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rPlanet Earth, a vertically integrated polyethylene terephthalate (PET) recycler that also manufactures various types of packaging from that material, has closed, according to industry sources.
Headquartered in Vernon, California, the company operated out of a 300,000-square-foot facility where it converted curbside bales of postconsumer PET into food-grade packaging. According to the company’s website, it recycled 58 million pounds of PET in 2023, with 100 percent of its products made from up to 100 percent postconsumer recycled PET (rPET). The company claimed that more than 99 percent of the postconsumer plastic it processed came from curbside recycling programs.
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In a statement confirming the closure, the Washington-based Association of Plastic Recyclers (APR) says rPlanet Earth accounted for approximately 4 percent of the rPET capacity in the United States, adding that the company faced low demand for its products while competing against a surge of low-cost imported material and cheap, oversupplied virgin plastic.
“These dynamics are driven by two factors: brands pulling away from recycled content commitments to instead buy more new virgin plastic, and by brands choosing to buy imported rPET to meet their U.S. recycled content requirements instead of buying from U.S. recyclers like rPlanet,” the APR writes. “The result is that U.S. recyclers are being squeezed out of the market at a time when the nation urgently needs more—not less—domestic capacity to build a truly circular economy.
“The sad truth is that this closure underscores that plastics recycling is a tough business, and until recycling plastics is equal to or more profitable than making new plastic, the U.S. will not make any significant progress in reducing plastic pollution.”
Sally Houghton, executive director of the PET Recycling Corp. of California, called the news of rPlanet’s closing “devastating” for the industry and the circular economy in California.
“They were the only reclaimer processing Grade B bales at a large scale, and now there’s very limited end market demand for that material,” Houghton tells Recycling Today. “PRCC will continue to search for markets to move the material, but there are few and low-paying options. There are some export possibilities, but not at a significant volume. As winter approaches, supply usually tightens, so we hope some reclaimers and end buyers may stockpile, but that remains uncertain.”
rPlanet Earth’s facility was a $100 million investment, and the company had received a variety of financing in previous years to aid its development. In 2016, Citi, MBS Urban Initiatives and New Markets Community Capital provided New Market Tax Credit (NMTC) financing for the company, with financing for the facility project structured through the NMTC Program, a federal initiative designed to spur investment in businesses and real estate projects in low-income communities.
Citi provided $7.5 million in NMTC allocation and $6.6 million in NMTC equity. New Markets Community Capital provided $8 million of NMTC allocation, and MBS Urban Initiatives provided $5 million of NMTC allocation. Private investors provided the rest of the capital.
In late 2018, the company also received a $2 million California Climate Investment loan from the California Department of Resources Recycling and Recovery (CalRecycle) as well as a $3 million grant and tax breaks from the state. The Closed Loop Fund also invested $1.5 million in rPlanet Earth in 2018.
rPlanet Earth is not the first large-scale PET recycler to close in California this year.
In February, Riverside-based Evergreen Recycling, which specializes in PET bottle processing, closed a portion of its facility and laid off 57 employees. In a statement announcing the closure, the company cited “economic factors” as a reason.
Houghton notes that with the state’s extended producer responsibility (EPR) law, Senate Bill 54 (S.B. 54), coming online in January 2027, and with the state’s mandated recycled-content law (A.B. 793) on the books, responsible end markets are crucial for the success of the program.
“There must be sufficient converter capacity and high-quality rPET available to meet these regulations,” she says. “Without functioning domestic reclaimers, California risks becoming dependent on imports, jeopardizing the state’s goals and investments.”
Houghton says that in order to aid California-based reclaimers, the state needs to continue the Plastic Market Development Payments (PMDP) that helped sustain them, adding that a recent push to increase the PMDP failed despite stakeholder efforts.
“PRCC will continue to push for its increase and extension as it is imperative to support the reclaimers at this time so that the California circular economy stays intact and the industry can compete with imports,” she says. “California’s PET recycling system is a cornerstone of the state’s circular economy. Without intervention, we risk losing the infrastructure necessary to achieve our sustainability goals.
“Increasing the Plastic Market Development payment to $300 per ton and extending its duration is not just a lifeline, it is an investment in California’s economy, workforce and environmental future.”
California isn’t the only state to feel the effects of a major rPET producer this year.
In June, Mexico-based petrochemical company Alpek S.A.B. de C.V. announced it would shutter Clear Path Recyling in Fayetteville, North Carolina, laying off 90 employees.
Clear Path, which was acquired by Alpek in 2021, had an installed capacity of 170,000 tons of PET resin and approximately 35,000 tons of rPET flake per year. In a news release announcing the facility closure, Alpek said the decision aligned with its long-term strategy to optimize its global footprint and focus on its more “competitive and scalable assets.”
In its statement regarding the rPlanet Earth closure, APR says it is not an isolated incident, noting that Europe, too, already has experienced multiple plant closures under similar conditions, with the U.S. risking following the same path if current policy trends continue.
“Without immediate action, the U.S. recycling industry could be overwhelmed by imports, jeopardizing jobs, investment and the very infrastructure needed to keep plastics out of landfills and back into new products,” the organization writes. “APR urges policymakers to act decisively: create strong incentives for brands to use domestically sourced recycled content and require country of origin labeling.
“Only with clear, enforceable measures can we ensure that U.S. recycling capacity survives, grows and delivers on its promise to reduce plastic pollution and the production of new plastic.”