Chemical Processing Notebook: Covestro's Long Road to Circularity

German materials giant Covestro is in transition. On Oct. 1, the company said it accepted a €14.7 billion ($16.7 billion) takeover offer from Abu Dhabi National Oil Co., or Adnoc. On that same day, Tim Thiel, Covestro’s global circular economy manager, participated in a panel discussion called “Plastics Billion Dollar Decarbonization Opportunity” during the Reuters Industrial Decarbonization North America 2024 in Pittsburgh. 

Thiel outlined a sobering reality: While chemical recycling and bio-based materials offer promising pathways to sustainability, fundamental hurdles around economics and infrastructure remain. 

In a follow-up conversation, Thiel discusses how one of the world's largest polymer producers is navigating the complex transition toward circularity – from its €100 million R&D investment to strategic partnerships that could reshape how the industry approaches plastic waste. The following is an edited version of that conversation.

Jonathan Katz: You have a circularity program at the University of Pittsburgh. How will this collaboration with the university help you get ready for the changing market that you're in?

Tim Thiel: It’s not there just to help us. It’s there to help industry. A large part of circularity that I would say is forgotten about is the actual design side. So what we've talked about so far is the input materials. We've talked about processes that make materials, and then we've talked a little bit about end-of-life upfront design on products. The idea here is making a product that are more easily taken apart at the end or that's closer to a monolithic design that makes it easier to recycle. That’s kind of the genesis of that program. We want these students coming out with a PhD certificate in circular design.

We want them out in the industry and the market so new products, new systems are created all around this realm of circularity. The whole program really is about, how can I design for reuse?

For example, if I'm designing the next mattress based on raw materials from Covestro, how do I make that mattress more apt to be recycled at its end of life in 10 years? Can I make it easier to come apart and use less materials or chemistries? I mentioned monolithic design. The thing that really hurts recycling is when you have various types of chemistries in the same product. If you think of a mattress, you have polyurethane foam for comfort; then you might have polyester textiles; then you might have cottons. All those are recycled differently, and so you have to be very cognizant of how to separate, how to sort it, and then how to recycle each piece differently. If we start moving the designs of materials or systems or products that are one single polymer, let's say, or chemistry, it's going to be much easier to recycle.

Jonathan Katz: Can you provide some examples of any changes you've had to make at the plant level to be able to handle these new formulations or bio-based mass balance materials?

Tim Thiel: The nice thing about mass balance: none. That's the good part of it. You don't really have to change your actual processing or how you produce. The thing you have to do is get your site certified. We chose a certification called ISCC Plus. They basically review the processes of our site, review how we receive materials, and they audit the site and then issue guidance.

When it comes to circularity or Scope emissions, we're looking at our energy sources. We have energy procurement people who are looking at renewable energy. We announced a year or so ago a virtual power purchase agreement with a company called Orsted. It's a 15-year agreement to lower our Scope 2 emissions to about 70,000 tons of carbon or CO₂ avoided per year with that agreement. Another change we made at the site was in regard to a catalyst. We had a project to look at our nitric acid production. Nitric acid is a precursor for a lot of our processes. We were using a catalyst in that process that had a high global warming potential (GWP) and a high product carbon footprint. In that project, we were able to find some solutions to replace that high GWP product. We were able to lower the emissions in that area by 98%. So that's a direct drop of our Scope 1 emissions at the site from that project change. 

If and when we get to segregated bio-based materials, that's where we would have to look at things like new piping and new tanks.

Jonathan Katz: In light of the recent lawsuit that the state of California filed against Exxon Mobil, how, as a company, do you ensure there's transparency in what you're doing and its true impact on the environment?

Tim Thiel: For transparency’s sake, that's why on the mass balance side you get certified, right? That's the whole transparency. It's not us saying, “Hey, look at us.” We have these materials. It's a neutral third party that we paid to audit us and provide us a certification. We are working within their framework.

Also, green claims fall under what's called the Federal Trade Commission’s (FTC) Green guidelines. So anytime we're going to do a new product launch or when we launched our mass balance portfolio, one, we're going to someone from our communications department and the talk to experts on how we should brand this and communicate this. We have specific legal groups that are well versed on FTC Green guidelines on how you can or can't talk about your product or process. And so, we go with that guidance on how we're going to be marketing this. 

Jonathan Katz: Is there anything else you would like to add? 

Tim Thiel: Yes, a couple of things that we're working on: We are embracing and looking into advanced recycling. In Europe, we're specifically looking at advanced recycling of mattress foam. We are also looking at advanced recycling of an insulation type of foam – whether it’s for a building or an appliance like a refrigerator. Advanced recycling would involve taking these post-consumer materials back down to their chemical constituents or monomers, and then we can reuse those monomers to make a new product, and our customers can reuse our product to make a new finished good – all without using traditional fossil-based raw materials. The other thing we're looking at in the future is alternative materials.

We signed two different agreements for recycled plastics that go into raw materials. One is called BioBTX in Europe, and then another is from Encina. We signed letters of intent to be an offtake of their process, which takes municipal solid waste in and mixed plastics and turns the mixed plastics and waste into viable raw materials for us, namely benzene and toluene. Again, we would use these raw materials in place of fossil-based raw materials for our processes at our plants. On the bio side, we have a process to make bio aniline at lab scale, and we're in the process of designing and going forward with a more pilot and industrial-scale bio aniline in the future years. Aniline is a basic chemical raw material for a lot of our products.

Another one is we're working with a company called Geno, formerly Genomatica. We developed with them a plant-based variant of a chemical called HMDA, a precursor raw material in paints and adhesives. These are all examples of what I would call long-term collaborations with value-chain partners that are going to lead to more sustainable raw materials for Covestro, lower carbon footprint materials, lower emitting materials for our customers. 

Jonathan Katz: Of all the technologies you just mentioned, are there any that are closer to commercialization than others?

Tim Thiel: I would say they're all in the three- to five-year-plus timeframe. So no, I couldn't really pick a winner.