"Government must intervene more disruptively or adjust its climate goals" - CPNL director Ton van der Giessen speaking
Since Jan. 1, Ton van der Giessen has been director of Circular Plastics NL, the National Growth Fund program aimed at closing the cycles in the Dutch plastic value chains. His ambition: "To pull the plastic recycling industry out of the adolescent stage and one step further towards maturity."
by Pierre Gielen
In The Hague, he is known as "Mr. Plastic," but Ton van der Giessen also likes to call himself a garbage man. For more than 40 years he worked for major waste and recycling companies, including Van Gansewinkel (Renewi), SITA (PreZero) and Van Werven, where he was CEO for thirteen years. Since January 1, Ton van der Giessen has been a director of Circular Plastics NL. His ambition: "To pull the plastic recycling industry out of the adolescent stage and take it a step further towards maturity."
"When I came into the waste sector by accident in 1980, I could never have imagined that I am now considered Mr. Plastic," he says. "I was fortunate that a tremendous amount has changed in this industry over the past 40 years. I have seen opportunities in that every time. I got to work for great companies, including publicly traded companies, from which I learned a lot. Eventually I discovered that a family business suits me best. At a listed multinational company, you have to make sure you survive the next three months all the time. In a family business, you look more at the longer term: what could be a good solution for the next generation? Then you do business from a different perspective, even if it costs money in the short term. If I had had to set up the plastic recycling activities at Van Werven for a listed company, I might have pulled the plug after two years, or even sooner."
Van der Giessen is still full of energy and does not intend to sit back now that he has retired. "I have a wealth of knowledge and experience and would like to apply it in other ways, as a director at CPNL, but also as a director for the National WEEE Register. That reports to the minister every year how much electrical and electronic equipment has been collected and recycled. I'm also president of the trade association for composting companies (BVOR) and an advisor to a couple of family businesses. It is nice that I am approached for these positions.
Bankrupt
Bringing the recycling industry to maturity, however, is not easy, he admits. As a commissioner of recycler Umincorp, for example, he recently watched that company go bankrupt. In one fell swoop, the Netherlands is two plastic recycling companies poorer, one in Amsterdam and one in Rotterdam. "That is of course a completely wrong development. It is absolutely inconsistent with the goals we have set together toward 2030 and 2050."
Despite hefty public investment by InvestNL, Umincorp was nipped in the bud by the current market situation. This is because the European market for plastic recyclate sales is suffering from fierce competition from China and the US, among others. Both virgin plastic and recyclate are currently widely imported at dumping prices. "This leaves no viable business model for Dutch recyclers."
Causes include relatively high labor costs in our country compared to China, as well as labor shortages. Few young people put working in a recycling company at the top of their bucket list. Therefore, there are several initiatives from CPNL to make labor-intensive operations, such as sorting, more automated. But the problem is more complex: "With a growing world population, the demand for plastic is also rising, because in many cases it is the best and most sustainable material choice. Alternatives are often worse for the environment. I expect plastic production to at least triple in the next 30 years. That won't make it easy to close the loop."
"Also, in the Netherlands we still burn more plastic than we offer at recyclers because it is cheaper. And of what plastic waste ends up at recyclers, at most 75% can be recycled. "So then you're at 30% recyclate. Just to stay at the same level, 70% virgin plastic has to be added. That way you can never become 100% circular. So there is still a lot to do to achieve the maximum. Government and business will have to work together on this. And business will have to work with knowledge institutes and startups on technological developments."
No capacity
Ultimately, of course, the goal is 100% circularity by 2050. And in six years (2030) already 50%. Van der Giessen is clear: "We won't achieve that. We simply don't have the capacity for it, even if we start developing new factories now."
However, new factories require industrial sites with an environmental category that allows waste. And those are scarce. "Local administrators would rather see a beautiful office park within their municipal boundaries than a company working with waste. That's the NIMBY syndrome: everyone thinks recycling is important, but preferably not in their own backyard. Not to mention the high energy costs and limited availability of electricity in some places in the Netherlands. Or about the nitrogen standards that throw a spanner in the works, especially when it comes to increased transport movements. Or about the years of procedures up to the Council of State to get zoning plans changed."
Chinese companies do not face such problems. There is no shortage of electricity in China (coal-fired power plants are still being added), there is plenty of cheap labor, there are no nitrogen standards, and there are no long, expensive procedures. Moreover, many plastics are made from cheap Russian oil that the West is no longer buying because of the war in Ukraine. This has led to a halving of world market prices for virgin plastics within two years. This has also reduced demand for recyclate in China. As a result, both virgin and recycled plastics are entering the European market in large quantities, at rates for which the European industry cannot make it. Some large virgin plastic producers have already announced they are closing their doors in the Netherlands because they can produce more cheaply elsewhere.
Van der Giessen: "This does say something about your competitive position in Europe, with its open market and democratic decision-making models in which anyone can go to court to raise objections. The plastic market is a global market and we don't live on an island in the Netherlands. That does not make it easy to realize the goals the government has set for itself."
Sorting duty
Therefore, this transition to circularity is not only about addressing financial bottlenecks, but also about addressing the laws and regulations that can help make the business case. For example, according to Van der Giessen, there should be a sorting requirement for all our waste, not just plastics. Waste can then no longer be shoveled directly into the incinerator unsorted. But that only makes sense if something also happens on the sales side of recyclate. "Otherwise you will be stuck with large quantities and it is not yet a viable option. But that is not an exclusively Dutch route, you would have to do it on a European level, given the international nature of the market."
Permitting could also be more flexible. The process is too complicated and slow. "I myself have that experience with Van Werven. We had land for an expansion in the Flevopolder four years ago, but before the nitrogen file was complete, we had already lost two and a half years. And now the zoning plan procedure is underway. If views are expressed there, it will take another three years. And then we still have no electricity at that location, because of grid congestion."
Adding it all up like that does create a bleak picture of the future. "I'm not gloomy," Van der Giessen emphasizes. "I am realistic. Recycling is necessary and it contributes to the climate. With every ton of plastic you take to a recycler, you save as muchCO2 as if you replace a gasoline car with an electric car for a year. But if the government does not intervene much more disruptively, it will have to adjust its climate goals. It's all about the choices you make. There is a field of tension there that can only be resolved in a collaboration between government and business. Preferably right away at the European level, because you have to be able to influence the market. For example, if there is an obligation that every plastic producer throughout Europe must use 20% recyclate, there is already too little available today. Then we will again have a luxury problem: where do I get my plastic waste from and how do I realize sufficient recycling capacity?"
Britain, by the way, has already introduced such a "blending requirement": there, 30% of (part of) the products must consist of recycled plastic, under penalty of a fine. In practice, that fine turns out to be so low that it is cheaper to simply pay it than to actually use recyclate.
Complicated market
Van der Giessen hopes that from his involvement with CPNL, he can contribute to finding real solutions that do work. "Plastic recycling is a very complicated market with many side effects. It is not always easy to assess them in the right way. The government is positive about recycling, but cannot oversee the business model of recycling companies in the right way."
Doing nothing is not an option. "No, we just have to persevere, push through and send as many but signals as possible to eventually get what we would like to get done. You can also approach it positively. When I entered the waste business in 1980, nothing was being recycled at all, outside of paper and glass. Through laws and regulations, taxes and landfill restrictions and fees, the government at least steers how we deal with a very large portion of Dutch waste: 85% is already recycled. Only in the 15% that remains is mostly plastic."
On the positive side, of course, there are already many recycling initiatives. "The Netherlands has good waste legislation, including a producer responsibility system for household packaging. The basis is there, but we are not there yet. We still have many steps to go. For many waste streams, such as paper and glass, this is not necessary, because that business model already works by itself much faster. Recycling glass costs a few tens of dollars per ton, recycling plastic hundreds of dollars. If you build a plant, plastic doesn't go through very much weight because it's light. Transportation is relatively cheap. That means small-scale regional processing doesn't pay off. But it also means you need a large central processing site. Then you need a lot of space and you have to convince people that it's needed at that site."
It can then take years before a planned plant is in place. However, there is another uncertain factor: the unpredictability of legislation surrounding end-of-waste status: when is recyclate no longer waste, but a new raw material? There are also many aspects to the discussion around Substances of Very High Concern. It is certainly not always better to stop recycling plastics containing these substances from the past. The effect can also be counterproductive, as we have seen several times. I advocate that we not only look at the presence of a single substance, but also at the overall effect it has on the environment."
Fltr. Maurits Boeije (secretary), Ton Geurts (chairman), Esther van den Beuken (board member), Ton van der Giessen (board member) and Marc Spekreijse (director).