A financially sound solution to the natural resource crisis comes down to one thing:

In order to explain the circular economy, we need to start with the typical economic model, the linear economy. The linear economy involves taking raw materials from the earth, using them to make products, selling those products and eventually disposing of them. The products wind up in a landfill, incinerated or in other places we don’t want to see them, like our oceans. In a linear economy, we create waste and a negative impact on the environment.

Conversely, the circular economy returns products, materials and resources into the production cycle. An example of a circular economy at work is BASF’s partnership with outdoor apparel supplier Vaude. BASF treats old tires and recycles the resulting materials into textiles Vaude uses to craft high-quality pants. To get a bit more specific, BASF replaces fossil fuels in the manufacturing process with pyrolysis oil derived from scrap tires to create a product called Ultramid^® Ccycled^TM which can then be used in the fabrication processes of performance textiles.

Not at all. The circular economy is about driving sustainable solutions through balancing economic and ecological needs by minimizing, or eliminating, finite resource usage. Ride share apps are a great non-manufacturing example. With ride sharing, we don’t all need to own vehicles; we are minimizing the usage of a finite resource, cars.

BASF is particularly focused on creating chemistry-based solutions for a sustainable future which often does involve manufacturing. A specific and effective solution we offer is called advanced recycling. Through advanced recycling, pre- or post-consumer waste streams, previously destined for landfill or incineration, are converted into high-value materials that are put back into the production chain. Our advanced recycling projects include creating plastics for furniture, repurposing old mattresses into new ones and transforming rubber scraps into car door handles, among others.

Let’s back up a little and talk about mechanical recycling. That’s the recycling we all understand. You have a soda bottle, throw it in your recycling bin and at the recycling plant, much of the plastic in that bottle will be mechanically recycled into some other plastic product. There will also be plastic waste from that process that cannot be addressed by mechanical recycling. Also, there are products, like old tires, that you cannot recycle mechanically because they cannot be melted and reshaped. What do you do with those items? That’s where BASF’s work with advanced recycling, also called chemical recycling, comes in.

Chemical recycling turns those materials into an oil through a technology called pyrolysis. Pyrolysis oil, the resulting product from chemical recycling, acts like a raw material that can replace finite resources, like traditional oil, in the creation process of new products. Fossil fuel use is minimized because there is an alternative solution derived from waste already circulating in the economy.

To be clear, mechanical recycling is still very much needed. Chemical recycling is only used to tackle the hardest-to-address waste streams. BASF does not consider materials eligible for mechanical recycling as options for our chemical recycling programs. Both recycling technologies have equally important roles to play in the circular economy framework.

There are two main challenges to this economic model.

The first is the lack of infrastructure for proper collection and sorting of plastic waste. In the United States, only a handful of states provide proper access for recycling at the residential level which leads to upsettingly low recycling rates. And there’s no standardization: Thousands of different community recycling programs collect thousands of different materials. This goes beyond the United States, as well. We need an international certification program that assesses recycled input so we can speak one recycling language globally. Modernizing and standardizing the processing infrastructure and increasing consumer access to recycling services is step one.

The second challenge is the limited public policies that enable businesses to invest in recycling technologies. As of today, there is no federal legislation that recognizes advanced recycling as recycling. The reason behind that is simply confusion. People confuse advanced recycling with burning plastics, which it is very much not. 20 states have enacted legislation that recognizes advanced recycling as manufacturing, not solid waste management. However, these 20 states create a patchwork of conflicting requirements among manufacturers and value chain partners. Governments should do all they can to support the best available technology for sustainability and encourage businesses to invest in developing these innovations. Without government support, this field won’t develop quickly enough to address our resource issue before it’s too late.

BASF is deeply committed to creating solutions that would enable the circular economy, even beyond our work in advanced recycling and pyrolysis oil. For example, we’re extremely proud of our wholly owned subsidiary Trinamix, which has developed a solution for sorting plastics in a high-speed environment—a mobile near-infrared spectroscopy that identifies plastics for easier and faster sorting. This is a step toward addressing the need for improved recycling infrastructure, which I mentioned before. Recycling facilities are not easily able to look at consumer-recycled plastics and then sort them. The BASF-developed technologies will help sort the materials and quickly return the materials to the economy.

The general consumer’s idea of sustainability is already changing. Most millennials care more about the environment than older generations. This sustainability-focus will only intensify with generation Z and the generations after.

As people grow to understand the need for the circular economy, I see people demanding more access to high-functioning recycling infrastructure and an increased consumer willingness to contribute to the circular economy through doing the initial recycling sorting themselves. People will become more engaged and involved.

Our world is facing a serious issue: decreasing natural resource supply and increasing demand. The key to solving this problem is going to be chemistry and that’s BASF’s wheelhouse. Together with our customers, we can innovate solutions for the planet and society. More than that, we can develop sustainably and profitably. With BASF's advanced recycling, responsibility doesn't have to mean untenable expense.