PWP Industries plans to build a separate California facility to recycle PET bottles, intending either to use the material in its Vernon plant or sell the resin to other processors.

The food-packaging thermoformer anticipates investing $20 million for land, construction, infrastructure systems and operating equipment. PWP plans to have the Southern California plant producing Food and Drug Administration-compliant flake toward the middle of 2010.

The firm is negotiating for real estate within a reasonable distance of the Vernon facility and may make a site decision in July, said Leon Farahnik, chairman and CEO of Los Angeles-based PWP.

"We want to promote post-consumer recycling content in the state of California," Farahnik said in a telephone interview. "We believe that products that use additives to make them biodegradable will not biodegrade in landfills. We want to reuse the energy sources we have."

The PWP recycling facility will accept "dirty bottles" from any available resource in California including PET containers from business partner Coca-Cola Recycling LLC. The Atlanta-based limited liability company is a subsidiary of publicly traded Coca-Cola Enterprises Inc., the largest bottler of Coca-Cola products.

The facility would make the recycled food-grade-suitable flake available to other Californians. Those non-PWP "outsiders would be able to buy" the material, Farahnik noted. "Now a lot of PET bottles from California are being shipped to China."

PWP is negotiating with vendors before making commitment to buy equipment and technology for the California plant and may make those decisions in August or September.

A captive PWP facility in Davisville, W.Va., uses a turnkey plastic recycling system from the Sorema division of Previero srl in Como, Italy, and solid-state polycondensation technology from the thermal processes business unit of Bühler AG of Uzwil, Switzerland. Coca-Cola Recycling supplies the used containers.

On June 2, West Virginia Gov. Joe Manchin helped Farahnik and others celebrate the ceremonial ribbon cutting for, and took tours of, the new Davisville operation, which cost more than $21 million and, in many respects, gives PWP a design template for the California project.

The Davisville plant occupies 80,000 square feet, targets a phase-one annual capacity of 40 million pounds of PET. It is located about 10 miles from a PWP plant in Mineral Wells, W.Va., that absorbs all Davisville output.

Davisville visitors heard how PET flake is washed and cleaned thoroughly to ensure removal of the label, cap and tamper-evident neck-band materials and other debris. Nearly all outputs — including the cap and label materials — are salable for other purposes.

At the new California plant, PWP projects an initial capacity to recycle 40 million pounds of PET bottles annually. A second phase would double the annual volume to 80 million pounds during the second quarter of 2011.

The California project will enable PWP to further its commitment to save energy, reduce the output of carbon dioxide and keep plastic out of landfills, Farahnik said.

He used a greenhouse gas equivalencies calculator of the U.S. Environmental Protection Agency to estimate the new California plant at full capacity would eliminate 60,000 tons of carbon dioxide, equaling what 10,000 passenger cars can produce in a year, and reduce the need for 780 million kilowatt hours of energy, equaling the power requirement for 50,000 homes or Flagstaff, Ariz., for one year.

Further, Farahnik said manufacturing of post-consumer PET is estimated to use about two-thirds less energy than production of virgin PET.

PWP thermoforms PET and polypropylene for food packaging at a plant in Abilene, Texas, as well as the locations in Vernon and Mineral Wells.

PWP is finding a ready market for post-consumer resin in food packaging. "All of our customers are involved in having post-consumer content in their product lines," Farahnik said.

Fast-food-franchise Subway uses PWP-formed salad bowls, and major players such as discount giant Wal-Mart Stores Inc. and warehouse-club-chain Costco Wholesale Corp. are interested in using PWP-made food packaging with recycled content.

Private investment firm Omninet Capital LLC of Beverly Hills, Calif., is a major financial backer of PWP.