A solution to Australia’s soft plastics woes

Licella soft plastics

With all the ballyhoo about the REDcycle program being suspended, and thousands of tonnes of soft plastics being stockpiled in various warehouses throughout New South Wales and Victoria, one take-out from the event is that there are not enough facilities to recycle soft plastics.

That could be about to change in the near future – i.e. early 2024. 

Licella is a company that uses hydrothermal liquefaction, or HTL, an innovative form of advanced recycling. Licella’s HTL technology is called the Cat-HTR (which stands for Catalytic Hydrothermal Reactor). This method of processing uses hot, pressurised water to recycle carbon from plastic, while using less energy than other methods such as pyrolysis and gasification. It also moves hydrogen from the water into the newly created oil, making the oil easier to upgrade in a conventional refinery with much lower impurity levels. Licella has been developing the process over the past 14 years, and it’s now being built at-scale commercially. 

“With the Cat-HTR we can create a high-grade oil, which is suitable to go back into the local plastic supply chain without any further purification steps, which is a big point of difference against pyrolysis,” said Licella marketing director Andrea Polson. “We operate at lower temperatures as well because we use water, so it’s a very efficient process. And we can get a higher yield of oil from a broader mix of plastics. We don’t need to do a huge amount of separation or decontamination at the front end.”

Polson points out that this decontamination doesn’t include large chunks of metal, but HTL can process bits of paper or organics that are stuck to the plastic.

Cat-HTR is the brainchild of Dr Len Humphreys (Licella’s CEO), who believes the technology will go a long way to solving Australia’s soft plastic pollution problem. But before setting out to conquer the world, the company needed a place to process the plastics.

“The first step was a feasibility study, which we did in 2021,” said Polson. “This confirmed that the opportunity was there, that there were economic and environmental benefits and that we could create a circular economy for plastic locally.”

The company is about to start building the first Australian processing plant in Altona, Victoria. The area was chosen because a lot of the existing plants in the area are part of the refining petrochemical industry. The site was an old Dow Chemical plant, which is zoned SUZ3 for petrochemical manufacturing.

The target processing capacity for the facility will be 120,000 tonnes a year. The initial piece of kit will process 20,000 tonnes a year of waste plastic but will soon scale up to 70,000 tonnes, as Licella will add a 50,000-tonne module once the next approval comes through from the Victorian EPA. 

And where will the feedstock currently come from? Even the recently discovered stockpiled REDcycle plastics only came in at 8000 tonnes. 

While the warehouses in NSW and Victoria are full of soft plastics from the REDcycle program, that is not even 10 per cent of what the new facility will need to meet its annual targets. Also, other companies are coming online with technologies that will also be turning plastic back into its original state. 

“That’s the most challenging piece of the puzzle,” said Polson. “We’ve got relationships with the downstream processors. We could sell the oil many times over; that’s not the problem. Getting this feedstock will be the biggest challenge. I think for the first stage, it won’t be a problem as there’s tonnes of post-consumer plastic. It’s when the facility ramps up to scale that this issue may arise. It shouldn’t go to waste-to-energy when higher value applications are right around the corner.”

But there is some good news.

Read more: REDcycle did the right thing by stockpiling

“There is the opportunity to capture less attention-grabbing but very problematic streams of plastic,” said Polson. “For instance, agricultural plastics, plastics from other product stewardship schemes, and back-of-house C&I plastic are burned or buried in huge numbers every year because their recycling options are limited.”

Polson said Licella is hoping for the plant to be operational within the next 12 to 18 months, but there are supply chain issues that are left over from COVID-19. However, she is optimistic that it will be up and running sooner rather than later. 

“The good thing about having a global footprint is that even though we’re an Australian company, the licence for the technology outside of Australia sits with an organisation called Mura Technology,” she said. “We work closely with them, and they have a global alliance with KBR and Dow. They’ve already commenced construction in the UK. And they’ve also done all the engineering work for the plants that they have under development in Southeast Asia.”

Patience is also needed. Polson wishes the facility was up and running now because currently there is no facility that can take the amount of plastics that need to be processed. 

“If we were online now, we could take all [the REDcycle stockpile],” she said. “We’re processing a couple of big bales of the REDcycle material as part of our trials up in Somersby in the Central Coast.”

How has Licella found dealing with the EPA over the approvals process to get the right permits to build the plant? 

“Victoria’s EPA have been pretty good and deserves credit for leading the way on these innovative recycling projects nationally,” said Polson. “Things have taken a bit longer than we anticipated, but they haven’t been dragging their feet. I think the thing that has been a cause for delays is the general uncertainty in the market. Also, we’re the first company to build a full-scale advanced recycling facility in Australia, which means there’s always a little nervousness around something new.”

And while nothing is certain until all the i’s are dotted and t’s crossed, there is some certainty due to the federal government awarding the company a $12 million grant via the Modern Manufacturing Initiative. The plant will also create 31 jobs initially, ramping up to 83 when it goes full scale. There is also expected to be 57 indirect jobs from the start, increasing to about 150 once it is in full production.

What will the quality of the product be like once it is processed? High, according to Polson and they already have a market for most of it.

“Our plasti-crude oil has several interested offtake parties. In general they would likely utilise the ISCC Plus mass balance approach, where for every tonne of our recycled oil we put in, it offsets one tonne of fossil oil,” said Polson. “What we do is use that recycled oil to offset as a 100 per cent replacement for fossil fuels and that basically goes back round through the supply chain as something like polypropylene.”

The conversion rate of soft plastics to oil will be between 80 and 85 per cent, meaning that when the plant is running at full capacity, 120,000 tonnes of soft plastics will produce approximately 100,000 tonnes of oil. Polson said that the company undertook a feasibility study that also showed a 64 per cent reduction in CO2 during the lifetime of the plastic-produced oil compared to imported oil. 

And what about the community? How have they reacted to the idea of a facility being built in their area?

“When we put in our application to the EPA, the community was about 80 per cent supportive,” she said. “Then you had 10 per cent who said, ‘it sounds really good but go do it somewhere else’. And then the other 10 per cent were like, ‘this is just waste-to-energy. Not in our back yard.’ We have no doubt community support will continue to grow after we switch on the lights. 

“Overall, I feel the plant will be great. We’re going to be helping solve a problem, which currently doesn’t have a solution. Whenever you’re doing something for the first time and it’s an emerging technology there’s always going to be a lot of questions. We started our community consultation very early in the piece, because we felt that there’s going to be a huge number of questions. We needed to take them on a journey of understanding what we’re doing.” 

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