The transition to green chemistry: 'Circularity is a team sport'

The fact that fossil fuels are running out is no longer a surprise. Sustainable fuels will replace gasoline and diesel in the future, and energy will increasingly come from renewable sources such as the sun, wind, or water. But what about chemicals? They are indispensable in producing materials for packaging, clothing, paint, and all kinds of other products. Chemicals are still often made from fossil oil, but this must and can be done differently. In the north of the Netherlands, much attention is being paid to making the chemical industry more sustainable. Various scaleups are building factories there to recycle plastic and make indispensable chemicals more sustainably.

The focus on green

“Eemshaven was built in the seventies as an overflow location for the petrochemical industry from Rotterdam, but was hardly ever used for that purpose due to the oil crisis at the time. That is why the region, compared to the four other chemical clusters in the Netherlands, has little petrochemical industry, such as oil refineries”, says Henri Kats, investment manager at the North Netherlands Development Agency (NOM). In addition to Delfzijl and Emmen, Rotterdam/Moerdijk, Terneuzen/Bergen op Zoom, and Geleen (Chemelot) also have a chemical cluster.

“This history allows the north of the Netherlands to focus on green chemistry. For example, we are working on salt and chlorine chemistry, and also looking for connections with farming when it comes to biomass as a raw material for chemistry. There are many large agricultural companies located in the region, so that is a nice link. In addition, circular plastics and Carbon Capture and Usage (CCU) are also important themes,” Kats outlines.

Opportunities for entrepreneurs

This offers opportunities for the – often relatively young – businesses that want to focus on making the chemical industry more sustainable. The list of companies is impressive. CuRe Technology is developing a technology to recycle plastic that is difficult to recycle. Circtec is building the world's largest factory for the chemical recycling of car tires. BioBTX will recycle plastic waste to produce Benzene, Toluene, and Xylene (BTX) – also known as aromatics – from waste plastics. And EEW – Energy from Waste Delfzijl will provide thermal processing for waste that cannot be reused. They all receive support from the NOM.

Long lead-up

All these companies are now on the verge of scaling up their technology and bringing it to market. This is an important step that does not happen by itself. It is difficult to compete with the existing petrochemical industry; all entrepreneurs agree on that. “This industry has had a hundred years to optimize the process and can now supply relatively cheap products. We have only been doing research for 15 years,” says Tijmen Vries, director of strategic development at BioBTX.

Companies introducing new materials need a long lead time, often around ten to twenty years. Even then, the products are often more expensive in the early years than the optimized fossil oil products. “We have to compete with cheap plastic from Asia that is made from fossil oil,” says Josse Kunst, chief commercial officer (CCO) of CuRe Technology. What's more, Cirtec also suffers from the different waste treatment standards, says Pieter ter Haar, director of sustainable carbonaceous materials at Cirtec. “We want to process materials such as car tires sustainably and circularly, while in countries like India, they are simply burned in the open air, with all the consequences this entails for people's health and the environment. That can be frustrating at times.” Partly due to these differences, several recycling companies have already gone out of business.

CuRe Technology finds solution for difficult-to-recycle plastic

Emmen-based CuRe Technology is developing a technology to reuse polyester, which is difficult to recycle.

Financing is complicated

A lot of time and money are needed to make chemistry more sustainable. Who is going to pay for this? That is the most critical question, says Ter Haar. “Investors often want to earn their investment back quickly and mainly look at the profitability of a project.” Vries also recognizes that it is challenging to finance innovations in green chemistry. “We see that investors often don't dare to take enough risks. Fortunately, we have now been able to solve this problem ourselves.” BioBTX recently raised an investment of 80 million euros to construct its first factory.

Vries: ”The NOM was among the first parties to invest in BioBTX. This investment will allow us to develop the technology further and give other investors confidence. That is very valuable.” The NOM was also a significant investor for Circtec in the run-up to the completion of the most recent investment round of €150 million for constructing the factory in Delfzijl.

BioBTX builds first plant for sustainable aromatics in Groningen

Last year, BioBTX raised €80 million to build the first plant for renewable aromatics in Delfzijl.

The government plays an important role

Ter Haar of Circtec sees a vital role for the government in supporting companies that want to become more sustainable. “The government must ensure supportive and, above all, stable legislation, which is often not the case now. Dutch politics is not always reliable, and laws and regulations change often. That also influences the investment climate.” More support from the government is also a wish of Wilfred de Jager, director of EEW - Energy From Waste Delfzijl. “The government is now opting for a policy that punishes companies that do not work circularly with tax measures. It would be better if the government chose to stimulate circularity, for example, by subsidizing the demand for recycled raw materials over virgin materials. That would stimulate the market and ensure recycling companies can earn a living. Ultimately, they will then be able to compete on price with raw materials.”

Kats also believes that green chemistry is not currently being given a fair chance. “The fossil industry can produce at a lower cost, and that is what consumers ultimately choose. However, the social costs, such as the consequences of climate change, are not included. If legislators take steps to allow the tax on the environment to be factored into prices, green chemistry will have a fairer chance,” says the NOM investment manager.

Circtec builds the world's largest tire recycling plant

Circtec is building the world's largest chemical recycling plant for car tires in Groningen. It will open at the end of the summer.

Waste status under discussion

One of the specific government regulations standing in the way of entrepreneurs is the waste status of materials. Waste has a particular status under the law, and companies must pay to dispose of certain substances. “In principle, this rule encourages companies to reuse as much as possible. But if a product already has waste status and it later turns out that it can still be used as a raw material, it is difficult to get rid of the waste status,” says Kats.

Companies then have to go through an extensive and lengthy process with the municipality to get the material's waste status removed. “In a circular economy, waste doesn't exist. Municipalities need to be more flexible in thinking along with entrepreneurs,” says Kats. Circtec has had to deal with such a process regarding the car tires.

EEW Delfzijl is also looking for clarity. “Almost all the products we make here have a waste status. That does not help us with sales opportunities. Sometimes we can only use a product in a lower application area (downcycling), while it could also be used in a higher segment (upcycling). The waste status says nothing about the quality of the material.”

From waste to energy: EEW gets closer to circular economy

EEW - Energy from Waste Delfzijl incinerates non-recyclable waste and converts it into energy.

Strong network

The entrepreneurs face many challenges. “Sometimes it feels like we have to overcome not just bumps, but entire hills and mountains. Once we have succeeded, we will have taken a very important step in the greening of chemistry,” says Vries of BioBTX. Kunst (CuRe Technology) also remains positive. “In innovation, you sometimes need a little positive optimism. We just have to get started, stay focused, and find good partners.” These partners are an indispensable part of any business.

The NOM is very active in building and supporting a network of green chemistry companies in the Northern Netherlands. ”Chemport is a strong network of companies in the green chemical industry that know how to find each other easily. There is a cooperative attitude, we want to help each other without expecting anything in return,” says Kats. Startups and scaleups work together. For example, CuRe Technology supplies BioBTX with residual materials from its recycling plant that it can then use as raw materials. Kunst: ”I notice that people in the north are very open and trust each other quickly.” In addition, large companies such as BP also work together with the scaleups in the region. “These large corporations need to become more environmentally friendly, and they do this regularly by working with new companies,” adds Kats.

“Circularity is a team sport. We have to do it together,” concludes Kunst.

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