Throughout my career I’ve worked closely with industry leaders to develop economical and sustainable supply chain solutions to get their products to market. And while I’ve seen numerous innovations impact our customers’ businesses, few have been as significant as the adoption of hydraulic fracking to extract petroleum, and with it, ethane gas.
Ethane is a key ingredient in plastics, and because of its low cost, nearly $220 billion has been invested over the past decade in new U.S. plastic production capacity, primarily in the U.S. Gulf Coast. Union Pacific embraced challenges our customers faced with exporting this much new production and invested millions to expand our Gulf Coast capacity, increased our storage-in-transit network, and designed a new carload and intermodal product called Dallas-to-Dock that helps customers efficiently export resin out of the West Coast. As a result, Union Pacific is the premier U.S. rail carrier of plastic resin.
But now UP along with our plastics customers are being confronted with a new challenge. We are facing scrutiny regarding our impacts to the environment – and rightly so. Did you know only 10% of all post-use plastics is recycled? Plastic used in everything from bags, straws, automobile parts to life-saving medical devices ends up in landfills, incinerated or in the environment. Change is needed, but recycling is complicated. Different types of plastics require sorting; new plastics have stringent recycling requirements, and perhaps most challenging -- our current infrastructure is not designed for a circular economy. Innovation is desperately needed, and that is where solutions like Agilyx and Cyclyx come in.
Agilyx is an advanced recycling technology that turns post-consumer plastics back into their original chemical components for use over and over again. The tech is designed to increase the recycling of plastics that cannot be recycled with traditional recycling processes.
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Cyclyx is a new kind of plastic feedstock management company that works with industries to increase plastic recyclability. Their ambitious goal is to increase plastic recycling rates from 10% to 90% by working with industry partners to source, collect and pre-process large volumes of waste and redirect it to be recycled.
I first learned about Cyclyx from one of our largest petrochemical customers, ExxonMobil. For petrochemical customers to increase recycling rates and capitalize the value of returning waste to its chemical form there must be better supply chain options for moving plastic waste from various U.S. collection points back to the Gulf Coast.
Rail could be a fantastic solution. It’s ideal for hauling heavy, bulky materials in mass quantities, and we do it with a much lower carbon footprint than truck. That’s why Union Pacific recently joined the Cyclyx consortium to partner with the member companies and lend our expertise to develop supply chain solutions for increasing recycling rates and advancing circular economies.
Our potential to help redesign the way the U.S. collects and reuses waste is exciting, and just one example of our commitment to supporting sustainable economic growth as part of our role of Building America.