Invested In Climate

Tackling the plastics crisis via blended finance with Circulate Capital & the Circulate Initiative, Ep #69

Sep 26, 2023

46:46

When it comes to plastics, we’re in a real bind. We have yet to develop and scale attractive alternatives to the petroleum-based plastic products we all use every day, and the plastics industry drives well over a billion tons of greenhouse gasses, that’s roughly 4% of total global emissions and plastic-related emissions are on track to double by 2060. Meanwhile, a small fraction – we’re talking less than 10% – of plastics are recycled.

Creating a circular economy for plastics is vital to eliminating the flow of plastic waste into our environment and to reducing the emissions generated from creating new plastic products.

Today’s conversation focuses on an ambitious effort to catalyze and fund the systems change needed to get us there. Circulate Capital is working to unlock a billion dollars to invest in circular solutions, and its partner Circulate Initiative offers research and insights to track this space and help recruit more private and public investment in this space. We’re joined by Ellen Martin, Circulate Capital’s Chief Impact Officer, and Umesh Madhavan, Research Director for Circulate Initiative. We talk about the history and state of the plastics crisis, their current efforts, and the investment opportunities they see. Circulate has impressive momentum in building coalitions of different kinds of investors – from governments to Fortune 100 companies. This blended finance approach is surely a key to mobilizing the commitment we need, and I was grateful to learn so much about it through this conversation. Here we go.

In today’s episode, we cover:

[3:18] Circulate Capital, Ellen’s role & where they’re based geographically
[4:24] Circulate Initiatives & Umesh’s role
[5:24] How Circulate Capital & Circulate Initiatives are connected
[6:56] The plastics problem & what’s causing it
[8:57] The plastics problem timeline
[11:01] Overlaps between plastic pollution, climate, ocean health & circular solutions
[13:04] Why Circulate Capital was established & what they’re aiming to do
[16:41] De-risking the investments using concessionary capital
[19:08] Using a highly collaborative investment ecosystem to solve the plastic waste challenge
[19:47] Circulate Capital’s role & how it’s focused
[20:59] Working with LPs to scale circular solutions
[23:24] What should we all know about the plastics economy & how it works
[25:06] Asia & Latin America plastic markets
[27:50] Breaking down $4B in investments in the circular economy for plastics
[31:27] The greatest opportunities from an investment lens
[34:15] What more needs to be done around the plastic waste problem
[36:32] The Plastics Treaty, its state of play & what impact will it have
[39:15] How plastic economies differ between Asia & Latin America
[41:25] Investment opportunities in the US & Europe
[43:25] Visions for the future of plastic