Based on the fundamentals of their environmental footprint compared to that of virgin fossil fuel-derived plastics, biodegradable bioplastics could significantly reduce the carbon emissions of the chemicals industry.
However, in order to achieve the scale needed to play a meaningful role, the bioplastics industry will require significant regulatory interventions from governments and substantial cost efficiencies as technologies mature and scale, according to Wood Mackenzie.
“From a sustainability point of view, bioplastics have two main benefits. As a renewable resource, they have a substantially lower lifetime carbon footprint than fossil fuel-derived polymers. Their biodegradability provides another route to reducing levels of plastic in the waste stream,” said Guy Bailey, Wood Mackenzie Head of Intermediates and Applications.
Despite the urgent need to increase the sustainability of the industry, bioplastics still play a small role in the plastics value chain today. So, what factors are holding their progress back?
Bioplastics currently make up less than 1% of global plastics consumption, according to Wood Mackenzie’s analysis. While healthy increases in capacity are forecast over the next few years, the growth rate is still behind expectations for polyethylene (PE), polypropylene (PP) and polyethylene terephthalate (PET).
“Cost is a significant barrier to scaling up bioplastics, as manufacturing bioplastics is often much more expensive than traditional polymers. Until bioplastics can consistently compete on price, they’re unlikely to displace commodity thermoplastics in most applications.
“Bioplastics producers also need to prove they provide a more holistically sustainable product. Agricultural feedstocks impose their own environmental costs – using pesticides and leaching of fertilisers in water systems, for example. Given current scales, bioplastics are also arguably a distraction. Building market share could mean diverting resources and efforts away from other sustainability measures, such as collecting and recycling plastic packaging,” said Ashish Chitalia, Wood Mackenzie Head of Polyolefins.
Despite the hurdles bioplastics must overcome, targeted interventions can help them to compete at scale.
“The easiest lever for governments to reach for is legislation. This could take the form of targets at an application level like recycled content targets for packaging applications in the EU’s Single Use Plastics Directive. Additionally, governments could focus policy changes higher up the value chain to incentivise production.
“If governments start to apply significant and consistent carbon taxes or prices, this would also stand to benefit lower-carbon bioplastics,” added Bailey.
To illustrate the impact new legislation and a carbon tax could have on the scalability of bioplastics, Wood Mackenzie ran a scenario that assumes bioplastics producers make a sustained push for integration efficiencies and a global carbon price of €100/ ton.
“Our research shows that, combined with efficiency gains from integration and scale, the implementation of an aggressive carbon tax would bring the price of polylactic acid (PLA) – a major bioplastic – in line with that of PE and PET.
“However, if the carbon price was cut to €50/ton, PLA would become a premium product once again, therefore eroding its ability to compete profitably at scale,” added Chitalia.
Based on Wood Mackenzie’s analysis, critical puzzle pieces must fall into place if bioplastics are to make major inroads into petrochemical-based plastics.
Some of these pieces include biorefinery integration, economies of scale, improvements in the polymerisation process technologies, an inherent mechanical property gap vs petrochemical polymers, and compatibility with downstream conversion technologies.