The Circular Economy: A Quick Guide
Article originally posted on Medium.
The term Circular Economy has exploded in popularity the past number of years. So what is it, what does it involve, and what is the potential impact of it? Today I’ll answer these questions and give an overview of its massive potential as a tool to accelerate a transition to a carbon neutral economy.
The concept of a Circular Economy emerged in the early 1990s and incorporated different features and contributions from a variety of economic and environmental concepts, including for example Cradle to Cradle. The concept has been further formalised over the years by a number of people and groups. Recently, The Ellen MacArthur Foundation and Circle-Economy have popularised the concept, providing resources for industry, and partnering and implementing circular practices with a range of multinational businesses. They provide best practice guidelines along with case studies of practical implementations with the goal of accelerating the transition to a Circular Economy.
The current economic consumption patterns could be described as linear and simplified as ‘take, make, use and dispose’.
The Circular Economy refashions this pattern and has three basic principles:
1. Design-out waste and pollution.
2. Keep resources in use.
3. Regenerate natural systems.
Image courtesy of the Ellen MacAurthur Foundation
The core idea is to avoid waste generation and pollution by clever design. Viewing waste as a design flaw, we can design-out up to 80% of waste, build in reparability and ensure when a product reaches end of life its resources stay in the Circular Economy for further use. There is a strong emphasis on reuse, repair, and refurbish. By keeping resources in use, we extend their useful life and minimise the need for the extraction of new materials. This supports the third principle of the Circular Economy by avoiding the use of non-renewable resources, thereby preserving or enhancing natural systems. In essence, it is a closed loop system from design and production right through to use and end of life recovery.
Slowly the term Circular Economy has made it into the business and government lexicon. It has been mentioned in recent government press releases and has featured in climate policy. In Europe, it is viewed as key tool in transitioning towards a carbon neutral economy with the EU publishing The New Circular Economy Action Plan which sets out a number of measures and actions in seven key areas. At the moment this action plan is voluntary setting out a clear vision of a Circular Economy in Europe.
Business interests are typically driven by cost reduction or increased revenues. Rarely, a business decision involves environmental impact. Through resource efficiencies, the Circular Economy is estimated to produce cost savings of $630 billion for complex medium live products, and $700 billion for fast-moving consumer goods all while reducing environmental impact. However, this requires a shift in business models and practices. Take the example of Dublin Bikes: a yearly fees grants you access to the bicycle, but not ownership (access vs ownership). The bicycles are professionally maintained and repaired thereby increasing the bicycle’s lifespan while providing a reliable service to customers (reuse). By rethinking current business practices and embracing the Circular Economy we can realise these cost savings all while reducing our environmental impact.
At zerowaste.ie, we promote a transition towards zero waste based upon the underlying principles of the Circular Economy. We are currently developing a deposit-return system, Rezero, for reusable food containers to reduce and eventually eliminate single use take away food packaging.
You can keep up to date with David and his team on any of their platforms @zerowaste.ie or follow their journey on the LaunchBox accelerator on #LaunchBox20.