EC Approves €500 million French Scheme to Support Chemical Recycling

Amid a spate of shutdowns, project cancelations and delays related to chemical recycling plants in Europe and the U.S., the French Government has announced some welcome support for the technology.

The European Commission has approved, under EU State aid rules, a €500 million French scheme to support the chemical recycling of certain types of plastic waste. The measure contributes to the achievement of the priorities of the European Commission for 2024-2029, based on the Political Guidelines, which call for a more circular and resilient economy.

The French scheme

France notified the Commission of its plans to introduce a €500 million scheme to support investments for the chemical recycling of certain types of plastic waste, such as trays, films, non-beverage bottles and textile materials with a certain amount of polyester content. The scheme aims to support chemical recycling technologies that convert mixed and/or contaminated plastic waste back into ‘virgin-like' raw materials. The scheme will contribute to the EU's objective of circularity of production and consumption processes as part of a broader transformation of the industry towards climate neutrality.

Under the scheme, the aid will take the form of direct grants. The scheme is open to companies of all sizes and operating in all sectors. The maximum amount of aid is 40% of the eligible costs, which are the extra investment costs calculated by comparing the total investment costs of a project of chemical recycling of plastic waste with those of less environmentally friendly projects.The Commission found that:

• The scheme is necessary and appropriate to allow for the deployment of chemical recycling of plastics.

• The scheme has an ‘incentive effect' as the beneficiaries would not carry out the relevant investments without the public support.

• France has put in place sufficient safeguards to ensure that the scheme has a limited impact on competition and trade within the EU. In particular, the scheme is open to all companies operating in all sectors and the aid is limited to the minimum necessary to undertake the projects.

Project cancellations and closures

The welcome news comes at a time where the investment situation regarding chemical recycling has ben on somewhat of a downward spiral. In the U.S., for example. four chemical recycling plants have ceased operations due to technical and financial issues, leaving only nine operating. Recent developments include:

• The Regenyx plant in the state of Oregon, for example, closed in April 2024 after failing to reach commercial scale and sustaining heavy losses.

• Fulcrum BioEnergy’s Nevada facility, which converted waste into jet fuel, was shut down after only two years following bankruptcy and failure to repay bonds.

• Eastman Chemical delayed its Texas methanolysis plant by two years due to loss of a key federal grant.

• NOVA Chemicals canceled its chemical recycling plant in Sarnia, Ontario, shifting focus to mechanical recycling due to high costs and regulatory complexity.

In Europe, at least six chemical recycling projects have been closed or abandoned in the last six months, including those by Borealis, Dow, and Neste, primarily due to poor economic conditions and slow technological progress. Dow and Mura Technology, for example, canceled plans for a large plant in Germany.

Positive developments in Asia

It's not all doom and gloom at Mura Technology however. The company has announced plans to develop a 50,000 tonnes/year chemical recycling facility in Singapore. This marks a significant milestone in the company’s expansion across Asia, joining existing facilities operated under license from Mura by Mitsubishi Chemical Corporation in Japan and currently being commissioned by LG Chem in South Korea, which when combined with Mura’s own UK facility in Wilton, Teesside, UK, will total 60,000 tonnes/year of liquid circular hydrocarbon output capacity by the end of 2025.

The new facility will be located on Jurong Island within the Singapore Essential Chemicals Complex (SECC) , where Mura has recently secured rights to a site from PCS. Mura has also opened a Singapore office to support this strategic expansion. Nicholas Kolesch in the position of Global Feedstock Director at Mura Technology Asia will oversee the development of sourcing networks for Recovered Plastic Feedstock for Mura’s Hydro-PRT advanced recycling facilities.

Until late 2024, Nicholas was the inaugural Vice President of Projects at the Alliance to End Plastic Waste, a non-profit organisation established by leading companies in the plastics value chain. Nicholas has also held several commercial leadership roles in the Borealis Group, with a focus on packaging and automotive.