Jamie Pitcairn Technical Director, Circle Economy and Sustainability 19 June, 2019

Title: The opportunity for compostable packaging in the UK Research Study Title: The opportunity for compostable packaging in the UK A Biotechnology and Biological Sciences Research Council Network in Industrial Biotechnology and Bioenergy (BBSRC NIBB)

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how the market for compostable plastics could grow Introduction LBNet/BBNet commissioned Ricardo to produce a report summarising the current status of compostable plastics how the market for compostable plastics could grow identify the most suitable biomass resource that could be used as feedstock indicate how bioplastics could contribute to targets for plastic packaging Preliminary data gathering Policy landscape Plastic packaging market Substitution potential Biopolymer substitution potential Bioresource requirement What are the bioresources? What is the availability? Impact & Benefit Analysis Carbon Economic

Drivers – Regulation & Policy UK Plastic Pact 2015 EU Circular Economy Package Basel Convention (2021) Growing the bioeconomy

Drivers – Consumer demand

Bioeconomy

So what’s the opportunity: understanding the current market In 2017, it was estimated that 2.361Mt tonnes of plastic packaging was placed on the UK market in of which approximately 1.523Mt (65%) is defined as consumer packaging. Consumer plastic packaging tonnage by format and polymer (2017) (kt)   HDPE LDPE PE PET PP PS PVC Other Total Film (exc. carrier bags) 71 110 21 28 2 9 17 368 Carrier bags 18 27 Bottles 268 1 347 633 PTTs 4 155 85 32 13 301 55 23 40 76 3 200 403 134 570 288 37 24 19 1,529 WRAP (2018) PlasticFlow 2025

Bioplastics placed on the market Bioplastics currently make up approximately 1% of global plastic production According available information the current UK market for biodegradable bioplastics is estimated at approximately 8,000 tonnes (+/- 1,000t).

Understanding the opportunity: challenges of plastic recycling Sorting and recycling heavily contaminated plastic – effective, viable?? System losses from collection to reprocessing – less than 15% reprocessed 2/3 of plastic packaging is exported (686,000t) for reprocessing/disposal Consider export issues….. China’s national sword/Basel Convention Material security & Circular Economy Future – need to understand what can be recycled and what has value. Not all plastics can be recycled – mixed plastics etc Not all recycling is economically viable (lack of end markets, sorting & cleaning is expensive) Opportunity: target plastic packaging where recycling is failing

The opportunity: understanding the substitution potential Need to understand the UK market opportunity for compostable packaging understand the packaging it could most readily replace, and understand the size of this potential market A list of plastic packaging applications was created; categorised firstly by: the polymer type used split by food or none food product. A Red, Amber, Green (RAG) assessment was undertaken to illustrate the substitution potential for compostable packaging In the short term (Green - already available), In the medium (Amber - biopolymer potential by 2025); In the long term (Red – unlikely by 2025). WRAP (2018) PlasticFlow 2025

Substitution Potential PP meal trays, fruit trays – flexibles that contain food

Target market

Potential Substitutable Market   Tonnes Potential Flexibles market 53,000 - 77,000 Potential Rigid market 9,000 – 11,000 Carrier Bag potential 28,100 – 50,000 Total 90,000 – 138,000

Biopolymers required to meet 2025 biopolymer requirement Forecast market tonnage 90kt – 138kt Totals (based on 100,000t average) 100,000 Flexible 77,250 PBAT 45,578 PLA 3,863 Starch 11,588 Regenerated cellulose, PHA, other 16,223 Rigid 17,250 12,075 5,175 Other 5,500 Much can be done with existing polymers – limited technical risk in getting to this number Even more could be achieved if it is the ‘right’ thing to do and has supporting policy and funding

Economic Assessment: commodity market The transition to a greater adoption of compostable packaging could, by 2025, provide an economic benefit to the bioplastics sector in excess of £267m Forecast market tonnage Current market spot price for materials streams £/t Value of the market Totals 100,000   £267,085,125 Flexible 77,250 £208,150,125 PBAT 45,578 £2,800.00 £127,617,000 PLA 3,863 £1,800.00 £6,952,500 Starch 11,588 £750.00 £8,690,625 Regenerated cellulose, PHA, other 16,223 £4,000.00 £64,890,000 Rigid 17,250 £42,435,000 12,075 £21,735,000 5,175 £20,700,000 Other 5,500 £3,000.00 £16,500,000 Price based on PHA and regenerated cellulose is bought as a blend and hence is a higher cost that is sometimes quoted [1] https://www.wur.nl/upload_mm/1/e/7/01452551-06c5-4dc3-b278-173da53356bb_170421%20Report%20Bio-based%20Plastic%20Facts.pdf

kg Co2 eq per tonne of plastic produced Life Cycle Assessment Sensitivity: feedstock and energy PLA produced using the UK grid mix and using bioresource “waste” as a feedstock has a global warming potential 52% smaller than LDPE kg Co2 eq per tonne of plastic produced 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 -500 PLA (Scotland) LDPE Virgin PLA PLA (UK)

Considerations Bioresource Considerations Quantify the most attractive bioresources Assess what is available vs accessible The role of packaging in the supply chain Consider scope of packaging items which are most appropriate for substitution: Household collections Sorting & processing facilities Secondary markets On the go Packaging contaminated with food waste – expensive to clean and recycle Collections and infrastructure Home composting collections are fundamental Valuing the contribution that compostable packaging can play in capturing the stream of food waste that currently isn’t captured Potential issue of too much compostable packaging home organic collections Consider the treatment route for compostable packaging. Highlight Defra universal waste collection/ strategy

Next steps: Decision time!

Jamie Pitcairn Technical Director Circular Economy & Sustainability Ricardo Energy & Environment jamie.pitcairn@ricardo.com 01235 753079 Thank you