Ken Pucker, professor of the practice at The Fletcher School at Tufts University, worries about many things. One of them is whether the fashion industry is going about circularity the wrong way.
The collapse of Renewcell, which until recently transmuted clothing castoffs into sheets of dried pulp that could be dissolved to create viscose, rayon and other man-made cellulosic fibers, has been preying on his mind. Shortly after the Swedish company revealed that it would be declaring bankruptcy, H&M Group, its largest stakeholder, announced that it was linking arms with investor group Vargas Holdings to launch a new venture to ramp up the production of textile-to-textile recycled polyester. The retailer currently sources its recycled polyester from bottle-to-textile recycling, which has come under fire for nicking old plastic bottles from the more efficient and repeatable process of making new soda or water containers.
The timing was likely coincidental, but it still felt like a “dagger,” as someone close to Renewcell put it. H&M had declined to throw any more capital into a commercial-scale operation that was ready to deliver the necessary volumes but failed to garner sufficient commitments from belt-tightening brands already loath to do things differently. Meanwhile, it was extending a $600 million offtake agreement divvied over seven years, enough to cover roughly half of its demand for recycled polyester, to an upstart with neither a factory nor a track record of success.
Then there’s the fact that Syre (pronounced sigh-ruh), which like Renewcell, is based in Stockholm, has hired Renewcell board member Mia Hemmingson as its chief strategy officer and former Renewcell project manager Christer Johansson as its projects and plant construction director. Daniel Ervér, H&M’s new CEO, even called Syre an “important step” in its “journey to integrate circularity across our business.” Ouch.
But back to Pucker, a Timberland veteran, and the things that keep him up at night.
“Recycling polyester from clothing is one step better than recycling using plastic bottles,” he said. “But in the continuum of solutions, is that really going to get us closer to a more sustainable future? Polyester is inherently challenged because of the energy required to extract and process a non-renewable fossil-fuel-based substance. It sheds microplastics. LCAs don’t indicate consequential savings of carbon because you still have [to take into consideration] sorting, transportation, production and handling.”
And considering that Syre plans to build its inaugural plant in pricy North Carolina, with a 50-cent per-garment premium on its product, to boot, might it not also face the same pitfalls that Renewcell did? Circulose, after all, cost 30-40 percent more than conventional viscose at the fiber level, which some say hampered its adoption. Or will H&M’s more prodigious use of polyester—23 percent versus 6 percent of wood and man-made cellulosic fibers, according to its website—be enough to shove the material through the adoption pipeline?
Syre means oxygen p? Svenska, but it’s also a portmanteau of “sy,” which is Swedish for sewing, and “re,” Latin for over and over again. Its name signals its ambition to bring about a “great textile shift,” said Dennis Nobelius, its CEO. If you haven’t heard of it until now, that’s because it’s been “hiding in stealth mode” for the past two-and-a-half years.
It was H&M that made the first move by approaching Vargas, which has successfully built companies such as Northvolt, which specializes in lithium-ion technology for electric vehicles, and H2 Green Steel, which creates a carbon-neutral version of the metal. Nobelius said that H&M wanted to invest in something along those lines but for textiles. A spokesperson for the apparel purveyor said in an email that its backing of Syre follows a series of investments by New Growth & Ventures, its corporate venture arm, which has similarly thrown its support behind innovators like Colorifix, Infinited Fiber Company and Kintra Fibers—and Renewcell, of course.
The reason why Syre took so long to pop up on the radar is that it had to pick a technology. Conventional wisdom has it that polyethylene terephthalate, a.k.a. PET, from plastic bottles, once converted into textiles, is next to impossible to re-recycle, at least at the scale necessary to make a difference. Syre employs a form of chemical recycling, known as glycolysis, that uses the solvent found in automotive coolant to break down polyester into its constituent molecules. These monomers are then chained back up to synthesize new PET for spinning into yarn. A pair of professors in North Carolina had been toiling on the process for nearly a decade but lacked the funds or expertise to do anything bigger with it, Nobelius said. They proved to be the “perfect match,” he added.
Work on a facility near Research Triangle Park, which is bordered by Duke University, North Carolina State University and the University of North Carolina at Chapel Hill in the Piedmont region of the Tar Heel State, is already underway. Once the equipment is installed, Syre will be able to run tests, potentially as early as the end of summer. Nobelius says that the recycling process can handle blends with as little as 60 percent polyester, though its performance “sweet spot” hovers at 90 percent, which is where Syre will set its threshold to begin with. Chemical byproducts, such as titanium dioxide, can be filtered out, and any short-staple cotton fibers can find new purpose as packaging. The idea, he said, is to work in a “circular way” that leaves no waste behind.
More important, Syre will provide a plug-and-play solution for the existing textile supply chain, requiring no infrastructure modifications for mills to wrestle with. Minimizing friction for change-leery businesses is key. Polyester remains the world’s most widely produced fiber with a 54 percent chunk of the market as of 2022, yet the recycled version only makes up 14 percent, according to Textile Exchange’s most recent Materials Market Report. Stiff competition for the PET bottles that comprise 99 percent of the feedstock is partly to blame, the organization said, but so are the “systematic challenges” of scaling up textile-to-textile recycling.
While Pucker wondered why Syre would construct its factory in North Carolina, half a world away from where the bulk of apparel is produced in Asia, Nobelius said that the plant is only a “blueprint” for testing and optimizing a network of 12 “substantially bigger” setups across the globe, including in Asia and Europe, that would collectively pump out more than 3 million metric tons of recycled polyester within the next decade. Some of them could start out processing post-consumer polyester, but post-consumer waste will have to be the focus if Syre is to trigger a “big societal change,” including slashing the emissions of polyester production by as much as 85 percent, he said.
Recycled polyester is more of a commercial draw than recycled viscose, if only because polyester infuses everything we wear, from high-performance mountaineering parkas to concert T-shirts, said Karla Magruder, founder of Accelerating Circularity, a nonprofit that seeks to create new circular textile supply chains through stakeholder collaboration. At the same time, nothing is cheaper than virgin polyester, which is churned out in vast, almost mind-boggling quantities. Production of man-made cellulosic fibers hit 7.3 million metric tons in 2022. For polyester, it was 63 million. All of which is to say that comparing Renewcell and Syre would be like comparing apples to beachballs.
One thing that Magruder knows, however, is that everyone is enamored with innovative fibers but fewer are willing to create the conditions that will help them thrive. Making a recycled product in a lab is the easy part, she said. Lining up the equipment makers, clothing sorters, garment recyclers, yarn spinners, textile manufacturers and, most vital of all, the brands that can sustain volumes beyond test quantities? That’s the tricky bit.
“People think that we’re going to get a piece of equipment, we’re going to flip a switch, and we’re going to be able to tell cotton from polyester from polycotton from viscose from wool. And that’s not going to happen,” Magruder said. “All of those different fractions have different potential end users. Each recycler has a different spec to what they can accept. Then you get into things like ‘O.K., if we’re using post-consumer goods. what’s in them? Do they meet [restricted substances lists]? Are we going to worry about whether or not we’re getting product that came from the Uyghur region?’”
That Syre picked North Carolina over Sweden isn’t completely out of left field. According to the Economic Development Partnership of North Carolina, the state is home to the largest textile mill industry in the United States, with more than 39,000 textile professionals—the inventors of Syre’s technology included. Unifi, which produces both virgin and recycled polyester, is headquartered there. So are the American Association of Textile Chemists and Colorists, Cone Denim and Cotton Incorporated. Virginia-based startup Circ, which recovers polyester and lyocell from polycotton garments, plans to build its first factory there. Reliable, low-cost electricity is another carrot: North Carolina’s industrial electricity rate is more than 8 percent lower than the national average, its Department of Commerce touts.
But America’s garment sortation system is still in its infancy, said Rachel Kibbe, co-founder of Circular Services Group and the executive director of the American Circular Textiles Coalition, also known as ACT. Though the highly manual and labor-intensive process is compatible with reuse today, more advanced and efficient methods are needed to identify garments at the fiber level, de-trim and sort them rapidly for cost-effective textile-to-textile recycling.
It’s for this reason that ACT, whose members include Circ, H&M and ThredUp, worked closely with Senators Michael Bennet and Bill Cassidy on a portion of the recently unveiled Americas Trade and Investment Act that earmarks $14 billion in federal incentives for businesses engaged in textile reuse, repair and recycling.
“Our hope is this starts to level the playing field, and the barriers to entry and scale, for circular textiles and related activities,” Kibbe said. “Infrastructure and machinery-heavy businesses are at a disadvantage with traditional capital only, which requires huge returns on quick timelines, and that’s where more patient public funding can play a critical role.”
Magruder said that even though “everyone says” that new innovators have to be financially viable to be successful, the truth is that the current economic model supports business systems that aren’t sustainable. Renewcell’s swift downfall, which has sent chills through the innovation space, should be a wake-up call that transformation cannot happen in a bubble.
“We have to come up with a business model that works; there’s no question about that,” she said. “I actually heard someone say, ‘We’re going to store all this material and you’re gonna get free fiber.’ Nobody’s getting free fiber. You have to sort, you have to take out buttons and zippers, you might have to wash it, you have to do all these other steps depending on what the recycling technology is. A feedstock in a particular format costs money.”
Magruder’s belief, which she said is getting stronger by the day, is that nothing will happen without policy. Early adopters who lay the necessary groundwork for change may have a first-mover advantage when regulation comes knocking, but It’s legislation that will “drive things more than anything,” she said.
Nobelius agreed that a major challenge for Syre is “building that ecosystem” of feedstock, which will require a great deal of industry collaboration. It plans to draw learnings from industry associations like the Amsterdam-based innovation platform Fashion for Good. Echoing Magruder, he said that it’s the “system that supports the fiber.” And Syre, for one, is in a hurry to move things along, with Nobelius saying that it’s “going for speed.”
Still, it would be prudent for Syre and other innovators to slow down and learn from the lessons of Renewcell’s demise, said Katrin Ley, managing director at Fashion for Good. These include factoring in longer R&D and ramp-up timelines, acknowledging that groundbreaking innovations demand patient capital and extensive refinement, and collaborating with brands to hone strategies to accommodate premium pricing and ensure a “financially viable transition” for all stakeholders. A multi-industry approach is equally important, she said. Not only does it diversify growth but it also guards against economic volatility within specific sectors.
“Syre’s approach, with private capital, diversified industry focus and parallel development in Asia, sets its strategy apart from Renewcell, [but] Renewcell’s insights are invaluable for Syre, and understanding the hurdles they’ve overcome could preempt potential challenges,” Ley said.
Many innovators pursue attractive prices with economies of scale but achieving this requires strategic decisions that “fundamentally affect” manufacturing cost drivers such as feedstock access, production capacity and logistics costs, she said. H&M’s offtake agreement may send a “strong signal” to the rest of the industry, but the “path to success demands careful navigation of financial, operational and market challenges” to ensure “seamless integration and adoption.”
The choice between going fast or going far isn’t so easy to make when climate breakdown is crying out for an urgent transition. Depending on whose data you believe, fashion accounts for anywhere from 2-10 percent of the world’s carbon emissions. Overproduction, more than anything, is exacerbating the problem. Nevertheless, incumbent materials that stoke pollution and deforestation aren’t helping.
Even so, patience is almost a mantra at Infinited Fiber Company, which has been piloting the work of creating Infinna, a cellulosic fiber made from recycled cotton-rich waste and agricultural residues like wheat and rice straw, for the past six years. It’s gearing up to build its first full-scale factory in its native Finland, albeit in two years. In March, it closed on a 40 million euro ($43 million) financing round, with significant infusions from new investors such as Zara owner Inditex—another (indirect) Renewcell customer–TTY Management, Youngone and Goldwin. It’s been careful to get binding offtake agreements—and only binding offtake agreements—from the likes of H&M, Inditex and Patagonia.
Together with its brand partners, the firm has made educating suppliers a priority, said Petri Alava, CEO at Infinited Fiber Company. Infinna can head directly into spinning without any intermediate steps, making it more drop-in than Renewcell’s Circulose.
“We’ve been, all these six years, very patiently doing the development work with the spinners and fabric producers so that they are ready when the commercial scale [happens],” he said. “Now as we’re planning for commercial-scale production, the brands are very actively reminding us that, ‘Hey, let‘s take this seriously.’ So I think the brands are maybe learning more from Renewcell to make sure we’re not replicating the same mistakes.” Ouch again.
Alava said that moving from an innovation-driven company to a business-driven one, “valley of death” and all, has been a major shift, but that brands have realized that “rushing is no good when you’re trying to scale up.” His worst nightmare is running out of cash like Renewcell did.
Nobelius doesn’t know why H&M stopped investing in Renewcell, which is now sifting through bids from potential buyers. He can only speak to why it helped kick-start Syre, which is because it saw a lack of textile-to-textile recycled material, particularly polyester. In time, the firm could turn its attention to other fibers, with cotton an obvious choice because it comprises nearly 60 percent of H&M’s materials basket. He’s likewise sanguine about the pricing issue. Bottle-to-fiber textiles started some 30 years ago with a 40 percent “green” premium. Today, it’s closer to 10 percent. This is a “good equivalent that we can look at,” Nobelius said.
Plus, greenwashing legislation from the European Union is already casting a long shadow, he said. Claims that bottle-to-textile recycling is better for the environment when bottle-to-bottle is clearly the more circular route may not pass muster for long, leaving brands with 9 million metric tons of bottle-to-textile fiber that will need to be replaced.
Pucker still has questions he would like to raise. Is all that invested capital going to yield consequential benefits in terms of sustainability? Will Syre create a significant leverage point to reduce the fashion industry’s environmental damage? Are consumers going to care about it when there’s a “massive chasm” between intention and action when it comes to sustainable choices? “The answer is I’m not sure,” he said. “And dare I say, I worry.”
