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Circular Economy is More Than Recycling

06/30/2022 | Adina Renee Adler

In a recent op-ed for The Hill, we argued that the principles of Circular Economy are essential to advancing the United States’ national security interests because they help to alleviate tight supply of critical minerals that otherwise can only be obtained through virgin extraction. This is but one element of the broader concept of Circular Economy that supports American manufacturing and facilitates the clean energy transition. While recycling is an important tool, the reality is that it is only one of the ways that Circular Economy can contribute to a net-zero future. Below, we are taking a closer look at some of the other ways that Circular Economy can lead to better environmental outcomes through: the 3 Rs (reduce, reuse, recycle), eco-design, material substitution, reverse supply chains, zero waste, and renewable energy use and resource conservation.

The 3 Rs

Reduce. Reuse. Recycle. When the average consumer thinks about resource management, these three words still loom large — and for good reason. By reducing our overall consumption of new goods and materials — either by cutting back on consumption or reusing pre-existing goods — we relieve stress on environmental extraction and cut down on dangerous pollution.

On the “reuse” front, commentators have continued to debate so-called “right-to-repair” policies — i.e. legislation designed to allow consumers to repair and modify their own consumer products independently of producers. Unfortunately, the issue is not cut and dry. In reality, there are both pros and cons to allowing the average consumer to have the ability to repair a phone or swap out the battery. But from a strictly environmental perspective, these efforts do help extend the lifespan of electronics, helping to reduce stress on the environment in the long run. Indeed, the benefits of reuse extend beyond electronics to a wide range of products that we use in everyday life, from clothing to vehicles to furniture.

For the purposes of Circular Economy, the third “R” — recycling — is perhaps the most important for building a sustainable future.

In everyday life, it is encouraging to see that recycling has become a more integrated part of consumer behavior. In airports, we see travelers filling their own reusable water bottles — or refilling plastic ones recently purchased — and on the internet, you are almost guaranteed to see ads for apparel and other consumer goods made with recycled materials. Taken together, these efforts to prolong the use of existing goods — and therefore the incorporated materials — relieve environmental stress caused by mining, landfilling, increased water use, and the like.

At the same time, recycling has filtered unevenly throughout consumer behavior. How many of us simply trade in our bought-as-new iPhone for a brand new model rather than purchase a refurbished — albeit slightly older — model?  If this is you, do not feel guilty: the market for second-hand electronics is quite robust, especially in the United States. But despite the value of recycling consumer electronics, this type of recycling receives relatively little attention from the average consumer, especially compared to the recycling of materials like plastic or paper.

To be sure, we still have a long way to go toward building systems that optimize the potential of reused and recycled materials. For instance, some groups point to the inefficiency of our existing systems for managing recycled plastic as evidence that recycling per se is not important. Yet this perspective overlooks the thousands of facilities — in the United States and around the world — that responsibly recycle materials ranging from metals to paper to plastics to rubber, electronics to textiles to glass. At the end of the day, recycling is still a core Circular Economy tool.

Eco-Design

Recycling on its own will not be enough to achieve a net-zero future. Looking ahead, it is absolutely critical that producers design the goods of the future with sustainability in mind — specifically by incorporating mechanisms to manage that good at the end of its original use into its design. This principle, known as “eco-design,” encourages producers to create goods that are easy to dismantle, using components and materials that are easy to segregate and which can easily be reused or recycled to create the next generation of technology. These eco-designed goods can also incorporate recycled content in their fabrication to reduce or eliminate the need to mine virgin commodities.

Eco-designed goods need not be inferior to goods made from virgin materials — a common misperception about these goods. For example, Dell has adopted a closed loop manufacturing process which allows its line of high-performance laptops to be made from recycled materials. Meanwhile, Nestle uses fully recyclable bottles that are made from 100% recycled content. Although the recycling process may degrade certain plastics and types of paper, smart eco-designs avoid these lower value materials whenever possible, resulting in products that are just as viable as those made from virgin materials.

Some manufacturers lament the lack of adequate supply of recycled materials — particularly of recycled plastics — as a major impediment to the widespread adoption of eco-design. Certainly the economics of plastics recycling remains a major challenge given the high cost of producing recycled plastics compared to the relatively lower cost of producing virgin plastics.  But it is important to understand that recycling is like any other manufacturing process: goods are produced for a customer, and more customers means more incentive to produce a given good. Increasing demand for recycled commodities through eco-design will spur more recycling and thus increase the availability of the recycled commodity input in the long run.

Material Substitution

Increasingly, manufacturers are producing goods using more environmentally and socially conscious materials in an effort to cut down on waste and facilitate reuse and recycling. Next-generation electric vehicle batteries are becoming rare earth-free and cobalt-free. The use of paper straw is growing exponentially. And, at last, Amazon’s padded mailers are now fully recyclable.

Although there are economic and practical challenges associated with transitioning to more environmentally-friendly materials — as well as materials sourced from socially-responsible chains based in friendly economies governed by the rule of law — these are not insurmountable challenges. As consumers increasingly look to the private sector to help them meet their sustainability goals, making the switch to environmentally- and socially-conscious goods is becoming all the more important.

And where challenges persist, producers have a prime opportunity to continue innovating. All the materials that producers currently use exist because someone discovered their unique qualities to make products more viable — and more cost effective — than what came before. The same is increasingly true for sustainable products, with significant advances in the quality and durability of goods made from more sustainable materials.

In the meantime, producers can use lifecycle and economic analyses to find ways to transition away from the most environmentally-harmful materials. Materials that use less water, degrade more quickly, are easily reusable and may even have better performance should always be considered as a replacement.

Reverse Supply Chains

To reduce our reliance on landfills as a primary disposal solution, we need to be able to easily transfer end-of-life goods and materials to manufacturing centers that can recycle, dismantle, reuse, or refurbish them. To accomplish that, we need to continue to build out our basic collection infrastructure — and continue to educate the public about the real benefits of recycling. In tandem with that effort, we need to continue investing in human and transportation resources to move collected products to a collection point, such as an original equipment manufacturer or its contractor. These materials can also be transported to materials recovery facilities that separate materials and direct each to the appropriate recycling companies, which in turn can process materials to the spec of a product manufacturer.

Ultimately, there are not many goods that can be made entirely in one country using materials that have been made or sourced in that same country — meaning that supply chains often straddle national borders. The same must be true of reverse supply chains. With this fact in mind, governments must have the proper trade agreements and international treaties in place to facilitate efficient, international reverse supply chains. This should start with the World Customs Organization, which could develop new harmonized tariff codes to distinguish secondary raw materials from waste (a topic which we will write more about in our next blog). But it will also require a critical look at tariff and non-tariff barriers, regulatory requirements and other considerations that affect the competitiveness of reverse supply chains as compared to forward global value chains.

Unfortunately, even as support for the principles of Circular Economy continues to grow, the legislative framework to support the implementation of these principles is eroding. For instance, the European Union and China have both put forward visions of self-sufficient Circular Economies, and the Basel Convention on the Control of Transboundary Movements of Hazardous Waste is currently moving forward with plans to implement burdensome regulations that will stifle the reuse and recycling of certain nonhazardous goods and materials.

Zero Waste

There are many other ways to reduce consumption across the board — including policies to eliminate the use of non-sustainably made goods or to divert used goods away from landfill.  This concept — known as “zero waste” — is a foundation element of Circular Economy, and communities across the United States are setting zero waste goals that aim not only to reduce landfilling but also to boost recycling rates. In the private sector, corporations are adding waste-free or waste-reduction commitments to their operations, and around the world, nations are implementing waste-free strategies that sometimes also incorporate waste-to-energy solutions.

Renewable Energy Use and Resource Conservation

Circular Economy encapsulates renewable energy usage and resources conservation across the manufacturing value chain. As the authors of a recent paper in European Business Review argue, “Emulat[ing] the natural producers, circular economy promotes production and consumption of sustainable and greener energy instead of burning non-renewable fossil fuels.”  That includes producing the clean energy technology itself and ensuring that technology can be reused, refurbished, or recycled at the end of its initial use.

As governments implement policies to accelerate the clean energy transition, they must also have policies in place to manage green technologies at the end of their lifespans. The recycling know-how to craft these policies exists — but not yet at scale. The International Renewable Energy Agency, for instance, estimates that about 10 million tons of photovoltaic solar panels will be decommissioned this year — and that number will rise to more than 70 million tons by 2050. The recycling of wind turbine blade recycling is growing, allowing thousands of blades — as much as 5,700 in Europe by 2030, according to some estimates — to be recycled. These processes will need to continue to grow to accommodate the expanding of green technologies.

The production of these technologies also requires a range of critical and essential materials. Recycling old materials can make them available as new inputs for manufacturing, thus realizing the dual benefits of material resource efficiency and cleaner energy usage within Circular Economy.  Indeed, the National Renewable Energy Laboratory (NREL) recently studied “underutilized” Circular Economy strategies beyond recycling that can “mitigate demand for starting materials and reduce waste and environmental impacts,” including material use reduction, product reuse and incorporating recycled content.

Ultimately, Circular Economy will succeed in driving positive environmental outcomes when it is supported by a policy framework that includes the following:

  • Leveraged public-private funding to fast-track R&D for recycling, material substitution and eco-design;
  • New harmonized tariff codes for secondary materials; and
  • Trade agreements that facilitate transboundary reverse supply chains, such as common definitions of eco-goods, harmonized eco-design and resource material standards along with mutually recognized conformity assessments, traceability platforms to enhance supply chain transparency and other considerations to improve competitiveness.
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