Chemical Recycling Costs: Stark EU Warning, but a Vital Role Remains

Chemical recycling could help Europe recover plastics that conventional recycling cannot handle. Its immediate obstacle, however, is economic: producing new polymers through some chemical routes remains considerably more expensive than using fossil-based raw materials.

That is the central finding of Economic viability of chemical recycling – Current and future perspectives, published by the European Commission’s Joint Research Centre on 22 July 2026.

The study does not conclude that every chemical-recycling technology is commercially unviable. Instead, it finds that the two pathways for which sufficient economic evidence was available—pyrolysis and solvolysis—currently struggle to compete with virgin materials without regulatory demand or a price premium.

Key findings at a glance

• Pyrolysis-derived naphtha is estimated to cost 1.5 to 3.5 times as much as virgin naphtha under the report’s baseline conditions.
• The resulting polymer can cost 1.4 to 3.7 times more than an equivalent virgin polymer.
• The baseline estimate for polymer produced through pyrolysis is approximately €3,000 per tonne, with scenarios ranging from €1,500 to more than €4,000.
• Solvolysis can achieve material yields of 90% or more for suitable polymers such as PET.
• The estimated cost of chemically recycled PET in the EU is about €2,150 per tonne, with a margin of approximately €500 in either direction.

These figures come from the JRC report and its executive summary. They are modelling results and ranges, not universal market prices for every plant or recycling process.

Why pyrolysis remains expensive

Pyrolysis heats plastic waste without oxygen, breaking polymers into smaller hydrocarbon molecules. One important output is pyrolysis oil, which may be upgraded and introduced into existing petrochemical infrastructure.

The process does not turn every tonne of incoming waste into a tonne of new plastic. According to the JRC, typical material-recycling yields are around 30% to 50% of the plastic-waste input.

Part of the carbon ends up in gases, fuels or other co-products. Additional costs arise from sorting, pretreatment, contaminant removal, oil upgrading and subsequent polymer production.

Feedstock quality also matters. Chlorine, moisture and incompatible polymers can reduce product quality or require more intensive treatment. This means claims that pyrolysis can accept any mixed plastic waste should be treated cautiously: technical acceptance does not necessarily mean efficient or economical plastic-to-plastic recycling.

The study expects incremental innovation, efficiency improvements and larger plants to reduce some expenses. It nevertheless concludes that these changes are unlikely to eliminate pyrolysis’s structural cost disadvantage in the foreseeable future.

Solvolysis presents a different picture

Chemical recycling is not a single process. Solvolysis uses solvents and chemical reactions to separate polymers into monomers or other reusable components.

It is particularly relevant to PET, which is used in bottles, packaging and polyester textiles. The JRC reports material yields of at least 90% for some solvolysis processes—substantially higher than the typical plastic-to-plastic yield associated with pyrolysis.

Its economics are still challenging. The estimated EU cost of chemically recycled PET is higher than several recent price ranges for virgin and mechanically recycled food-grade PET.

Solvolysis may nevertheless provide value when mechanical recycling cannot deliver the purity or quality required by a particular application. Its viability therefore depends on the waste stream, final product and price that customers are willing to pay for recycled content.

What the report says about gasification

The JRC discusses gasification as part of the wider chemical-recycling landscape. Gasification converts carbon-containing material into synthesis gas, principally carbon monoxide and hydrogen, which can then serve as an industrial raw material.

However, the report does not calculate a comparable economic verdict for gasification. It states that the available information on operating facilities—particularly reliable cost information—was insufficient to support such a conclusion.

This distinction is important. Gasification was not declared economically competitive, but neither was it proven to have the same cost structure as pyrolysis.

Emerging electrified, plasma-assisted or carbon-dioxide-utilising systems may eventually change the technical picture. For now, predictions of cost parity remain technology-developer claims unless supported by independently verified, full-scale operating data.

The evidence gap should therefore be presented as an open research question, not as proof that omitted technologies are already economical.

Regulation may create a market despite the premium

Chemical recycling does not necessarily need to match the price of virgin plastic in every market to attract demand.

EU rules are increasing the need for recycled material in packaging. The Packaging and Packaging Waste Regulation and the Single-Use Plastics Directive establish recycled-content requirements, including targets affecting beverage bottles and contact-sensitive packaging.

These obligations can create a market in which qualified recycled material commands a premium. Chemical recycling could be particularly useful where recycled plastic must approach virgin-grade or food-contact quality.

The JRC’s official publication page consequently says chemical recycling could play a significant role in meeting European recycled-content requirements even though it does not currently achieve cost parity.

Demand is not guaranteed, however. Producers may adopt mechanical recycling, alternative packaging materials, reuse systems or other strategies when those options provide regulatory compliance at a lower cost.  Chemical recycling costs

Mechanical recycling remains essential

Chemical recycling should generally be considered a complement to mechanical recycling, not its automatic replacement.

Mechanical processes usually preserve more of a plastic’s embedded value when the waste is clean, sortable and suitable for reprocessing. Chemical routes may become relevant for contaminated, composite or degraded streams that cannot be recycled mechanically into an acceptable product.

The most appropriate treatment therefore depends on several factors:

• The polymer and level of contamination
• The achievable material yield
• Energy use and emissions
• Product quality and safety requirements
• The proportion converted back into material rather than fuel
• Total cost across the complete processing chain

Under EU terminology, material converted into fuel or used to generate energy does not count as recycled material.

A necessary reality check

The JRC report offers a strong warning against assuming that scale alone will make every form of chemical recycling competitive.

At the same time, it should not be interpreted as a final judgment on every emerging molecular-recycling technology. Its detailed economic assessment concentrates on pyrolysis and solvolysis because those pathways offered the most usable evidence. The report explicitly identifies incomplete full-scale operating and cost data as a continuing limitation.

The credible conclusion lies between uncritical optimism and outright dismissal: chemical recycling costs remain high, but selected processes may support Europe’s circular-plastics objectives where they solve a genuine material-quality problem and where independently verified performance justifies the premium.

Frequently asked questions

How much more expensive is chemical recycling?

In the JRC’s pyrolysis model, the resulting polymer costs approximately 1.4 to 3.7 times more than virgin polymer, depending partly on fossil-feedstock prices. This estimate should not be applied automatically to every chemical-recycling technology.

Does the JRC study cover all chemical-recycling methods?

It surveys several technology families but focuses its economic modelling on pyrolysis and solvolysis. It says the available operational and cost data were insufficient for an equivalent assessment of gasification.

Can chemical recycling replace mechanical recycling?

Not generally. Mechanical recycling remains preferable for many suitable waste streams. Chemical processes could complement it when contamination, polymer mixtures or quality requirements prevent effective mechanical recycling.

Is gasification already cost-competitive?

The JRC report does not establish that conclusion. Independent data from commercial-scale plants would be needed to verify claims of cost parity.

Why could companies still buy more expensive recycled plastic?

EU recycled-content obligations can create demand for qualified recycled material. Companies may pay a premium when chemical recycling provides the necessary quality and other compliance options are unavailable or more expensive.

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