9 item(s) found.

Circular Economy

07 October 2019

Circular Economy

MAGIC UiB & UAB teams

Background

 

The circular economy is an alternative to the linear economy, in which natural resources are extracted, used and discarded. Circularity involves recycling, increasing product durability, creating repair and restore cultures, sharing economies, and many more ideas. Natural resources enter the economy and are re-used for as long as possible, reducing both the need for resources, and waste and emissions. This general definition, however, refers to a blurred picture: many of the concepts and ideas that compose the circular economy are not well defined, and some are in contradiction with each other. The circular economy is best understood through three main ideas: the circular economy is a policy in the making, it is an imaginary about the future, and it is far removed from what is known about the economic process in biophysical terms.

The circular economy was reformulated in 2015 with the specific aim of supporting the economic recovery after the 2009 financial crisis and the economic crisis that ensued, especially in Southern Europe. As the circular economy policy was being developed, the European project itself entered a severe legitimacy crisis, which has manifested in the rise of extremist parties, anti-immigrant and separatist discourses. The post-crisis context has played a significant role in the framing of the circular economy and in the negotiation of its stated aims. Defining characteristics of the circular economy are the focus on win-win narratives, synergies, and moderation – in the policy realm, the circular economy is not a revolutionary idea!

 

Methodological Approach

 

Our analysis is based on Quantitative Story-Telling (QST), a hybrid qualitative and quantitative tool, proposing a new way of using scientific information in the process of decision-making.  It is an alternative to the concept of evidence-based policy.  The general iterative schema of QST includes several steps: the first step is to identify narratives about situations, problems and solutions (through text analysis and interviews); then selected narratives, validated though meetings with policy-makers, are quantitatively represented with MuSIASEM. Lastly, the results are presented and then the feedbacks received are used to eventually run another cycle of QST.

 

Narratives

 

Three narratives were identified for the QST analysis:

  1. Imaginary of the Circular Economy.  "The CE offers new business opportunities to change from the consumption model to repair & reuse cultures, increased recycling, and a service-based economy, all of which have the potential of generating jobs, economic growth and yielding environmental benefits including GHG emission and waste reduction." (This is a collection of multiple narratives on different aspects and potentials of the CE, combined to obtain a ‘big picture’). The analysis of the imaginary of the Circular Economy allows us to engage with the development and assembly of the circular economy concept, and to understand how this concept is being negotiated and shaped in European policy.
  2. Indicators for the Circular Economy. "There is a big challenge in measuring the circularity of the economy and monitoring progress towards the Circular Economy." Interest in indicators was signalled by many policy makers we contacted, drawing attention to the role that indicators have in stabilizing the circular economy as a policy concept, and in creating new concepts and “things” in need of governing (e.g. secondary raw materials, as discussed in the results section below).
  3. Critiquing the Circular Economy. "The narratives that define the benefits are partly incomplete, incoherent and in tension with existing knowledge. Accordingly, the monitoring framework is likely to demand reinterpretation and specification of policy goals in order for indicators to be meaningful." Our stakeholders were interested in the critiques to the circular economy concept that could be articulated using the social metabolism approach.

For more information about the selected narratives, see this report.

 

Main findings

 

The full report on ‘Narratives behind the Circular Economy concept’ is available as Deliverable 5.7. The main findings are summarized below:

 

Imaginaries of the circular economy

What is interesting to note in regard to sociotechnical imaginaries and the elements that these imaginaries assemble, is that they implicitly assume that a transition towards more circularity is a matter of improving product design and designing in more sustainable modes of production and consumption (eco-design). Such a model rehearses a techno-optimist understanding of innovation and problem solving in which a seemingly inevitable technological progress provides solutions for societal challenges. This model builds on and at the same time rehearses a classical innovation narrative that depicts innovation as necessary for the EU to remain competitive in the international market. Innovation and technological progress cannot be challenged. In the case of the circular economy, the narrative is used to promote investment in research, R&D expenditure, patent applications, as well as the number of programmes and graduates in mineral processing.


Find out more:

BOOK: Kovacic, Z., Strand, R., Völker, T. (2020), The Circular Economy in Europe: Critical Perspectives on Policies and Imaginaries. Routledge, London, 208 pp., doi: 10.4324/9780429061028, ISBN: 978-0-367-18358-5 (hbk). eBook ISBN: 978-0-429-06102-8, first published: 7 November 2019, freely available in open access

 

The role of indicators

We argue that the monitoring framework and indicator development function as a site collective imagination in which desirable ‘circular’ futures are co-produced. These futures are imagined to provide novel opportunities for the private sector and to generate jobs and economic growth while at the same time improving the natural environment as measured by selected environmental indicators. When it comes to imagining the drivers of the transition to a Circular Economy the indicators show a clear emphasis on technological innovation. We may summarize that the indicators rehearse a collective European self-imagination that frames sustainability and environmental protection in terms of industrial activity and economic growth within Europe, a technology-centred idea of innovation, and a particular model of science-policy relations that promotes governing through monitoring, command and control.


Find out more:

POLICY BRIEF: Roadmap for the Circular Economy, assessment of the Monitoring Framework for the Circular Economy (Ares(2017)1830357).
POLICY BRIEF: Brief on the European Environment Agency (EEA) scoping study for indicators of the Circular Economy: EEA Report “Circular economy in Europe, Developing the knowledge base” 2/2016.
SCIENTIFIC PAPER: Indicator development as a site of collective imagination? The case of the European Commission policies on the Circular Economy.
SCIENTIFIC PAPER: The role of metrics in the governance of the water-energy-food nexus within the European Commission
EC 'HAVE YOUR SAY'': Feedback on Roadmap Ares(2019)7907872 - Circular economy: new action plan to increase recycling and reuse of products in the EU.
VIDEO: What will it take to close the loop?
OUTREACH: Post on Resource Nexus Platform

 

Critique of the Circular Economy

There exists a profound confusion around the conceptual definitions and interpretations of the term circular (bio)economy. The co-existence of diametrically opposite interpretations of the concept indicates lack of a serious discussion of its theoretical foundations. Two narratives on circular bioeconomy are explored in depth: (i) the new economic paradigm based on technological progress (the economics of technological promises) that seeks perpetual economic growth; (ii) an entropic (thermodynamic) narrative that reflects on the limits on economic growth imposed by nature. The latter narrative makes a distinction between primary, secondary and tertiary resource flows and helps to identify what can and cannot be re-circulated within the metabolic pattern of social-ecological systems. Adopting the biophysical view, it becomes clear that the industrial revolution represented a linearization of material and energy flows with the goal to overcome the low pace and density of biological transformations. The required level of productivity of production factors in contemporary developed economies (flows per hour of labor and per hectare of land use) is orders of magnitude larger than the pace and density of supply and sink capacity of natural processes. Relying on nature to ‘close the loop’ will simply slow down the economic process.


Find out more:

VIDEO: Is a circular bioeconomy possible? 
SCIENTIFIC PAPER: On the Circular Bioeconomy and Decoupling: Implications for Sustainable Growth
EC 'HAVE YOUR SAY': Feedback on Roadmap Ares(2019)7907872 - Circular economy: new action plan to increase recycling and reuse of products in the EU

Teams Involved

What does the concept of the Circular Economy mean?

What does the concept of the Circular Economy mean?

Tessa Dunlop

The Circular Economy is attracting increasing attention from researchers, funding agencies, policy makers and industry. The European Union invested EUR 184 million in 2016 alone on green projects, almost half of which were on the Circular Economy. What is so special about the Circular Economy?

The Circular Economy first appeared in waste management policy, referring to the increased recycling of products. The reduction of waste is beneficial to the environment in terms of pollution, emissions reduction and of decreased resource use. An uptick in recycling necessitates the development of new business models, the emergence of different industries that can process waste and recycle products, as well as new markets for these products – this is where the economy part comes in. The Circular Economy has become a vision for resource efficiency, environmental concerns and economic growth. In one of the articles of this issue we ask, can the Circular Economy boost job creation?

The Circular Economy vision has grown beyond the issue of waste management. Given the potential benefits of a circular model for the economy and the environment, what could be achieved by expanding the Circular Economy to include agriculture, energy and other related industries?

There are also important caveats to take into consideration when looking at the policies and framing of circular economy goals. Firstly, it is important to consider how circular the economy actually is, and how circularity can be measured.  Some believe that the percentage of materials that are either reused or recycled is as low as 6% at the global level (Haas et al. 2015). This is because a great proportion of the products we use cannot be recycled, including energy resources and construction materials. For food and biomass to be effectively recycled by humans, our economy would need to depend on slow-moving ecological systems to produce materials we need – including wood, food and the regulation and replenishment of water, soil and gas resources. Furthermore, what are the risks and uncertainties linked to an increase in recycling? Research has shown that the treatment process to recycle many materials often involves the application of substances that are dangerous to human health and the environment.

Taking these issues into account, are circular economy objectives feasible, viable and desirable? We will let you make your own mind up when reviewing our selection of text and multimedia materials in this first edition of the Nexus Times. These include a video and an infographic on the circular economy as well as three articles that aim to shed light on some of the challenges that Circular Economy initiatives face globally.

We hope that you enjoy this inaugural edition, and that it is relevant to your work. Going forward, we will be tackling cutting-edge topics regarding the water-food-energy-land-use nexus including the limitations to the bioeconomy and the paradox of energy efficiency.

Please get in touch if you would like to contribute to The Nexus Times or provide comment on our articles.

» Read "The Nexus Times" Issue I - CIRCULAR ECONOMY (June 2017)

What if Europe had to process its own waste?

What if Europe had to process its own waste?

Tessa Dunlop and Zora Kovacic

A great deal Europe's waste is exported to the Global South, including electronic, chemical and incinerator waste. Despite recent policy action to reduce plastic waste, the EU still plans to export a significant amount of plastic to other countries. But what if  Europe did not export any waste at all?

In the case of plastics, the EU generates a whopping 25.8 million tonnes of plastic waste per year, with packaging making up 40%. Most of this packaging waste (70%) is either incinerated or sent to landfill, with less than 30% collected for recycling. But almost half of the plastic packaging material collected for 'recycling' is sent to third-party countries - the exported plastics are included in the official recycling rate. While plastics packaging cannot be seen as a representative study of other types of exported waste, it is a worthwhile sector to analyse given recent policy announcements by the EU.  The EC is updating its plastic strategy following the announcement by China in late 2017 that it would ban imports of single-use plastics, including from the EU.

So why is collected waste sent far overseas?

Because it is still cheaper to do so than to process it in Europe. Labour costs are higher in Europe, and the high fragmentation of collection and sorting means that high-quality recycling is difficult to perform cheaply at scale. Not to mention a great deal of collected material is of 'poor' quality, meaning that it has been contaminated by food or other substances. Contaminated waste materials are difficult to recycle and require intensive treatment to produce high quality recyclates. Furthermore, the manufacturing processes (injection, extrusion, blow moulding, thermoforming, etc.) can differ significantly depending on the product-specific requirements that define the resistance, weight and aesthetic aspects of the product.

The performance of sorting and recycling varies greatly from country to country, as do the commitment pledges to improve waste recycling and sorting practices. Recycling targets have generated some controversy in the European Parliament, as many of the Eastern European countries are reluctant to face the high costs of recycling given their limited relative contribution to waste generation. Returning to the case of plastic waste, in 2014 five countries generated approximately 70% of Europe's plastic packaging waste – namely Germany, Italy, the UK, France and Spain. Only Germany in 2014 was close to reaching a 55% recycling target. France, on the other hand, has the lowest performance – even though it is responsible for approximately 13% of the total EU generated waste.

So how is the EU responding to China’s ban on plastic waste?

  • The Circular Economy Package aims to increase packaging recycling to 70% by 2025. But this ambitious target may be watered down, especially under pressure from the plastics industry. Plastics Recyclers Europe has commissioned a study showing that a 55% recycling target can be achieved by 2025, or by 65% if extra exports are included.

  • In 2017 the EC also proposed a new plastics package to ensure that all plastic packaging is reusable or recyclable by 2030.  

  • Recycling does not mean that waste is processed. Slovenia for example has one of the highest recycling rates in Europe and also one of the highest waste export rates. The EU imposed legislation to reduce landfilling to less than 10% of waste output by 2030 – which has been a successful strategy in Germany to increase the recycling performance – but risks increasing incineration rates if measures aren't imposed on this practice too. Waste processing methods are not mutually exclusive and may generate trade-offs.  

  • Calls have also been raised to place a tax on single-use plastics, although it is expected to be politically unpopular. Also, this would only tackle one waste stream, ignoring the considerable amount of non-plastic waste generated including construction and energy waste.

While China's import ban is expected to lead to a significant reduction of the extra-EU exports, it is assumed that exports of plastic packaging waste will remain at half their 2014 level (50%)  to countries including Malaysia, Indonesia and Vietnam, according to the Plastics Recyclers Europe study. There is little information about what happens to this waste after it is exported, as it is costly to monitor.

MAGIC diagnosis: waste outsourcing is a question without a straight answer.

Waste in general (not just plastic packaging) is difficult to monitor, measure, keep track of and dispose of. Measurements are more easily available for specific waste streams (such as plastics, electronic equipment, construction waste, food waste) than for total waste. Policies break waste down by each waste stream, and sometimes classify waste by economic activity. As a result, it is difficult to get an overall picture of how much waste is produced and discarded. How relevant is it to focus on plastics? According to a recent report published by the European Commission (European Commission 2018), plastics represent less than 3% of material flows.

Secondly, how should waste be measured? By weight, construction materials contribute to about 35% of total waste in the EU-28 (European Commission 2018), but other factors are also important: e.g. the proper disposal of hazardous substances is needed to avoid health and environmental hazards, and the recovery of rare earth metals may be an important measure against scarcity and price fluctuations. When the quality of materials contained in waste is taken into consideration, measurements may change from relative quantities to chemical properties.

Third, there may be blind spots in waste management. While many initiatives - not least in the Circular Economy Package - deal with recycling, reuse & repair, eco-design, waste prevention and sharing economies, the issue of waste outsourcing is not mentioned. The issue of outsourcing points at the fact that waste management is not just a matter of individual behaviour or recycling methods, but is linked to the way economic activities are organised. The question “What if Europe didn’t export any waste?” requires a complexity-based approach that takes into account the ramifications of economic activities, including the interdependencies with foreign trade. 

References:

Deloitte. 2018. Sustainability Blueprint for plastics packaging waste: Quality sorting & recycling
<http://www.plasticsrecyclers.eu/sites/default/files/PRE_blueprint%20packaging%20waste_Final%20report%202017.pdf>

PlasticsEurope, 2015. Plastics 2015 – An analysis of European plastics production, demand and waste data
<http://ec.europa.eu/environment/circular-economy/pdf/plastics-strategy.pdf>

The World Bank Group, 2012. WHAT A WASTE. A Global Review of Solid Waste Management
<https://siteresources.worldbank.org/INTURBANDEVELOPMENT/Resources/336387-1334852610766/What_a_Waste2012_Final.pdf>

European Union, 2015. Waste Shipment data.
<http://ec.europa.eu/trade/import-and-export-rules/export-from-eu/waste-shipment/>

European Commission, 2018.  Commission Staff Working Document - Measuring progress towards circular economy in the European Union – Key indicators for a monitoring framework.
<http://ec.europa.eu/environment/circular-economy/pdf/monitoring-framework_staff-working-document.pdf>

Can the Circular Economy boost job creation?

Can the Circular Economy boost job creation?

Zora Kovacic

The European Union’s Circular Economy plan needs to push circularity beyond waste management in order to realize its job creation potential.

The meaning of the term ‘Circular Economy’ can be interpreted in two different ways: (1) as an alternative economic strategy that includes the integration of agriculture, energy, and water policy and (2) as a specific policy goal that aims to improve the EU approach to waste management.

1. The first definition of ‘Circular Economy’ looks at the potential to change the way that resources are used within the economy. It involves shifting away from the current linear model in which resources enter and exit the economic process, towards a circular model in which resources are reused repeatedly in the economic process.

As a broader concept, the Circular Economy requires a re-organization of the economic process as a whole. Such an important change could have a significant impact on job creation. However, if the entire economic process is to be reorganized and restructured, how can we measure the potential impact that a Circular Economy would have on job creation? We need a more concrete idea of what a ‘significant’ potential impact could be – significant, because changes would incorporate the whole economy, and potential because we cannot be sure about how the economy will change, adapt, and what challenges may emerge.

2. The second definition of ‘Circular Economy’ applies specifically to the EU’s Circular Economy directive, which amends Directive 2008/98/EC on waste.

One of the main goals of the Circular Economy directive is employment growth. The directive reads: “Taking waste policy further can bring significant benefits: sustainable growth and job creation, reduced greenhouse gas emissions, direct savings linked with better waste management practices, and a better environment”.

Job creation has been on top of the agenda in the wake of the 2008 financial crisis. Can the Circular Economy live up to its promises? Jobs in the waste management sector comprised 1% of employment in the EU28 in 2015 (Eurostat, 2017). According to the Eurostat Database, this 1% includes waste collection, treatment and disposal activities as well as in remediation and other waste management services.

The Circular Economy directive goal to boost jobs creation states that “More than 170,000 direct jobs could be created by 2035, most of them impossible to delocalize outside the EU”. 170,000 jobs equates to a 15% increase in employment in the waste management sector in the next 20 years, which corresponds to a mere 0.1% increase in total employment.

Given these low numbers, it is clear that in order to ensure that the Circular Economy really does boost job creation, the strategy must go beyond the waste management sector.

References:

  • European Commission, 2015. Proposal for a Directive of the European Parliament and of the Council amending Directive 2008/98/EC on waste. Brussels, 2.12.2015
  • Eurostat, 2017. Employment by sex, age and detailed economic activity (from 2008 onwards, NACE Rev. 2 two digit level – 1000.
  • European Union, 2017. Quality report of the European Union Labour Force Survey 2015, 2017 Edition. Luxemburg, Publications Office of the European Union.

Acknowledging risk migration in recycling

Acknowledging risk migration in recycling

Maddalena Ripa

How can science and policy deal with the uncertainty of the potential risks the recycling poses to human health and the environment?

The main idea behind the Circular Economy is that materials are reused for long periods of time; much more than is already the case. In the current system, recycling undergoes a process of downcycling. This means that materials and products are designed to have one single life, so that when they are recycled, they lose valuable properties such as quality and functionality every time they are reused. The problem is that chemicals need to be added to recycled products to improve their quality each time they are reused. This process is polluting, and recycled materials often contain more additives than the original product. It is no surprise then that recycling reduces the quality of the materials, as it is difficult to manufacture the same product again and again.

With plans to recycle more as part of new Circular Economy initiatives, closing the loop on a global scale presents new uncertainties. An increase in recycled products including plastic, paper and cardboard, lubricants and other products can cause unpredictable health and safety problems. This is important when considering that the recycling of products contains toxic chemicals. If waste re-enters the economy as either new products made with recycled materials or as secondary raw materials to be traded, it may create a double exposure to toxic substances.

Take Brominated Flame Retardants (BFRs) as an example. These chemicals are commonly found in furniture and building materials, and are increasingly seen in electronics as metal components become replaced by plastic. BFRs are almost entirely banned in countries across the European Union, as they can lead to health problems such as lower mental, psychomotor and physical development. Nevertheless, they are still persistent on the market. BFRs appear in products imported from countries such as China, where e-waste is on the rise and recycling regulations and policies are less stringent. Plastics recovered from electronics contain PBDEs (Polybrominated diphenyl ethers), one of the most commonly used BFRs. PBDEs generally end up in recycled plastics because these toxic, bio-accumulative and persistent substances cannot be easily separated from plastic waste streams. In addition to direct migration of BFRs from waste materials, there is evidence that higher brominated flame retardants can undergo degradation and de-bromination during waste treatment. In some instances, this may lead to the formation of more toxic and bioavailable compounds. In effect, PBDE would be released into the environment and wildlife, endangering human health, two times during a product lifecycle.

Similar risk migration concerns have been raised for paper recycling. Several studies have demonstrated that paper, cardboard and waste paper potentially contain a significant number of chemicals, some of which have been classified as ‘critical’. This is because they are likely to remain in the solid matrix during paper recycling and end up in new products where their concentration may be even higher when compared to virgin fibre-based products (for example in case of phthalates and phenols). One of the most controversial examples refers to the detection of small quantities of BPS (bisphenol-S) in paper products. These are often made with recycled content such as napkins, flyers, and magazines. Bisphenol A and S are chemical compounds used as strengtheners in polycarbonate plastics, epoxy resins in water pipes, coating on the inside of food and beverage cans and in making thermal paper (used in sales receipts, for example). These compounds are toxic to human health, due to their hormone disrupting properties, and potentially to the environment. The amount of BPA released during recycling can vary widely, depending on the processes used, but recent studies suggest that BPS, like BPA, is transferred from thermal paper that has been recycled and accumulates in the recycled products.

The uncertainties created by the Circular Economy have to be acknowledged both by policy and by science. With regard to policy, the European Commission is issuing new regulations regarding the use and recycling of these toxic compounds. This approach can be seen as a precautionary approach to policy making.

But what is the response and responsibility of the scientific community? One possible answer to this challenge is uncertainty assessment, which Jeroen van der Sluijs is developing together with the Health and Environment Surveillance Committee of the Netherlands Health Council. The purpose of this work is to conduct a quality check in terms of uncertainty on potential side-effects of policy measures in order to alert the authorities to important links between recycling, the environment and human health. The role of science in this case is not only that of producing facts, but also that of communicating uncertainty.

From the MAGIC Nexus Project we will keep investigating how governance in the context of uncertainty leads to the emergence of new roles for science and for policy.

References

  • Arnika Association, 2015. Toxic Toy or Toxic Waste: Recycling POPs into New Products. Summary for Decision-Makers Brominated flame retardants from electronic waste are present in plastic children’s toys.
  • ChemTrust, 2017. No Brainer: The impact of chemicals on children’s brain development: a cause for concern and a need for action.
  • JRC-IHCP, 2010. European Union Risk Assessment Report. Environment Addendum of April 2008. 4,4’-Isopropylidenediphenol (Bisphenol-A). Part 1 Environment.
  • Leslie HA, Leonards PE, Brandsma SH, de Boer J, Jonkers N. Propelling plastics into the circular economy – weeding out the toxics first. Environ Int; 2016: 94: 230-4.
  • Pivnenko K, Eriksson E, Astrup TF. Waste paper for recycling: Overview and identification of potentially critical substances. Waste Manag; 2015: 45: 134-42.
  • Puype F, Samsonek J, Knoop J, Egelkraut-Holtus M, Ortlieb M. Evidence of waste electrical and electronic equipment (WEEE) relevant substances in polymeric food-contact articles sold on the European market. Food Addit Contam Part A Chem Anal Control Expo Risk Assess; 2015: 32(3): 410-26.

What type of complexities are involved in circularity?

What type of complexities are involved in circularity?

Luis Zamarioli

Circularity means different things in physics, biology and economics. But what do different narratives imply for European policy?

Closing the loop’ is the European Commission’s slogan for promoting the Circular Economy agenda. The choice encapsulates the idea that in order to improve certain economic and environmental standards, Europe must transition from an open-ended and linear economy to a closed one. From physics and biology, we learn that closed systems are never perfectly isolated, or really closed. This is because they lose energy to surrounding systems in thermodynamic processes and also mutually communicate and influence each other in biological autopoietic systems. The economy also can never be entirely closed. Matter will always change and lose functionality internally, energy will be lost at varying degrees and a ‘Circular Economy’ will always communicate, shape and be shaped by other economies through trade. Based on these considerations, this article looks at why a circular economy could not realistically aim to be considered as a static state, but rather as an aspirational process to be monitored, managed and improved.

Our current economy is still largely based on a linear get-change-consume-discard approach. If this linearity continues unchanged, we risk exhausting Earth’s limited resources with too much ‘getting’, and we compromise the availability of other resources through our current rate of discarding. A circular economy attempts to close that system, bringing the two loose ends together – of ‘get’ and ‘discard’. But does the Circular Economy mean that just any circularity would suffice? The answer is no. Simply transforming the economy into a circular one would not immediately improve efficiency and reduce resource use and waste. For example, if the energy necessary for transforming a material that has been disposed of is higher than obtaining a raw material, we must question whether this is a desirable solution. Also, does that process produce more pollution, such as in the form of liquid residues or CO2 into the atmosphere, contributing to climate change? This questioning brings us to the conclusion that even within circularity, some less energy intensive and less polluting processes are preferred over others.

A useful concept borrowed from waste management to address this issue is the ‘waste hierarchy’. The hierarchy states that processes that require less energy and less new material in order to maintain the cycle should be prioritized over others which involve high energy and material loss. That is to say that if we reduce the amount of waste we produce, through better design and packaging, the system will be more efficient than if we choose to reuse discarded materials. When comparing reuse with recycling however, reusing a material requires less energy than putting it through a recycling process that makes it a relatively new product again. Another step further down the hierarchy, recycling is more efficient than recovering materials by transforming them into something else, such as energy production through incineration. At the bottom end of the hierarchy, disposal is the least efficient, since it removes the possibility of closing the system.

Looking more broadly outside internal circularity processes, a circular economy also behaves as a biological autopoietic system due to constant communication and exchanges, continuously shaping and being shaped by other systems. In economic terms, this means that even if it were functioning according to the highest internal standards and efficiency, a singular economy will never be entirely isolated from other systems. The exchanges it makes with others will impact the system itself and will also affect other systems, mutually and continuously. Economically, this could mean that by reducing Europe’s raw materials usage, the costs of such inputs would potentially drop globally, creating an incentive for other markets to raise their consumption and resource-intensity. As a significant importer, such increases would mean that imported products would come with higher aggregated resource-intensity, raising the relative levels of materials and energy that Europeans absorb on the consumption side. This could happen even if Europe’s own production moves away from such unsustainable business types.

References

  • Loiseau, E., Saikku, L., Antikainen, R., Droste, N., Hansjurgens, B., Pitkanen, K., and Thomsen, M. (2016). Green economy and related concepts: An overview. Journal of Cleaner Production, 139, 361–371.
  • Maturana, H. R., & Varela, F. J. (1980). Autopoesis and Cognition. The Realization of the Living. (R. S. Cohen & M. W. Wartofsky, Eds.), Boston Studies in the Philosophy of Science (Vol. 42). London, Dordrecht, Boston: D. Reidel Publishing Company.
  • O’Hara, P. A. (2009). Political economy of climate change, ecological destruction and uneven development. Ecological Economics, 69(2), 223–234.

Infographic: Measuring circularity

VIDEO: What will it take to 'Close the Loop?'

01 June 2017

The circular economy: A new efficiency paradox?

28 September 2017

The circular economy: A new efficiency paradox?

Tessa Dunlop

Proponents of the circular economy call for actions to be 'eco-effective': but is this another efficiency paradox?

The goal to create a Circular Economy has gained traction in recent years with calls from both government and civil society to ‘close the loop’. The European Union has pledged over EUR 6 billion as part of its Circular Economy Package and various NGOs around the world have championed the cause. Broadly speaking, the circular economy aims to increase environmental sustainability and spur economic growth through greater resource efficiency in the recycling and reuse of products. The idea is to decrease environmentally intensive primary production in favor of lower-impact secondary production whilst creating less waste, or ‘output’. Some are distancing the objective of circular economy away from the concept of efficiency in the traditional sense (the ratio of useful output to total input, for example the amount of coal used to power a steam engine), and replacing it with the idea of eco-effectiveness. According to the Ellen MacArthur Foundation, the idea behind eco-effectiveness is to transform products and their associated material flows such that they “form a supportive relationship with ecological systems and future economic growth” in a cyclical way such that materials can “accumulate intelligence over time (upcycling)” as opposed to simply trying to minimize the linear flow of materials that characterizes our current consume and throw-away culture. But is this perspective really that different to the objectives that underpin efficiency? Whether considering efficiency in relation to energy generation, or eco-effectiveness as applied to product manufacturing and consumption, both terms imply a reduction of resource inputs into the economic system, because natural resources are finite. And what if, like the paradox of efficiency, a circular economy could perversely lead to an increase in product demand, and thus more primary production and resource extraction?

Zink and Geyer (2017) have introduced the term ‘circular economy rebound effect’ to describe a phenomenon whereby increases in production or consumption efficiency are offset by increased levels of production and consumption. They have criticized the fact that circular economy proponents focus too much on the engineering aspects of the circular economy and not enough on its complex economic effects. In other words, they question whether a circular economy would reduce or displace primary production, or even if it might increase it.

While there is a solid body of research that measures the environmental impacts of recycling and repair activities, there is little known about the impact that these practices have on primary material and product production. This is in large part due to the complexity and difficulties in measuring the economic interactions between the primary and secondary goods markets, which are expected to become more competitive in a circular economy. Zink and Geyer (2017) argue that there is evidence pointing to the existence of circular economy rebound effects that could erase any gains in product recycling or reuse by increasing market demand for products. Take, for example, the income effect when lower-price recycled goods enter the market. Wholesalers often sell lower-grade quality recycled or reused products such as recycled paper or plastic at a discount to higher quality first-use goods. When purchasers perceive themselves as wealthier because they are able to buy more for less, they can purchase more material and use it to make more products than before. The excess wealth may be spent elsewhere, with unpredictable results.

One can also conceive of unexpected consequences of circular economy actions on a larger scale, explain Zink and Geyer (2017). An increase in recycling could, for instance, prompt consumers to purchase more disposable products under the belief that they are reducing their environmental impact. Wealthy consumers may sell their second-hand phones to subsidize their purchase of more expensive first-hand phones, thereby increasing demand and primary production. This effect may be fueled by an increase of secondary phone buyers, for example in poorer countries, who did not previously have an option to buy a phone. And how might a shift towards reuse and repair occupations effect the macroeconomy, including  employment levels, affluence, immigration and consumption patterns?, query Zink and Geyer (2017). What if cheaper recycled products become less cool? (And thus less valued than their harder-to-come-by primary production alternatives?)

This is not to say that the circular economy will necessarily lead to increased primary production. Many initiatives can reduce negative environmental effects if products truly substitute primary production alternatives and they do not create perverse market incentives to consume more new products. The point is that there is currently not enough research to say definitively whether circular economy initiatives will displace and/or reduce primary production. Thus one must critically examine the credentials of circular economy initiatives in their claims to increase ‘eco-effectiveness’.   

 

References

Welch, D., Keller, M. and Mandich, G. 2017. Imagined futures of everyday life in the circular economy. Interactions. Vol. 24, Number 2.

Zink, T. and Geyer, R. 2017. Circular Economy Rebound. Journal of Industrial Ecology. Vol 21, Number 3.

Ellen MacArthur Foundation: https://www.ellenmacarthurfoundation.org/circular-economy/interactive-diagram/efficiency-vs-effectiveness

European Union: https://ec.europa.eu/commission/priorities/jobs-growth-and-investment/towards-circular-economy_en