Annual Event November 7, 2023: We Are Off to a Great Start
09-11-2023
With half a billion in subsidies from the National Growth Fund and one and a half times that amount in private investments, the chemical industry in the Netherlands can begin building a green, circular chemistry sector. Dozens of new start-ups can be supported through this initiative, including the establishment of factories for biobased or circular plastics.
This was the conclusion from the annual event held by the Groene Chemie Nieuwe Economie (GCNE) platform in Utrecht. Over 250 people from the chemical sector, policymakers, politicians, and scientists were presented with the latest developments from the green chemistry front at the Spoorwegmuseum. According to GCNE chairman Arnold Stokking, the Netherlands has a wonderful chemical industry. "But it's no longer enough. We need to innovate," he says. "That will happen, we don't need to doubt that. The only thing we need to discuss is that it happens in the Netherlands. For our economy and for our children."
BioBased Circular
The platform aims for a circular chemistry with innovative technologies, without fossil fuels and CO2 emissions by 2050. This means that processes must be electrified, and no fossil fuels or raw materials should be used anymore. Together with the Top Sector Agri & Food, GCNE has requested and received 338 million euros from the Growth Fund for its program BioBased Circular. Participating companies are investing an additional 550 million euros. Currently, 125 companies, knowledge institutions, and other partners are involved in the program. The goal is to replace oil and other fossil raw materials for plastic with biobased raw materials, recycled plastic, and - in the future - carbon from captured CO2 (CCU). If successful, the Dutch chemical sector could reduce its CO2 emissions by 3.5 to 5.8 million tons, the economy could grow by 1.5 to 3.5 billion euros, and 2,500 to 8,300 new jobs could be created.
Barriers on the Route
There are several barriers on this route. Companies are willing to switch to electric processes, but the electricity grid is already full. Currently, only 5 percent of all plastic is made from recycled materials. By 2050, that must be 55 percent. But even if the Netherlands uses all European recycled plastic waste in new plastic, there won't be enough raw material available. There aren't enough biocrops either, so imports are necessary. Additionally, the technology for producing plastic from CO2 still needs to be developed. Yet, all three are needed to make all plastic fossil-free by 2050. "Recycling alone will not suffice. We also need new biobased raw materials. We need new biopolymers, and hopefully, we can in the future use CO2 that we capture as a new source for carbon. We need all three to succeed," says Marc Spekreijse, director of Circular Plastics NL (CPNL). The CPNL initiative already received 220 million euros in subsidies from the Growth Fund last year to resolve bottlenecks and close loops. The goal is to recycle half of all plastic by 2030 and 100 percent by 2050. This amount will be doubled by companies, knowledge institutions, and other stakeholders. Together with BioBased Circular, that amounts to half a billion in subsidies, far more than countries like Belgium and the UK provide for green chemistry.
'Don't Abolish Fossil Subsidies Too Quickly'
Fossil raw materials like oil are still relatively cheap and abundant. Biobased raw materials and recycled plastic are more expensive and scarcely available. So why would companies in the chemical sector do it differently? To create a level playing field, fossil raw materials should be priced, for example, with resource taxes that political parties want to introduce. Sometimes politics can move too fast, such as with the abolition of fossil subsidies. "If this is done as proposed, then the industry will leave, and it's game over. Transition comes with chaos, but we need to take it slow and keep a cool head," says Stokking.
Recycled Plastic Not Waste
Furthermore, recycled plastic is still often classified as waste by the government, preventing it from being used as a new raw material, especially in the food sector. During the conference, two reports titled ‘End of Waste Status’ were presented to Jacqueline Vaessen of the Top Sector Chemistry and Gabriëlle Sogelée from the Ministry of Infrastructure and Water Management. These reports contain various recommendations for finding solutions. "We notice in the business community that there is a lot of uncertainty. Therefore, we are focusing on making our policies clearer and more accessible," states Sogelée. "Sometimes there is unnecessary heavy assessment for the protection of people and the environment. That hinders innovation. We are also working on European waste end criteria for plastic, textiles, and construction and demolition waste. We need to explore those certification options together."
New Value Chains Explained
Groene Chemie Nieuwe Economie aims to support at least fifteen game changers and build ten new so-called value chains or circles with the BioBased Circular program in the coming years. This will be monitored by TNO. A value chain is an abstract concept, but during one of the sessions, it was made concrete. For instance, sugar beets from Cosun can be processed into bioplastic by Avantium, which Coca-Cola and Unilever use for their bottles and packaging. This plastic is collected by companies like Renewi and Suez and upcycled by clean-tech companies like Ioniqa to create new plastic again. This way, the chain is complete, and all companies benefit.
No Angry Industry
Together with knowledge institution Brightsite, GCNE has highlighted what is needed for the green transition of the chemistry sector: 11 million tons of recycled plastic, 45 million tons of biomass, and 32 million tons of carbon from CO2 to make fossil-free plastic. Additionally, 4.8 million tons of hydrogen from water as fossil-free fuel is required. The platform has discussed these findings with its members, from knowledge institutions to chemical companies and clusters like Shell Moerdijk, Chemelot, and Chemport Groningen. Several conclusions can be drawn from this. "Everyone is on board. There is no such thing as an angry industry or people who think this will just pass by. But we have noticed that not everyone is aware of how significant this is. We talk about circularity, but we haven't quite grasped it yet," says Stokking.
Ensuring Companies Can Keep Up
According to the sector, it is crucial to have long-term government policy with clarity. This must come primarily from the Ministry of Economic Affairs and Climate Policy (EZK). They want to work together with platforms like GCNE and companies in the sector to make new steps forward. "We are on the right track, but we are not there yet," says Erwin Nijsse, Director-General of EZK. "A lot of money has been allocated for climate and the sustainability of existing businesses, but when it comes to circularity, we seem to have forgotten something. We think relatively little about how to kick-start that new economy. By 2035, we need to build new markets and set them up in a way that companies can participate and make that transition."
Read more about the political debate on the Circular Industry that took place at the annual event.
Read more about the five new game changers on stage.
