Developing a Practical Chemical Recycling Technology for Polyester. Weaving the Loop. Developing 100% Polyester Products Expanding the Loop

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1 The Outstanding Potential of Teijin s ECO CIRCLE System Developing a Practical Chemical Recycling Technology for Polyester Weaving the Loop ECO CIRCLE : The Beginning 1. A Strengthening the Loop 2. Broadening the Circle of Cooperation Developing 100% Polyester Products Expanding the Loop Developing Chemical Recycling Technologies for Polycarbonate and PLA Creating New Loops In 2005, Teijin s pioneering ECO CIRCLE closed-loop system for collecting and recycling polyester products received a Good Design Award in Japan in the New Frontier Design category. The Good Design Awards recognize products that are outstanding examples of design and that contribute to the improvement of life and the advancement of industry. In selecting ECO CIRCLE for the award, the jury acknowledged the outstanding potential of this innovative system, praising Teijin for its commitment to commercialization, as well as its contribution to a recycling-oriented society. From the beginning, we recognized that simply having developed a technology would not enable us to contribute in a meaningful manner to greater awareness of recycling unless we could transform this technology into a viable system that could be expanded. The first hurdle was to increase recognition of ECO CIRCLE in society at large and encourage greater participation. The next was to increase the system s breadth by promoting the development of more easily recyclable materials and products and by using the technology to expand the scope of ECO CIRCLE to include products other than polyester. We succeeded in the development of our innovative technology for the closed-loop recycling of polyester fibers. Now, by having invited leading environmentally aware companies and organizations to participate as ECO CIRCLE members, we have established a firm basis for the widespread acceptance of ECO CIRCLE. As we move forward, our technological strengths, business development prowess and ability to act decisively will be put to the test as we strive to expand and strengthen the circle of cooperation. The challenge continues. 14 Teijin Limited

2 Developing a Viable Chemical Recycling Technology for Polyester Weaving the Loop Chemically decomposing materials that are made from 100% polyester and recycling them back into a raw material is not a particularly diffi cult process. Teijin has been chemically decomposing and recycling polyester yarn waste generated during the production of polyester fi bers for more than four decades. Until 2000, however, thermal and materials recycling processes were the only options for recycling polyester fi bers. Obstacles to Practical Application Most polyester textiles are not 100% pure polyester, but contain other substances, including cotton, other polymers, dyes and other additives, and processing agents. Such materials are necessary to impart desired textures, colors and other properties. The diffi culty of separating out such substances in advance is the principle reason for the signifi cant degradation of the polyester that occurs with materials recycling. Chemical recycling requires an even more sophisticated method for separating out and removing such substances. This has traditionally been the biggest obstacle to the development of a practical chemical recycling system. Other issues that demanded consideration were economic feasibility and overall environmental impact. Taking on the Challenge Building on its accumulated in-house chemical recycling technologies, Teijin succeeded in developing a groundbreaking, commercially viable chemical recycling technology for polyester. Underscoring the scale of technological innovation involved, Teijin has fi led applications for 57 patents to date. Development efforts began in 1992 the same year Teijin published the Teijin Group Global Environmental Charter as one way to give substance to its philosophy, set forth in the charter, of coexistence with the environment. Despite hard times, exacerbated by the outbreak of the Asian Financial Crisis in 1997, in 1998 Teijin inaugurated the Chemical Recycling Committee and expanded the scale of its efforts. In 2000, Teijin announced that it had succeeded in developing a new practical chemical recycling technology. Special Feature: ECO CIRCLE Developer of Teijin s Chemical Recycling Technology for Polyester Koji Mukai Teijin s chemical recycling technology has two constituent technologies. One of these is, of course, the technology for methanolysis with ethylene glycol decomposition. The second is the technology that enables the extraction and elimination of contaminants, notably dyes and other processing agents. Dyes for polyester fi bers enjoy a reputation for being highly colorfast, as the dyes used disperse well and bond fi rmly to fi ber molecules. Separating out and removing such dyes a process called decolorizing involves fi rst applying heat to the fi bers, which makes it easier to extract dye from between the expanded fi ber molecules, and then using a solvent to remove all traces of the dye. Teijin s success in developing an effi cient decolorization technology and format was instrumental to the realization of a practical chemical recycling technology. Recovered polyester products Chopped polyester Pellets Decolorized pellets Polyester raw material (DMT) Polyester chips ECOPET PLUS (Filament) ECOPET (Fiber products) Closed-Loop Recycling Chemical Recycling Chemical recycling refers to treating a material chemically to recover its component raw materials, which are then reused. Teijin developed the world s fi rst practical chemical recycling technology for polyester that facilitates the recovery of polyester raw materials of comparable purity to virgin materials derived from petroleum, thus making it possible to recycle and reuse the materials many times over. Thermal recycling Incinerate for reuse as fuel One-time energy recovery Materials recycling Dissolve materials for reuse In most cases, one cycle (reuse is limited due to deterioration of quality) Chemical recycling Recover raw materials for reuse Endless cycle (recovered raw materials can be reused repeatedly) Teijin Limited 15

3 ECO CIRCLE : The Beginning A. Strengthening the Loop No matter how advanced its chemical recycling technology for polyester, Teijin realized that the stability of the loop would be undermined unless it could ensure a steady supply of used polyester products. This realization led to Stage 1 Stage 2 Stage 3 Three-Stage Plan of Action Secure ECO CIRCLE partners Cooperate with other environmentally aware companies in Japan to facilitate the effective recovery of polyester products Expand geographical focus Cooperate with environmentally aware companies overseas Seek a broader range of participants Cooperate with environmentally aware individuals and organizations and promote global implementation the development of ECO CIRCLE, a system for the collection and chemical recycling of used polyester products back into the raw material. With the aim of establishing the ECO CIRCLE system and enhancing the breadth of the loop Teijin created a three-stage plan of action. Cooperate with Environmentally Aware Companies The fi rst stage focused on securing channels for the collection of used polyester products. As no offi cial system exists, our fi rst task was to secure ECO CIRCLE partners, that is, companies that can cooperate on this front. The only condition for being an ECO CIRCLE partner is that they can assume responsibility for collecting a substantial volume of used polyester products. To this end, Teijin selected employee uniforms of environmentally aware companies as our main collection target and began promotional efforts in cooperation with apparel manufacturers. At present, Teijin collects and chemically recycles a signifi cant number of employee uniforms, and its roster of ECO CIRCLE partners continues to grow. The second and third stages were to expand the geographical focus of efforts and seek a broader range of participants with the aim of expanding and strengthening the circle of cooperation. What is ECO CIRCLE? Developed by Teijin in 2000, ECO CIRCLE is the world s fi rst closed-loop recycling system for polyester products. Full-scale efforts to promote the system began in Today, all of the 80 registered ECO CIRCLE participants are manufacturers of apparel and/or sportswear that cooperate in the development of products made from materials that can be recycled, the collection of used polyester products and the reuse of recycled fi bers. Used polyester products collected by participating companies are sent to Teijin Fibers recycling facility in Matsuyama, Japan. There the products are chemically decomposed and returned to dimethyl terephthalate (DMT) and processed to create new polyester fi bers. The facility has an annual recycling capacity of 10,000 tons equivalent to approximately 10 million uniforms. As the life cycle assessment (LCA) conducted for ECO CIRCLE shows, chemical recycling of polyester has only a minimal impact on the environment. To further reduce that impact, ECO CIRCLE partners are encouraged to store collected products and ship in large lots. Sales MEMBER Product development USER Chemical recycling Collection MEMBER Shipment in large lots 16 Teijin Limited

4 B. Broadening the Circle of Cooperation Collaborative Efforts with Patagonia The second stage of the ECO CIRCLE plan of action was to broaden our geographical focus with the aim of expanding and strengthening the circle of cooperation. Here Teijin began to look for potential partners overseas, focusing on companies with advanced environmental responsibility programs and globally recognized brands. It was here that Teijin s excellent partnership with outdoor gear and apparel company Patagonia, Inc., began. Noted internationally for its commitment to product quality and environmental activism, Patagonia had begun exploring ways to make its entire garment line recyclable, or made from recycled products, by Patagonia s participation in ECO CIRCLE began in 2005 with the launch of a program for collecting worn-out Capilene baselayers for recycling into new garments. Later, Patagonia broadened the scope of the program to include polyester fl eece and hard-shell jackets. Today, Teijin is working to further advance its relationship with Patagonia and to develop similar relationships with other leading companies. Targeting Environmentally Aware Consumers Teijin s efforts to promote cooperation with environmentally aware companies during the fi rst stage of the ECO CIRCLE plan of action were given a boost by such external factors as Japan s Law Concerning the Promotion of Procurement of Eco-Friendly Goods and Services by the State and Other Entities commonly known as the Law on Promoting Green Purchasing. With the understanding that further expansion of ECO CIRCLE demands its recognition and acceptance by consumers, Teijin is today working to promote ECO CIRCLE products. Efforts to date have included collaboration with retailers and outdoor apparel manufacturers to develop products aimed at environmentally aware consumers and publicizing these efforts through the media and by staging special related events. Patagonia s Participation in ECO CIRCLE 2005 Capilene baselayers 2006 Polartec fleece clothing 2008 Hard-shell jackets Capilene baselayers, manufactured by Patagonia Special Feature: ECO CIRCLE Environmental Impact of Chemical Recycling (Life Cycle Assessment) MJ*/DMT (tons) J = joule (unit of energy measuring heat ) 1MJ = 1 million joules CO2: tons DMT: tons 72,422 Reduces energy consumption by 84% (Incinerated) Reduces CO2 emissions by 77% DMT derived from petroleum 11,962 DMT produced using Teijin chemical recycling Dimethyl terephthalate (DMT) is the raw material used to make polyester DMT derived from petroleum DMT produced using Teijin chemical recycling In full operation, the ECO CIRCLE system makes it possible for Teijin to reduce its annual consumption of crude oil by 39,000 tons and natural gas by 24 million Nm 3. CO 2 emissions are approximately 3.2 tons less per ton of polyester than for polyester produced from petroleum. Teijin Limited 17

5 Developing 100% Polyester Products Expanding the Loop Teijin recognizes that increasing the polyester content of polyester products is key to making collection and recycling easier because it reduces the need to separate out other materials and thereby to expanding and strengthening the circle of cooperation. With this in mind, Teijin is working to develop 100% polyester materials and has broadened its focus beyond apparel to include such products as fully recyclable interior materials for automobiles, trains and other applications. Comment from Noboru Watanabe, Developer of ELK Unlike conventional nonwoven textiles, ELK uses two kinds of polymer with different melting points and features a unique tanglespring structure in which elastic fi bers and springstructured fi bers are entangled stereoscopically. ELK is used in combination with Teijin s Solotex polytrimethylene terephthalate (PTT) fi ber in a composite-structure cushion surface material, which together enhance the comfort of seated passengers. ELK and Solotex were adopted for use in the new Series N700 Shinkansen bullet trains, which went into service in July At present, we are cultivating new applications for ELK, particularly in aircraft and automobile seats. ELK s unique tangle-spring structure ELK A high-performance cushion material currently used primarily for automobile and train seats, ELK was developed by Teijin with the aim of creating a polyester material that outperformed polyurethane, traditionally the material of choice for seat cushions due to its excellent resilience, durability and formability. Developed using two kinds of polymer with different melting points and a unique structure, ELK is fl exible yet holds its shape well and offers outstanding resilience and durability. The material is also signifi cantly more breathable than polyurethane, meaning it doesn t get as sweaty, and is 20% lighter. These properties have attracted attention from railway operators in Japan seeking materials that reduce carriage weight thereby reducing energy consumption and improving acceleration and which can be recycled. The material is currently used for seat cushions in approximately 20% of the railway carriages in use nationwide. ECO STORM Hard-shell jackets and rainwear for outdoor and sporting purposes demand materials that are more waterproof, water repellent, wind resistant and highly wickable than regular outdoor wear. Accordingly, the materials of choice to date have been nylon or other fi bers coated or laminated with fl uoropolymers or polyurethane. However, the presence of fl uoropolymers or polyurethane means that materials cannot be chemically recycled. Teijin s ECO STORM is a woven polyester textile made from recycled polyester fi bers that has been laminated with highly durable thin polyester fi lm, thereby creating a 100% polyester material that delivers an outstanding performance and is also easily recycled. Comment from Kenji Iwashita, Developer of ECO STORM With ECO STORM, we are confi dent that we have developed a material that is highly water repellant and waterproof, even in heavy rain, but is also outstanding in terms of texture, appearance and elasticity. ECO STORM textile ECO STORM jacket 18 Teijin Limited

6 Developing Chemical Recycling Technologies for Polycarbonate and PLA Creating New Loops Teijin is broadening the focus of ECO CIRCLE beyond polyester fi bers and currently collects a variety of polyester products, including used PET bottles and PET fi lm, for recycling back into polyester raw material. Teijin is also developing new collection systems and chemical recycling technologies to ensure polyester from a wide range of its polyester products is recycled. Teijin is exploring the potential for recycling its many non-polyester products and has succeeded in developing chemical recycling technologies for polycarbonate products and polylactic acid (PLA). The Company is also close to commercializing a materials recycling system for notoriously diffi cult-to-recycle carbon fi bers. in In 2005, this technology was tested at the EXPO 2005 Aichi international exposition, the theme of which emphasized environmental issues. This technology uses water alone as a reactor and requires no catalysts or other additives. Normally, PLA is produced from L-lactic acid. If its optical isomer, D-lactic acid a byproduct of the recycling process is mixed in, the physical properties of the polymer deteriorate. Teijin s technology facilitates the recovery of almost 100% of the L-lactic acid and essentially prevents the production of byproduct D-lactic acid. Production of recycled PLA using this technology uses over 33% less energy than production using plant matter. Chemical Recycling of Polycarbonate Products Teijin s chemical recycling technology for polycarbonate products, originally developed in 2004, facilitates an amazing recovery and recycle rate of 96% for key raw material bisphenol-a (BPA) as well as minimizes impurities and reduces impact in terms of energy consumption. In addition to such outstanding performance features, this technology facilitates a signifi cant reduction in recycling costs compared with conventional distillation recycling processes, thanks to the development of component technologies that make possible alkaline decomposition of polycarbonate at low temperatures and which ensure the recovery of high-purity BPA from liquid polycarbonate. Teijin has built a demonstration plant and is conducting tests with a view to commercialization. Chemical Recycling of PLA Developed in 2004, Teijin s chemical recycling technology for PLA was realized through collaborative research with Japan s Toyohashi University of Technology, which began Chemical Recycling Process for Polycarbonate Products Collection of waste polycarbonate products Crushing Depolymerization Purification Extraction of BPA Polymerization Polycarbonate resin Finished product Chemical Recycling Process for PLA Plant matter Starch Lactic acid PLA Finished product Decomposition Special Feature: ECO CIRCLE Environment-Friendly Design Certification System Teijin is promoting environmental initiatives in three categories: Environmental preservation, environment-friendly design and environmental business. Environment-friendly design refers to design that seeks to reduce environmental impact at all stages of a product s life cycle, from the procurement of raw materials through production, sale, use, recycling and disposal. One initiative in this category has been the establishment of a proprietary certifi cation system for Teijin Group products that assesses the environment-friendliness of design according to six key criteria. An assessment of ELK using the system, for example, reveals that it equals or surpasses existing products in Teijin s lineup on all six counts. Assessment of ELK Using Teijin s Environment-Friendly Design Certification System Reduction of environmental impact at the production stage ELK 5.0 Provision of information 2.0 Safety Environmental preservation 2.7 Energy conservation Conventional products Resource conservation Teijin Limited 19

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