Circular Economy keep it smart and close the loops Talke Schaffrannek, Director Applied Sustainability, BASF

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Circular Economy keep it smart and close the loops Talke Schaffrannek, Director Applied Sustainability, BASF Company logo

Circular Economy Decouple growth from resource consumption LINEAR ECONOMY RECYCLING ECONOMY CIRCULAR ECONOMY KEEP IT SMART Increase efficiency of processes and enhance effectiveness of products and solutions CLOSE THE LOOPS Turn waste into resources, use natural loops 2

Our Purpose We create chemistry for a sustainable future 3

How can we steer our portfolio towards a more circular economy? How can we measure progress?? 4

We implement active sustainable portfolio steering 27,3% Accelerator: Substantial sustainability contribution in the value chain Performer: Meets basic sustainability standards on the market Transitioner: Specific sustainability issue which are being actively addressed 68,3% Challenged: Significant sustainability concern identified, action plan in development 4.3% 0.1 % We strive to increase the Accelerators and phase-out Challenged solutions. 5

With Sustainable Solution Steering, we can measure our contribution to circular economy 27,2% Cost savings downstream Biodiversity and renewables Climate change and energy Emission reduction Resource efficiency Water CIRCULAR ECONOMY Health and safety UN Sustainable Development goals* 0% 10% (Double nomination possible) In order to steer the portfolio of the future, we also screen R&D projects for their contribution. *In our assessment, we focus on hunger and poverty as many of the other UN SDGs are covered by our other sustainability criteria.

solutions in scope 60,000 ~13,000 Accelerator solutions with > 15.5 billion sales in 2017 > 2,300 experts involved e.g. R&D Product Safety Sales Marketing Sustainability >60% of R&D budget spent on Accelerator projects in 2017 >800 actions defined

How are we affected by circular economy and how can we contribute to a more circular economy?? 8

Circular economy transforms value chains Decoupling growth and resource consumption External factors driving the shift towards circularity Technology shifts e.g. electric vehicles Consumption changes e.g. car sharing Linear Model Disposal of molecules at end-of-life Increasingly bent models Partially renewable feedstock Some level of product recycling Start of partnering approaches New regulations e.g. EU Circular Economy package, insulation standards Circular Model (total recovery) Full re-use of molecules or carbon Design to re-use for end products

Our contribution to Circular Economy KEEP IT SMART Increase efficiency of processes and enhance effectiveness of products and solutions CLOSE THE LOOPS Turn waste into resources, use natural loops Our contribution combines the idea of smart business models with circular resource use

CLOSE THE LOOPS Biomass Balance Resources Raw material production Sport Infinity Project BASF production Additives for concrete End-of-life Compostable bags Customer production Use

ecovio fruit & vegetable bags Example for Loop Certified home-compostable fruit & vegetable bags Dual use: fruit & vegetable bag and organic waste bag Less organic waste in landfill More compost ecovio bags help close the loop of the food value chain.

Green Sense Concrete Technology Example for Close the Loops Green Sense Concrete system consists of: 1. Innovative admixture products 2. Concrete mix services 3. Eco-efficiency analysis BASF s Green Sense Replaces up to 78% of cement with recycled materials 45% less CO 2 emissions 1 BASF material used at: Burj Khalifa, Al Attar Tower, Dubai Arch Tower, Infinity Tower, 1 Data based on 1 m 3 compared to a reference mix

New business model: Biomass Balance - allows us to use bio-based raw materials for the same product performance Refinery BASF Production Verbund Raw materials Steam cracker/syngas plant Chemical production Products Crude oil/ natural gas Naphtha/ natural gas Allocation Fossil product Bio-naphtha/ biogas Basic organic chemicals Fossil resource saving product certified Biomass Bio-based raw materials (e.g. sugar) Product with 14 C content

Conclusion Conclusion Circular Economy: much more than waste management With Sustainable Solution Steering we measure our contribution to circular economy Biomass Balance is a new business model that lowers the use of fossil resources It s all about collaboration! 12

BASF Plastic Additive solutions as enabler for sustainable applications Andreas Thürmer, Senior Technical Manager Polymer Additives Company logo

Plastic Recycling Additives as enabler for sustainable solutions Content 1 Background BASF Additives and Recycling 2 3 Polymers and Aging Phenomena Additive Solutions Additive blends restore Polymer performance 4 Joncryl Functional Additives Repairing and Enhancing PET and Polycondensates 5 Perspectives 17

Plastic Additives 18 20.03.2018

BASF Additives and Recycling Enabling Use and Re-Use Fundamentally, BASF Plastic Additives provides solutions that enable the use of plastics in demanding applications Plastic processing Prolonging the lifetime of plastics Functionalizing/extending the performance of plastics including their coloration Recycled Plastics will also require BASF Plastic Additives core competencies to broaden the use of recycled feedstock and enlarge the number of accessible higher value end applications Markers to help plastics sorting Enable processability Repair polymer chain Re-coloration

BASF Additives and Recycling Striving for Resource Efficiency Disposal Prevention Preparing for re-use Recycling Other recovery Inverted Pyramid and hierarchy for sustainable resources management Prolonging lifetime Enabling several cycles Upgrading properties for up-cycling Additives enable to use less, to use longer and to re-use 20

Polymers and Aging Phenomena Polymer Service Life Constraints during service life and waste post treatment Manufacturing Waste to Regeneration Polymerization (T, Catalysts residues, water) Compounding (Melting T, Other components) Service (exposure to T/Energy, UV, Chemicals, polluants, mechanical stress, etc) Re-processing (T/Energy, Chemicals, water) Converting (Processing T) Industrial/Consumer Use Sorting, Cleaning (Water, Chemicals) Time Scale Minutes to Hours Weeks to Years Weeks to Months Temperature Exposure Medium to High Low to medium Medium to High

Polymers and Aging Phenomena Auto-Oxidation and Degradation Chemistry Radicals and hydroperoxides formation versus stabilization options Irganox Phenolic AOs and Tinuvin, /Chimassorb hindered amines (HAS) react with free radicals to yield inactive products (ROH H 2 O) RO + OH Degradation Path Stabilization Path RH R-H (Polymer) Cycle II Melt processing Energy, Ageing Catalyst residues Degradation issues are complex and solutions are tailor-made R R + ROOH Irgafos Phosphites react with hydroperoxides to yield inactive products (ROH) Irgastab Hydroxylamines or Irganox E 201 or other radical scavengers capture carbon centered radicals Cycle I RH O2 ROO Irganox Phenolic AOs react with oxygen centered radicals

Polymers & Aging Phenomena, Consequence of Degradation Aging of polymers leads to materials properties collapsing Change in Polymer Properties Induction Period Stabilizer consumption Small increase in ROOH Slow O 2 uptake Degradation Mechanical Failure Change in Mw Change in Mw distribution Carbonyl built-up Rapid increase in ROOH Fast O 2 uptake Discoloration or other visual changes Time Restoring / enhancing polymer properties needs additives package

Challenges for Recyclates in waste stream Monomer Manufacturing Process Chemicals Lubricant Additives Synthesis Virgin plastics Pure Clean Full stabilizer package Polymerization Regulators Storage Stabilizers Granulation Antioxidants Processing Stabilizers Masterbatchers Converters 24 Neat recyclates are low-value materials Polymer mixtures Impurities pre-damage from 1 st life insufficient stabilizer residue Recyclates End Products Polymer Recycling R

Key Challenges in Plastic Recycling Mixtures of incompatible polymers Polymer degraded from previous heat history Unstable polymer consumed stabilizers from previous life cycle Contamination with solid particles Out gasing and odor issues from volatile impurities Additive Blends provides solutions to address these challenges 25

Value Re-Creation of Plastics with Additive Blends Picture Courtesy of 26 Neat recyclates are limited to low-cost applications Stabilization packages for recycling allow to: Re-enter the 1 st market Increase the content of recyclates in an application Use recyclate for higher-end applications Systems Ready to use or tailor-made

Standard Blend System for PP Battery Cases Addition of Recyclostab 451*: Improves the long-term thermal stability of PP recyclates from battery cases. Minimizes negative effects of acidic residues 29 44 53 0 10 20 30 40 50 60 Time to embrittlement [days] at 135 C without restabilization 0.2% RECYCLOSTAB 451 0.5% RECYCLOSTAB 451 PP from battery cases can be used in high-end applications

Additive Blend Systems with Repair function for PO or TPO Addition of Recycloblend 660*: Neutralizes negative effects of solid impurities and retains mechanical properties Typical applications: bumpers, rotomolding, filled PP systems 600 Tensile Impact strength kj/mm 2 0.5% paint residues 400 200 0 0 500 100 1500 2000 2500 Oven Aging at 135 C [hours] without restabilization 0.70% RECYCLOBLEND 660 1.2% RECYCLOBLEND 660 System improves mech. properties of contaminated polyolefins

Mixed Polyolefins Consumer Waste PO Recycling PolyAd* taylor made formulation improves at the same time: Mechanical properties of a PE / PP mixture Processability by adjusting the melt flow from a low MFI to high flow injection moldable material MFI Enhancement of PE / PP Recyclate PE/PP 1:1 ratio 5 13 18 0 5 10 15 20 without restabilization 0.2% PolyAd Stabilizer 0.4% PolyAd Stabilizer Specific system to make the recyclate fit for the next applications

Taylor Made Systems PE / PA or PE /PET Multilayer Film Reprocessing Incompatible PE / PET film mixture (85%:15%) or PE / PA film mixture ( 90% / 10%) not reprocessable as such Taylormade solution compatibilizes and restabilizes multilayer film scrap Defective PE / PET and PE / PA Film without PolyAd* solution PE / PET (1%) and PE / PA (2%) Film using PolyAd* solution Smart system allows to recycle resins instead of landfilling them

Joncryl ADR Functional Additives The Technology Reactive modifier to upgrade PET and polycondensates Multifunctional reactive polymeric chain extender Reactive extrusion to upgrade R-PET Suitable for foams, films, sheets, straps and many other applications Chain extenders to restore mechanical properties of Recyclates 31

Joncryl ADR Functional Additives The Applications Chain extension and chain branching enable second life for R-PET Enable R-PET in higher value applications beyond fibers Alternative to solid state polymerization Allow reactive compatibilization of alloys and blends New material properties based on long chain branching Improve mechanical properties and enable new applications 32

Joncryl ADR Functional Additives The Mechanism Reactive Extrusion to restore mechanical properties of polymers Aging of polymers leads to materials properties collapsing Reactive extrusion with Joncryl ADR build molecular weight and slight branching Different chain extender available optimized for different applications Additive technology to modify and restore polymer properties 33

Joncryl ADR Functional Additives Sheet and Thermoforming Joncryl ADR Chain extension for PET sheet and thermoforming applications Up to 100 % R-PET possible Significant improvement of impact properties Increased viscosity of polymer melt Faster and stable processing Improve impact properties and line speed 34

BASF Additives and Recycling Perspectives Recycled Plastics are now considered as an alternative (in volume also) feedstock for high end applications Additives will play a role in upgrading performance of recycled polymers and consequently increase their value Many elements still require developments: Materials collection and efficient sorting of different polymers Capacity for collection and transformation Additives to repair and homogenized or enable tuning of recycled grades characteristics Additives for virgin plastics that do not impair later recycling 35