Rethinking the future of plastics
A new
report finds that applying circular-economy principles could dramatically
reshape the economics of this workhorse of the global economy—and help the
environment.
Plastics are the
workhorse material of the modern
economy. Their popularity has kept the industry growing for 50 years, with
global production surging from 15 million metric tons in 1964 to 311 million
metric tons in 2014. If business proceeds as usual, this number is projected to
double to more than 600 million metric tons in the next 20 years. Yet
functional benefits come at a price. Plastic packaging, especially, is the
quintessential single-use product: it represents a quarter of the total volume
of plastics, and around 95 percent of the value of plastic-packaging material
(worth some $80 billion to $210 billion annually) is lost to the economy. And
while its intended useful life is typically less than a year, the material
lives on for centuries.
A new report by McKinsey, the Ellen
MacArthur Foundation, and the World Economic Forum, The new plastics
economy: Rethinking the future of plastics, finds that applying
circular-economy principles to global plastic-packaging flows could reshape the
material’s economy. In particular, it could drastically reduce negative
externalities—valued conservatively by the United Nations Environment Programme
at $40 billion—such as “leakage” into oceans as plastics escape established
waste-collection systems. Today, almost a third of all plastic packaging leaks,
with about 8 million metric tons annually polluting oceans.
Taking action
The new report explains that
improvement efforts to date are highly fragmented and subscale. Urgent action
is needed to move the industry into a positive spiral of value capture,
stronger economics, and better environmental outcomes. The report explains how
stakeholders evolve toward a “New Plastics Economy” with three main ambitions:
1. Create an effective
after-use plastics economy by improving the economics and uptake of recycling,
reuse, and controlled biodegradation for targeted applications.
2. Drastically reduce leakage
of plastics into natural systems (in particular, the ocean) and other negative
externalities.
3. Decouple plastics from
fossil feedstocks by—in addition to reducing cycle losses and
dematerializing—exploring and adopting renewably sourced feedstocks.
Even with today’s designs,
technologies, and systems, these ambitions can be at least partially realized.
For example, one recent study found that 53 percent of plastic packaging in
Europe could today be recycled “ecoefficiently.” While the exact figure can be
debated and depends on, among others, the oil price, the message is clear:
there are pockets of opportunities to be captured already—and even where not
entirely feasible today, the New Plastics Economy offers an attractive target
state for the global value chain and governments to collaboratively innovate
toward.
Redesigning materials, formats, and
systems; developing new technologies; and evolving global value chains requires
a new approach to achieve a systemic shift toward the New Plastics Economy. A
coordinating vehicle is needed to drive this, with an initial focus on
establishing a global plastics protocol and coordinating large-scale pilots and
demonstration projects, mobilizing large-scale “moon shot” innovations (such as
developing “bio-benign” materials and polymers with superior recyclability),
developing insights and building an economic and scientific evidence base to
better understand material flows and economics of various solutions, engaging
policy makers and providing them with a tool kit to better assess policy
options, and coordinating and driving communication across the various
stakeholders acting along the global plastic-packaging value chain. We
understand the work involved means this won’t happen overnight. But the time to
start is now.
The full report on which this
article is based, The new plastics economy: Rethinking the future of plastics
http://www.mckinsey.com/Business-Functions/Sustainability-and-Resource-Productivity/Our-Insights/Rethinking-the-future-of-plastics?cid=other-eml-alt-mip-mck-oth-1602
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