Oil giant ExxonMobil, one of the world’s largest plastics producers, has been sued by California for deceiving the public for decades by promising that all the plastic it produces would be recycled, but that has not been the case at all.
The lawsuit claims ExxonMobil promoted recycling as a “cure-all for plastic waste.” However, less than 5% of plastic is actually recycled into other products, despite the company labeling its items as “recyclable,” said Attorney General Rob Bonta’s office.
So, the company knew a vast majority, “95% of the plastic in the blue bin was going to be incinerated, go into the environment or go into a landfill,” but they still lied while its consumers kept on diligently putting their plastic water bottles into recycling bins.
“‘Buy as much as you want, no problem, it’ll be recycled,’ they say. Lies, and they aim to make us feel less guilty about our waste if we recycle it,” said Bonta. “The end goal is to drive people to buy, buy, buy, and to drive ExxonMobil’s profits up, up, up,” he added.
The remarks came at a virtual news conference, Climate Week in New York City, where he was joined by environmental groups’ representatives that filed a separate lawsuit. The lawsuit is similar to that of the agency and is also being filed in San Francisco County Superior Court.
As oceans and landfills are filled with plastic waste, it creates a global pollution crisis, alleges the lawsuit.
ExxonMobil meanwhile blamed California for its flawed recycling system, saying that state officials knew for decades that their system wasn’t effective, but they still didn’t act and have now taken to blaming others.
“Instead of suing us, they could have worked with us to fix the problem and keep plastic out of landfills.”
– Lauren Kight, spokesperson for ExxonMobil
Several oil and gas companies have been sued by many US municipalities and states in recent years over their role in climate change, with cases still making their way through courts.
This includes a lawsuit that California filed last year against the world’s largest oil and gas companies, alleging they misled the public about the risks of using fossil fuels.
Hailing the latest suit as the first of its kind, the attorney general’s office believes it will put the lifecycle of plastics and the potential harms of microplastics in focus. Meanwhile, Judith Enck of the nationwide project Beyond Plastics, which seeks to end plastic pollution, said:
“This is the big one. I hope this is going to open the floodgates.”
While previous lawsuits targeted companies that sell individual plastic products, this time, an effort has been made to “hold the production companies accountable.” The lawsuit states ExxonMobil is the world’s largest producer of polymers, which are derived from fossil fuels and used to make single-use plastics.
The American multinational oil and gas corporation is “the largest direct descendant of John D. Rockefeller’s Standard Oil.” ExxonMobil’s chemicals division produces plastic, synthetic rubber, and other chemical products. The company has been widely criticized and sued for environmental incidents.
With a market cap of $520 billion, ExxonMobil’s shares (XOM:NYSE) are currently trading at $116.88, up 17.07% YTD. It has an EPS (TTM) of 8.34, a P/E (TTM) of 14.03, and a dividend yield of 3.25%.
For Q2 2024, the company reported $9.2 billion in earnings, while cash flow from operating activities was $10.6 billion. The distribution of $9.5 billion to shareholders meanwhile included $4.3 billion in dividends and $5.2 billion in share repurchases.
“We delivered our second-highest 2Q earnings of the past decade as we continue to improve the fundamental earnings power of the company.”
– CEO and Chairman Darren Woods
Holding ExxonMobil Accountable
The lawsuit against ExxonMobil that was announced earlier this week originated from an investigation that the Attorney General’s office launched over two years ago in April 2022 into the petrochemical and fossil fuel industries. For this, the office issued subpoenas that bought previously hidden documents to light.
The complaint alleges that not only have there been violations of California’s nuisance and unfair competition laws, but the oil giant has also concealed the harm caused by plastics.
Despite there being evidence that plastic manufacturers haven’t been forthright about the challenges of turning old plastics into new items, the state still faces a tough battle in its suit against ExxonMobil.
“The state’s primary claim relies on public nuisance, a notoriously murky area of law. It could be difficult for a court to grant California relief here without opening a Pandora’s box of other, similar claims.”
– Notre Dame Law School professor Bruce Huber, who specializes in environmental, natural resources, and energy law, told a media publication
According to the lawsuit, ExxonMobil knew that plastic is “extremely costly and difficult to eradicate” and that it disintegrates into harmful microplastics. But, it still promoted recycling as a key solution through news and social media platforms and ramped up plastic production at the same time.
This isn’t even all; the state’s lawsuit further points out that the company has been encouraging “advanced recycling” or “chemical recycling” lately. The office has also sought information on this technology, which uses pyrolysis to turn plastic that is hard to recycle into fuel. The slow progress of this technology, as per the Office, was a sign of the company’s continuing deception. Bonta called it a “farce” and “another version of the same old lie.”
The spokesperson from ExxonMobil said the technique works, adding that the company has processed over 60 million pounds of plastic waste into usable raw materials through advanced recycling. Meanwhile, the Office emphasized only 8% of materials turning into new products.
Bonta said the lawsuit contents will amaze many who place plastic products in blue recycling bins and purchase products made from recycled materials. He said:
“This is a revelation to many, after years and years of a belief that is untrue because they were lied to by ExxonMobil about the myth of recycling.”
This lawsuit, which came just a day after Governor Gavin Newsom signed into law a statewide ban on all plastic shopping bags at supermarkets in California, is showing the “fullest picture to date of ExxonMobil’s decades-long deception.”
It wants the company to be held accountable for “actively creating and exacerbating the plastics pollution crisis through its campaign of deception.”
The state further hopes to compel ExxonMobil to end its deceptive practices as well as to secure an abatement fund with “billions of dollars” and civil penalties for the harm the company inflicted on California via plastics pollution.
This lawsuit comes ahead of a final round of global plastic treaty negotiations that’ll take place in South Korea in the coming months. The US has said that it supports a treaty on cutting down global plastic production, a position that Exxon opposes.
Praising the lawsuit, Christy Leavitt, plastics campaign director at Oceana, said:
“(The lawsuit will) hold industry accountable and debunk the plastics recycling narrative that holds us back from real solutions.”
Recycling Not a Panacea to the Plastic Pollution Problem
The increasing amount of plastic waste has become a critical global challenge, with recycling being touted as an effective solution to solve the problem of plastic waste while enabling resource utilization.
However, plastic recycling has largely been ineffective in counteracting the impact of increasingly rising global plastic production, which is happening at over 400 million metric tonnes annually. This is because of low global recycling rates, which are at a mere 9%.
Globally, more than 9200 million metric tonnes of plastic have been produced, of which 6900 million metric tonnes didn’t have any type of recycling. This results in the accumulation of plastic in landfills or dissemination in the environment.
Landfilling is one of the most popular ways of managing plastic waste, but it has limited capacity. Incineration, on the other hand, can emit hazardous chemicals and gasses. Recycling plastic waste into new products is seen as a promising way to address the growing global plastic waste problem.
However, even when plastics are recycled, they are made into items that are of lesser quality and value. Moreover, such items aren’t suitable for many uses, like food packaging, and continue to cause considerable pollution.
In conventional “mechanical” recycling, when plastics are washed and shredded up, they burn large amounts of fossil fuel energy. This not only emits greenhouse gases, waste, and chemicals but also creates microplastics and nanoplastics.
There are simply “enormous gaps” to fully unlocking the potential of plastic recycling, according to a recent report. Tackling the intricacies of plastic recycling, as per the research, requires acknowledging the presence of end-of-life (EoL) plastics.
Over 400 Mt of plastics is created primarily as single-use items annually, which accounts for more than 50% of consumer-based plastics, and are difficult to recycle. It is because of the intrinsic polymer and product design flows of plastic that obstruct their EoL recyclability.
The complexity and diversity of plastic compositions, which is exacerbated by chemical additives blended for versatility, lead to a low recycling rate due to the difficulty in recycling different grades together without degrading properties.
Moreover, only a small fraction of the thermoplastics, most of which are recyclable, find their way into the recycling stream. Additionally, several types of plastics are just incompatible during recycling, which ends up increasing the cost and reducing the profitability.
The research also pointed to a lack of standardization in waste handling as a major obstacle. For example, the Resin Identification Code (RIC), which identifies the type of plastic resin used in a product, has no dedicated class for non-recyclable, biodegradable polymers like rubber and polylactic acid.
The study emphasized the need for a comprehensive tagging system that considers factors like color and updating certifications and permits alignment with modern scientific understanding and findings.
AI-Powered Study Uncovers Global Plastic Pollution Crisis
A Leeds University study revealed the shocking scale of global plastic pollution. Researchers used AI to examine waste management in over 50,000 cities to determine how much plastic is discarded and what happens to it. In 2020, 52 million tonnes of plastic entered the environment—enough to circle the Earth 1,500 times.
More than two-thirds of plastic pollution comes from uncollected trash, the study found. Waste collection is unavailable to 1.2 billion people, 15% of the global population. They dump or burn their waste. Burning plastic releases toxic chemicals that harm humans and the environment.
Source: Nature
The researchers also found that India, not China, is the biggest plastic polluter, followed by Nigeria and Indonesia. They think these areas need better waste collection to reduce pollution and protect health.
The study emphasizes global waste management improvements. The researchers hope their findings will spur action to address this growing issue and improve the lives of millions without proper waste collection.
Finding Innovative Solutions to the Growing Threat
Today, everyone is concerned about plastic pollution, and that’s for a good reason. This worldwide problem has become a major issue due to its severe negative effect on the environment and the human body.
Not just the end product itself but at every stage of its lifecycle from extraction, production, use, and disposal, plastics affect us, our health, our environment, biodiversity, and climate change. The harmfulness of plastics also comes from the fact that they are durable.
The long molecule chains creating plastic make sure that the polymer is strong enough to withstand decades of wear and tear. So, instead of dissolving, they just break down into smaller plastics.
When large plastic materials are fragmented into sizes of less than 5 mm, microplastics are formed. Washing, road paint, worn tires, and city dust are sources of microplastics. It is also produced intentionally such as microbeads which are used in health and beauty products. While plastic can easily be found all around us, microplastics are being found even in the oceans, remote islands, and polar regions.
Due to their micro size, microplastics are easily ingested, inhaled, and even absorbed through the skin. According to WWF, an average person could be ingesting about 5 grams of plastic every week.
Also, they move easily through the food chain and persist in the environment. When it comes to the risks posed by microplastics, they can range from malnutrition, inflammation, and reduced fertility to mortality.
While their effect is not clearly known yet, as we reported previously, the awareness of microplastics is growing with their presence. Microplastic particles are becoming omnipresent at a planetary level, and their interference in our lives is also rising.
In light of this, reducing the overall consumption and global virgin plastic production can really help have better results and achieve a circular economy.
A lot of innovation is also happening to address the problem of plastic pollution. Some of the practical solutions involve creating biodegradable and compostable plastics which are made from materials like sugarcane or cornstarch so that they decompose more quickly and reduce the environmental burden.
Ocean clean-up initiatives have also been helping remove plastic waste from marine ecosystems, while reusable packaging models are reducing plastic waste. There’s also edible packaging, allowing for the removal of plastic waste entirely.
Researchers are even utilizing AI to tackle the problem of microplastic pollution. For instance: a team from the University of Waterloo built an AI tool called PlasticNet that employs deep learning and spectroscopy to distinguish the unique “fingerprints” of particles for faster and more precise identification, which is particularly beneficial in wastewater treatment and food production.
On a personal level, people can prevent microplastics from dispersing by minimizing the use of single-use plastics and opting for clothing made of natural fibers. Also, research has found that boiling the water can help make it free from nano- and microplastics (NMPs).
Among companies creating innovative solutions to help the plastic pollution problem is PureCycle Technologies. Its proprietary technology purifies waste polypropylene (PP), one of the most common forms of plastic found in consumer goods, packaging, and automotive components, and turns it into materials that can be reused in high-quality applications.
With a market cap of $1.76 billion, PureCycle’s shares (PCT:NASDAQ) are currently trading at $10.66, up 151.11% YTD. It has an EPS (TTM) of -0.93 and a P/E (TTM) of -10.92.
For Q2 2024, the company reported $10.9 million of unrestricted cash and secured an additional $18 million through the sale of revenue bonds. In June, it achieved its highest production month, producing over 100,000 pounds of pellets on multiple days. Its commercial team meanwhile introduced recycled resin to more markets. The company noted:
“By blending the PureCycle resin with post-industrial recycled material or virgin polypropylene, compounded material provides a more consistent product, should simplify the customer approval process, and is expected to increase the ability to bring higher levels of recycled product to the market.”
Conclusion
This California lawsuit against ExxonMobil shines a much-needed spotlight on the ongoing massive problem of plastic recycling. Recycling alone simply cannot undo the harm already caused by decades of plastic production.
With a single percent of plastics successfully recycled, a shift toward reducing plastic production is essential for meaningful change. Besides legal accountability, addressing the global plastics crisis requires innovation and cooperation across industries to ensure a sustainable future.
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