International Recycling Group purchases site

International Recycling Group (IRG), headquartered in Erie, Pennsylvania, has finalized the purchase of 25.48 acres at the former Hammermill Paper site at 1565 E. Lake Rd. from SB3 LLC for $1.23 million, the company’s founder and Chairman Mitch Hecht says. At the site, the company plans to construct what it is calling a “SuperPRF,” or a plastics recovery facility, that will accept all forms of postuse plastics, including cups, lids, tubs and other single-use plastics that it sources primarily from material recovery facilities (MRFs). It also will produce 10,000 tons per month of recycled polyethylene terephthalate (PET), high-density polyethylene (HDPE) and polypropylene (PP) pellets and flakes.

“In practice, we will try to bring in everything and sort for its best and highest use,” Hecht says.

Plastics that IRG doesn’t recycle on-site will be sold to other mechanical recyclers. It also will use residual materials to produce CleanRed, an iron-reducing agent used in steel production. Steelmakers in Japan and Europe are using CleanRed, he says. “We are bringing that technology to the states.”

However, Hecht adds, “If a chemical recycler that is able to provide us with a value proposition that gets us more value [for the residual material], we’re open to selling to them as well.”

By using CleanRed to replace metallurgical coal, Hecht says, steel producers can lower their costs and reduce their CO2 emissions by more than 30 percent. “You can replace a ton of coal roughly with a ton of our material."

IRG is in the process of finalizing a long-term off-take contract for CleanRed with a large U.S. steelmaker, he adds.

Hecht says he sees this technology as a bridge until recycling capacity in the U.S. expands and high-margin applications are more broadly available for end-of-life plastics.

The site is opportunity zone-qualified, meaning that IRG will realize tax benefits from locating there. Erie offers easy access to the Midwest and North Atlantic, as well, with half the U.S. population being within a 150-mile radius of the site, Hecht says. Pennsylvania also is home to a sizable plastic manufacturing economy.

He adds that IRG is working with the Erie branch of Penn State, one of the country’s largest polymer research institutes, on R&D for recycling applications.

The company plans to construct a 350,000-square-foot building at the former Hammermill site, with all inventory management occurring under roof, Hecht says. In addition to bale breaking and sorting equipment that includes optical sorters, robotics and artificial intelligence, the site will have shredding, washing and pelletizing operations.

“There’s nothing you don’t see in every MRF and recycling plant,” Hecht says. What will be different, he adds, is the scale and the flexibility IRG will have on the front end of its system that will allow the company “to accept and handle more difficult material that MRFs are loath to deal with.”

He says the company will purchase HDPE, PET and PP bales as well as Nos. 3-7 bales.

“The market is moving in the direction of MRFs having to open their doors to collecting all plastics,” Hecht says, as a result of consumer and legislative pressures. He says IRG plans to be a partner to MRFs by investing in “robust” equipment to handle every type of plastic and every form factor.

“We hope over time they will come to see our large scale regional plant as an outsourcing service for all plastics.”

Within 10 to 15 years, he says, IRG would like to site an additional 10 to 15 facilities that are comparable in size to the Erie plant.

Hect says construction on the building will begin in the first quarter of next year, with commissioning and start-up expected in the second half of 2024.

The company is funded in part by Erie Insurance, which invested $6 million in the company through its Opportunity Zone Fund, and Plastek, which purchased a $3 million equity stake in IRG’s parent company, GreenSteel LLC.