Industry promotion of recycling through instruments like plastic credits distracts from the urgent need to reduce overall production, with less than 10% of plastic recycled globally, according to a sustainable finance think-tank.
A new report by Planet Tracker finds that 91% of plastic globally is not recycled, with confusion around recycling symbols misleading regulators and consumers, and the illusion of recyclability shifting focus away from the real need to limit production and adopt alternative materials.
This figure is backed up by OECD data, which finds only 9% of plastic to be successfully recycled, with the world producing twice as much as two decades ago, the bulk of which ends up in landfill, the natural environment, or is incinerated.
The focus on recycling as a panacea for global plastic pollution is distracting from ongoing efforts to deliver a Global Plastic Pollution Treaty, says Planet Tracker.
Planet Tracker is calling on investors to support the Investor Statement on the role of petrochemical companies in resolving plastic pollution, recognising they are a major contributor to plastic production and that lifecycle emissions from plastics are projected to more than double by 2060, making up 4.5% of global emissions.
The latest round of the UN led Plastics Treaty negotiations, which closed with insufficient progress, saw petrochemical companies and their supporters opposing any plastic production cuts and pushing back against the inclusion of polymer production within the treaty, states Planet Tracker.
Investors should call on petrochemical companies to support a more ambitious agreement, it says, with expectations on companies to transparently disclose strategies for more sustainable plastic, and to address polymers and chemicals of concern in their products.
The fourth Intergovernmental Negotiating Committee (INC-4) meeting in Ottawa, Canada in late April, concluded with countries weighing the proposal of a target for 40% reduction for plastic production by 2040 submitted by Rwanda and Peru, even as a final agreement was not reached.
Countries agreed on a series of expert meetings aimed at catalysing convergence on key issues in the lead up to the final round of talks (INC-5), scheduled to be held over Nov. 25-Dec. 1 in Busan, South Korea.
Several environmental organisations, such as Friends of the Earth International (FOEI) and Greenpeace, pointed to a lack of ambition, with some arguing that parties bowed down to the plastic and fossil fuel industries.
Greenpeace noted the “disappointing” presence of 196 lobbyists from the fossil fuel and petrochemical industries at the summit, claiming that “states are listening more closely to them than health scientists”.
MOUNTING PROBLEM
Plastics account for 3.4% of global greenhouse gas emissions and every year 19-23 million tonnes of plastic waste leaks into aquatic ecosystems, polluting lakes, rivers and the sea, according to UNEP.
Without action to curb this escalating crisis, global plastic waste is projected to almost triple by 2060, reaching around 1 billion tonnes.
The growing market for plastic credits, such as those registered under Verra’s plastic programme, “does not tackle the underlying problem of rising plastic production, which is overwhelming the present waste treatment infrastructure”, said John Willis, director of research at Planet Tracker.
“Such offsets promote the messaging from the plastic industry that we can recycle ourselves out of the present plastic pollution crisis [yet] plastic should not be viewed as a recycled material at present”, given that less than 10% of the material is recycled globally, he told Carbon Pulse.
In 2019, global plastic production reached 368 million tonnes and is predicted to double within 20 years, with the majority of it designed for single-use purposes with limited recyclability.
GROWING MARKET
Efforts to generate plastic credits from plastic removal or reduction projects are on the rise, with the market aiming to address global plastic pollution that is wreaking havoc on terrestrial and marine biodiversity and negatively impacting human health.
Up to $40 billion in annual funding is estimated to be needed between now and 2040 to get the situation under control, with the plastic credit market hoping to play a role in addressing the situation.
Verra, the world’s biggest standard for voluntary carbon credit projects, and the Plastic Credit Exchange (PCX) – active primarily in North America and South and Southeast Asia – have established themselves as early frontrunners in plastic credit issuances.
Verra launched its plastic credit standard in 2021, and in March 2022, the Second Life Thailand project became the first to be registered as well as securing an issuance of 736 credits.
Bentley Motors and Escape Travel are among those to have used credits from that project to offset their own plastic use, according to the Verra registry.
A plastic removal project at a banana plantation in Queensland, Australia, registered under Verra’s plastic programme last year and received 32 Waste Collection Credits (WCC), representing 32 tonnes of plastics removed that would normally have been left in the environment.
The project is a cooperation between developer GreenCollar, the Australian Banana Growers Council, and waste company MAMS Group to collect the plastic that is used to cover banana bunches as they ripen, as opposed to shredding the plastic and ploughing it into the soil, which is normal practice.
Meanwhile, India-based Calculus Carbon is working to establish itself as an intermediary, connecting project developers and plastic waste generators interested in investing in the industry.
Yet a challenge facing Indian developers that wish to qualify for one of Verra’s two plastic credit types – Waste Collection Credits (WCCs) and Waste Recycling Credits (WRC) – is the additionality requirement that recycling projects must meet in regions where current recycling penetration rate is below 20%.
And earlier this year, The World Bank issued a seven-year $100 million, principal-protected Plastic Waste Reduction-Linked Bond to channel capital towards community-led plastic waste collection and recycling efforts in Ghana and Indonesia, with investors receiving a financial return linked to the sale of plastic and carbon credits issued on the Verra registry.
Two projects developed by social enterprise Plastic Collective are in line to receive financing from the bond – the Searcular collection and recycling project in Java, Indonesia, and the Asase Foundation community-based collection and recycling project in Ghana.
Plastic Collective’s community-led collection and recycling projects are supported by brands including Coca Cola and TK Maxx through the sale of plastic credits.
While Planet Tracker welcomes financial flows directed at recycling and reuse infrastructure for the plastic industry, care needs to be taken to ensure that plastic credits are genuine, with a need for robust monitoring and verification systems to be in place, said Willis.
SHIFTING THE BLAME
The Planet Tracker report identifies several key problems with tackling plastic pollution.
These include misleading recycling symbols arising from the plastic industry’s resin identification codes that are often wrongly perceived as recycling symbols and do not represent recyclability, only the source material.
The industry has a “history of deception’’, the report states, with the focus on promoting recycling as the solution to plastic pollution in order to allow for the continued expansion of production and to protect profit margins.
Deceptive tactics also include the industry’s ability to “shift the blame” for plastic pollution on to consumers and municipalities, with few municipalities able to afford the necessary clean-up costs and many consumers having no waste collection.
This comes in addition to a “financial market blind spot”, whereby the true risks associated with plastic production are not properly accounted for by lenders and insurers, the report says.
By Bryony Collins – bryony@carbon-pulse.com
