Chemical Recycling: Between Technological Breakthrough and Economic Reality

August 13, 2026 Source: own NeoOil P5 system

The European plastics industry is undergoing profound change. Driven by political objectives such as strengthening the circular economy, reducing dependence on fossil raw materials, higher recycling rates, and a more sustainable approach to plastic waste management, regulatory requirements are being continuously tightened.

In particular, the EU and Germany are increasingly relying on measures that promote the use of recycled materials and accelerate the transition from linear to circular material flows, such as the new EU Packaging and Packaging Waste Regulation (PPWR).

At the same time, the challenge on the waste side is also growing: Complex plastic mixtures, composite materials and contaminated waste are reaching technical and economic limits in mechanical recycling.

This is precisely where chemical recycling – especially pyrolysis – comes in. It is considered a promising approach to returning difficult-to-recycle material streams to the material cycle and thus closing an important gap in the existing recycling system.

However impressive the technological advances of recent years may be, experience shows that even a clearly identifiable need does not guarantee economic success.

When technology meets reality: Consolidation in the pyrolysis market

Because significant challenges lie between regulatory support, industrial scaling, and economic viability, challenges that are often difficult to overcome in practice. Some prominent examples from recent years in Europe, the USA, and South Korea illustrate this:

Carboliq (Germany) had to file for bankruptcy at the beginning of July 2026 – despite an innovative process as an alternative to classic pyrolysis.
The South Korean recycler Eco-Creation ran into payment difficulties in June 2026 and defaulted on liabilities of around 2,4 million euros.
Also in June, Freepoint Eco-Systems the company halted operations of its new pyrolysis plant in Ohio following government and public pressure.
The British recycler Plastic Energy was placed under administration in June 2026 due to liquidity problems.
The British Viridor in May 2026 over her Norwegian daughter Quantafuel from chemical plastic recycling. Reasons given included weak demand, regulatory uncertainty, and competitive pressure from virgin materials.
The Dutch recycler Pryme In May 2026, it closed its only pyrolysis plant and announced its withdrawal from the stock exchange.
The US pyrolysis specialist Brightmark filed for Chapter 11 bankruptcy protection in 2025.
Fuenix Ecogy and Blue Cycle (both Netherlands) failed in 2025 despite ambitious growth and scaling plans.
HC Plastics (Germany) had to file for bankruptcy and sell its plant as early as 2023.
Even prominent projects like the joint project of Dow and Mura Technology They were hired in Germany.

However different these cases may be, a pattern is clearly recognizable: The technology is often available, but scalability, economic viability and long-term purchase agreements constitute critical bottlenecks that determine the success or failure of the projects.

Why good technology alone is often not enough

Chemical recycling operates within a complex and challenging environment: Due to its technical complexity, it typically involves high initial investment costs (CAPEX). In recent years, this has been compounded by highly volatile energy and operating costs, as well as uncertain offtake structures for pyrolysis oil and other byproducts of the recycling process.

To make matters worse, regulatory expectations are evolving faster than markets are reacting. This is because many business models implicitly rely on the assumption that political frameworks translate quickly and linearly into economic benefits.

The reality, however, is that markets are developing more slowly than expected and industrial investments require long-term stability. Consequently, disillusionment is growing within the industry: a high technology readiness level (TRL) is necessary, but by no means sufficient for long-term success.

The next step: flexibility along the entire value chain.

Successful approaches in advanced recycling today are characterized by a significantly broader scope. Instead of focusing exclusively on individual process steps, the focus is shifting towards integrated value creation systems.

These are characterized by:

Access to suitable feedstocks
safe acceptance of products such as pyrolysis oil or secondary raw materials
Integration into industrial partner structures
Operational flexibility depending on the regional market environment

Modern recycling is not a self-contained process, but rather a system with very different requirements. Mechanical recycling may still be the best solution for single-material types like PET, while complex material flows require thermochemical processes. And in some markets, the basic infrastructure for collection and recycling is the primary focus.

enespa: Advanced Recycling as a Holistic Approach

Against this background, enespa has also undergone significant strategic development in recent years: Starting from the vision of a "world without plastic waste", the company was initially built up as a research and technology-driven company.

The technological basis is now mature – but market experience has shown that successful implementation requires more than just a functioning plastic-to-oil plant.

Therefore, we now pursue a holistic approach, best described as Recycling as a Service . This includes:

Development and implementation of complete plant solutions
Support throughout the entire project cycle – from initial conception through approval processes to turnkey handover.
Training and empowerment of on-site operations teams
Support through an in-house laboratory for continuous technical guidance
Development of operating models together with partners, including in-house operation of selected plants
Active participation in feedstock sourcing and product acceptance

Our integrated approach is particularly evident in our international partnerships, for example in Morocco, where recycling is not limited to plastics but also includes other material streams such as copper cables or mixed waste fractions. Here, recycling is deliberately conceived broadly – adapted to local realities and material availability.

Conclusion: The future is integrated recycling.

Developments in recent years paint a clear picture: the success of recycling companies depends not only on technology, but also on their ability to understand and shape entire ecosystems. The industry is moving away from isolated facilities towards integrated solutions that consider raw materials, processes, operations, and sales markets together.

The goal remains unchanged: a world without plastic waste – in that sense, we remain true to our beginnings. However, the paths to achieving this are more complex, regionally focused, and operationally demanding than many industry pioneers assumed just a few years ago.

So the journey remains exciting.