It sounds like the perfect solution. Bayer, a venerable German chemicals company, has developed a process for using carbon dioxide, the main culprit for climate change, as a feedstock for making plastics.

After a successful pilot project, Bayer is planning a production facility at its site in Dormagen. Drawing on waste CO2 from other chemical processes, the plant will, by 2015, be gobbling thousands of tonnes of CO2 and producing polyol, a precursor to polyurethane, used in manufacture of such products as mattresses, building insulation and consumer goods.

Substituting a waste product for feedstocks such as coal, petroleum, natural gas and even biomass makes great sense in terms of sustainability, thus assuring raw material supplies in decades to come. Powering the process with sustainable electricity will bolster its green credentials. Bayer, meanwhile, will improve its processes, enhance its competitiveness and respond to its customers’ desire for “greener” products.

“This is one of many projects that has the potential to be a game-changer, showing real progress towards the use of CO2 as a competitive feedstock,” says Hubert Mandery, director-general of Cefic, the European Chemical Industry Council.

Green chemistry, which encompasses an ethos of avoiding hazardous substances, once conjured images of washing-up liquid reformulated to be more environmentally friendly. Progressively, over the past decade or so, the chemicals industry has come to see sustainability as a strategic objective that goes to the heart of what it does. For our planet, this is good news. With sales of $3tn in 2010, the chemical industry is one of the largest in the world. It gobbles 10 per cent of global energy and spits out 7 per cent of greenhouse gas emissions. Better products and processes can slow global warming. Because more than 95 per cent of its output goes into other manufactures, more sustainable chemistry enhances the sustainability of industries from food and farming to transport and consumer goods. As Bayer’s polyol is gradually adopted more widely, other products will become greener.

David Constable, director of the American Chemicals Society’s Green Chemistry Institute in Washington, says two themes powering green chemistry have been the reduction or elimination of toxins and of waste. “A third has been the consumer. In the US, there are a lot of young mothers,” he adds, “who read labels on products and who are concerned about exposure to a variety of materials in the things that they buy”.

Legislators have tended to follow a similar agenda. The toxic substances control act was last overhauled in 1976 but many states have introduced regulations controlling particular substances. California became the latest on October 1, with its safer consumer products regulations that oblige companies to file an assessment of alternatives to chemical ingredients considered undesirable. Europe’s all-embracing registration, evaluation, authorisation and restriction of chemicals regulations, under progressive implementation since 2007, are an international benchmark forcing industries such as pharmaceuticals to replace many traditional solvents.

Increasingly, the future vision is being framed within the industry, strongly influenced by 12 principles drawn up by Paul Anastas and John Warner, the founding fathers of green chemistry, in 1998.

These principles, which range from waste reduction and promoting renewable feedstocks to improved catalysis and synthesis, provide possibilities that offer vast cost savings. A study by Pike Research in 2011 identified green chemistry as a market opportunity that would grow from $2.8bn in 2011 to $98.5bn in 2020 and deliver industry savings of $65.5bn.

One example is a process perfected by Elevance Renewable Sciences, based in Illinois. It uses catalysis to convert natural oils into ingredients for personal care products, detergents, lubricants and polymers at lower cost and using less energy than rival compounds made from petrochemicals. Commercial production has begun in Indonesia.

Bio-based feedstocks have great potential, says Professor James Clark, head of the Green Chemistry Centre of Excellence at the University of York, in England. But, rather than use food grains, he says, the chemical industry has to invent ways of making its products from straw, grass and wood. One industry’s waste can become another’s raw material. British industry throws away about 100,000 tonnes of orange peel a year, he says. Yet citrus peel is a good source of limonene, which can be used to clean electronic circuit boards, and pectin, used as a food thickener.

Inventing cleaner, cheaper products, created with new processes from renewable feedstocks is only a beginning. Achieving their widespread adoption in a capital-intensive industry takes time.

It requires the overhaul of entire chains, from the supply of raw materials to modifying customer technology and facilities. Collaboration will be essential, to develop technologies and to enable them to be adopted on a commercial scale.

In the US, the Green Chemistry Institute has set up industrial roundtables to tackle key industry-wide problems. In Europe, where fossil feedstocks are largely imported, multiple programmes are under way designed to turn long-term sustainability into a strategic advantage.

The real holy grail, says Mr Mandery, is artificial photosynthesis. “When we can use sunlight to turn CO2 into energy to heat our houses or power our cars, we can reinvent the way we live.”