Circular Economy? Not so fast.
As a burgeoning paradigm to address environmental and resource efficiency, going Circular makes sense. Yet, there are some challenges Circularity has to address before it moves forward.
On a quest to find the solution to a problem, it is quite rare that we ever find the solution straight away. Instead, we often oscillate, and bounce between difference ideas, methodologies and philosophies in order to make sense of and execute the outcomes that we want. This process is what we might call a “Dialectic”, and it is not only desirable, but necessary in the process of discovery. This process of trial-and-error happens in science, engineering, literature, sports, but also in sustainability. In the space of circular economy, I believe this is especially true. Circular economy is a field of sustainability which attempts to address the issues of our modern linear economy and endless extraction of resources to bring society back into sustainable limits - however it is a very young field, and with youth often comes naivety and recklessness. To help circular economy (as a sustainable design principle), overcome its youth and eventually mature, I want to give it some advice. I’ve crafted three different points of advice for circular economy principles to improve upon the current paradigm and evolve it into something more pragmatic and realistic.
1. Recycling Is Energy Intensive
The first layer of critique is that if you want to make an economy modelled off of recycling your wastes, you need to make sure you have the energy extraction to back it up. This comes from the idea that, almost all of the time, to convert a waste back into a useable resource, you require an exogeneous energy input into the system. To recycle plastic, we need to shred it, melt it and form it and so on. If we want to constantly be cycling the atoms in our economy so that wastes are not produced, we are required to use energy to spur on that cycling process. There are two considerations associated with the energy used for this process.
We first need to make sure that we have energy leftover to produce more energy in the future so that our energy capture is sustainable. That means that we can’t just allocate all the energy we have now to recycling, but towards producing more things which can capture more energy, because our energy capture technologies will eventually degrade. This might involve setting aside surplus energy to make new solar panels in the future for example.
Second, we need to make sure that the energy we are using to recycle gives us a reasonable Energy Return on Investment (EROI) so that we can afford to have surplus energy in the first place to dedicate to making new energy capture for the future and cycling atoms within the economic system. This involves, at whatever rate of circularity you want, making sure that the renewable energies you use are able to self-perpetuate (are autopoietic), just like fossil fuels can, and not only that, but able to support a whole circular economy in the process.
2. Repurposing at Scale is Intrinsically Costly
One alternative to the recycling model of circular economy is that we can increase circularity by repurposing, reusing and repairing wastes etc., slowing down the rate of waste generation. This is indeed one way to increase circularity. The more we repurpose stuff, the less new production is required to replace the things we need. Buying second-hand is a good example, as I am placing less demand on the production of a new product, meaning there is less incentive to produce new things, decreasing the rate of extraction and waste. On the surface, this seems like “the green dream”. We get a slower materials economy leading to less externalities generated, yet our utility-based economy stays relatively stable. In other words, there would be a move towards decoupling. Yet is this actually feasible?
To look at this we need to examine the relationship between repurposing and replacement methodologies and the associated incentive structures between them. Say for example, that I break a chair. The obvious thing to do in the modern economy is to buy a new one or replace it. In this replacement process, there is a supply chain associated with the chair I am buying, and that supply chain makes the chair the in the exact same way every single time. The reason manufacturers do this is because they can use the exact same machinery, labor and equipment and method of production, i.e., capital investment, to mass produce more chairs than an artisan in the 1700’s would ever think possible. This method of standardized production, introduced by Henry Ford in the early 1900’s created an Economies of Scale advantage, so much that it would outcompete every other product on the market. This would eventually result in most markets being dominated by Fordism (Ford’s standardization methodology), leading to a market system where you were at a significant disadvantage if you were not mass-producing your product.
Next let’s look at repurposing. If instead of buying a newly manufactured chair I look to buy a chair that has broken and been repaired. If I do this, I will not be buying the chair from a large firm using machinery to repair chairs. Instead, I would likely be buying from someone on Facebook marketplace who wanted to make a buck or two. Why is this? Because resources often waste in a variety of different ways. My chair could have broken by a rusty nail, rotting wood, or stitching falling apart, or a combination of any or all of these. If I want to make an industrial system based off of repurposing, repairing and reusing, I need to have different machinery and methodology for each of these failure states, for all possible chairs - in which case the capital investment would be ludicrously large that it would be cheaper to just repair them by hand.
There is in fact, a Diseconomies of Scale for repurposing and reinsertion into a supply network. And so, we can’t repair by hand because it would not be able to keep up with neither the supply of broken chairs being produced, nor the demand for chairs from the market - making them negligible for waste mitigation, expensive, and vulnerable to being outcompeted in the market by firms who do not repurpose. We can see here that repurposing is, intrinsically, at a game theoretic disadvantage when competing with replacing - and we can’t expect it to be incentivized under current market conditions.
I’ll be fair though, as there are some conditions where this model does not apply. For one, things that have wasted in a utility sense, rather than a material sense, e.g., used clothing which hasn’t broken or degraded, but the previous owner didn’t want anymore (this is why thrift shops are still in business). Another exception is resources which can only waste in one particular way. If you know ahead of time how the resource is going to waste, you can set up manufacturing systems at scale which can standardize the repairing or repurposing process.
So, in summary the second piece of advice is, whatever system you design, you need to make sure that your solution can outcompete the current dynamics of the system you are trying to change.
3. Focus on Waste not Resources
Whilst I don’t think this is an inaccuracy on the part of circular economists, I believe that the messaging opens them up to being dismissed more than they should; what I mean is that the branding for Circular Economy often stresses the importance of reducing resource extraction so that we don’t run out of resources. This isn’t wrong. Since the Limits to Growth model was released in 1972, it has been made clear that economic growth in a finite materials economy cannot happen indefinitely. However, since that model was released, it was misconstrued as providing concrete predictions for resource collapse in the future, and when that did not happen, any critique like it has been largely ignored. This opens questions about resource constraints up to dismissal, e.g., Elon Musk saying resources are becoming more abundant on Bill Maher.
Whilst Elon’s criticisms are simplistic and arguably based on a techno-optimism, they are based in some truth at least. Resources, at present, are not a pressing issue, and isn’t the main reason to transition to a circular economy. The main planetary stressor is waste. Whilst we are extracting resources, we are also generating and dumping waste at unprecedented rates. This waste production leads to heavy metal pollution, microplastics, respiratory and waterborne diseases, biodiversity collapse, GHG emissions, legacy pollution, and large-scale economic costs. These types of externalities are arguably, more immediate, and easier to communicate the urgency of.
Final Comments
I’ve outlined here, some advice by which Circular Economy as a paradigm can continue to evolve through a dialectical process. This can hopefully spur a more pragmatic and systematic way of analyzing the material conditions, incentive structures and messaging of circular economy in the broad context of the modern linear economy. Where the true value of circular economy lies, I think is in conjunction with what we call Nature-based Solutions (NbS). As circular economy is a design principle based off of Biomimicry of ecosystem material flows, Circular Economy, along with NbS can become a powerful team towards a decoupled economy, and a regenerative relationship between nature, people and the economy that mediates the two. But that’s for another time!