Infinity Recycling’s Circular Plastics Fund has made its first investment by acquiring a 20% stake in Pryme, the cleantech company behind Europe’s single largest plastic waste advanced recycling project in Rotterdam
Pryme, a cleantech company focused on recycling plastic waste, has received a €6.3m investment from the Circular Plastics Fund (CPF), recently set up by Dutch impact investment manager Infinity Recycling.
The investment, CPF’s first, represents 40% of the private placement in Pryme and gives the fund a 20% stake in the company, which is listed on the Oslo-based Euronext Growth Market.
Pryme’s first commercial plant, currently under construction in Rotterdam, will be Europe’s single largest advanced recycling project for plastic waste. While there are other sites with greater capacity, these comprise smaller processing modules linked together.
The plant is due to start commissioning in the fourth quarter of 2022 and will process about 40,000 tonnes of waste plastic annually when fully operational.
CPF is an Article 9 ‘dark green‘ impact fund – the highest designation under the EU’s Sustainable Finance Disclosure Regulation (SFDR). The fund was created to back companies scaling up proven advanced recycling technologies that break down plastic waste into primary commodities to be reused as inputs for new products.
The fund completed a successful initial capital raising in February, which received strong backing from global plastic supply chain investors and Invest-NL, the Dutch investment agency.
Jan-Willem Muller, a managing partner at Infinity Recylcing, told Impact Investor that it remains important that mechanical recycling of plastics is used to the full, but that further solutions are required for residual waste streams that can’t be easily handled in a sustainable way.
“We invest in those technologies that are able to take those streams and, instead of downcycling them into landfill or incineration plants, can upcycle them back into the building blocks of plastic,” he said.
Pryme uses pyrolysis technology to convert mixed plastic waste into pyrolysis oil, which can then be used by the chemicals industry as a substitute for naphtha, used in production of new plastics.
Pyrolysis produces around 70% lower carbon emissions than incineration and represents around a 40-60% cut in CO2 emissions compared with the production of virgin feedstock from fossil fuels.
The company estimates more than 10 million tonnes of European plastic waste is suitable as feedstock for its plants and says the technology will make a significant contribution to the EU’s target of recycling 50% of plastic packaging waste by 2025.
The technology’s ability to be scaled up quickly to meet demand due to the large capacity of each plant was a major consideration for Infinity.
“This technology can provide the economies of scale that the industry is looking for, which means it can expand in a cost-efficient manner. We know that, while people are happy to pay a premium for sustainable products, we still need to make sure that the product produced by our portfolio companies is price competitive,” said Jeroen Kelder, also an Infinity Recycling managing partner.
The technology is scheduled to be rolled out in plants in Rotterdam and other key petrochemical hubs in Northwest Europe over the next five years, adding a further 160,000 tonnes in production capacity.