20 June 2023

Recycled PET: one closed loop, many winners

Reading time: 9 min.

Increasing the amount of recycled material in PET drinks bottles really shouldn’t be a problem. After all, more than 90 percent of all used bottles are collected in Germany. And yet over half of the rPET obtained from them is used outside the beverage industry Here at the REWE Group, we have trialled a closed-loop cycle for disposable drinks bottles. Our first circular economy project creates security of supply for suppliers and helps us achieve our recycled material targets.

Food packaging has several vital roles. It keeps products fresh, maintains their quality and are often essential for transportation purposes, in the case of drinks, for instance. Once used, however, packaging quickly ends up in the bin. This is why we at the REWE Group have set ourselves the target of making all packaging for our private-label products more environmentally friendly by the end of 2030. How will this work? By avoiding, reducing and improving the packaging commonly used today. One approach within this strategy is the creation of closed-loop cycles using the company’s own materials, such as single-use PET drinks bottles. The more secondary material, i.e. material obtained from recycled bottles, used in their production, the better. A closed loop such as this helps to save primary raw materials. It protects natural resources, thus making a positive contribution to environmental and climate protection. The REWE Group has therefore set itself a clear target. The aim was for our disposable PET drinks bottles to contain an average 50% recycled content by the end of 2023 (experts refer to this as the rPET quota).

Achieving the recycled material target with a closed-loop system

Together with partners from the recycling and beverage industry, we have trialled a closed-loop system for disposable drinks bottles in order to reach this figure and achieve even higher quotas in the following years. The pilot: In the first three quarters of 2023, RCS Rohstoffverwertung GmbH, a recycling specialist from Werne in North-Rhine Westphalia, collected an agreed quantity of used bottles crushed into bales (and therefore easier to transport) from a REWE central warehouse in Cologne. RCS then recycles the PET bottles into plastic flakes, sorted into clear and coloured, and turns them into rPET pellets. In the next stage, this recycled material is delivered to Refresco Deutschland GmbH, an independent drinks solutions provider and leading bottler of soft drinks and fruit juices which supplies many retailers, including the REWE Group. Headquartered in Mönchengladbach, the company manufactures its own preforms and can therefore use the recycled material directly in its process. The new bottles, containing a large proportion of rPET, are freshly refilled and soon back on the shelves at REWE and PENNY stores. A functioning closed-loop material cycle.

A prized raw material

What makes it so special? You would think that there was enough secondary material in Germany thanks to its well-functioning deposit return system. Indeed, according to the Gesellschaft für Verpackungsmarktforschung (GVM), or German Society for Packaging Market Research, more than 94.8% of all PET drinks bottles and as much as 97% of PET drinks bottles with a deposit (reusable and disposable) were reused in 2021. But not exclusively for the production of bottles. Due to its high quality, rPET is also a prized secondary raw material in other industries, including the foil and film industry, where one of its uses is in the production of food packaging. At present in Germany, there is not yet large-scale recycling of this type of packaging into recycled material for reuse in the food industry. According to the GVM, this sector accounted for almost 27% of recycled PET in 2021. Other uses included the production of fibres, detergent bottles and plastic tape and in injection moulding applications.

The REWE Group’s pilot has now trialled a closed-loop system for disposable drinks bottles. This provides a significant proportion of the rPET required for our own-brand drinks products. This improves planning predictability for Refresco GmbH, the preform producer. This is because the rPET procurement process constantly faces shortages, market fluctuations and uncertainty. The GVM notes that, for many years, PET from recycled drinks bottles has been more expensive than virgin plastic.

To ensure the success of the closed-loop approach, it is important to work closely with all the stakeholders involved. These include: The consumers who use the deposit return system to return their empties (the raw material for rPET) to reverse vending machines. The recyclers who process and resell the material. And with the packaging industry, which uses the secondary material to manufacture bottles.

At the REWE Group, we consider achieving the target of 50% rPET in all disposable drinks bottles by the end of 2023 as a mere stepping stone on the path towards further increasing this proportion over the coming years. Creating a closed-loop material cycle has an important role to play in this as it ensure the sufficient availability of suitable recycling material.

However, there are technical restrictions on the use of secondary raw materials in bottle manufacture. Recycled material takes on a darker colour when it is heated several times during the production process. The better the flakes are sorted beforehand and any coloured pieces removed, the more uniform the preforms will be. If recycled plastic preforms are not a uniform colour, the bottles are more likely to burst when inflated under high temperatures, as the darker areas absorb more heat and expand more quickly than the lighter areas. This is why the flake sorting process is important as it can ensure that the preforms have a uniform colour, thus improving the quality of the bottles produced.

To maintain the stability of drinks bottles, new primary material must therefore also be fed into the material cycle. However, it is possible to produce bottles made from 100% recycled plastic. REWE demonstrated this back in May 2019 when it became the first retailer to launch an own-brand bottle, the 0.75 L Aqua Mia Sport, made entirely from rPET. Shortly after, PENNY also added two water bottles to its range made from 100% and 80% recycled material, respectively.

The EU tightens the reins on rPET

Across Europe, the run on recycled material will increase significantly over the next few years. The EU Packaging Directive adopted in 2021 stipulates that disposable bottles must be made from at least 25% recycled material by 2025. In the draft EU packaging regulations published in November 2022, quotas of 30 percent by 2030 and 65 percent by 2040 are discussed. At first glance, these requirements do not seem particularly demanding, given that Germany already reached a quota of 44.8% in 2021. However, functioning deposit return systems do not yet exist in some EU countries. These systems create an incentive for consumers to collect empty bottles and return them to the cycle. The German Society for Packaging Market Research anticipates that more EU states will establish deposit return systems in the near future in order to meet the EU requirements.


“The circular economy is a key issue for the future”

Three questions for Rino Iacobellis, Senior Buyer alcohol-free drinks/beer for REWE Group Buying

Recycled material is a prized commodity. What led the REWE Group to initiate a closed-loop system?

Rino Iacobellis: Recycled material has been a highly prized commodity since the announcement of the EU regulation that drinks bottles across the EU must contain rPET in future. However, this doesn’t go far enough for the REWE Group and we have set ourselves a much higher target with the goal of achieving 50% rPET by 2023. We therefore need the cycle in order to achieve the defined target and to help our suppliers obtain the raw material.

Rino Iacobellis

is Senior Buyer alcohol-free drinks/beer for REWE Group Buying

What challenges did you need to overcome when developing the pilot project?

Rino Iacobellis: The main challenge was to develop a functioning model of collaboration along the entire chain. In addition to contractual issues, we also had to reorganise our purchasing and logistics processes. As part of the closed-loop model, we are now involved in the supply of raw materials too. For us as a retailer, it is a new way of working with the supply chain.

You are more than halfway through the trial. How would you sum it up so far? What has worked well, what might need improving and what will happen at the end of the pilot?

Rino Iacobellis: We are pleased with the way the pilot is going and with the collaboration between the partners. In the future, we want to examine whether it might be possible to further extend the model and to potentially involve more suppliers. From our perspective, the circular economy is a key issue for the future. Its importance will continue to grow in view of future regulatory requirements and developments on the commodities market.