Going under the knife for a more sustainable future

    Tough action required to future-proof industry and safeguard further capital investment 

    Stemming the flow of plastics into the environment will need ‘more than a nip and tuck approach’ if the world is to reach peak plastics and meet the net zero challenge, says market analyst Wood Mackenzie.

    After 50 years of carefree consumption, urgent transformation is needed to negate large-scale greenhouse gases (GHG) being emitted annually by the sector into the global atmosphere, claims the company. In 2021, the plastics industry will produce 1.2 gigatonnes (GT) of carbon dioxide equivalent. At the same time, emissions from the industry are set to rise by 90 per cent over the next three decades as demand for plastics products increases.

    Andrew Brown, head of polymer demand at Wood Mackenzie, said: “Plastics have been a complete game-changer over the past 50 years. They have become a vital part of everyday life and are now pivotal to the energy transition. However, the balance has shifted too far towards low-cost, disposable plastics, which cause environmental damage at every stage in their life cycle, and it needs more than a nip and tuck approach to address this.”

    Wood Mackenzie calls for the creation of a plastics value chain with more sustainable practices across production, waste collection, recycling and lower-carbon, renewable feedstocks. The methodology uses a scenario to identify where the industry can act to reduce its environmental footprint while continuing to deliver essential products and services supported by the plastics economy.

    The results of Wood Mackenzie research show that the industry can deliver a ‘peak plastics’ future, in which demand growth moderates and consumption of fossil fuel feedstocks declines. The model shows carbon emissions returning to around 1 GT by 2050, peaking at 1.45 GT in 2035, compared to emissions of nearly 2 GT in 2050 in the base case scenario; and a total saving of 8 GT over the next 30 years under peak plastics. It also foresees mismanaged waste down by 45 per cent versus the base case, saving 1 billion tonnes of plastics waste going into the environment, open burning or unsanitary dumps over the next three decades.

    However, without any offsets, the scenario shows the sector producing 1 GT of emissions in 2050, while tens of millions of tonnes of poorly managed waste would continue to flow into the environment.

    Wood Mackenzie suggests positive results can be delivered with a regime of diversifying traditional fossil fuel feedstocks, minimising the carbon footprint of plastics production and investment in cleaning up the waste chain. The consequence of failing to do so could jeopardise future capital investment for businesses and risk social license to operate.

    Seeking renewable inputs to meet demand remains a challenge. The ongoing extraction of fossil fuels – which account for 85 per cent of plastics feedstocks today – contributes to GHG emissions and a linear business model.

    Sandheep Sebastian, senior data scientist, said: “There are a host of greener feedstock options being considered which have superior environmental profiles. These include making plastics from bio-feedstocks, from waste and by combining captured carbon with low-carbon hydrogen.

    “But most fundamentally, producing plastics from waste through mechanical and chemical recycling simultaneously addresses both carbon emissions and plastics waste. In our peak plastics scenario, renewable feedstocks account for 25 per cent of base chemical production by 2050 – up from less than 2 per cent today – with oil demand into the petrochemical sector going into decline from 2035.

    “However, substantial investment and research and development are required to build up scale in these alternative feedstocks.”

    The research also looked at what the 30 largest plastics producing companies have committed to do to address their environmental footprints. The biggest areas of focus are on shifting to lower-carbon energy inputs and driving operational efficiencies. Only four out of the 30 mentioned Scope 3 (the emissions in their supply chain, particularly associated with what happens to the plastics they have produced) in their carbon commitments.

    Head of intermediates and applications, Guy Bailey, said: “While leading petrochemical companies should be applauded for taking steps to address the impact of their products, current commitments are – in aggregate – insufficient to the scale of the problem, and lacking in detail for how they will be implemented.

    “Companies that fail to address governments’ climate and recycling targets risk pariah status amongst investors and the consumer brands that use their plastics. However, organisations that take the lead and act now will come out of this ahead of the pack with a more stable and sustainable future.”