Wuppertal Institute: Six proposals to save the industry

Bonde: We must not squander this trump card

“A comprehensive circular economy should serve as a compass for plastics,” says DBU Secretary General Alexander Bonde. “The strained recycled plastics market must be supported by innovations – otherwise, we risk losing both industry and ideas.” Promising technologies in Germany must be established in the market. “We must not squander this advantage,” said Bonde. The plastics value chain is largely organized linearly; plastics production is based primarily on fossil oil and generates enormous amounts of waste. What is needed, however, is “a shift away from the linear ‘take-make-waste’ model – that is, the extraction, use, and disposal of raw materials. “Sustainable action and business practices only work in a circular economy – from product design and waste prevention to reuse, sharing, repair, and recycling,” said Bonde.

EU Packaging Regulation (PPWR): A major upheaval for the entire plastics industry 

In just a few months, on August 12, 2026, the plastics industry in Europe faces a major upheaval: On that day, the new European Union (EU) Packaging and Packaging Waste Regulation (PPWR), which entered into force on February 11, 2025, will take effect. The PPWR aims to reduce packaging consumption, improve recyclability, and promote the circular economy, including minimum quotas for recycled content: Starting January 1, 2030, the quota will be 30 % for food-contact packaging with PET as the main component, rising to 50 % in the same category by 2040. Single-use plastic beverage bottles must contain 30 % recycled content starting in 2030, and as much as 65 % by 2040. According to the EU’s intentions, the PPWR is intended to increase demand for recycled material as a secondary raw material – thereby reducing the need for fossil raw materials, minimizing greenhouse gas emissions, and improving the recyclability of plastics. What sounds plausible at first glance, however, has several drawbacks, as Prof. Dr. Henning Wilts, the author of the position paper, explains. Apart from the EU regulations, which he considers to be “too late,” the head of the Circular Economy Department at the Wuppertal Institute points to an acute predicament facing the industry: weak demand for recycled materials – even as oil prices rise, which makes new petroleum-based plastic products more expensive and should therefore actually give products made from more affordable recycled materials a competitive advantage. The result: Due to a lack of investment security, more and more plastic recycling companies are giving up. Know-how is being lost, according to Wilts. There is a threat of a recycled material shortage, which could lead to “having to rely on recycled material imports from abroad due to the PPWR requirements.”

Proposals from the Wuppertal Institute:

A plastic tax and a reduction in the variety of plastic materials

The position paper aims to counteract this, according to Wilts. The low demand for recycled plastic stems partly from the supposedly negative image of recycled plastic and partly from specific plastic requirements. The advantage of plastic diversity – for example, in terms of shape, colour, and strength – is a disadvantage for the recycling industry: There are “tens of thousands of plastic variants that prevent theoretically feasible recycling processes in practice,” says the 48-year-old department head. Nationwide, the recycled content is below 20 %, “even though innovative technologies would enable a significantly higher share.” The six proposals in the position paper are intended to help the plastics industry resolve its dilemma between minimum recycled content quotas and increasingly dwindling recycling capacity due to low demand for recycled materials. Author Wilts advises, for example, significantly reducing the “sometimes excessive variety of materials” – without compromising the material’s functionality. Material diversity and minimum recycled content quotas are also components of the German government’s “National Circular Economy Strategy” (NKWS), which is currently under discussion. Wilts continues: Public procurement offers “a key lever” for generating additional demand for recycled plastics. In addition, a plastic tax would be sensible “to integrate the environmental costs of extracting and processing crude oil into plastic.” However, this must be implemented in a globally coordinated manner and must not lead to “the use of ecologically harmful alternative materials.” Another point in the position paper: plastic as a service – a concept in which revenue is generated not through sales but through the circular use of plastic. For example, according to Wilts, Rolls-Royce charges fees for the use of aircraft turbines instead of selling them.

Around 431 million t of plastic produced worldwide each year – from bathroom

fixtures to baking paper

Plastic is omnipresent – from bathroom fixtures to baking paper, from clothing to computers to cosmetics, not to mention the electronics and mobility sectors. According to the Plastics Europe association, approximately 431 million t of plastic are produced worldwide each year, with more than a third of that in China, 55 million t in Europe, and 13 million t in Germany. The consequences of waste: plastic particles even in the Himalayas and more than 150 million t of plastic waste in the oceans. Wilts estimates “around 16 million t of plastic waste in Europe and 6 million tons in Germany.” Nationwide, “just under half” is recycled, while in Europe the figure is significantly lower. According to Wilts, the global plastic recycling market has a volume equivalent to approximately € 51.4 billion. The raw materials for recycled plastics currently consist of products with specifications for plastic recycling, primarily packaging, vehicles, electronics, and certain commercial waste. The plastic recycling market in this country is predominantly made up of small and medium-sized enterprises. “Almost everything” can be recycled, and with AI-based sorting, even “highly specialized processing” is possible. However, due to a lack of reliable demand, the current state of the art is “that these innovations do not make it beyond university labs.”