comes to doing business more sustainably. Recycling will play a crucial role in transforming the industry. Without circularity, chemistry will have a hard time in a society where sustainability goes from being a competitive advantage to a basic requirement. We cannot do without cycles: where possible, we must keep materials in the cycle.

"It won't work without cycles. Where possible, we have to keep materials in circulation."

Recycle what is possible

To achieve this, we must exploit all possibilities: at present, less than ten percent of global plastic waste ends up in recycling. To close the gap, we need to expand mechanical recycling. At the same time, new technologies are also needed: We need to expand chemical recycling to utilize additional waste streams and bring recyclates into applications for which mechanical recycling is not suitable. This may be the case due to high impurities in the plastic waste or due to high quality requirements for the end products, e.g. in medical applications. There is a lot happening in this field: Neste itself is currently investing in chemical recycling capacity in Finland, but many other companies are also pushing new recycling technologies. The chances are good that we will be able to recycle more and more in the future. The circular economy can become a reality. But is it enough?

The demand for plastics is growing, despite attempts to reduce the use of plastics where possible. So not only do we have to close a gap in the recycling race, the full distance is also becoming steadily longer. In addition, recycling is always associated with losses, we lose material at every step of the process. Depending on the recycling process, the quality and the composition of the waste, more or less material is lost. A general rule: the more complex the waste, the higher the losses. For the foreseeable future, we will therefore always need new material to meet demand. In a sustainable society, this material can no longer come from fossil sources. Fortunately, there are alternatives that we can use: for example, bio-based raw materials.

„Recycling and the circular economy can become the backbone of the transformation.“

Using waste and residual materials

There are numerous bio-based raw materials that are suitable for the production of plastics and chemicals. At Neste, for example, we rely primarily on waste and residues: old frying fat, for example, or residues from vegetable oil production. In our refineries, these raw materials are processed into pure hydrocarbons. Chemically, they are almost identical to the products from fossil refineries. This is how bio-based or renewable fuels (diesel, jet fuel), but also naphtha or propane eligible for plastics production are produced. Since the renewable raw materials for polymers and chemicals can hardly be distinguished from their fossil relatives, they can also replace them one-to-one. They can also be mixed with fossil - or chemically recycled - feedstock for polymers and chemicals production. This makes them particularly interesting as an effective addition to the circular economy.

In the end, renewable raw materials enable the production of plastics and chemicals of identical quality and with identical properties as those made from fossil materials: polypropylene, polyethylene, PET or similar. As a result, there are already numerous applications on supermarket shelves around the world: from high-quality coffee capsules to packaging films, from nappies to plastic cups. Applications in the medical or food industry show that there is no compromise on safety either.

The decisive difference: the carbon footprint

The carbon footprint is quite different, though, when replacing fossil with renewable materials. When bio-based raw materials are used, we use carbon from the earth's natural cycle. In contrast to fossil raw materials, the total amount of carbon dioxide in the atmosphere remains largely unchanged when bio-based materials are used. Neste's bio-based Neste RE feedstock has a carbon footprint that is over 85 per cent smaller compared to fossil raw materials for plastic.

Unlike other sectors, renewable plastics are not an idea for the future. They are available in the here and now - and not in short supply: Neste alone has renewable refineries with a total capacity of about 3.3 million tons of renewables annually. In early 2024, the figure will rise to 5.5 million tons, and is expected to reach around 6.8 million tons by the end of 2026. It is therefore possible for the polymers and chemicals manufacturers to significantly reduce emissions in the supply chain and reduce dependence on fossil resources without major CAPEX expenditure or infrastructure conversions.

„In order to completely replace fossil resources, we need to expand the raw materials base.“

Renewable raw materials of the future

The availability of today's used waste and residual materials has a natural limit. According to estimates, we will have over 40 million tons of waste and residue oils and fats available to us worldwide every year in 2030. With global plastics production at around 400 million tons, it is clear that this will not be enough - especially since the oils and fats are also processed into fuels or other products.

In order to completely replace fossil resources, we must therefore expand the raw material pool. While also working on expanding the availability of waste and residue oils and fats globally, there are also other promising sources of raw materials we are researching at Neste:

• Lignocellulose: Here, agricultural and forestry waste and residues serve as the basis for the required carbon.
• So-called "Novel Vegetable Oils" (NVO): Vegetable oils that are based on advanced, more sustainable, regenerative agricultural concepts that minimize demand for additional agricultural land. The key sustainability benefit provided by these advanced agricultural concepts is that additional volumes of vegetable oils can be produced with regenerative agricultural practices that maximize greenhouse gas savings and carbon sequestration while promoting soil health. Existing agricultural land is used, for example off-season or in harmony with livestock farming.
• Microalgae: Photosynthetic algae can in principle be cultivated wherever there is sunlight and water - including salt water.
• Municipal waste: Certain parts of conventional household waste can be processed into hydrocarbons through gasification or fermentation and synthesis.
• Power-to-X: With the conversion of CO₂, an almost infinite carbon source for power or raw materials could be available - provided there are sufficient amounts of renewable energy.

It takes all solutions

In the search for sustainable solutions for the chemical industry, recycling is often idealized as the perfect solution. In the process, additional technologies are forgotten.

It is true: recycling and the circular economy can become the backbone of transformation. The more material we recycle and thus keep in the cycle, the better. Where mechanically possible, it should be done mechanically. Where not possible, we should recycle chemically.

But recycling alone will not be enough in the post-fossil age. We will need additional alternatives. We need to be aware of this today and set the right course. Bio-based raw materials can be one of these alternatives. The fact that they are already available today helps us to drive the change. Because: Our CO₂ budget is absolute. Every drop of crude oil we save counts - already today. Let's not wait, let's get started!

Katja Wodjereck, Executive Vice President Renewable Products, Neste

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Zur Person

Katja Wodjereck is Executive Vice President Renewable Products at Neste. Prior to joining Neste in spring 2023, the Augsburg native was President DACH and Italy at Dow and Commercial Director Dow Industrial Solutions. During her 20-year career at Dow, Katja Wodjereck previously held various leadership positions in sales, marketing and product/asset management in Europe and Latin America. Katja Wodjereck is a graduate of an Executive MBA program and studied International Business Management.