It’s on: the race for sustainable packaging
There is a reason for the immense success of plastics in packaging. It is simply a material with phenomenal characteristics: cheap, food-grade, lightweight, flexible, easy to produce, and an excellent barrier against oxygen, grease and water. However, traditional plastic does not come without flaws: it lasts an eternity in the environment and is derived from oil. Finding a solution to these problems has become a priority as the consumers are becoming more environmentally aware and policymakers are introducing stringent regulatory frameworks for single-use plastics. Fortunately, many brave entrepreneurs are currently embracing this challenge. Their goal is to develop cost-competitive alternatives with similar properties compared to fossil-based plastics while at the same time having a lower environmental footprint. Some startups are aiming to improve the performance of existing materials, like paper, via eco-friendly additives or composites (e.g., Papkot and Qwarzo) or via novel fiber processing technologies (e.g., PulPac and The Loop Factory). Others are experimenting with completely new bio-based materials that focus on either biodegradability (e.g., Sulapac and Traceless) or recyclability (e.g., UBQ Materials and Woodly). The reality is that for each packaging application there is a different solution and there is not a universal formula that will fix all our plastic problems. Soon, we expect to witness an ecosystem of green companies covering the many needs of the packaging market.
The challenges of sustainability
From an investor’s perspective the road to sustainable packaging bears opportunities and obstacles. First, some of the biobased resources used as feedstock are new and currently unexploited. This means establishing new supply chains and ensuring they are ready for scaling up. There is also a tradeoff between biodegradability and usability. Packaging that can compost at home is hardly suitable to protect its content for long under certain conditions. When it comes to a non-biodegradable material recyclability in existing recycling streams is key. For companies and investors alike, emerging and fast-changing regulations related to packaging and waste management is a substantial risk. What can be labelled as biodegradable today might be considered generic waste tomorrow and vice versa. Finally, even when the above-mentioned green characteristics are present, it is not obvious that a product has a lower carbon footprint. That is why ECBF benchmarks packaging alternatives against each other by so-called “life cycle assessment” starting from feedstock to the end of product life.
The role of ECBF
ECBF, the biggest European fund focused on the bio-based and circular bioeconomy, is striving to participate in the sustainable packaging revolution. We believe that the ecological alternatives to fossil-based packaging are a key component of the green transition hence our commitment to scout and support the most promising startups in the field as an active investor.
This article was originally published in European Biotechnology Magazine Winter Edition 2022.