IRG cancels Pennsylvania recycling project, cites White House funding delays

Plans for a massive plastics recycling project in Pennsylvania have been canceled, and the company behind the project is pointing to actions taken by President Donald Trump's administration as a key reason why.

International Recycling Group, for years now, has been trying to develop the $300 million project in Erie, Pa., that was heavily dependent on a $182 million federal loan awarded while President Joe Biden was in office.

But under the Trump administration, that loan has been put on hold as part of the president's larger skepticism of so-called green projects.

IRG also cited uncertainty over the institution of tariffs that impact international trade by the new administration.

And then there was the issue of output from the proposed plant with IRG now questioning whether the company could attract enough business at a time when brand owners are backing off on sustainability pledges to use higher percentages of recycled resin in their packaging.

"I am personally devastated after 18 years of working to bring this vision to a reality that we have failed to overcome these challenges," IRG CEO Mitch Hecht said in an April 3 statement.

"Over four years ago, we brought the IRG project to Erie with the intention of creating high-paying, family-sustaining jobs and turning Erie into a leader in environmental sustainability by replacing new plastic production with reused and recycled materials gathered from homes across the region," he said.

Now the IRG founder is walking away from a project that would have had a huge impact on the plastic recycling market.

The Plastek Group, a maker of plastic packaging and molds based in Erie, was a local backer of the project along with insurance company Erie Insurance.

"We are very sad and disappointed at the recent news and the fact that plastics recycling, the plastics industry, the environment and the jobs IRG would have created in Erie have missed out on a great opportunity," Plastek CEO Dennis Prischak said in an email.

"My family and Plastek became involved for, what we believe, we're all the right reasons and are glad we were part of it," he added. "Very sad. We tried."

A local chamber of commerce called the decision to end the IRG project "a significant loss."

"The Erie Regional Chamber is frustrated by the financial pressure building due to economic uncertainty at the federal level, which IRG cited as the reason to cancel plans for its Erie plastics recycling plant project," chamber CEO Brandon Mendoza said in a statement.

The project had support at both the state and local levels and within the public and private sectors, he said. "The opportunity cost to develop such an enormous project with all pieces aligned to end like this is a disappointing outcome."

It was just in November that Hecht authored an perspective column that appeared in Plastics News indicating he was "committed to seeing the project through."

IRG had planned to convert 160,000 tons of post-consumer plastics per year into 100,000 tons of recycled plastics. Another 20,000 tons per year of a residual plastic product, which the company called CleanRed, would have been used as fuel by steelmakers.

A crack in the Erie plans became publicly apparent last month when IRG halted collection of recycled plastics in Erie. The company had created an operation called newBin, a collection program designed to ultimately feed used plastics to the proposed recycling plant.

"Due to uncertainty related to continued support by the federal government, we have had to put all collection activities on hold for the time being," the company said in March.

IRG, in revealing the death of the project, took efforts to head off some potential questions that could be raised.

IRG said plastics already collected are "in secure containers and will be removed in the coming days. None of this material is classified [hazardous]. If a recycling buyer cannot be found, the material will be sent to landfill. The company is following all protocols to ensure that the materials will be processed and shipped in an environmentally sound manner."

The company also said only $300,000 in public funding was used on the project that was first announced in 2019. A loan from the Erie County Redevelopment Authority was used to help buy land, and the loan is secured by a lien on the property. IRG said the loan "is expected to be repaid in full."

"Commonwealth grants that had been offered to IRG under the Redevelopment Assistance Capital Program and Rail Assistance Program were never accessed," the company added.