No Circular Economy Without a New Metric

As a resource management tool, the circular economy is yet to reach its potential. Although innovators and startups are keen to develop new circular business models, it seems consumers and established companies are still unsure or risk-averse as they tread lightly to scale up towards mainstream adoption.

The circular economy is called 'circular' because the underlying function is based on a returns system. Whether that be the vast array of promising reusable items all the way through to every product and clothes manufactured And this returns system includes reprocessing end-of-use cycle materials for re-entry into the supply chain.

"While it’s still important to recycle and build better systems for it, more recycling will not solve plastic pollution or our overconsumption and waste problems. We all know the iconic image of the chasing arrows in a triangle: Reduce, Reuse, Recycle...But somewhere along the way, we forgot that the first two R’s - reduce and reuse - are more important than recycling for the environment. Unfortunately over the last 40 years, we’ve put most of our time, energy and resources into recycling because frankly, it’s the easiest. And it doesn’t threaten the throw-away, disposable paradigm that corporations have built their business models and supply chains around." (Source: Upstream)

While I agree with almost everything my colleagues at Upstream write, here is our dilemma. A fair amount of product-use-cycle-extension business models rely on the consumer surrendering ownership in preference for take-back schemes so the manufacturer can promote second, third or even fourth use-cycles and, ultimately, ensure the product's material value can be realised at the end of the final use-cycle. It is a behaviour most consumers are not yet comfortable with or used to. Furthermore, we dispose of end-of-use-cycle products in the name of 'recycling' for the wrong reasons. The original narrative was to 'save the environment', an endeavour we have clearly failed at.

For the whole of human history, we have not valued primary raw materials, the natural capital of every country. The new narrative must be resource management and to achieve this goal we must transition to a new metric. In addition, aligning resource management with the circular economy will provide greater clarity for many people who do not truly understand the value of circularity.

Where Did Recycling Come From?

Reusing materials has been a common practice for most of human history with records as far back as Plato in the fourth century BC. During periods when resources were scarce, archaeological studies of ancient waste dumps show less household waste (such as ash, broken tools, and pottery), implying that more waste was recycled in place of new material. However, archaeological artefacts made from recyclable material, such as glass or metal, may neither be the original object nor resemble it, with the consequence that a successful ancient recycling economy can become invisible when recycling is synonymous with re-melting rather than reuse.

The first documented recycling data comes from Japan in 1031 CE. The Japanese imperial court ordered the collection and recycling of used paper, marking a significant milestone in recycling history. This initiative aimed to conserve resources and reduce waste, setting a precedent for future recycling efforts.

The Japanese approach to recycling paper involved repurposing used materials to create new paper products. Therefore, this early example of recycling had a profound impact, conserving natural resources and fostering a culture of sustainability and innovation.

What Are Recycling Rates?

The recycling rate is one of the most widely used indicators for monitoring progress in waste recycling and resource-saving activities. Basically, the recycling rate is calculated as the proportional value (%) of waste recycled from the total waste generated. An increase in this indicator usually means that the progress is being made in recycling activities. However, many countries define and calculate the recycling rate in many different ways.

Recycling rates take many forms and levels of waste recovered, such as recovery rate, collection rate, diversion rate, and cyclic use rate. Such diverse definitions and lack of standardized measurements for the recycling rate often require careful treating of the recycling rate value to avoid incorrect or confusing comparison and interpretation. In the Asian context, disparities in defining the recycling rate are even more pronounced. This is mainly because of the prevalent presence of informal recycling sector in Asia, which often go unrecorded.

Below is a graph showing the countries with the highest global recycling rates.

Like many other developed countries, the EU exports a huge amount of its waste. Türkiye is the largest destination for waste exported from the EU, with a volume of around 14.7 million tonnes in 2021 - more than three times as much as in 2004 and almost half of the total exports of waste.

So What Happens to the Waste Exported to Türkiye?

Türkiye is already one of the largest importers of waste from Europe. In 2022, for example, Türkiye accounted for 39% of Europe’s waste exports, which included around 400,000 tonnes of plastic. This waste has serious consequences for the environment and human health. A Greenpeace report published in 2022 found that toxins released from Türkiye's plastic waste end up in the fruit and vegetables produced in the Çukurova valley, one of the most fertile valleys in the world.

The lie of recycling statistics has been going on for decades. Countries, politicians and recycling companies have been maintaining the benefits of recycling for environmental reasons until China implemented, its now infamous Sword Policy (January 2018) which exposed the recycling lie. This exposure was an opportunity for countries to begin to take responsibilty for their own waste, however, as we all know exporting waste and emissions proved just a little too easy for everyone. It seems we liked the 'lie'.

Resource Scarcity Equally Urgent Alongside CO2 Emissions

Pressure on resources is continuing, with a growing demand for natural resources coupled with a drive towards reducing dependency on potentially unreliable countries. Global material extraction, i.e. the extraction of natural resources such as biomass, metals, fossil fuels, non-metallic minerals and so on, continues to increase worldwide. The amount is expected to double between 2015 and 2060 and to reach 190 billion tonnes. As more evidence is generated about the condition of the environment and the pressures on it, its limits are also becoming clearer.

The potential of half of the ecosystems to deliver ‘services’ has already decreased significantly and the trend is continuing. About 54% of the demand for the so-called 'regulating ecosystem services' is insecure (i.e. climate, water, and disease regulation, as well as pollination) and cultural services (i.e. educational, aesthetic, and heritage values as well as recreation and tourism) are affected.

Increasing Pressure on the Manufacturing Industry

Resource scarcity will continue to cause critical and, to a certain extent, irreversible environmental damage. But it will also impact the economy by causing market prices to rise. Among manufacturing companies, those with high energy and material requirements will especially feel the effects of resource scarcity on their operational costs.

In order to remain competitive on the global market, it is becoming increasingly important for companies manage resources responsibly and sustainably, choosing to use alternative energy sources and renewable materials.

By strategically integrating sustainable, future-oriented approaches and technologies into their production, industrial companies can make use of natural resources in a more efficient manner. From procurement to production, from distribution to disposal and recycling – there is room for improved resource efficiency at every stage of industry.

By optimising process sequences and material flow, it is possible to lower costs for resources such as energy and water, while at the same time reducing material waste and the volume of rejected parts. Smart factories and the Industrial Internet of Things enable companies to establish highly efficient production processes that use real-time data to optimize resource use.

Furthermore, innovation in the field of product design and the development of alternative materials are helping to alleviate competition for limited resources and generate added value both commercially and ecologically.

Conclusion

All of the solutions mentioned in the paragraphs above are occuring simultaneously around the world. From startups to innovators, from techies to established companies and consulting firms, resource management is now, slowly, gaining traction. New materials and technologies are being developed and implemented to further reduce emissions and make companies far more resource efficient. Governments are stepping up regulations around the world and waste management companies are improving weaknesses in collection and reprocessing systems even though off-take markets are still slow to bridge the gap between supply and demand.

All this activity may sound well and good except we require a far more robust metric for reprocessing rates that actually provides genuine and worthwhile information. Every single stakeholder (consumers - companies - governments) must know how much contaminated and uncontaminated end-of-use-cycle materials are being collected, reprocessed and disposed of.

Finally, we have absolutely no clue as to how much primary raw materials are being or can be displaced by secondary raw materials. We are unable to link biodiversity loss with resource extraction to a much more granular number. The data gaps and inadequacies generated by dysfunctional recycling statistics can no longer continue.

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This is the last newsletter for 2024. See you again in January 2025!

Ms Adrienna Zsakay is the Founder and CEO of Circular Economy Asia Inc., and this article represents her opinions on the circular economy. Circular Economy Pick of the Week is brought to you by Circular World™ Media — a brand owned by Circular Economy Asia Inc.

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References

'Why we can’t recycle our way to a sustainable future' published by Upstream.

'Recycling' - Wikipedia

'The First Recycling Data in the World: A Journey Through History' published by Arco Recycling, 12 July 2024

'Recycling rate and target setting: challenges for standardized measurement' by Yasuhiko Hotta, Chettiyappan Visvanathan and Michikazu Kojima, published in Journal of Material Cycles and Waste Management, 18 February 2015

'Turkey’s plan to recycle more has made life hard for its informal waste pickers' by Tulin Dzhengiz, Lecturer in Sustainability, Manchester Metropolitan University, published in The Conversation, 08 October 2024

'Global Megatrends Shaping the Future of Production: Scarcity of Resources' published by Kuka