(WNY News Now) – In a significant step toward a cleaner future, the U.S. Department of Energy’s Loan Programs Office has announced a $182.6 million loan guarantee for IRG Erie to build a cutting-edge plastics recycling facility in Pennsylvania.
The U.S. Department of Energy’s Loan Programs Office (LPO) today announced a conditional commitment for a loan guarantee of up to $182.6 million to IRG Erie, Inc. (IRG Erie). This funding will support the construction of a state-of-the-art plastics recycling facility in Erie, Pennsylvania, and an advanced injection system at a steel manufacturing site in northwest Indiana.
The facility will mechanically recycle polyethylene terephthalate (PET), high-density polyethylene (HDPE), and polypropylene (PP) polymers. It aims to convert approximately 160,000 tons per year of post-consumer waste plastic into around 100,000 tons per year of recycled plastic materials, reducing the need for virgin plastics. Additionally, the facility will produce about 20,000 tons per year of CleanRed™ from residual plastic output.
CleanRed™ is a revolutionary product that can significantly reduce greenhouse gas (GHG) emissions in steelmaking by replacing a portion of coking coal in blast furnaces or anthracite coal in electric arc furnaces. This project will mark the first time in the U.S. that a plastic-waste-based iron reducing agent is produced and sold to a domestic steel manufacturer.
The recycling facility and injection system project will create 334 construction jobs and 221 operations jobs across Erie and northwest Indiana. This initiative aligns with President Biden’s Investing in America agenda, focusing on creating high-quality jobs and fostering a clean energy economy.
The U.S. steel industry, responsible for 7% of national GHG emissions, stands to benefit greatly from this innovation. By replacing 14% of coking coal with CleanRed™, GHG emissions in the steelmaking process could be reduced by 24%, pushing the industry closer to net-zero emissions.
Producing recycled plastics uses 50% less energy than traditional methods, further reducing environmental impact. The facility is expected to prevent up to 555,000 metric tons of CO2e emissions annually, equivalent to recycling 190,000 tons of waste instead of landfilling.
This project also supports President Biden’s Justice40 Initiative, which aims to direct 40% of the benefits from federal investments to disadvantaged communities. Both the Erie plant and the steel manufacturer are located in such communities, with 24.7% of Erie residents living below the poverty line.
IRG Erie’s initiative promises significant environmental benefits while promoting economic growth and community development. As part of President Biden’s vision for a sustainable and inclusive future, LPO borrowers are expected to implement comprehensive Community Benefits Plans, ensuring strong labor standards and meaningful community engagement.
The LPO’s financing offer, part of the Title 17 Clean Energy Financing Program, is contingent on IRG Erie and DOE meeting specific technical, legal, environmental, and financial conditions before finalizing the loan.
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