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Plastic Bags: 12 million barrels of oil used in US and UK reduced 98%

James Albert by James Albert
July 31, 2023
in Commodities, Markets
0

FintechZoom > Markets > Commodities > Plastic Bags: 12 million barrels of oil used in US and UK reduced 98%

As the world grapples with the damaging impacts of plastic pollution, new data and initiatives are shedding light on the path towards a more sustainable future. From the staggering volume of plastic waste generated by households and corporations to the promising drop in single-use plastic bag usage, this article delves into the latest developments in the fight against plastic pollution and explores the potential solutions ahead.

Plastic pollution has long been a global environmental concern. However, recent data reveals that the introduction of charges for single-use plastic bags has resulted in a significant reduction of their usage. In the United Kingdom, the implementation of a charge on single-use plastic bags has led to an astounding 98% decrease in their usage among major retailers.

The Scope of the Problem

Every year, British households discard nearly 100 billion pieces of plastic. This staggering figure is indicative of a global crisis that sees millions of metric tons of plastic find their way into the world’s oceans. If current trends persist, plastic waste in the oceans will outweigh fish by 2050. But who is responsible for this surging tide of plastic waste?

The ‘Dirty Dozen’: Corporations and Plastic Pollution

Recent data has exposed the ‘Dirty Dozen’ — the 12 brands responsible for an astounding 70% of branded plastic and packaging pollution in the UK. Topping the list is The Coca-Cola Company, followed by McDonald’s and PepsiCo. This group also includes Mondelez International, Anheuser-Busch InBev, Tesco PLC., Haribo, Nestle, Mars, Incorporated, Heineken Holding, Carlsberg Group, and Red Bull GmbH.

Dirty Dozen Brands | FintechZoom

The Environmental Impact

The environmental toll of this pollution is immense. Plastic waste, whether it’s packaging from popular food and beverage brands or discarded fishing equipment, poses a significant threat to marine and terrestrial ecosystems. As plastic gradually chokes these fragile ecosystems, the urgency for effective solutions grows.

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How Much Crude is Necessary to Produce Plastic Bags?

According to the International Energy Agency (IEA), plastics and other petrochemical products are anticipated to be the primary contributors to global oil demand growth in the future. Despite the increasing public scrutiny and regulation, the fossil fuel industry is relying on plastics to drive growth and new projects. The industry’s projections suggest that plastics could account for the majority of the net growth in oil demand, with BP predicting that plastics will represent 95% of net growth in demand for oil from 2020 to 2040[1]. However, this projection might be impacted by factors like rising carbon emissions and the growing public opposition to plastics[1]. Moreover, emerging economies like India and China are expected to significantly boost the demand for petrochemical products[3].

A chart showing BP’s forecast for oil demand growth between 2020 and 2040. | FintechZoom

References: [1] Big Oil’s hopes are pinned on plastics. It won’t end well. – Vox [2] Petrochemicals set to be the largest driver of world oil … [3] Rising use of plastics to drive oil demand to 2050: IEA

The production of plastic bags requires a significant amount of petroleum oil. Approximately 12 million barrels of oil are used annually in the US to manufacture plastic bags [2]. This figure equates to about 504 million gallons of oil, indicating that a substantial amount of crude oil is necessary for their production [2]. Given this, there’s a pressing need to find sustainable alternatives to plastic bags or improve their management and recycling to reduce the associated environmental impact. The current Crude Oil WTI price is now at $80.67.

References: [1] Big Oil’s hopes are pinned on plastics. It won’t end well. – Vox [2] Petroleum Product of the Week: Plastic Bags [3] The Plastic Bag Problem

This Plastic Reduction and Crude Reduction is Important to Occidental Countries

The reduction in plastic and crude oil consumption is an essential step for Occidental, or Western countries, to gain more independence from OPEC+ members’ decisions. By reducing reliance on oil, these countries can mitigate the effects of sudden oil price increases and fluctuations resulting from OPEC+ decisions. This strategy also aligns with global efforts towards sustainable development, which encourages the reduction of plastic use and a shift towards renewable energy. Moreover, fostering local industries such as renewables can potentially create jobs and stimulate economic growth, thus making these countries less reliant on oil exports from OPEC+ members [1][2][3].

References: [1] OPEC+ announces surprise oil output cuts [2] OPEC : Brief History [3] What is OPEC+ and how is it different from OPEC?

The Power of Change: The Single-use Carrier Bag Charge

In the face of this crisis, steps have been taken to curb plastic waste. Since the introduction of a 5p charge for single-use carrier bags in UK supermarkets in 2015, usage at major retailers has dropped by over 98%. This has prevented more than 7 billion harmful plastic bags from polluting streets and the countryside.

Plastic Bag Reduction | FintechZoom

The Effectiveness of the Charge

This initiative’s impact is evident. The number of single-use carrier bags sold by the main retailers plummeted from 197 million in 2021/2022 to 133 million in 2022/23, a 33% reduction. The average person in England now buys just two single-use carrier bags a year from these businesses, compared to around 140 in 2014 before the charge was introduced.

Further Efforts to Reduce Plastic Bag Usage

In 2021, the charge was increased to 10p and extended to all businesses, resulting in a further 35% drop in the number of bags used. Retailers have also voluntarily donated over £206 million from the proceeds to good causes, demonstrating the dual environmental and community benefits of such initiatives.

Government Measures to Tackle Plastic Pollution

The UK government is building on the success of the carrier bag charge with further measures to combat plastic pollution. The Environment Act introduces an all-in deposit return scheme for drinks containers and plans for simpler recycling collections for every household and business in England. A comprehensive ban on single-use plastics will also come into effect in England from 1 October 2023.

The Bag Charge: An Effective Deterrent

Introduced in supermarkets back in 2015, the initial 5p charge has proven to be an effective deterrent in curbing the widespread use of these harmful bags. Major retailers – including Asda, Marks and Spencer, Morrisons, Sainsbury’s, The Co-operative Group, Tesco, and Waitrose – have reported this dramatic decrease in plastic bag usage since the charge’s implementation.

On average, an individual in England now purchases a mere two single-use carrier bags per year from these retailers, a significant drop compared to the approximately 140 bags bought annually prior to the introduction of the charge in 2014.

A Remarkable Reduction

The number of single-use carrier bags sold by the leading retailers was recorded at 133 million in the 2022/23 financial year, a reduction from the 197 million reported in the previous year. This represents a reduction rate of 33%. In comparison to the staggering 7.6 billion bags used in 2014, this is a monumental decrease.

In 2021, the charge was increased to 10p and expanded to all businesses, resulting in a further decline of over 35% in the number of bags used, from 627 million in 2019/20 to 406 million in 2022/23.

A Win for Charity

Retailers have also contributed to various good causes. More than £206 million from the proceeds of the bag charge have been voluntarily donated to sectors such as education, arts, heritage, sports, environment, health, and charity or volunteering since the charge introduction.

Environment Minister Rebecca Pow stated:

Our charge has helped to stop billions of single-use carrier bags littering our neighbourhoods or heading to landfill while ensuring millions of pounds go to good causes.

We are determined to do more to tackle plastic pollution at source, with further bans on single-use products starting in October and our deposit return scheme will cut litter and drive up recycling rates. We continue to encourage all relevant retailers to play their part in further reducing the use of single-use carrier bags.

Andrew Opie, Director of Food & Sustainability at the British Retail Consortium, added:

Retailers have worked closely with the government over the single-use bag charges to ensure it has been an industry-wide success – with 98% fewer bags used across the biggest grocery retailers. It has also generated millions in funds that retailers have donated to a variety of good causes.

A Step Towards a Plastic-Free Future

The success of the bag charge is just one aspect of the government’s broader efforts to combat plastic waste. In 2018, the government introduced one of the world’s most stringent bans on microbeads in rinse-off personal care products. Two years later, restrictions on the supply of single-use plastic straws, drink stirrers, and cotton buds were implemented.

In addition, a tax of more than £200 per tonne was introduced in April 2022 on plastic packaging manufactured in or imported into the UK that does not contain at least 30% recycled plastic.

Through the Environment Act, the government is enacting further measures to tackle plastic pollution and litter. This includes the introduction of a deposit return scheme for drinks containers and plans for simpler recycling collections for every household and business in England.

A range of polluting single-use plastics will be banned in England from 1 October 2023. The restrictions will include single-use plastic plates, trays, bowls, cutlery, balloon sticks, and certain types of polystyrene cups and food containers.

These collective efforts mark a major step towards a plastic-free future, emphasizing the importance of each individual’s role in reducing plastic waste and promoting a more sustainable lifestyle.

Corporate Responsibility and Future Directions

While these initiatives are promising, corporations bear a significant responsibility in reducing plastic pollution. The ‘Dirty Dozen’ and other heavy plastic polluters must adopt circular business models and take responsibility for their products’ entire lifecycle. As these corporations wield the power to either save or condemn our oceans, their commitment to sustainable practices is crucial in the fight against plastic pollution.

Conclusion

The battle against plastic pollution is far from over. While the reduction in single-use plastic bag usage and the upcoming single-use plastic ban are encouraging signs, more needs to be done. Corporations, consumers, and governments must unite in their efforts to curb plastic waste and protect our environment for future generations.

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James Albert

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James Albert is a personal-finance analyst for FintechZoom and is based in New York. Contact: [email protected]

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