Introduction
Plastic pollution is the accumulation of plastic waste in the environment where it harms ecosystems, wildlife, and human health. Plastic pollution includes any plastic material that ends up in the environment. It is particularly dangerous because it does not break down naturally. Plastic pollution has reached critical levels, vastly exceeding the global capacity for environmentally sound management. With less than 10% of global plastics recycled, production continues to rise, mounting environmental and health issues worldwide. The United Nations is facilitating negotiations for a Global Plastics Treaty involving nearly all nations, aiming to establish a legally binding framework addressing plastic pollution’s lifecycle; from production to disposal. This notwithstanding, there have been significant divisions among governments on crucial treaty components such as production limits, hazardous substances, and funding mechanisms which obstruct advancement at multiple negotiation sessions (environment.ec.europa.eu ; weforum.org).
Amid this impasse, plastic credits are being presented by some stakeholders as a potential tool in the treaty’s financial architecture. Supporters argue that plastic credits could help mobilise private capital for waste management, incentivise collection and recycling, and reduce visible pollution in frontline communities. These proposed solutions have systematic flaws and a tendency to forestall upstream solutions such as reducing plastic production. In addition, many credit schemes do not ensure that the credited activity does not happen without the credit; and many practices underlying credits can generate harmful emissions leading to severe health risks (business-humanrights.org/en/ ; lemonde.fr ; O’Neill & Moon, 2025).
As treaty negotiators seek mechanisms to finance the transition to a less polluted and healthier global environment, the inclusion of plastic credits raises critical questions. Will their integration into the Global Plastics Treaty strengthen collective action, or will it institutionalise a policy distraction that mitigates visibility of waste without meaningfully curbing production or protecting human health?
What Plastic Credits Do
Plastic credits are market- based instruments that allow companies to pay for external plastic waste collection or disposal to offset their own plastic footprint, quite like the carbon credits idea in practice. Plastic credits are a financial tool aimed at combating plastic pollution by associating corporate payments with measurable waste recovery efforts. Each credit signifies a unit of processed plastic waste, often one kilogram or tonne, linked to approved projects. This system allows companies to support waste management in areas with limited infrastructure while taking responsibility for their plastic impact (worldbank.org).
Projects that collect plastic from the environment, divert waste from landfills, or process it through recycling pathways are verified and certified by independent registries or standards bodies. After auditing and documenting the amount of plastic managed, credits are issued and listed publicly. Companies buy these credits to offset their plastic use and report them against sustainability goals upon retirement (targray.com).
The underlying logic is that private sector funding can channel capital into local waste management projects that may otherwise lack investment, thereby increasing collection, recycling, and proper disposal in underserved regions. In theory, this mechanism creates incentives for both improved waste practices and corporate engagement in plastic pollution reduction (genevaenvironmentnetwork.org).
Environment and Health Concerns
Plastic waste significantly endangers the environment and public health throughout its lifecycle. Practices associated with plastic credit schemes, particularly the incineration of plastic waste, often worsen these risks. Burning plastic releases toxic pollutants like dioxins, heavy metals, and volatile organic compounds (VOCs), which contaminate air, soil, and water, leading to serious health issues such as respiratory illnesses, cancer, and hormonal disruptions, particularly affecting vulnerable communities without proper air quality measures (ehn.org).
Aside toxic emissions, plastics contain and release harmful chemical additives like phthalates, bisphenols, lead, and cadmium, which can leach into the environment. These substances are associated with neurological harm and reproductive disorders. Improper plastic waste handling adds to environmental contamination, contributing to microplastic pollution in water, soil & human tissues, raising concerns about long-term health effects (nrdc.org).
Scientific assessments indicate that current recycling and disposal methods inadequately protect ecological and human health. Many chemical recycling processes are more like incineration, generating hazardous byproducts instead of effectively reusing materials and are often situated in environmentally unjust communities. This toxic exposure and lack of proper safeguards emphasize the warnings from environmental and public health experts against depending on plastic credit-linked disposal methods. They advocate for rigorous standards, monitoring, and prioritization of reduction, reuse, and truly sustainable waste management (Abahussain et al., 2025; ehn.org ; nrdc.org).
In the negotiations for a UN Global Plastics Treaty, the debate is this: In order to close the financial gap in waste management, supporters contend that these market-based tools connected to the collection of plastic waste could draw private investment (verra.org). On the other hand, many scientists and environmental groups remain dubious, arguing that plastic credits undermine important treaty objectives like enforcing legally binding restrictions on plastic manufacturing and fail to cap or lower the production of virgin plastic (awi.de/en/). This debate highlights a central tension in the negotiations: whether to focus on waste management or to implement comprehensive measures addressing upstream causes of plastic pollution. The resolution of this issue will significantly influence the treaty’s effectiveness and environmental integrity.
Governance Risks
Plastic credit schemes present governance risks that may compromise global plastic governance frameworks, particularly if integrated into major agreements like the UN Global Plastics Treaty. Key issues include inconsistent standards and lack of transparency, leading to potential greenwashing or companies falsely claiming environmental benefits without actual plastic reduction. Without effective regulations, such credits could allow continued high plastic consumption, undermining goals related to producer responsibility and reduction of plastic use.
Another governance challenge involves the risk of market distortion and policy fragmentation due to plastic credits. By commodifying pollution, these credits may distract from more effective regulatory strategies like binding production limits, thereby weakening regulatory frameworks. Additionally, the lack of minimum standards for monitoring, reporting, and verification can result in opaque pricing and inconsistent credit quality, undermining trust in governance and challenging the integration of these measures into broader sustainable waste management policy.
Treaty objectives may be threatened if terms like “innovative finance” or “market mechanisms” are used in international negotiations on plastic credits. Experience with carbon offsets signals how weak legal frameworks can lead to low-quality credits undermining the credibility of international agreements and allowing industry exploitation to hinder meaningful reforms. There is a need for clear principles, strong oversight, and safeguards if plastic credits are to play a complementary but not replacement role in global plastics policy.
Conclusion
Plastic credits are a debated policy in global plastics governance, offering potential short-term financing for waste management but risking a focus on remedial measures rather than addressing the root causes of plastic pollution, such as excessive production and consumption. Without strong governance and transparency, they could dilute the goals of the Global Plastics Treaty and exacerbate environmental and social injustices. An effective global strategy should emphasize binding reduction targets and producer responsibility, positioning market-based tools as regulated complements rather than substitutes for necessary systemic changes. Going forward, African countries must take a lesson from the carbon credits scheme that has not been in their favour. Negotiations on this issue must provide verifiable and implementable incentives for African participation.
References
https://environment.ec.europa.eu/news/eu-regrets-inconclusive-global-plastics-treaty-2024-12-02_en
O’Neill, K., & Moon, S. (2025). Standards and the Regulation of Plastic Wastes in Developing Countries. Background paper prepared for World Development Report.
Abahussain, A. A., Nasr, F. A., bin Jumah, A., Saravanan, P., Kumar, N. S., Al-Zharani, M., … & Tamizhdurai, P. (2025). Toxic threats from plastic waste: human health impacts, challenges, and policy solutions. RSC advances, 15(48), 40761-40788.
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