What is the circular economy?
Humanity is at a crossroads. The current environmental, social and economic situation lead us to rethink the need to adopt a series of changes in our way of thinking and living, and also in the ways of producing and consuming. It seems that the time for the circular economy has arrived. But what is it and what exactly does it entail?
There are various theories and concepts, different models regarding what the circular economy is, how it can be put into practice and where it can lead us. And, although several firm steps are already being taken within the framework of this new model (LCBA is a good example of this).
The objective of this article is to show what the circular economy is, why putting it into operation is a necessity and what would be, broadly speaking, the stages of this new structure of the economic model.
The concept of circularity
To offer a broad and simple definition of the circular economy, it could be said that it is an economic system (a model or a strategy) that aims to reduce consumption and waste of resources as much as possible by applying reuse, repair and recycling processes, among others.
It is based on principles from the school of industrial ecology and goes through “closing the loops” of industrial flows and lengthening the life cycles of products, since resources are limited and our current model inevitably leads to collapse.
Understanding this circular economic model is easier if we understand that the model we come from can be classified as linear: raw materials and manufactured products (and the energy involved) follow a path that passes through the extraction / production, consumption / use and waste / disposal phases. The motto would be “produce, use and throw away.”
Sustainability is the great workhorse; Is a sustainable circular economy possible? Criticisms focus on the cost-benefit ratio, on the one hand, and the impossibility of going to the extreme without fundamentally altering our way of life. Technological innovation will play a central role in this movement so that it does not become a simple regression.
Benefits of the circular economy
In any case, it does not seem likely that there will be a plan B, and it is not necessary to arrive at a “pure” system to begin to see the benefits of the circular economy:
- The most immediate of the benefits is that reducing consumption would reduce dependence on raw materials and energy in many economic sectors, improving security of supply (and prices).
- In a context of growing pollution, overconsumption and rising inequality, the impact of a “change of chip” on people’s well-being and health (physical and mental) would undoubtedly have a positive effect.
- The environmental impact (the first advantage for some, collateral for others) is not trivial. Most of the “pre-circular” processes involve a very high ecological cost, with repercussions (global warming aside) that are difficult to predict in many areas.
- Innovation would be boosted by the need to seek more efficient solutions, and competitiveness would also be stimulated, resulting in more efficient economic processes from a global point of view.
- The management of waste and its reintroduction into the production cycle would generate (it is already being seen) new business opportunities and new economic sectors (and labour niches).
- Both the savings of final consumers and their differential participation on a small scale in this new economy would make it possible to improve the quality of life in a generalized way.
Thus, the benefits cover fields as varied as productivity, climate change, savings or health. All of them have in common being concerns of the first order in this first half of the 21st century.
The stages of the circular economy
The theoretical model of the circular economy is expressed graphically with a circle. But that circle would have different forms depending on which sources are consulted; in this infographic you can see the one from the European Parliament Studies Service. And it could have several phases or stages, which we present below.
- Share. This is “phase 0”, and the recurrent theme would be to move “from ownership to use” of products, goods and services. Sharing practices lead to a huge optimization of resource and energy consumption.
- Repair. That is to say, fixing damaged goods, a traditional practice that programmed obsolescence has cornered and that is making a comeback (including the famous “right to repair” defended by the EU).
- Re-use. Nor should this stage be underestimated, on the contrary: in the reuse of goods (with the use for which they were conceived or for any other) lies the key to reducing the generation of waste.
- Remanufacture. It consists of returning damaged goods to the manufacturer, who can give them a second life with reused, repaired or new parts. Electronic products are the paradigmatic example, but it is quite a challenge.
- Recycle. We are familiar with the resurrection of certain materials (paper / cardboard, glass, certain plastics), but there is room for improvement, from the moment of triage to technological optimization contributions.
And with this would the circle be closed? From a practical perspective, there would always be a margin both for the extraction of new resources and for the generation of some wastes; But if these phases are put into operation at full capacity, it will be possible to see very substantial changes in our economic, social and environmental model.
A path of no return
The energy, production and consumption transition towards the new circular paradigm can be more or less abrupt, more or less fast, more or less efficient or more or less attractive in terms of competitive advantages; but what seems certain is that it will be inevitable.
For this reason, LCBA Argentina, Brazil, Chile and Colombia strongly supports and supports the implementation of new low-carbon and circular technologies in the four markets in which it operates, favouring this energy transition.
If you are a European provider of this type of technology or a company with a project related to the circular and low-carbon economy in Argentina, Brazil, Chile and Colombia, request your participation, and you will be able to benefit from numerous advantages. Learn more details here.
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