Closed Loop Partners invests $15M in recycling this year

According to Closed Loop Partners, it has provided approximately $15 million in investments to local municipalities for projects to upgrade recycling infrastructure and services across the Midwest and Southeast U.S. in the last year. Deployed by funds within the New York-based firm’s private credit arm, the Closed Loop Infrastructure Group, these investments are helping advance the infrastructure needed to collect, process and return materials to supply chains at their end of life.

Closed Loop Infrastructure Group’s first fund was established in 2014 and funded by some of the world’s largest retailers, corporate foundations, technology and consumer goods companies, including 3M, Amazon, Coca-Cola, Colgate-Palmolive, Johnson & Johnson, BlueTriton, Keurig Dr Pepper, Procter & Gamble, PepsiCo, Danone North America, Danone Waters, Starbucks, Unilever and Walmart Foundation. It provides below-market rate loans to finance projects that build circular economy infrastructure in the United States.

Since then, Closed Loop Infrastructure Group has added three additional funds—Closed Loop Circular Plastics Fund, Closed Loop Local Recycling Fund and Closed Loop Beverage Fund—that have invested in more than 45 different projects to date, including procuring recycling carts, making recycling facilities upgrades, supporting innovative recycling technologies and more, keeping more than 3 million materials in circulation and avoiding more than 6 million metric tons of greenhouse gas emissions, according to Closed Loop Partners. Across all their investments, the funds have catalyzed capital inflow from other sources equivalent to three times what has been deployed.

Alongside companies advancing new recycling solutions, municipalities have played a key role in accelerating recycling infrastructure improvements across the country, with local waste authorities leading the way toward building more robust local circular economies, Closed Loop Partners says. The infrastructure upgrades financed by the Closed Loop Infrastructure Group have resulted in nearly $40 million in direct savings to municipalities to date, through more materials kept in circulation and out of landfills.

Closed Loop Partners’ Infrastructure Group provided flexible financing to several municipalities over the past year:

• The Central Virginia Waste Management Authority (CVWMA) represents counties and localities in the central Virginia (Richmond) area. Only five of the area’s eight counties participating in the CVWMA’s recycling program had 95-gallon curbside recycling carts, and the authority sought a loan from the Closed Loop Infrastructure Fund to help finance the purchase of more than 90,000 95-gallon carts for the three remaining jurisdictions. In July 2023, the Closed Loop Infrastructure Fund provided a loan of more than $4 million to fund the new 95-gallon carts provided by Los Angeles-based Rehrig Pacific, upgrading from 24-gallon bins and enabling a 5,000 to 7,000 incremental increase in tons of materials collected per year, with the potential to increase to about 8,000 tons per year. The investment was made in collaboration with The Recycling Partnership, Washington, which provided grant funding, technical support and education and outreach for the upgraded recycling program.
• Scott County is the third largest county in Iowa, with the Waste Commission of Scott County serving more than 25 counties in Iowa and Illinois and more than 185,000 total households. The commission’s relationship with Closed Loop Partners began nearly 10 years ago, when it was first looking to finance upgrades to its recycling infrastructure services. The Closed Loop Infrastructure Fund provided funding to the Commission in 2015 and 2018 to finance new single-stream recycling carts and infrastructure improvements, respectively. The success of these investments resulted in a follow-on multimillion-dollar loan in 2022 from the Closed Loop Infrastructure Fund, alongside the Closed Loop Beverage Fund and Closed Loop Circular Plastics Fund, to finance the purchase of new optical sorters to increase and improve the existing facility’s sorting capacity, Closed Loop Partners says. The new loan will help grow the processing of recyclables, including polypropylene, throughout the region. When installed, the equipment upgrades will provide more than 3.5 million pounds of additional capacity and allow for the recovery of an additional 900,000 pounds of materials each year, the company says.
• Building on long-standing commitments to support recycling efforts, the city of Kansas City, Missouri, sought a loan to finance the purchase of 162,000 new curbside recycling carts to increase material collections services, affecting 380,000 residents. In 2023, the Closed Loop Infrastructure Fund and Closed Loop Beverage Fund provided a loan of more than $5 million to the city, financing 162,000 65-gallon carts from Rehrig Pacific––an upgrade from the 20-gallon bins previously used. This change helps enable a 2,000 to 3,000 incremental increase in tons of material collected per year, with the potential to increase to 10,000 incremental tons per year, Closed Loop Partners says. This initiative was made possible by a collaboration among private and public partners, including Closed Loop Partners, the American Beverage Association’s Every Bottle Back initiative, Missouri Beverage Association, The Recycling Partnership, Dow and Rehrig Pacific.

Closed Loop Partners says the need for investments in recycling infrastructure is critical, given the misalignment between the volume of materials produced and the infrastructure available to recover them, process them after use and return them to manufacturing supply chains. Moving forward, the four funds within the Closed Loop Infrastructure Group continue to invest in projects that the company says help strengthen the infrastructure needed to recover end-of-life materials and increase the volume of quality recyclables needed to meet growing demand.

Closed Loop Infrastructure Group funding applications or information about Closed Loop Partners’ capital strategy can be found here.