What Sustainable Business Leaders Need to Know About Chemical Recycling in Michigan

Chemical Recycling in Michigan: Background Information for Sustainable Business Leaders 

Sometimes referred to as advanced recycling, chemical recycling is a class of technologies that convert used plastics back into their original building blocks, chemical products or feedstocks, waxes, or fuels.  It is practically and technically unique from mechanical recycling, which most business leaders and recycling understand as the commonly-held definition of “recycling.”  

Although there are few such facilities in the Great lakes region, it has emerged as one of many new technologies available to manage end-of-life materials. Due to its energy requirements and skepticism from the environmental community, chemical recycling has proven a controversial solution and a subject of occasional debate in materials management and recycling public policy. 

In consultation with the Michigan Chemistry Council and Michigan League of Conservation Voters, with additional information from the Natural Resources Defense Council, we have created a background document to inform our network on advanced and chemical recycling, including its role in the 2023 Part 115 debate.

Chemical Recycling and Part 115: Why Environmental Justice Leaders Were Opposed

After several years of negotiation, a package of legislation updating Part 115 of the Natural Resources and Environmental Protection Act was passed in the lame duck session of 2022, modernizing the way the state regulates solid waste and fully investing Michigan in sustainable materials management, incentivizing recycling and composting as an alternative to landfills. 

A generational accomplishment for materials management, many observers in the sustainable business community were surprised to see progressive and grassroots environmental groups swing into opposition against the bill package and encourage Governor Whitmer to veto it.

During the unified Democratic majorities of 2023 and 2024, environmental justice advocates and progressive environmental groups sought changes to the law to address at least the controversial amendment on the regulation of chemical recycling. Other issues are likely to emerge as stakeholders learn about how the law will be implemented. 

As a general rule, Michigan Sustainable Business Forum is an ally to the state’s environmental justice movement and we believe it is important for sustainable business leaders to understand their perspective and stand alongside them when possible. We also recognize that sustainable materials management requires a collaborative approach of many industries, various levels of government, and diverse stakeholders that have not reached a consensus on how to approach fundamental issues for the creation of a circular economy, such as the role of fossil fuels and petrochemical feedstocks. 

Why Was Part 115 Passed in the Lame Duck Session?

The bill package passed the Michigan House of Representatives much earlier in the legislative session, and had been held indefinitely in the Senate Regulatory Reform Committee, with media reports suggesting that its chair had aligned with constituents in the waste management industry to indefinitely delay its passage. Arguably, this version of Part 115 only moved forward in the lame duck period after  the Republican Party lost its majority in the November election and thus sought to put its imprint on the bill package where possible..  

The Michigan Recycling Coalition has a wealth of information on Part 115 here. 

What is Chemical Recycling (also known as “advanced” or “molecular” recycling)?

Chemical recycling is a class of technologies that convert used plastics back into their original building blocks, chemical products or feedstocks, waxes, or fuels. These technologies purify, depolymerize, and/or convert plastics through:

• Pyrolysis – heats used plastics without oxygen into oils that can be refined for new plastics or fuels;
• Gasification – heats used plastics with controlled oxygen into syngas that can be converted;
• Solvolysis – uses solvents to purify used plastics into new materials.

As an example familiar to some MiSBF members, Brightmark opened an “advanced plastics renewal facility” in Ashley, Indiana in early 2021 and is now processing 100,000 tons of mixed plastic waste each year into 18 million gallons of ultra-low sulfur diesel and naptha, plus six million gallons of wax. Brightmark is a subsidiary of Chevron that is also known for its renewable natural gas partnerships with Michigan dairy farmers and anaerobic digesters. Still, the operational and economic feasibility of this facility have been in regular question.

More information can be found from Closed Loop Partners and American Chemistry Council.

How is Chemical Recycling Different from Mechanical Recycling?

Compared to mechanical recycling that typically chops, washes, and melts used plastics, chemical recycling is more challenging and energy-intensive but can also yield virgin-quality materials that can be recycled indefinitely and used for stricter applications. Chemical recycling is particularly advantageous for low-value plastics (No. 3-7), which are famously difficult to mechanically recycle due to contamination, technical challenges, or lack of markets. However, from a life cycle assessment perspective, it hasn’t been proven that these processes are more efficient than virgin plastics in regards to energy consumption and pollution, though a recent study sponsored by the American Chemistry Council does provide data that supports chemical recycling as environmentally preferable to the use of virgin plastics. 

By design, chemical recycling is not supposed to compete with mechanical recycling for the same materials, targeting hard-to-recycle plastics. In practice, this is only true as long as chemical recycling is more expensive and less attainable, or availability of low-value plastics is not sufficient to meet contracted feedstock demands. If developments are subsidized by economic development incentives or industry, and/or facilities are overbuilt for the available supply, there is certainly potential for the practice to compete with mechanical recycling. It is also relatively common for recycling markets to crash unexpectedly, and when this occurs chemical recycling could be more attractive than processing material mechanically at a loss. However, both of these costs pale in comparison to the inexpensive landfilling rates across the state.

As material recovery facilities (MRFs) continue to collect and broker recyclable materials, chemical recyclers become an increasingly viable option to sell the higher numbered plastics and are historically difficult to recycle using mechanical methods. This could result in further curbside contamination however, as non-traditional materials would be introduced into a system that is built around more readily-recycled items.

Is Chemical Recycling the Same as Incineration?

There is contention on whether chemical recycling technologies are in fact incineration. Many environmental advocates in the state refer to chemical recycling as “burning plastic” and the lame duck amendment as the “plastic incineration amendment.” This is particularly meaningful for environmental justice activists in Michigan and Midwest, as the movement has prioritized action against waste to energy facilities that employ incineration, such as the years-long campaign to close the Detroit Renewable Power facility. A variety of chemical recycling processes use heat without oxygen to break down plastics into new materials, such as feedstocks and other products, but also fuel for various applications, including energy production. Incineration requires oxygen and does not produce usable products, only ash, and potentially electricity (scrap metal is also collected from the Kent County Waste to Energy Facility, the only such facility currently operating in the state). Proponents of chemical recycling are positioning the practice as an alternative to landfills and waste to energy in their communications and messaging.   

The Natural Resources Defense Council has an explanation here on why the distinction is important. 

What Does the Chemical Recycling Language in the Part 115 Bills Do?

Although Part 115 is more commonly understood for its regulatory changes and planning requirements, some of the more consequential debates centered on definitions of technology and industries. The legislation defined chemical recycling and the various technology types. As long as chemical recycling facilities are using “source separated post-use polymers”, the facilities would not be considered waste facilities or incineration for the purposes of Part 115, which has always exempted “source separated materials” from the definition of solid waste. Presumably, chemical recycling facilities do not take in mixed-waste streams; instead, they purchase bales of specified plastics from MRFs or from post-industrial sources. As such, these facilities are more like plastics compounders, paper mills, or foundries that also utilize recycled materials and are likewise not considered waste facilities.

The statutory language specifically notes that the facilities would be regulated as manufacturing facilities subject to air, water, waste, and land use regulations. It also expressly excludes products sold as fuel from being considered recycled-content products (pre or post-consumer). While the products would not be able to be considered recycled-content, any facility in Michigan would be labeled as a ‘chemical recycling facility’ and would be decreasing the amount of plastics in landfills by converting them into fuels.

At present, given the limited number of facilities operating in the state and pending investments, the outcome is that Michigan is now aligned with states that have adopted standards advocated for by the chemistry industry. Environmental advocates contend that overtly exempting these facilities from Michigan solid waste statutes would shut down the discussion and prevent proper classification and regulation of pyrolysis and gasification before the industry is operating at a large enough scale for regulators to understand its impact. 

This does have national implications: These facilities are currently under review by the EPA for decreased air pollution protections (a rule proposed by the Trump administration). The previous EPA administrator Michael Regan asked for comments on whether pyrolysis and gasification should have to meet the same standards as incinerators, or be exempted from that level of regulation. Through the Part 115 amendment, Michigan had signaled its opinion to the federal government and its delegation to Congress. Current EPA administrator Lee Zeldin has spent part of his first year in the second Trump administration touring advanced recycling facilities, most notably ExxonMobil’s Advanced Recycling Operations where he showed interest and approval for their operations. During his senate hearing, Senator Jeff Merkley (D-Oregon) asked about his opinion on advanced recycling, to which Zeldin responded that he was still researching and learning all sides of the issue. 

Was the Amendment Rammed Through in Lame Duck?

Yes and no. The concepts and language have been extensively reviewed and debated as part of stakeholder discussions as far back as 2017. An earlier version of the language was included in the Part 115 bills introduced in 2018 (HB 6483), 2020 (HB 5812), and then in 2021 (HB 4454). In the prior legislative session in 2020, the Michigan Chemistry Council and American Chemistry Council provided 15 minutes of legislative testimony on advanced recycling. 

However, it was not introduced as part of the package that passed the House in 2022, but rather as a standalone bill (SB 954) that did not advance. Environmental advocates that negotiated the package will note that they sacrificed their own amendments in good faith to reach a compromise. The amendment was introduced in lame duck and led to environmental organizations splitting on how to proceed: Michigan Environmental Council, Michigan Recycling Council, and Michigan League of Conservation Voters supported the bill package but opposed the amendment, while Michigan Sierra Club, Ecology Center and Michigan Environmental Justice Coalition opposed the bill and called for a veto once it passed. 

Specifically, the lame duck amendment: 

• Defined the technologies as “chemical recycling” instead of “advanced recycling”
• Added requirements against speculative accumulation of material
• Further differentiated chemical recycling from mechanical recycling
• Expressly excluded products sold as fuel from being considered recycled products

Since Michigan adopted this language, four other states have followed suit with Wyoming being the 25th in March of 2024.

How Has this Affected Manufacturing Policy in Michigan?

In 2023, the Newaygo City Council and Planning Commission approved the creation of a ‘chemical recycling’ facility operated by global recycling company Clean-Seas. If constructed, this facility would be one of 12 similarly sized operations across the United States, would cost $20 million, create 30-60 jobs for the community, and begin converting over 50 tons of hard to recycle plastic into synthetic fuel per day. This number would increase as capacity increased, growing up to 500 tons per day. At present, this facility has not been constructed. 

With the Democratic party in control of the Legislature in 2023, Senator Rosemary Bayer introduced a bill (SB-543) that would strike the chemical recycling provisions from Michigan law, theoretically preventing the development of the Newaygo facility. Her reason being a lack of beneficial evidence, either environmentally or from a business perspective. There is currently no bill on the floor addressing this.

When considering the business case for a chemical recycling facility, it should be noted that these facilities have only been successful when operating at large scale with minimal contamination. A specific example in scaling technology is using the smaller stirred tank reactors for pyrolysis, a method that limits the capacity of the reactors, compared to larger fluidized bed reactors that can be scaled more easily. Facilities that have not been able to operate at scale have found alternative solutions, such as burning the plastics with oxygen as fuel, similar to what is seen at Kent County’s Waste to Energy facility. 

Aligning with other goals from the environmental justice community, Senator Sue Shink also re-introduced a bill in 2025 (SB-0195) that would repeal a 2016 law passed with Republican support that prohibits local governments from banning plastic grocery bags. If passed, this would not only allow local governments to put their own limits on single-use plastics, but would also diminish the feedstock of the proposed Newaygo facility, potentially preventing it from becoming successful.

What Does This Have to Do With Extended Producer Responsibility (EPR)?

Extended Producer Responsibility (EPR) is a type of product stewardship that would place the fiscal responsibility of recycling infrastructure on the producers of the product. It shifts financial and management responsibility back to the producer with government oversight and provides incentives to producers who incorporate circular solutions into the product and packaging design. This policy is currently in place for electronics, but Michigan is looking to develop a similar program for packaging. Theoretically, this would incentivize manufacturers to use more products that could be mechanically recycled and help improve the recycling system for hard to recycle products. Whether the plastics industry could use EPR to provide feedstock for chemical recycling plants or to improve mechanical recycling in Michigan, is part of the current discussion. 

As part of the requirements for EPR, producers would be required to follow the resource conservation hierarchy of reduce, reuse, recycle, and beneficially use as appropriate. When managing products, human health and the environmental protection considerations are required. As a third party, the government becomes the compliance agent, ensuring that producer programs are transparent and accountable to the public. This would imply that regardless of the process by which hard to recycle plastics are converted, any process that endangers the environment or humans would be disallowed. 

A claim has also been made that marketers from chemical recycling companies are able to manipulate data to market a product as “recycled plastic” when they are actually applying recycling percentages from other products to their single “high percentage recycled plastic” product. This claim was addressed in conjunction with a description of pyrolysis and mass balance accounting by the American Chemistry Council here.

What Does This Mean for Environmental Justice, Sustainability and Sustainable Business?

Michigan’s environmental justice, environmental and health advocates are only beginning to understand what existing state and pending federal regulations mean for the growth of the practice, as are the state’s regulators, other stakeholders, and to a certain degree the plastic and chemical industries themselves. What is understood is that the plastic and chemical industries are seeking solutions such as chemical recycling to answer the growing public perception that plastic pollution is a global environmental crisis. Not only are their customers and investors demanding investments in the creation of a circular economy (or at least keeping the material out of waterways and oceans), stakeholders of all sorts are having serious discussions about the continued use of low-value plastic resins, especially for single-use packaging. Chemical recycling as a solution then becomes a temporary measure that does not strike at the core issues, those being the reduction of single-use plastics and eventual energy independence from fossil fuels. Although not a universal priority, reducing the use of petrochemical plastic is generally considered a core tenet of sustainable business today. 

Ultimately, the heart of the matter is whether Michigan should have a regulatory environment that supports ever increasing volumes of low-grade plastics in its municipal solid waste. 

The state’s environmental justice movement is defined by its opposition to so-called “false solutions” from industry, and its leaders view chemical recycling as an example of this. 

For sustainability and sustainable business practitioners, as well as the recycling industry, the issue is more complicated, as chemical recycling could create an end market for low-grade plastics. Even so, sustainability practitioners don’t have a stake in whether these facilities face a lower regulatory burden, and may find partnering with such facilities more appealing if there is greater confidence in their pollution prevention measures. Sustainability practitioners seeking to eliminate low-grade plastics from their operations, or that are generally skeptical of recycling as a solution for plastic pollution, will likely find common ground with environmental justice advocates on this issue.