The Energy Cost Reduction Day, observed on 10 January, provides an opportunity to analyse the impact of energy prices on the plastics industry in Europe and on the related economic sectors. Plastics are an essential component for many strategic industries, from automotive and defence, through packaging, construction and electronics, to healthcare and renewable energy. The decline in the competitiveness of European plastics production, deepened by the energy crisis, creates a risk of deindustrialisation and growing dependence on imports, which conflicts with the European Union's objectives in the areas of sustainable development, economic security and strategic autonomy. The current situation of the industry indicates a turning point, at which maintaining local production capacities requires both regulatory measures and system solutions related to energy costs, border competition conditions and support for the transition towards a circular and net zero economy.
The importance of the plastics industry for the European economy
Plastics are an integral part of the European economy and value chains in many sectors. Plastic parts and products are crucial for industries such as automotive, packaging, construction, electronics, healthcare, renewable infrastructure and consumer goods.
"Plastic parts and products serve many strategic industries, such as automotive, packaging, construction, electronics, healthcare, renewable infrastructure and consumer goods. The entire plastics value chain in Europe provides around 1.5 million jobs in more than 50,000 companies. It is also an important industrial branch for Poland, the market for rubber and plastics products is developing dynamically, with steady long-term growth," says Anna Kozera-Szałkowska, Managing Director of Plastics Europe Polska, the local branch of the association of plastics producers in Europe.
The importance of the sector goes beyond direct jobs, as the stability and development of the plastics industry affect the innovation and competitiveness of entire value chains, including in areas considered crucial from the perspective of the EU's industrial policy and security.
Declining European share in global plastics production
According to current data, Europe's share in global plastics production has been systematically decreasing. In 2006, the region accounted for 22% of world production, whereas in 2024 this share fell to just 12%. At the same time, the industry's turnover in Europe has dropped significantly, from EUR 457 billion in 2022 to EUR 398 billion in 2024, which represents a 13% reduction.
European trends contrast with the development of the plastics industry in other parts of the world. Global plastics production increased in 2023 by 4.1%, and compared to 2018 by as much as 16.3%. Asia currently accounts for 57.2% of world production, with China alone generating 34.5% of global output, nearly three times more than the entire European Union.
In Europe, production lines are being shut down and plants are being closed, while output continues to fall. The industry is on the edge and the warning signs are clear. From the industry's perspective, this is the last moment to implement remedial measures, including in the area of energy prices, in order to limit the risk of permanently losing autonomous production capacities.
Implications for jobs and living standards
Without urgent action to restore competitiveness and unlock investment potential, Europe faces progressive deindustrialisation and the loss of its innovation advantage. A decline in domestic plastics production would mean greater dependence on imports, which runs counter to the EU's assumptions regarding sustainable development and economic security.
Maintaining plastics production in Europe is important not only for the development of innovation and for implementing the circular and net zero transition of sectors that use plastics. It also has a direct impact on the security and strategic autonomy of the European Union, which is important in the current geopolitical situation, as well as on the preservation of jobs and the standard of living of Europe's citizens.
Addressing the energy cost crisis
The plastics industry is an energy-intensive sector, therefore energy costs are crucial for its competitiveness. The European plastics industry urgently needs active political support and regulatory frameworks adjusted to the real operating conditions of production plants.
One of the industry's demands is to add the chemical sector, including polymers, to the EU's EU ETS compensation list. From the companies' perspective, it is also important that regulations take into account the possibility of sectoral reinvestment of the funds obtained, in order to accelerate the transition towards a circular and climate-neutral economy.
Such an approach could translate into more sustainable operations of companies across the value chain, including sectors that use plastics as key structural and functional materials.
Anna Kozera-Szałkowska, dyrektor zarządzająca Plastics Europe Polska
Levelling the playing field at EU borders
The issue of energy costs should be complemented by measures to protect the European market from unfair competition. Strengthening border control mechanisms in the EU is indicated as one of the important elements of supporting local industry in the face of pressure from producers in other regions of the world.
The proposed measures include investments to increase customs control capabilities, harmonisation of procedures at EU level, the use of digital tracking tools for goods flows and the introduction of mandatory independent certification for imported products. The aim of such solutions is to maintain high environmental and labour standards and to level the playing field for European producers in the global market.
In this context, the possibility of establishing a Chemicals and Plastics Trade Observatory is indicated as a tangible tool to protect EU industry from unfair practices and their long-term effects. Such an institution would make it possible to monitor trade flows in real time and to implement instruments supporting fair trade.
Environmental costs and the path to net zero
The Energy Cost Reduction Day is not only about financial aspects and the level of energy prices. The environmental costs of industrial operations are also important.
"Equally important from the perspective of our industry's ambitions is the reduction of environmental costs, that is striving for net zero emissions," adds Anna Kozera-Szałkowska. "This is the goal defined in our roadmap The Plastics Transition, which presents the pathway showing how we can achieve both a net zero and circular plastics system in Europe by 2050."
Implementing this vision requires the use of all available recycling technologies and the introduction of mechanisms that stimulate market demand for circular products and solutions. The measures indicated include, among others, stimulating investment in innovation, setting ambitious targets for recycled content in products and removing barriers that hinder the free movement of goods and secondary raw materials within the internal market.
The application of such solutions is intended to enable Europe to maintain an autonomous, safe and sustainable plastics industry capable of both competing on the global market and delivering on the European Union's climate objectives.
