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Dow, LyondellBasell, NOVA Chemicals Launch Closed Loop Circular Plastics Fund

(Credit: Pexels)

Plastic waste continues to be a huge problem because much of the plastics produced winds up in landfills and often ends up in water supplies. The cumulative production of plastic has already surpassed eight billion metric tons worldwide, with further increases expected in the coming decades. Meanwhile, the current supply of recycled plastics meets just 6% of demand for the most common plastics in the U.S. and Canada because of technical or market barriers.

To help address these concerns, three leading plastics and material science companies – Dow, LyondellBasell and NOVA Chemicals – have established the Closed Loop Circular Plastics Fund  to invest in scalable recycling technologies, equipment upgrades and infrastructure solutions. The Fund, managed by Closed Loop Partners, and with an initial $25 million investment, invites businesses across the plastics value chain to join in advancing the recovery and recycling of plastics in the U.S. and Canada. The goal is to eventually deploy $100 million, through a combination of the Fund’s founding investors, additional corporate investors and financial institutions, in order to attract additional capital beyond the Fund’s own commitments. At scale, the Fund’s investments aim to recycle over 500 million pounds of plastic over the Fund’s lifespan.

The Closed Loop Circular Plastics Fund will invest in three strategic areas:

  • Access – Increasing the collection of targeted polyethylene (PE) and polypropylene (PP) plastics by advancing current and next-generation material collection systems, including transportation, logistics and recycling sortation technologies and infrastructure.
  • Optimization – Upgrading recycling systems to more efficiently aggregate, classify and sort the targeted plastics to increase the total amount of high-quality plastic, including food-grade and medical-grade plastic, sent for remanufacturing.
  • Manufacturing – Investing in facilities and equipment that manufacture finished products, packaging or related goods using recycled content, including recycled PE and PP.

Closed Loop Partners is a New York based investment fund and innovation center focused on the circular economy. Instead of the traditional ‘take-make-waste’ linear model, a circular economy refers to an economy that is restorative and regenerative by design. In a circular economy, economic activity builds and rebuilds overall system health. The concept reveals and designs out the negative impacts of economic activity that cause damage to human health and natural systems. This includes the release of greenhouse gases and hazardous substances, the pollution of air, land, and water, as well as structural waste such as traffic congestion. A circular economy is based on three principles:

  • Design out waste and pollution
  • Keep products and materials in use
  • Regenerate natural systems

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