Post Consumer Plastics Markets and Comments

1. Post Consumer PlasticsMarketsand Comments David Cornell Technical Director Association of Postconsumer Plastic Recyclers August 25, 2010

2. Which Plastics? • “Single use” = packaging, mostly • ‘Packaging’ uses about 43% of plastics • 22% is PET - ~90% bottles • 30% is HDPE – ½ bottles, rest moldings & films • 22% is LDPE – mostly films & bags • 15% is PP – many forms • 5% is PVC,PS etc. – many uses and forms Per US EPA, 2009

3. Key Issue to Recycling EXPORTS RESTRICT DOMESTIC SUPPLY • 58% of PET exported (essentially all growth in collection is exported), 2008 • 22% of HDPE bottles exported, 2008 • Over half of collected films exported.

4. Wisconsin Law - 1995 § 100.297 - Plastic container recycled content • 10% recycled or remanufactured content • Remanufactured = scrap/repro/regrind • Unless “the federal food and drug administration has approved the use” of recycled plastic • Effectively unenforced, ignored

5. PET, #1 The virgin plastic is • Actually a copolymer, mostly the same • Fairly uniform in molecular weight and melt viscosity – processes predictably • Mostly uncolored • Usually few additives • Is all food grade

6. Recycled PET Uses - 2008 • 43% Fiber- carpets, ‘heavy’ thread • Relatively easy ‘drop in’, US textile industry severely impacted by imports. • 21% Bottles – food and non-food • Average 3% PCR content, can readily be 10%, some doing up to 100% PCR content • 17% Films – thermoforms, food & non-food • A growth market, replacing PVC and PS • 15% Strapping – shipping and construction • A value-added market

7. Learnings for RPET Uses • Much (fiber & strapping, >50%) driven by economics. Rarely sold on environmental benefits. Would change if RPET were intolerably polluted or too costly. Not “down cycled”, “other cycled” • Can use RPET for food contact. • Films is a growth market for virgin and recycled PET

8. More Learnings • 60% of all bottles are PET • Exports hurt domestic recycling • Recycling is best when material goes to the highest value for which it is suited. • Be careful mandates do not do more harm than good

9. HDPE, #2 two types Virgin plastic is • Variable in melt viscosity, and not interchangeable – very big deal • Color- uncolored and colored • Not many additives, mostly stabilizers • But some additives disqualify for food contact

10. Recycled HDPE Uses - 2008 • 43% Non-Food bottles. • To meet California law. • 17% Pipe, agricultural and highway • Potentially a growth market • 15% Plastic lumber • 9% Automotive • 7% Lawn & Garden

11. Learnings for RHDPE Uses • The California RPPC law’s recycled content provision provided the impetus to create the critical mass of demand • Colored bottles (copolymer HDPE) are uniform and can go into extruded uses, like new bottles and pipe. • Recycling into food contact can be done, but few have the FDA’s LNO and supply of appropriate material is limited.

12. More Learnings • 36% of all bottles are HDPE • 14% of films are HDPE. Not easy to sort out the HDPE film from LDPE film • HDPE bowls and tubs and buckets are NOT the same as bottles and cannot be separated automatically. • Recycling is best when material goes to the highest value for which it is suited. • Be careful mandates do not do more harm than good

13. LDPE/LLDPE, #4, for now Virgin plastics are • Both used for films, but are not interchangeable • (LLDPE needs different RIC number) • Color- pigmented or not • Some additives present

14. Recycled LDPE/LLDPE Uses • Over 50% exported • ~30-40% to plastic lumber • Film uses – limited by contamination • Merchandise bags (not food grade) • Trash bags • Some to injection molding blends, such as trash bin lids. • Mixed polyolefins usually compatibilized

15. Learnings for RLDPE Uses • While LDPE is uniform, separating from LLDPE is difficult and limits uses. • Cleaning film is non-trivial and film applications need very clean material • Uses such as plastic lumber or other mixed polyolefin uses make sense.

16. Polypropylene, PP, #5 Virgin plastics are • Variable in composition and melt viscosity. • Properties are variable (PP is versatile) • Color- pigmented or not • Stabilizer additives present Cannot easily be separated into consistent fractions, unfortunately

17. Recycled PP Uses • Injection molded bottle caps and molded items recycled into paint cans • Extrusion-grade PP (bottles) sought for packaging (California RPPC law), but hard to source • Limited sources hurt development of end uses.

18. Learnings for RPP Uses • Sourcing consistent material is not easy. • Mixed PP goes to most tolerant uses, not necessarily most valuable • Using recycled PP requires expert treatment of resin, generally proprietary additives and treatments.

19. Other Resins • PVC, PS, PLA, ABS, PC, and others • The available amounts are insufficient to make a business of recycling single use items of these resins • Critical Mass of Supply Necessary

20. Critical Mass to Recycle • For commodity plastics (what are used for single use items) there needs to be over 300 to 400 million pounds produced annually of recognizable and sortable items • Works for PET and HDPE bottles. • Sort of works for PE films • PP – Lacks recognizable amounts • PLA, PVC, PS – lacks amounts

21. Plastics Recycling Success Three areas must grow equally • Supply • Capacity to process (needs critical mass of supply to justify investment) • Markets The three legged stool long/short leg = crash

22. Supply – leg 1 • Creating supply is critical, and a crisis today, and getting worse • We need more good bottles • We need means of sorting for polyethylenes and polypropylenes • Historically, public policy created supply. • Growth through curbside collection limited, need to increase participation & efficiency

23. Processing Capacity – leg 2 • Sorting Capacity – MRF focus • Needs for sophistication growing at MRFs • MRF’s have a critical mass issue • MRF’s not part of the film recycling ‘One method does not fit all’ • Washing Capacity – Industrial focus • Use private investment, grants, and loans. • To survive, facilities are getting larger • Investment needs clear permanent signals

24. Market Demand – leg 3 • APR supports post consumer recycle content • Not post industrial or remanufactured • Content mandates have helped grow plastics recycling • Good product means containers conform to Design for Recyclability Guidance, DfR • APR publishes at website. Defines good.

25. So What Is the Problem? • We (the many industries and public) need clear public policy signals. • We are seeing lately commercial signals (Wal-Mart scorecard, for example) separate from public policy. Those signals are not necessarily clear or permanent. • We need mechanisms to keep material (and jobs) from too much export.

26. Needs • Graduated, enforced, mandated PCR content, gauged to increase domestic demand without disrupting entire system. • Efficient & equitable Extended Producer Responsibility or similar effort for increased collection and funds raising. • Funding for technology development to go beyond today in sorting and handling. • Enforced laws, helpful DfR regulations

27. Post Consumer Plastic Packaging Recycling Whether we like/want it or not, recycling plastic packaging is a joint public/private activity. There are many stakeholders. Clear, durable market signals are important. Plastics recycling is international, not local.

28. Thanks