Environmental sustainability and recycling in action: SPE's Global Plastics Environmental Conference 2006

Plastics Engineering, April, 2006 by Alice Blanco

Sponsored by the Plastics Environmental Division of SPE, the Global Plastics Environmental Conference (GPEC) took place February 28-March at 2 at Atlanta's Gateway Sheraton. The Conference theme--Environmental S sustainability and Recycling in Action--was underlined by the opening event, a tour of the Mohawk Industries' PET-recycling facility in Summerville, Georgia, where each year, 3.3 million soft-drink bottles are transformed into the polyester fiber from which high-quality residential and commercial carpeting is made.

Outstanding technical sessions included presentations from academia and industry covering six topic tracks: automotive; electronics; reclamation and supply; biobased and biodegradable materials; marketing and business--recycling, sustainability, and ELV (end-of-life vehicles); and regulatory (deposit laws, safety, and legislation). Plenary sessions, a student poster display, more than 20 exhibits by industry participants, and introduction of the Division's 2006 Environmental Award winners completed the Conference program.

High Energy Costs: The Future of Plastics

The plastics industry represents the fourth-largest manufacturing sector in the U.S. and continues to be a high-growth industry. Primarily dependent on petroleum-based feedstocks, it is affected by rising fossil-fuel prices and heightened concern over natural-gas supplies. Biobased and recyclable materials and plastics-recycling efforts are playing increasingly important roles as the industry seeks to face these challenges.

A Two-Headed Monster

Plenary speaker William R. Carteaux, president of the Society of the Plastics Industry (SPI), called it a "two-headed monster": the requirement for natural gas as the major feedstock for plastic resins, and the high demand for natural gas to power plants that generate electricity. According to Mr. Carteaux, it is estimated that more than 80% of resin produced in the U.S. is made from natural gas rather than from crude oil. When plants were constructed in the U.S. years ago for the cracking, or refining, process that converts raw material into resin, a plentiful supply of inexpensive natural gas was available, but since the year 2000, prices for natural gas have increased an astonishing 700% as suppliers struggle to meet demand. The U.S. manufacturing industry uses one-third of the nation's energy, and the plastics industry represents almost 10% of that total.

Why the strain on natural-gas supplies, and the resulting price increases? According to Mr. Carteaux, U.S. government moratoriums have prevented the further development of natural-gas reserves in the outer continental shelf, while Clean-Air Act amendments enacted by the U.S. Congress in the year 2000 put restrictions on electricity-generating plants, with the effect that those plants are now powered almost exclusively by natural gas rather than coal. Ninety percent of electricity-generating facilities constructed in the last ten years are fueled by natural gas, said Mr. Carteaux, squeezing the supply of natural gas and making it more expensive.

Competitive Problem

The average energy cost for all manufacturing in the U.S. is approximately $5.58/million Btu. Yet energy costs for the manufacture of plastic and rubber products are almost double that, at $10.90/million Btu. And while the U.S. once enjoyed the lowest-cost natural gas in the world, that is no longer the case. Lower natural-gas prices in countries around the world, notably China and India, help explain the U.S.'s current competitive disadvantage, said Mr. Carteaux. The overall effect of higher natural-gas prices in the U.S. is that it has become increasingly difficult to compete with manufacturers in countries such as China and India.

Furthermore, reported Mr. Carteaux, according to predictions from the U.S. Department of Energy's Information Administration Group, U.S. reliance on imported oil will escalate from its present 56% to 68% in the near future, and, correspondingly, natural-gas prices are expected to continue their upward spiral. Compounding the problem is that 400 million cubic feet/day of natural-gas production is expected to remain offline in the foreseeable future as a result of damage inflicted by the two major hurricanes that struck in the Gulf of Mexico in 2005.

From 1970 until the early1990s, U.S. natural-gas supply and demand were "pretty much in check." The shortfall began in the mid-1990s and continued to increase, until in 2005 the shortfall amounted to 5 trillion cubic feet; it is expected to grow by 2025 to 10 to 12 trillion cubic feet as a result of the increase in demand, said Mr. Carteaux.

Solutions

Opening currently restricted domestic sources of natural gas could go a long way toward reducing supply shortfalls, suggested Mr. Carteaux, as could streamlining the exhaustive permit process required of companies carrying out exploration for new sources of oil and natural gas. According to the February 2006 Report to Congress, of the U.S. Department of Interior, Minerals Management Service, there is enough oil and gas in the outer continental shelf to heat 100 million homes for 60 years or fuel 85 million cars for 35 years. "That's a lot of oil and natural gas sitting out there, and if we had that 35-year time frame, it would certainly give us an opportunity to develop alternative sources as we go forward," he said. The technology used in construction of the 4000 drilling platforms for oil and gas production in the Gulf of Mexico has proven to be extremely sound and environmentally safe: of the 3050 platforms that were in the direct path of the two hurricanes in 2005, only 108 were completely destroyed and 53 badly damaged. There were no significant incidents of oil spills or slicks, he noted.