A Houston Firm Says It’s Opening a Billion-Dollar Chemical Recycling Plant in a Small Pennsylvania Town. How Does It Work?

POINT TOWNSHIP, Pennsylvania—Randall Yoxheimer, chairman of the locally elected board of supervisors here, has seen economic development proposals come and go, but the latest one—a $1.1 billion chemical recycling plant for plastic waste—has left him, and even some scientists, perplexed.

Announced in April, the plant would use first-of-its-kind technology and employ hundreds of workers to turn waste plastic into new plastic. With the promise of taking a bite out of a serious global plastics problem, the new facility sounds like a terrific idea, Yoxheimer said as he sat under the bright fluorescent lights of the township’s office. 

The Houston startup company, Encina, that wants to develop the plant seems to have “excellent motives,” he said. But Encina officials provided township leaders with so little information that it’s hard to discern the promises from reality, Yoxheimer said.

“I am used to the way companies present themselves, and this company has been somewhat vague on a lot of things,” he said. “They are not terribly adroit in how they are trying to move forward. After they did that billion-dollar press release, we heard very little from them.”

He said he intends to stay neutral in the matter, which has already stirred considerable local discussion. “But I am concerned about the functionality of this whole thing,” Yoxheimer said. “The fact that it’s prototypical concerns me.”

With the plastics industry facing global pressure to do something to curb its waste that has touched all corners of the planet—microplastics have also been detected in human blood, feces and even human placentas—chemical recycling proposals like Encina’s have sprung up across the United States.

The concept of breaking down plastics into their core chemical elements and then using those chemicals to make new plastics in a sort of “closed loop” or “circular” economy, is advanced by many industry representatives as a desirable goal because it would, in theory, reduce the need to drill for more fossil fuels, the primary source of plastic products.

That’s how Encina officials see their efforts, said Sheida R. Sahandy, the chief sustainability officer and general counsel for the company.

“When we say that it’s circular, the idea is that you get it back to virgin quality, you can just keep reusing it and reusing it or reformulating it into another product and reformulating it into another product,” she said.

Encina, she said, is working diligently to develop its first plant here in Point Township, a small community of suburban homes and farms along the wide-bodied Susquehanna River, about 60 miles north of the state capital of Harrisburg.

But close examinations by environmental advocates and media organizations over the last few years have found few commercial successes with the chemical recycling of plastics, and concerns about environmental risks. They’ve found plants that do little more than make new fossil fuels, and produce a lot of waste, falling short of the promise of a circular economy.

“This whole chemical recycling is a charade,” said Jan Dell, a chemical engineer who has worked as a consultant to the oil and gas industry and now runs The Last Beach Cleanup, a nonprofit that fights plastics pollution and waste. “It’s a hoax. And it’s been perpetrated for 30 years. Every time the public has some interest in, ‘Oh, there’s too much plastic waste,’ they trot it back out again.”

Shrouded in Mystery

In Point Township, Encina plans to turn 450,000 tons of plastic waste annually—something like 150 truckloads a day, according to Yoxheimer—of plastic waste from urban centers like Pittsburgh, New York and Philadelphia, into benzene, toluene and xylene, hydrocarbons found in gasoline and feedstocks for the petrochemical industry.

While Encina touts its transparency, the details of its proposal remain shrouded in mystery, under a veil of proprietary technology. In broad strokes, Encina has said that it will be working with partners to create those feedstocks that can be used to make everything from furniture to fuels to sports equipment to plastic bottles.

Encina has released so little technical information—and state environmental regulators that have been talking to Encina officials are not commenting much on the company’s plans—that the situation has left independent experts like University of Pittsburgh professor Eric Beckman, a chemical engineer with a Ph.D. in polymer science, not sure what to make of the company, its proposal or whether the plant can be economically viable. 

From what Beckman can tell, Encina likely will turn the waste plastics into naphtha, a flammable liquid hydrocarbon mixture, and then turn the naphtha into benzene, toluene and xylene.

“I don’t know if anybody has done that yet” at a commercial scale, Beckman said. “Encina has zero results on their web page. I find the lack of details somewhat disturbing.”

Sahandy said the company’s “process and value proposition are unique and previously not used. However, we have proven both the technology and the customer demand, including at our testing operations in San Antonio. I cannot provide any more technical insight than what has been otherwise publicly disclosed.”

‘Advanced Recycling’

The United States leads the world in the generation of plastic waste, at nearly 300 pounds per person per year, according to a 2021 study from the National Academies of Sciences, Engineering and Medicine. Only a small portion—less than 6 percent—of plastics used by consumers in the U.S. actually get recycled, a recent analysis of EPA data by Beyond Plastics and The Last Beach Cleanup found.

The type of plastics that are recycled the most are those used, for example, to make soda bottles or milk jugs, often numbers one or two. These waste plastics typically go through a mechanical process involving sorting, grinding, shredding, cleaning, melting and remolding, most often into other products. As the plastic degrades, it’s “down-cycled,” a term to describe turning, say, bottles into carpeting or fleece until the plastic cannot be used anymore.

The company has already been able to take advantage of a plastics industry push to relax regulations on the chemical recycling of plastics. The industry, led by the trade group American Chemistry Council, has been working to grease the regulatory skids to favor chemical recycling, which it likes to call advanced recycling, in statehouses, the U.S. Capitol and at the U.S. Environmental Protection Agency. 

Twenty states including Pennsylvania have since 2017 passed legislation aimed at regulating chemical recycling, including methods using pyrolysis, as manufacturing, not waste management or waste incineration. 

The ACC applauded Pennsylvania Gov. Tom Wolf in 2020 for signing Pennsylvania’s revamped recycling law, saying it would “help Pennsylvania attract new recycling businesses and support job creation while keeping more plastic out of landfills.” 

It turns out that legislation with its new definition of “advanced recycling” exempted the Encina plant from having to secure a waste management permit and other waste-handling requirements from the Pennsylvania Department of Environmental Protection, provided all other state and federal regulations are met, said Jamar Thrasher, spokesman for the Pennsylvania DEP.

The EPA is also weighing how it intends to regulate advanced recycling nationally under clean air and waste incineration rules. An EPA spokeswoman would not say when any new regulatory proposals might emerge.

Few Successes 

Alarmed by a steady stream of research that shows how plastic waste has become ubiquitous in the world, environmental organizations are pushing for a global treaty and state and federal policies that will reduce plastic production and curb the use of single-use plastics like bottles, wrappers and bags.

But advanced recycling is gaining ground because consumers and companies that use plastics for packaging are demanding plastic bottles or packaging be made with at least some recycled content, said Joshua Baca, vice president of plastics for the chemistry council.

So far, there have been few successes.

The global news agency Reuters last year published a report that found most of some 30 advanced recycling operations it examined internationally were operating on a modest scale or had shut down. The industry faces “enormous obstacles,” the news agency found, including the cost of collecting and managing plastic waste and creating products that can compete economically with fossil fuels or virgin plastic.

Environmental organizations have come to similar conclusions.

Greenpeace in 2020 found that most advanced plastics recycling plants that were being promoted by the industry were not recycling plastic waste into new plastics, but rather they were making fuel for combustion and barely putting a dent in the glut of waste plastics.

Greenpeace sees the industry efforts more as a form of public relations known as greenwashing, rather than a viable solution, similar to other unproven or uneconomical industry-backed solutions to intractable environmental problems, such as capturing and storing greenhouse gases to curb climate change.

“‘Chemical recycling’ projects may be more likely than petrochemical projects to be approved for regulatory relief or public funding, as they carry an aura of ‘green’ and ‘circular,’ precisely because they are considered recycling,” the report concluded. “Rather than pouring money into a declining oil and gas industry’s self-imagined technological solution, money should be invested into a green and just recovery prioritizing a transition away from petro-based business models toward a climate-safe future with environmental justice.”

The Natural Resources Defense Council this spring examined eight U.S.-based chemical recycling facilities touted by industry. “The majority of facilities are not recycling any plastic,” the environmental group found. The facilities were also generating hazardous waste, releasing hazardous air pollutants and were often in communities that are disproportionately low income, people of color, or both, NRDC found.

“What we’ve seen are some major challenges, when you’re using post-consumer, mixed plastic waste; that can be quite a contaminated stream,” said Veena Singla, a senior scientist with NRDC. 

The contamination can come in the form of some plastics being incompatible with the chemical recycling process and hard to remove, she said. Pesticides, paints or cleaners left inside plastic containers are other forms of contamination, she added.

Adding recycled content to plastic products like bottles or packaging made with virgin fossil fuels under the guise of sustainability is a form of “sustainability fraud,” said Terrence Collins, professor of chemistry at Carnegie Mellon University in Pittsburgh and director of the CMU Institute for Green Science. It perpetuates an unsustainable fossil fuel economy laden with toxic chemicals that make people sick, he said, adding: “It’s a continuation of the fantasy.”

As the industry aggressively markets its vision of chemical recycling as a primary solution to the plastics crisis, another critic describes it as an intentional mirage, of sorts.

“It is a Potemkin village,” said Neil Tangri, the science and policy director at the Global Alliance for Incinerator Alternatives, at a recent plastics conference at Bennington College in Vermont. That’s a term used to describe a pretentiously showy façade intended to mask or hide something undesirable. The industry is saying, “‘Look, we have the technology, don’t look inside the box too much,” he said. Their real goal, he said, is instead to maintain their business model and avoid consumer scrutiny. 

Some experts see chemical recycling efforts today as part of a path toward truly recyclable plastics of the future.

“Chemical recycling is not a panacea, it’s not the solution,” said Gregg Beckham, a senior research fellow at the U.S. Department of Energy’s National Renewable Energy Laboratory in Colorado. “I don’t think it’s here and I don’t think it’s now,” he added. 

But some “pioneer” plants that are being developed now may be helping to make way for a new generation of greener plastics that are still decades away, Beckham said.

“I hope that in the next 50 years or so that humankind will transition over from fossil-based polymers made the way we make them today, to bio-based polymers that are more easily recyclable,” said Beckham, who is leading a National Renewable Energy Lab research consortium focused on solving plastics recycling problems. “And I think chemical recycling can help be part of the bridge to get there,” he said.

An Optimistic Timeline 

Encina launched in 2016, led by David Schwedel, a venture capitalist and investor from Miami who told the Miami Herald in 2014 that his mother had printed him his first set of business cards for him when he was 12 years old. He parlayed his interests in boating and marine services into energy technology, including coal reclamation, and now, chemical recycling of plastics.

When the company put out what Yoxheimer called its “billion-dollar press release” announcing its Point Township Circular Manufacturing Facility and later met with community members in May, it promised to process annually as much plastic as can fit inside a domed football stadium each year.

Encina touted the benefits of the facility saying it would “reduce the need to produce new plastic from oil and gas resources, providing circular solutions to customers committed to reducing their impact on the environment to build a circular economy.” 

Gov. Wolf also hailed the project as a winner for jobs and the environment. 

“Not only will they be creating new, good-paying jobs, but they’re committed to doing it with an innovative approach that will lessen their impact on the climate and sustain a brighter future for all of us,” he said in the press release.

Encina says the plant will inject $2.1 billion into the local and state economies over the next five years. It’s saying construction will begin next year, employing as many as 750 people, with production in 2024. Encina said the plant would need 300 employees.

Dell, the chemical engineer with the Last Beach Cleanup, said she finds the company’s plans fantastical, starting with its plan to secure 450,000 tons of mixed post-consumer plastic waste a year. 

“It’s not possible,” said Dell, who has been studying what plastics are actually collected for recycling across the region and nationwide. “There is no system for collecting the three through sevens. The plastics they need are not going to be available.”

Yoxheimer described the timetable as optimistic.

The company is still in early discussions with the Pennsylvania environmental regulators over its permits for water discharges and air emissions, so the plants’ full potential pollution impacts remain unknown. 

Documents and correspondence provided to Inside Climate News on Aug. 30 under the state’s right-to-know law describe the types and sources of plastics the company will accept and construction phasing. The first phase will be a facility to accept post-consumer scrap plastics for sorting, baling and shipping out to markets. The second phase includes equipment to break down the waste plastics through chemical processing, with final chemical products shipped out on a nearby rail line for manufacturing.

Encina acknowledges it will have to work through traffic and stormwater concerns as well. The documents provided by Pennsylvania DEP show part of the project site within 100-year and 500-year floodplains. Local residents recalled a history of repeated flooding in the area.

Encina has also told officials they would need to draw as much as 1.7 million gallons a day from the Susquehanna River, and may need to discharge into the river as much as 2.9 million gallons a day. The withdrawals will require approval from the multi-state Susquehanna River Basin Commission, which coordinates the management of water resources in the 27,500 square-mile Susquehanna River Basin.

Encina is in “preliminary discussions” with the commission but has not submitted any applications, said Stacey Hanrahan, spokeswoman for the commission.

Sahandy said she was unable to predict when the company will be able to get the permits it needs. “It’s hard to answer the timing question on the permitting side because we’re really not in the driver’s seat,” she said.

To Beckman, the Pitt chemical engineer, the proposal seems as rushed as it is mysterious. He also said he wonders how it will be funded. The company’s website, while seeking additional investors, notes having raised $75 million, but that’s far from the $1.1 billion investment the company announced.

“Anytime you do a startup, you raise money, with the promise that you’ll be able to deliver,” Beckman said. There’s a new trend in business where “you’re trying to build the airplane while you’re flying it,” and that can be risky, he added.

More Questions Than Answers 

Mysteries aside, the head of the regional economic development agency describes Encina’s efforts as “very real.” 

Over the last year, the company has purchased and renewed an option to purchase the riverfront property, met with state environmental regulators, local academic officials at nearby Bucknell University, worked with the governor’s office and held a community meeting, said Jennifer Wakeman, the executive director at DRIVE, a regional economic development agency.

Beyond the potential direct economic impact of jobs and indirect benefits of what she described as “the biggest investment that I have seen in my time here in the region,” which is nearly 30 years, Wakeman said she’s excited to be a part of a project “that is going to be a flagship.” Encina, she added, is not receiving any special state financial incentives.

But at a township meeting in July, and in follow-up conversations at homes and cafes, there were more questions than answers.

The Encina proposal has turned Rocky Roshon, 46, into the civic watchdog he never imagined. 

He’s attending township supervisors’ meetings and speaking out in ways he has never done before. That’s because he and his wife, Holly, share a home that’s 65 feet from the proposed plant’s property line, and they view it as an existential threat to their quality of life and property values.

Rocky Rochon bought the property from his grandfather when he was 18, and does not want to see the neighboring cornfields turned into a chemical plant fed by dozens of incoming trucks hauling plastic waste daily, that produces toxic chemicals to fill railcars. 

Beyond their concerns about traffic, odors, air pollution and changes on the land that could increase flooding, the Rochons are also worried that chemicals leaking from the plastic waste containers, the recycling process or railcar spills could pollute their drinking water well. 

“I’d get my lawyer from around here and they’d get theirs from New York City and I’d have to live 20 years on bottled water,” he said.

While the company’s actual planned air emission and water discharge limits remain in the realm of private conversations between the company and state regulators, and its process is shielded by assertions of proprietary technology, Collins said he’d be concerned if he lived nearby.

“It’s like a refinery,” he said of chemical recycling plants. “You are going to have all kinds of chemicals escaping into the atmosphere that people are going to be breathing whether they like it or not.” 

Pollution and water quality are among the concerns of nearby resident Sandy Hein, who took time away from restoring a 1920s family home to discuss the project over lavender iced tea at a cafe in downtown Sunbury, where American flags and banners honoring fallen military heroes line Market Street. Hein said she was disappointed by the company’s town meeting, held in May.

A retired chemist, Hein said company representatives on multiple occasions told her that the plant would produce no waste, something she said she does not believe to be possible. (Sahandy said Encina has only said it seeks to be part of a future “zero waste” world.)

Hein is active with a local chapter of the Washington, D.C.-based Climate Reality Project, an environmental group, and said she cannot yet say whether she supports or opposes the Encina project.

“I would like to see plastics recycled, but not to the detriment of the people,” she said. “I do not have the information I need to make an informed decision,” she said, adding she wants to see the company’s proposed air and water permits, when they become available.

“I will be looking at their volumes and their discharges and that type of thing,” said Hein, who knows her way around industrial environmental compliance and enforcement from her career in manufacturing. “I want to make sure that the people in this area are safe,” she said. “That’s my drinking water.”

In the sunroom of her Lewisburg home, about 10 miles from Point Township, Sandy Field, a medical and science writer with a Ph.D. in biochemistry, said she’s concerned about Encina’s plan to burn fracked natural gas as a heat source, with its environmental health and climate impacts.

The project may sound great, she said, but wonders if there aren’t better ways to tackle the plastics crisis.

“It’s taking plastics, a toxic product, and making toxic products of them, next to our river, using fracked natural gas,” she said. “As someone who is concerned about the climate crisis, we need to be moving away from natural gas.”

‘Treasured by All’

At a Bucknell University boat landing in Lewisburg, a great blue heron takes flight from the Susquehanna River, and Canada geese pass overhead, their honking calls dissipating as the birds disappear over tall shoreline trees. Professor Ben Hayes, director of the Watershed Sciences & Engineering Program at Bucknell, describes the Susquehanna River as  “treasured by all,” and the “lifeblood of the Chesapeake Bay, our nation’s largest estuary.”

Sitting on a picnic table under shade trees on a warm summer morning, he explained that the river is much cleaner than it was decades ago but faces emerging challenges from chemicals that mimic hormones and have other toxic effects. Research has also found microscopic plastic fibers in the water and tiny bits of plastic inside the river’s fish, he said.

Hayes said he does not yet know much about the Encina proposal but sees it as a potential risk and an opportunity. 

The risk to the river could include, for example, pollution caused by flooding or from the plant’s operations, he said. The opportunity, he said, could come if the company opts to go beyond “minimum requirements” and adopts a full sustainability and transparency model, one that fully protects the river from chemicals or microplastics, and has transparent partnerships with the community and local research institutions, such as Bucknell.

Pennsylvania has been blessed with natural resources including timber, coal, oil, natural gas, steel and gravel, whose development has been vital to the region’s communities, economy and culture, he said. But people who live in the region are also aware of the environmental costs of extractive industries, while also looking for new sustainable industries to sustain an economy, he added.

“What you’re seeing now is, I think, an openness at the state to welcome industries’ innovation. But we’re going to be cautious,” he said.

Driving in a black GM SUV from the township office to the planned construction site along a two-lane state highway, Yoxheimer, the township commission chairman, said the township will need to rely on state environmental regulators to make most of the decisions about how the plant will operate. But the township, with its population of about 4,000 residents, will have a say over land-use questions including stormwater management, set-back requirements and vegetative barriers.

The way he sees it, a lot is at stake, locally and potentially, nationally.

With the danger presented by plastics and the growth of the plastics industry, there’s a potential for the Encina plant to be among the first of a new industry, with economic benefits locally. “If it works, we are going to see these all over the place,” he said.

But he also said he sees a downside.

“I would say probably there are maybe 30 or 40 homes that are up there in that area,” he said. “My concern largely is, when these people bought their homes, they didn’t anticipate this.

“They have a quality of life that they enjoy now and I would not like to see them lose that just because someone wants to come in there and plop out a billion-dollar plan. I don’t think it’s fair to those residents.”