As Executive Vice President of UPM Biorefining & Technology, I see these pressures every day. And I am convinced: the solution lies in our UPM key cornerstone – Renewable Circularity.
Why recycling alone is not enough
Recycling is essential, but it cannot deliver steep decarbonization or secure Europe’s industrial base on its own. Even under the most ambitious scenarios, Europe will still require close to 30 million tons of virgin plastics every year. Plastics play a key role in meeting critical functional needs and are of superior environmental performance compared with alternative materials in many application areas, leveraging the sustainability transformation of a wide range of sectors including automotive, construction, packaging, consumer goods, healthcare, and renewable energy.
This is why at UPM we argue for Renewable Circularity: a role model complementing circularity efforts with renewable solutions. It expands circularity beyond repair, reuse, and recycling to include the systematic replacement of virgin fossil materials with renewable alternatives.
Only by doing this can we both decarbonize our economies and secure the materials that Europe’s industries need to thrive and become future proof.
The stakes for Europe’s industrial future
Nowhere is this more urgent than in the chemical sector. Once a cornerstone of Europe’s industrial strength, it is now under existential pressure. In 2023 alone, more than 10 million tons of production capacity were announced for closure in Europe. The EU has introduced many remedies to boost competitiveness, lower energy costs and cut red tape, but imports from Asia, Middle East and the United States continue to rise, driven by strong industrial policies and significant overcapacities in fossil value chains abroad.
Meanwhile, our competitors are moving fast:
- China has declared its ambition to lead the global bioeconomy by 2035, with massive coordinated investments.
- Japan has set its direction with targeting the production of 2 million tons of bioplastics by 2030, embedding renewable feedstocks as a core element in its industrial strategy.
Global competitors have already realized the economic opportunity presented by renewable circularity and are showing strong commitment to helping their traditional chemical industries to embark on the new age. Europe cannot afford to fall behind. If we hesitate, we risk watching innovation stall at the pilot stage while industrial deployment and markets take shape elsewhere. Europe needs to reverse the trend and give the chemical sector a new lifeline by designing policies that bring production capacities back to our continent.
Biorefineries: Europe’s strategic assets
When we at UPM speak about Renewable Circularity, we are not talking theory. At UPM, we are already proving what is possible.
Our biorefineries in Leuna (Germany) and Lappeenranta (Finland) demonstrate, not only that renewable alternatives to fossil plastics and chemicals can be delivered at industrial scale, but that Europe is uniquely positioned to lead due to our strong chemical base, and backwards integration into sustainable biomass.
But let me be clear: biorefineries are far more than production plants. They are strategic assets for Europe’s future.
- They reduce fossil dependence by replacing fossil feedstocks with renewable biomass.
- They cut emissions at the source, helping Europe to decarbonize.
- They create high-value jobs and anchor entire new industrial ecosystems locally.
- They strengthen resilience by securing feedstock supplies at home and reducing exposure to volatile global markets.
- They catalyze innovation, providing the industrial platforms needed to scale and potentially export new technologies.
This is why I believe biorefineries must be recognized as critical infrastructure for Europe, on par with energy grids and transport networks. They are not just UPM assets, they are Europe’s assets, enabling decarbonization, industrial renewal, and strategic autonomy.
What Europe must do
If Europe wants to lead in Renewable Circularity, we need decisive action. In my view, three priorities stand out:
1. Stimulate market demand through ambitious binding quotas and targets
- Introduce mandatory bio-based content requirements in packaging, textiles, and automotive plastics alongside circularity requirements.
- Create predictable demand, de-risk investment, and give industry confidence to scale.
2. Secure sustainable access to biomass
- Quotas alone will not work without reliable feedstocks.
- Europe must guarantee diversified, certified supply through well-known and accepted certification schemes, setting the bar high with regard to sustainability criteria, while avoiding overregulation that fragments markets.
3. Treat biorefineries as strategic assets
- Recognize them in EU industrial policy as critical infrastructure.
- Provide targeted incentives, streamlined state aid, and regulatory clarity to accelerate deployment.
Crucially, this is not about choosing between circular and bio. They are complementary. Recycling extends material lifecycles; bio-based solutions substitute fossil options where recycling cannot reach and accelerate steep decarbonization. Together, they form the dual engines of a resilient and future-oriented European industry.
My call to action
Europe has the technology, the industry leaders, and the historical know-how of the chemical sector to thrive within the new paradigm of renewable circularity. What it lacks today are the market signals and coherent policies to unlock scale and give the confidence to European industry to embark on this future-proof path.
The forthcoming updates to the Bioeconomy Strategy and Circular Economy Act must therefore be aligned as mutually reinforcing pillars. Done right, this alignment can anchor renewable industries in Europe, reduce fossil dependence, and restore our competitiveness.
For me, this is not just a sustainability agenda- it is a strategic industrial policy. Renewable Circularity offers Europe a path to climate neutrality that strengthens competitiveness, secures autonomy, and creates prosperity.
The choice is clear: we either let innovation stagnate and cede leadership to others, or we embrace Renewable Circularity as Europe’s industrial future.
