What is a Circular Economy?
December 15, 2022

What is a Circular Economy?

Discover why a circular economy is the future of economic growth and how it can help us create a brighter, more sustainable future.

What is a circular economy? 

In essence, the goal of a circular economy is to 'ensure we can unmake everything we make' - The Ministry of Environment.

A circular economy is a restorative and regenerative economic system by design. It aims to keep products, components and materials at their highest utility and value at all times, eliminating the concept of waste and drastically reducing the use of unused raw materials. It also works to optimise resource yields and eliminate the use of toxic chemicals. The circular economy is a model that works towards a more sustainable future by creating a system of closed-loop production that reduces the waste and environmental impact of economic activity.

Sourced from: https://commons.wikimedia.org/wiki/File:The_Circular_Economy_concept.png

What is a linear economy?

"Today’s economy is massively wasteful. Most of the materials we use, we lose, the things we make are consistently under-utilised, and our efforts to fix it treat the symptoms, not the cause." - Andrew Morlet, an expert on the circular economy

Before going any further, it is first essential to understand the traditional or linear economy. A linear economy is an economic system that follows a "take, make, dispose of" model. A high level of consumption and extraction of raw materials and a high rate of waste production characterises it. In a linear economy, resources are used only once and then disposed of rather than recycled or reused. This type of economy is unsustainable and can lead to environmental degradation and depletion of natural resources.

Sourced from: https://environment.govt.nz/what-government-is-doing/areas-of-work/waste/ohanga-amiomio-circular-economy/

What are circular economy principles? 

Circular economy principles are guidelines and goals that promote sustainability by encouraging resource reuse, repair, and recycling. These principles aim to close the production and consumption loop and reduce the waste created by traditional linear economic models. Principles include:

Design Out Waste and Pollution: Design products that minimise or eliminate waste and pollution at the source. 

Keep Products and Materials in Use: Maximise the use of existing products and materials for as long as possible through repair, reuse, remanufacturing and recycling. 

Regenerate Natural Systems: Restore biodiversity and regenerate natural systems. 

Share and Reuse Resources: Encourage the sharing of products, materials, and services, and consider reuse and rental approaches instead of ownership. 

Shift to Renewable Energy: Create a clean energy system powered by renewable energy. 

Create Sustainable Business Models: Develop new business models that promote sustainable consumption and production. 

Transparency and Accountability: Increase transparency in the production, use, and disposal of products, and ensure accountability for the entire lifecycle of products and materials.

Enhance Product Design: Design products and materials for future use, repair, remanufacturing, and recycling. 

Foster Collaboration: Foster collaboration between government, industry and citizens to create sustainable solutions.

What are the 5 Rs of a circular economy?

  1. Rethink: Consider the environmental implications of the products and services you use. Look for ways to use fewer resources, reduce waste, and increase efficiency. 
  2. Refuse: Refuse products and services that require excessive use of resources, generate a lot of waste, or have little value. 
  3. Reduce: Reduce your consumption of resources and your waste output by making smarter choices about the products and services you use. 
  4. Reuse: Look for ways to reuse products and materials rather than throwing them away. This includes repairing items and finding creative ways to use them in new ways. 
  5. Recycle: When you can't reuse something, recycle it. This includes repurposing materials or sending them to a recycling facility.

Circular economy examples

Refurbished Electronics: Refurbished electronics are products that have been used and then repaired and tested for quality. This allows the product to be used again instead of needing to be replaced with a new one.

Recycling: Recycling is one of the most common circular economy examples. This involves collecting materials such as paper, plastic, glass, and metals and sending them to a facility where they are sorted and processed into new products. 

Renewable Energy: Renewable energy, such as solar or wind power, can produce electricity. This is a circular economy example as it uses natural resources that are not depleted and can be used repeatedly. 

Composting: Composting is a process that turns organic materials such as food scraps and yard waste into compost, which can then be used as a soil amendment or fertiliser. 

Upcycling: Upcycling involves taking used materials and transforming them into higher quality or value. For example, an old dresser can be upcycled into a bookshelf.

The circular economy benefits

Reduced Waste: Circular economies reduce waste by designing products that are intended to be recycled, reused, or repaired. This helps to reduce the number of resources used and the amount of waste produced. 

Lower Cost: Circular economies reduce the cost of production by minimising waste, using fewer resources, and increasing efficiency. This makes the cost of goods more affordable for consumers. 

Reduced Pollution: Circular economies reduce pollution by recycling materials, reusing resources, and using renewable energy sources. This helps to decrease emissions and protect the environment. 

Job Creation: Circular economies create jobs by encouraging businesses to invest in recycling and reuse programs. These programs create new jobs and help to stimulate the economy. 

Increased Innovation: Circular economies encourage businesses to become more innovative in their designs and production processes. This helps to create new products and services that meet changing consumer needs.

Improved Sustainability: Circular economies reduce resource consumption and the associated environmental impacts. By encouraging the reuse, repair, and sharing of resources, a circular economy significantly reduces the need to extract and produce new materials. In turn, this results in reduced energy and water consumption and carbon emissions. 

Increased Manufacturing Efficiency: Circular systems enable businesses to become more efficient and productive by closing the loop on materials. This involves reducing waste and increasing the reuse of resources, allowing companies to lower their costs and improve their bottom line.

Best circular economy products

Reusable straws: Reusable straws are an excellent example of a circular economy product. They can be reused for a long time, eliminating the need for single-use plastics. 

Recycled clothing: Recycled clothing is made from materials that have been donated or upcycled. These materials are often much more sustainable than traditional materials and can help reduce waste. 

Solar panels: Solar panels produce renewable energy, which can be used to power homes and businesses without relying on non-renewable sources. 

Compostable packaging: Compostable packaging is made from materials such as bioplastics and cardboard that bacteria and other microorganisms can easily break down. This helps to reduce the amount of waste that is sent to landfills. 

Refillable containers: Refillable containers are a great way to reduce the amount of packaging waste that is created. These containers can be used repeatedly, eliminating the need for single-use containers.

In Summary,

The circular economy is an innovative way of thinking about producing and consuming goods. It is a powerful concept that could drastically reduce environmental impacts and create a more sustainable future. It is not a new idea but a way of viewing the world differently. By utilising existing resources more efficiently and eliminating waste, the circular economy has the potential to revolutionise the way our society operates and create a more sustainable future.