Cheap Crude Oil Endangers Success in Plastics Recycling
The low oil price makes the production of new plastics more cost-effective and has further aggravated the already tense situation of many plastics recyclers. The Green Dot, the detergent manufacturers Werner and Mertz and the Federal Association of the German Waste, Water and Raw Materials Industry are therefore now jointly calling on politicians to create financial incentives for the use of recycled plastics.
In recent months, many employees have taken care of themselves in their home office – and ordered even more often than usual on the Internet. Plastic waste in private households has increased by around 10 percent as a result, and at the same time the demand for recycled plastic has collapsed dramatically, according to a joint statement by Grüner Punkt, Werner and Mertz and the Federal Association of the German Waste Management, Water and Raw Materials Industry (BDE).
The shift in the plastics market caused by the corona pandemic only appears paradoxical at first glance: Cheap crude oil makes the production of new plastics cheaper, making the material recycling of plastic packaging economically less attractive. Many manufacturers, who had previously used recycled material for products and packaging, are now even switching back to virgin material, the three companies criticize.
“Heavy blow for the recycling industry”
The technology of material recycling, as stated in the declaration, is in any case a “shadowy existence”. In comparison, the use of new plastic, which is privileged in Germany due to the exemption from mineral oil tax and the EEG levy, is too cheap. The latest development is therefore a “heavy blow for the recycling industry”.
With Grüner Punkt, the BDE and the Mainz-based detergent manufacturer Werner and Mertz, which uses recycled plastic for its brands such as Frosch auf Flaschen, three companies along the value-added chain have joined forces to demand a commitment to the recycling economy from politicians. Specifically, they are calling for a stronger focus on sustainability in public procurement, a fund system supplemented by a plastic tax on new goods, and clearly defined minimum quotas for the use of recycled plastic. “Plastics recycling is in danger of being severely damaged by the inaction of politicians”, criticizes BDE President Peter Kurth. The potential of the environmental service sector for climate protection, especially in the case of plastics, is far from exhausted.
Compensation fund and plastics tax on new goods
“Recycled plastic saves up to 50 percent of the greenhouse gas emissions generated by new plastic – but this is not reflected in the price,” says Michael Wiener, CEO at Grüner Punkt. Only the setting of defined recycling use targets for certain product groups by politicians will enable the creation of sustainable recycling markets and provide the necessary planning security.
Reinhard Schneider, owner of Werner und Mertz and winner of the German Environmental Award 2019, describes how a fund system to compensate for the financial disadvantage of the use of recyclate could look like: “The ecological spread of purchase prices could be incorporated into the existing packaging law in section 21 in the form of a fund into which everyone must pay. Only those who use recyclates should receive a refund. In addition to this, there could also be a plastic tax applied only to new products, as planned in Italy. This is in line with the abolition of subsidies for the production of new goods by removing the exemption from mineral oil tax and the EEG levy”.