The soft-plastics recycling debacle

Liz Kasell says her purpose was “simple – reducing the amount of soft plastic packaging going to landfill”.

More than a decade on, though, the execution of her vision has proved more complex than she could have imagined, and 11,000 tonnes of plastic she saved from landfills is instead piled up in dozens of locations around Australia.

REDcycle, the business she founded, is under administration, having racked up debts reportedly totalling $5 million. The big supermarkets that sought to greenwash their profligate packaging practices and those of their suppliers by partnering with her company – apparently without knowing what was being done with their waste – are under pressure from environmental agencies to find safer storage for it, because it is a fire hazard. If a Coles or Woolworths dumps it now – or worse, burns it – they will lose whatever environmental cred they gained from the scheme.

And thousands of Australians who diligently separated their waste, delivered the soft plastics back to the supermarkets from whence they came and stuffed them into REDcycle bins, are frustrated. As was Kasell herself when she started out in 2011.

In a long, half-plaintive, half-defiant statement posted to the company’s website on February 27 this year, shortly after the liquidator was appointed, she recounted the rise and fall of REDcycle, beginning with her exasperation at the “ubiquitous material ending up in my weekly waste bin”.

“When REDcycle was launched, there was no guidebook or instructions on ‘how to create a recovery system for a challenging waste stream with a negative value’,” she wrote.

“As a mum to a young son, conscious of what we would leave his generation, doing nothing was unacceptable. So off we went, designing, building, and launching the REDcycle Program, a recovery initiative for post-consumer soft plastic.

“It became a movement, a force of good, a community-driven desire for change.”

And the public’s desire for change was great and growing fast. Between 2019 and REDcycle’s collapse last November, collection volumes ballooned 350 per cent, and Australians were returning five million pieces of soft plastic every day, according to Kasell.

It was more than the company could handle, notwithstanding agreements with several processors and manufacturers to convert the plastic waste into new products – street furniture, bins, shopping trolleys, bollards, concrete aggregate for construction and asphalt additives for roads.

“Unforeseen challenges, exacerbated by the pandemic, soon meant that REDcycle’s recycling partners were unable to accept and process the rapidly increasing volume of soft plastics due to lack of immediate access to infrastructure, inadequate processing capacity, and most importantly reduced demand for recycled products,” Kasell wrote.

“Then in June 2022, our largest volume offtake partner had a significant fire, resulting in their Tonerplas facility closing for reconstruction for 12 months.

“This combination of factors put untenable pressure on the REDcycle business and system, and consequently, REDcycle regrettably announced the pause of the collection program in November 2022,” she wrote.

Jeff Angel, however, does not buy Kasell’s line that REDcycle was the victim of “unforeseen” circumstances that all came to a head. It is now clear, he suggests, that the company was in trouble years before creditors went to the courts to have it wound up.

“The reason that REDcycle collapsed was partly their lack of transparency. They didn’t tell people they’d been stockpiling since 2018,” says Angel, director of the Boomerang Alliance, the peak body representing 55 allied groups advocating against plastic pollution and in favour of recycling.

“More and more stockpiles are being found … stored in unsafe circumstances in terms of fire. They’re in dreadful trouble. They’re being prosecuted for not telling the EPAs about the problems they were having. They’ve got creditors after them. And even though it was only a relatively small proportion of the population participating, they are a very vocal angry group now,” Angel tells The Saturday Paper.

He has some sympathy for Kasell and her associates. They had good intentions, he says. But good intentions and bad management have left an enormous mess.

According to the supermarkets, when REDcycle initially suspended operations it did not tell them the specific locations of its stockpiles or how big they were. They did not even have the full picture when they assumed responsibility for dealing with the unrecycled soft plastics, one day before REDcycle was put into liquidation. More sites kept being identified.

“To date, we have identified a total of 44 sites where REDcycle had been stockpiling soft plastics without our knowledge,” said a spokesperson on behalf of Coles and Woolworths this week.

Those sites are scattered across six states: 19 in New South Wales, 15 in Victoria, six in South Australia, two in Tasmania and one each in Western Australia and Queensland.

“We have contacted the operators of every site to develop an action plan to ensure this material is stored safely,” the spokesperson said.

“With new information continuing to come in, we’re navigating a complex range of sites and challenges, and we know this process will take time.”

Jeff Angel doesn’t buy the supermarkets’ line, either.

“The supermarkets are now saying, ‘Oh, we didn’t know they were stockpiling. We didn’t know they weren’t selling it for recycling.’ My response is, you had a responsibility, given you were using that REDcycle logo to enhance your reputation, to really understand what was going on,” he says.

Nor was it just the supermarkets that wanted to bathe in the green glow of the recycling company. The REDcycle website lists a couple of hundred businesses – retailers, food and wine companies, packaging companies, pharmaceutical companies, apparel and appliance makers and sellers, even Australia Post – as “partners”.

But it was the supermarkets that directly engaged the public in the recycling effort that are most culpable – they now own the problem and are seeking a solution through a Soft Plastics Taskforce. It began meeting last December after the Australian Competition and Consumer Commission (ACCC) gave an “interim authorisation” for the Coles, Woolworths and Aldi chains to work together in ways “that could otherwise raise concerns under the competition provisions of the Competition and Consumer Act”.

For a limited time, the chains could work together “for the particular purpose of exploring options for the storage, transport, processing, recycling and management of soft plastics to minimise the volume that may end up in landfill, which is of great benefit to us all,” ACCC deputy chair Mick Keogh said.

It looks like being a protracted co-operation. One of the “core objectives” of the taskforce is to resume soft plastics recycling through supermarkets, but it could take until 2025 to get that happening on a large scale. Furthermore, the taskforce cautions in its “roadmap” that the “timeline to resume collections may also be affected by the need to dedicate local processing capacity to the existing stockpiles”.

That is to say, they have hit the same obstacles that caused REDcycle’s downfall: a lack of capacity to recycle, which in turn reflects the absence of an effective circular economy. And REDcycle, according to the taskforce report, was collecting less than 5 per cent of post-consumer soft plastics.

The fact that dealing with such a relatively minor part of the waste stream has become such a major problem, says Angel, “has shown up the superficial effort that the packaging industry was putting into plastic recycling”.

 

One option being considered by the supermarkets is sending the waste overseas for reprocessing – which, of course, would be consistent with Australia’s historical approach to dealing with waste. Until about six years ago, we sent some 600,000 tonnes of it – not just plastics but all manner of allegedly recyclable material – to China, for example. Then China effectively banned it, on the basis that it was contaminated with food and other waste. A number of other South-East Asian neighbours followed suit.

In response, the Australian Packaging Covenant Organisation, a body comprising industry and government, set targets for domestic recycling. APCO goals include making 100 per cent of packaging recyclable or compostable, and seeing 70 per cent of plastic packaging recycled or composted by the end of 2025. This was to happen through the voluntary actions of industry.

APCO talked big. The 2025 targets, it said, “would require a complete and systemic change to the way Australia creates, collects, and recovers product packaging, and are an important step on Australia’s journey towards a circular economy for packaging”.

But the challenge was huge, as was amply shown in data pulled together for a national plastics summit and subsequent National Plastics Plan put forth by the Morrison government in 2021.

It found 3.5 million tonnes of plastics, including one million tonnes of single use plastics – 70 billion pieces of what it called “scrunchable” plastics – were consumed every year. About 84 per cent of all plastics went to landfill and 130,000 tonnes a year went into the marine environment. Of the 393,800 tonnes of plastics collected for reprocessing, almost half was still exported.

And evidence given to an inquiry by the house of representatives standing committee on climate change, energy, environment and water – which began, coincidentally, just as REDcycle fell over in November – showed the problem was only getting worse.

In its submission, the NSW EPA cited 2022 APCO data showing that the total amount of plastic packaging consumed went up more than 5 per cent in the two years to 2019-20. And the amount recovered went down from a paltry 18 per cent to a woeful 16 per cent.

“This data suggests that voluntary targets have not facilitated a large increase in recycling,” said the EPA. “Recovery rates will need to increase significantly to meet the 2025 target of 70 per cent of plastic packaging being recycled.”

Angel’s organisation, the Boomerang Alliance, cited data from a Minderoo Foundation report that showed Australia generated more single-use plastic waste per person than any other country except Singapore, with an estimated 59 kilograms of plastic waste per person annually – compared with a global average of 15 kilograms per person.

In its submission, global conservation group WWF also compared Australia unfavourably to other nations, particularly European ones. But such comparisons are problematic, because “re-use” does not always mean “recycle” when it comes to plastics. In a report last year, Energy Tracker Asia detailed a worrying trend in the region to “solving” the plastic waste problem by incinerating it.

“On a macro level,” it said, “the EU and the US already burn around 42 per cent and 12 per cent of their waste respectively. The waste-to-energy sector will grow massively in the coming years, especially in the Asia-Pacific region.”

Energy Tracker Asia noted that China already had more than 300 incinerating plants (known as waste-to-energy plants), with hundreds more in the pipeline.

Plastic is, of course, a product of the fossil fuel industry, and the industry sees opportunity in producing and burning more. The Energy Tracker report said some of the world’s biggest petrochemical and consumer goods companies, including Exxon, Shell, BASF, PepsiCo and Procter & Gamble, were involved in an organisation named the Alliance to End Plastic Waste, and had earmarked $US1.5 billion over five years to finding solutions, one of which is incineration. But it warned that incineration “creates more problems than it solves”.

Already Australia burns a significant amount of its plastic waste. Data from the Morrison government’s National Plastics Plan show that in 2018-19, about 72,000 tonnes was sent to “energy recovery”.

Angel says that in Australia, as elsewhere in the world, “the incineration industry is making a big play to take up more of the plastics being recovered”.

“But that’s not a circular economy and it’s not recycling,” he says. It simply seeks to address one big environmental problem by exacerbating another: climate change.

 

Despite all evidence that the voluntary recycling is not producing results, the Australian government persists with it. In fairness though, it should be noted the new Labor government has taken some positive steps.

Environment Minister Tanya Plibersek points to several initiatives taken in the past year. “We’re investing $250 million in recycling facilities including $60 million for hard to recycle plastics, reforming the regulation of packaging by 2025, and have formed a Ministerial Advisory Group to get the best advice on actions the government can take to advance our circular economy,” she says.

“The Clean Energy Finance Corporation is also investing with a $100 million recycling fund and there is $3 billion earmarked in the National Reconstruction Fund – for clean energy, green metals, waste reduction and remanufacturing.”

And, she warns: “If business doesn’t voluntarily step up on plastics, I will regulate.”

Threats of action are not enough, though, in the view of Greens senator Peter Whish-Wilson, as years of failure to meet the APCO targets demonstrate.

“Why? Because our current waste reduction targets are voluntary,” he says. “Voluntary approaches to waste reduction do not work – it’s that simple. Mandated waste reduction targets are needed to underpin investment in and upgrades to recycling infrastructure.

“The government needs to step in and procure plastics for public infrastructure projects such as roads, playground equipment, and paths, while simultaneously requiring all plastic producers [such as the supermarkets] to use a much higher percentage of recycled plastics in their products.”

Oddly enough, two years ago Labor supported a Greens amendment to mandate the national packaging targets. The amendment failed by one vote in the senate. But at that time, One Nation held the balance of power. In the new senate, the numbers would be there to push it through, if Labor were willing.

There is some good news even under the current voluntary plastics recycling regime, however. The Melbourne facility, operated by recycler Close the Loop, that took the largest part of REDcycle’s collected soft plastics, and that burned in June 2022, is back in business.

And by later this year, says Joe Foster, chief executive of Close the Loop, the company is expecting to produce more than four times the quantity of recycled product it was before the fire. It makes TonerPlas, a material used in road construction that is produced from plastic and printer toner.

The great advantage of the product, Foster told ABC’s RN Breakfast this week, was that it used “material highly contaminated with mixed plastics, and also with food waste”.

Initially, he said, production would convert 4500 to 5000 tonnes of recyclable materials a year at its Melbourne plant. There were plans to expand to other states, “to handle a much bigger volume of the soft plastics”. Furthermore, the company was looking to get its raw material directly from kerbside pickups, so there was no need for people to sort it themselves and deliver it to special bins.

But he, too, called for the government to mandate the inclusion of recycled plastics in construction materials.

Of course, Foster is a businessman, talking his book. But what he had to say points to a solution other than dumping or burning used soft plastics.

At last, recycling them may have an economic value.