Li-Cycle Holdings Corp., Toronto, says Koch Strategic Platforms (KSP), a subsidiary of Koch Investments Group, Wichita, Kansas, will make a $100 million investment in Li-Cycle through the purchase of a convertible note. The investment is designed to support Li-Cycle’s growth opportunities in North America, Europe and Asia.

Additionally, Li-Cycle says it will work with several Koch Industries subsidiaries to explore opportunities to accelerate its global growth strategies. This includes potentially working with Koch Engineered Solutions (KES), which provides engineering, procurement and construction services, as well as the Optimized Process Designs group (OPD), a capability of KES that provides detailed engineering packages, single-point procurement for all equipment and materials, fabrication and construction services. Li-Cycle and KES are exploring commercial opportunities to support the global deployment of incremental spoke facilities and to enhance execution and operational readiness for the company’s Rochester hub.

“KSP’s investment in Li-Cycle will further fund and accelerate the growth of our lithium-ion battery recycling footprint in North America and globally as we scale our efficient and proven technology globally to grow in lockstep with our customers and pursue new market opportunities,” Ajay Kochhar, co-founder and chief executive officer of Li-Cycle, says.

“Lithium-ion battery recycling and recovery is critical for the electrification of transportation. Li-Cycle is a true leader in the space with proven innovative technology and a robust portfolio of customers and strategic partners,” David Park, KSP president, says. “We’re confident in Li-Cycle’s cutting-edge technology and in the company’s ability to deliver long-term value to its stakeholders throughout the battery supply chain.”

As the deployment of new large electric vehicle battery manufacturing factories is occurring more quickly than initially anticipated, Li-Cycle says it recognizes the need to accelerate establishing its processing capacity. The company says its total addressable market (TAM) estimate for the quantity of lithium-ion batteries available for recycling globally in 2025 has grown by at least 50 percent.

Under the terms of the investment, KSP will purchase a convertible note in the aggregate principal amount of $100 million. The note will have an initial conversion price of approximately $13.43 per Li-Cycle common share, subject to customary anti-dilution adjustments, which was established based on 125 percent of the seven-day volume-weighted average price of Li-Cycle’s common shares prior to the date of the note purchase agreement. Li-Cycle says it will settle its conversion obligations through the delivery of common shares. The note will mature Sept. 29, 2026, unless repurchased, redeemed or converted earlier. In addition, KSP has committed to a standstill agreement, and Li-Cycle has granted certain registration rights to KSP.

Li-Cycle says it expects this strategic investment by KSP to provide it with the opportunity to tap into key industry expertise across the broader Koch Industries ecosystem to augment Li-Cycle’s existing expertise, on mutually acceptable terms and with aligned incentives for the long-term success of Li-Cycle. For instance, KES has capabilities to construct, test and ship modular spoke facilities at various KES construction facilities, including in Texas and Poland. With offices in 54 countries, KES can support Li-Cycle with the roll-out and ground execution of spoke facilities globally, as well as support the development of a tailored operational readiness plan for Li-Cycle’s Rochester hub.

In early August, Sen. Sheldon Whitehouse introduced the Rewarding Efforts to Decrease Unrecycled Contaminants in Ecosystems (REDUCE) Act to the Senate. The bill, co-authored with Congressman Tom Suozzi, is designed to create a new incentive to recycle plastic and to address plastic waste in our ecosystems by imposing a 20-cent-per-pound fee on the sale of virgin plastic used in single-use products. It has been included as part of the budget reconciliation package before Congress. According to the sponsors, the fee would help recycled plastics compete with virgin plastics and ensure the plastics industry is accountable for its harms to the climate, oceans and minority and low-income communities.

Whitehouse has announced that the bill has received support from a number of environmental groups.

“Support is growing for our plastic polluter fee bill,” he says. “We need to end the cascade of plastic pollution into our environment. That pollution chokes our oceans, hastens climate change and threatens Americans’ well-being, and it’s the plastics industry that should cover the cost of the damage. I’m glad to partner with Congressman Suozzi to send a strong market signal to reduce plastic waste and boost recycled plastic. I’m also glad to earn the support of leading ocean and environmental advocates.”

Signatories to a Sept. 16 letter addressed to Sen. Ron Wyden, the chair of the Senate Committee on Finance and Rep. Richard Neal, the chair of the House Committee on Ways and Means, indicate their support for the bill. Those organizations include the Ocean Conservancy, U.S. PIRG (Public Interest Research Group), the World Wildlife Fund, the American Sustainable Business Council, Barrel Bag, Californians Against Waste, the Clean Air Council, Environment America, Fenceline Watch, GAIA (Global Alliance for Incinerator Alternatives), Greenpeace, Inland Ocean Coalition, Lonely Whale, Oceana, Oceanic Global, Our Climate, the Plastic Pollution Coalition, Social Venture Circle, Surfrider Foundation and the Turtle Island Restoration Network.

“A virgin plastic fee, such as the REDUCE Act, as introduced by Senator Whitehouse and Representative Suozzi, will level the economic playing field between virgin and recycled plastic, incentivize reuse and recycling of plastic and will raise revenue to invest in needed recycling and waste management infrastructure,” the letter reads in part. “In our current political moment, we cannot afford to pass on the opportunity to create change in upcoming legislative packages, including reconciliation.”

A news release issued by Whitehouse’s office says the REDUCE Act would:

• Establish an excise tax on virgin plastic resin. Manufacturers, producers and importers of virgin plastic resins would pay 10 cents per pound beginning in 2022, which would increase gradually to 20 cents per pound in 2024. This fee would apply to virgin plastic used to make single-use products, including plastic packaging, beverage containers, bags and food-service products. Exported virgin plastic resin and postconsumer recycled resin would be exempt from the fee.
• Provide rebates for certain products. Companies that use virgin plastic to make medical products, containers or packaging for medicines, personal hygiene products and any packaging used for the shipment of hazardous materials would not have to pay the fee and could qualify for a full rebate for any fees paid on the plastic they use for such products. Virgin plastic used to make products intended for repeated use also would qualify for this rebate.
• Establish a Plastic Waste Reduction Fund. The bill would direct revenue from the virgin plastic fee into a Plastic Waste Reduction Fund. These funds would be available to carry out plastic waste reduction and recycling activities, including making improvements to recycling infrastructure; carrying out marine debris reduction, detection, monitoring and cleanup activities; and addressing environmental justice and pollution impacts from the production of plastic.

Industry opposition

Unsurprisingly, a number of organizations that represent the plastic industry do not support the proposed legislation.

Joshua Baca, in a blog post to the Washington-based American Chemistry Council's (ACC's) website, writes in part, “Can we address the problem of plastic waste while preserving the societal benefits of plastics?

“Absolutely. But not if Congress passes ill-advised taxes on plastics.”

He writes that the measure “would impose significant additional costs on most everything we buy,” given the widespread use of the material.

“The tax ostensibly is designed to help reduce plastic waste. But it would do nothing to create circular solutions that help keep plastics out of our environment,” Baca adds.

He writes that while the tax is said to focus on packaging and single-use plastics, “… it taxes resin that is not used to manufacture ‘single use’ products … and then provides tax rebates to many downstream users of plastics that do not pay the tax in the first place. (The rebate is galling. Many companies would pay the tax, the government would hold the money, and then companies would have to ask for it, an expensive use of labor that defies common sense and imposes lost opportunity costs).”  

He continues, “In its implementation, the tax would penalize many of the durable products that we need to combat climate change. It actually is at direct odds with the spending plan’s provisions to combat climate change.”

Baca adds, “Taxing plastics basically would incentivize the use of many alternative materials that are less effective at delivering the fuel, energy and operational efficiencies needed to combat climate change.”

The ACC has made suggestions to Congress that would help to create a circular economy for plastics. The strategy supports producer responsibility for plastic packaging and includes a national standard that all plastic packaging contains at least 30 percent recycled plastic by 2030. It also involves creating a regulatory system that would enable the rapid scaling of advanced recycling, or chemical recycling.

The ACC, the Plastics Industry Association (Plastics), Washington, and other organizations representing the plastics industry sent a letter dated Sept. 27 to Sen. Mitch McConnell, Sen. Chuck Schumer, Rep. Nancy Pelosi, Rep. Kevin McCarthy expressing concerns with the proposed inclusion of the virgin plastic resin tax in the budget reconciliation package.

This correspondence follows a similar letter that was sent to Congress earlier this month from 38 CEOs representing America’s plastic makers and the plastics value chain, the Plastics Industry Association notes.

The most recent letter raises concerns about raising costs of everyday goods on American consumers, reduced U.S. manufacturing competitiveness and lack of meaningful solutions to address plastic waste associated with the proposed tax. “Additionally, there has been a lack of expert analysis, public debate and other considerations associated with the regular legislative process but not included in the ‘fast track’ reconciliation process,” a press release issued by the Plastics Industry Association states.

The letter reads in part, “Our respective industry commitments to sustainability include goals of using less material and working to reduce our overall environmental footprints. We stand ready to continue conversations with Congress to advance these goals, but don’t believe a tax of this sort moving through the process in this manner is the right approach. This resin tax proposal having first been introduced only weeks ago has not been fully vetted. No witnesses have been called to provide expert analysis by either side in the public setting of a committee hearing. There has been no opportunity to study the economic impacts of a tax of this size nor how such a measure would viably be applied.

“Early analysis paints a bleak picture: One industry estimate concludes the resin tax will place 92,000 American jobs at risk and increase the cost of plastic resin by up to 26 percent. On top of the direct impact on the cost of resin, the complexities of implementing such a tax would place an enormous burden and cost on manufacturers and users of plastic products trying to comply.”

“This is a massive tax,” says Matt Seaholm, vice president of government affairs at the Plastics Industry Association. “It is [adding] 20 cents per pound on a pound of resin that may sell for 70 cents per pound. You do the math—that’s a substantial tax.”

Seaholm says Plastics agrees that the industry should promote ways for manufacturers to incorporate more recycled plastic; however, he says, the association doesn’t think this tax is the right way to go about that.

“We believe there is a false assumption being made by some that there is the same amount of virgin resin and recycled-content resin and that businesses are making a choice to use the cheaper version,” he says, adding that recycled-content resins generally are cheaper than virgin resin already. “What we’re trying to make clear is there’s not a sufficient amount of recycled resin to switch to. The tax would just be an increased cost in finished products and would be felt throughout the supply chain.”

He concludes, “We share the goal of increasing the amount of recycled plastic that's used, but we disagree with a tax of this size and in this manner. We also believe there should be a much more robust conversation about it.” 

Rumpke Waste & Recycling, Colerain Township, Ohio, announced Sept. 29 that it has signed agreements with Logan, Ohio-based Kilbarger Construction Inc. to acquire certain assets from the company and to assume operations of the Athens Hocking Reclamation Center Landfill located in Nelsonville, Ohio, and the Meigs County Transfer Station in Pomeroy, Ohio.

Rumpke assumed operations July 16, and permits were transferred on Sept. 27. The Athens Hocking Landfill first opened in 1983 and boasts more than 500 acres. The landfill is permitted to accept 2,500 tons of material per day, including municipal solid waste (MSW) and construction and demolition (C&D) debris. The facility currently receives approximately 570 tons per day.

“Rumpke has been in business for nearly 90 years. Landfill and transfer station management is part of our core business,” Andrew Rumpke, area president of Rumpke, says. “Our family-owned and -operated company has managed sanitary landfills for decades. We are honored to assume ownership of the Athens Hocking Landfill and Meigs County Transfer Station from another family-owned and -operated company.”

In all, about 20 employees work at the respective sites. All current employees were offered employment and onboarded in July, the company says. Regarding the Athens Hocking Reclamation Center Landfill, Rumpke announced it plans to continue operating the site as a MSW and C&D landfill.

Rumpke Waste & Recycling, in business since 1932, is one of the nation’s largest privately owned residential and commercial waste and recycling firms. Rumpke owns and operates 14 landfills and 12 recycling facilities. Rumpke’s service area includes parts of Ohio, Kentucky, Indiana and West Virginia.

Rumpke also boasts a commitment to waste-to-energy projects. Currently, Rumpke has landfill-to-energy facilities at four of its landfills. Rumpke is continuing to plan and build similar energy facilities at other locations. Three additional gas-to-energy facilities are under construction in Richland County, Ohio; Medora, Indiana; and Montgomery County, Kentucky.

Commercial Metals Co. (CMC), Irving, Texas, has reached an agreement to sell the land underlying its former Steel California and Rebar Etiwanda operations, located in Rancho Cucamonga, 40 miles east of Los Angeles. CMC ceased operations at that site in December 2020, and customers of CMC’s Rebar Etiwanda operations will be serviced from other CMC fabrication locations.

According to a news release from CMC, the Rancho Cucamonga site is expected to be repurposed for other industrial uses.

CMC reports that gross proceeds from the sale of the land will total approximately $300 million and will be used to partially offset the cost of the company’s new Arizona 2 micromill in Mesa, Arizona, anticipated to be commissioned in the second half of 2023. The company has reported that the new electric arc furnace (EAF) micromill is its second in Mesa and third EAF micromill overall. The micromill will produce merchant bar and rebar by using environmentally friendly steelmaking technology.

CMC says the sale is expected to close during CMC’s second fiscal quarter of 2022 and is subject to purchase price adjustments. The closing of the sale transaction also is subject to a customary due diligence review period as well as customary closing conditions.