Two things today – first, we find continued calls for “advanced recycling” technologies and systems. A couple of the primary issues are not that advanced, collection, transportation, and cleaning, but all require breakthroughs, which in some instances may be local and not economically replicated elsewhere. The strict FDA demands on what types of recycled polymer can be used in food packaging applications exclude many recycled material streams. This is especially true with many of those who have already had food contact applications. Advances in cleaning might meet FDA standards and increase the available pool of useable polymers. The challenge here is that a cleaning process likely works best once the polymer has reground into standard shapes – which would need to come after any AI-enhanced sorting innovation. That would lead to cleaning more than one stream and keeping the polymers segregated – which would cause inefficiencies. Right now, “advanced recycling” technologies appear to be a euphemism for disposal. Anything that can deal with a mixed and not necessarily clean stream will be breaking the polymers down chemically to form some fuel or feedstock for more plastics – it is a significant step down in value and maybe the word “advanced” is misplaced.
Separately, picking up on Cheniere’s CO2 footprint announcement – this could be good or bad for the industry and Cheniere. As research analysts years ago, we learned that once you give us data, we want more, and we want it frequently – this will be the case here, and it may prove very beneficial from an emissions perspective. If lower carbon footprint fuels can get a price premium, this could be the catalyst for meaningful CCS investment – see our ESG and Climate report from yesterday.