$10M Investment Secured for Closed Loop Partners Fund to Advance PE and PP Recycling Initiatives
- 31-May-2023 4:16 PM
- Journalist: Xiang Hong
Tokyo, Japan: Sumitomo Mitsui Banking Corp., a Japanese financial institution, has invested $10 million in a Closed Loop Partners fund for rigid and flexible Polyethylene and Polypropylene recycling initiatives. The funding aims to hasten projects in the United States and Canada by investing in infrastructure, equipment, municipal services, as well as innovation and enabling technologies for flexible film and other plastic types. Sumitomo Mitsui's group chief sustainability officer, this funding will be used to advance the development of recycling projects in North America.
The Closed Loop Circular Plastics Fund, operated by CLP, will manage the investment. This fund is dedicated to catalytic debt and equity financing for projects related to PE, PP, and flexible plastics. These plastics are vital resin types that necessitate further investment to enable more material to remain in circulation, ensuring that the industry's demand for recycled material is satisfied.
As the U.S. recycling industry faces more scrutiny over which types of plastics are recyclable and how recycling infrastructure improvements should tackle harder-to-recycle materials like plastic film, this new round of investment has arrived. Meanwhile, significant brands have pledged to use recycled content in their packaging, which the industry views as a market driver for investments in recycling infrastructure.
The intention of the new funding from Sumitomo Mitsui, as announced by CLP, is to ease the bottlenecks present in the recycling system, with a specific focus on PE and PP. Sumitomo Mitsui is among several major corporations, such as Dow, LyondellBasell, NOVA Chemicals, Charter Next Generation, Chevron Phillips Chemical, SK geo centric Co., and SEE, that have previously invested in some form of plastics recovery or recycling initiative.
The collective effort is crucial for promoting the recovery and recycling of plastics in the United States and Canada, on a large scale. In the previous year, Dow and WM collaborated on a curbside film recycling pilot program, which WM declared was initiated, in part, because of rising demand for most plastic grades. WM bought a controlling interest in plastic recycler Avangard Innovative, now known as Natura PCR, which will handle commercial plastic film and shrink wrap. NOVA recently revealed that it would manufacture a line of recycled PE from mechanically recycled feedstock. Meanwhile, companies such as LyondellBasell and Chevron are eyeing opportunities to collect types of "landfill-bound" plastic for use in chemical recycling applications and anticipate a significant increase in demand soon.
In recent years, the Circular Plastics Fund has invested in multiple plastics recycling initiatives. These include equity investments in Greyparrot, an AI waste analytics platform, and in Circular Services, which is said to be the most extensive privately held recycling and reuse firm in North America. Furthermore, the fund extended a loan to Myplas USA for the construction of a 170,000 square-foot recycling facility for plastic films in Minnesota.
The fund's performance is measured based on financial and impact outcomes. These performance indicators include how many tons of PE and PP are involved in the initiative, as well as how many metric tons of greenhouse gas emissions are avoided or reduced.