Circular Economy (CE) has become a hot topic. A new ISO Technical Committee, ISO TC323, will now seek to standardise the terms and measurement indicators for CE, and its four Working Groups have started drafting text for new standards. From 2.-0 LCA consultants, we are taking active part in this international standardisation work, as we have previously done for Life Cycle Assessment (LCA).

One of the topics that are now debated is the relationship between LCA and CE. This month, the UNEP Life Cycle Initiative published a position paper on this topic.

The position paper reminds us that Circular Economy (CE) originally was a concept coined by Pearce & Turner (1990) as an economy where wastes are recycled into resources, either through a technological feedback mechanism or through a natural ecosystem feedback mechanism, so that the stock of resources is constant or increasing over time. In other words, a circular economy is a sustainable economy. However, in the current interpretations and implementations of CE strategies, a narrower view is sometimes taken, focussing on specific physical resources, assuming that these resources are the most valuable area of protection, ignoring other resources or impacts. 

LCA has the intention to avoid burden shifting between different life cycle stages or between different resources or impacts. It can therefore be argued that LCA applied to CE strategies should be able to prevent CE strategies from overlooking potential upstream and downstream impacts, and looking beyond specific resources to a more holistic assessment of the biophysical, social and economic effects of a decision.

However, also LCA is often applied with a too narrow perspective, and the position paper highlights a number of preconditions for LCA to play the desired role:

• Consistent accounting for changes in stocks of resources respecting mass balance principles.
• Consistent modelling of open recycling loops.
• The inclusion of all relevant resources and impacts, i.e. a full economy-wide Life Cycle Sustainability Assessment perspective.
• Transparency of assumptions, reliability of data, and critical interpretation of results and trade-offs between a globally agreed numbers of impact categories, e.g. through valuation, as suggested in ISO 14008.

For both LCA and CE, it may be more economical to circle back to the original intentions and definitions, than to spiral down blind alleys of simplified interpretations and applications.

References

Pearce D W, Turner P K. (1990). The economics of natural resources and the environment. Hemel Hempstead: Harvester Wheatsheaf London 378 pp.

Claudia Peña C, Civit B, Gallego-Schmid A , Druckman A, Caldeira- Pires A , Weidema B, Mieras E , Wang F , Fava J , Milà i Canals L , Cordella M, Arbuckle P, Valdivia S, Fallaha S , Motta W (2020). Using Life Cycle Assessment to achieve a circular economy. Position Paper of the Life Cycle Initiative, July https://lca-net.com/p/3925

At the core of the circular economy concept we find the closing of material cycles through recycling of by-products and wastes (what some people call the “End-of-Life”, see also my earlier blog-post). Recycling is also a topic that has been investigated widely in Life Cycle Assessment (LCA), but here it has turned out to be one of the most difficult areas in which to ensure correct information and to avoid greenwashing. Many seek to use recycling as an argument for avoiding responsibility for environmental impacts. So I thought it might be time to summarize some of the problems we have encountered in our LCA practice, and in this way also inform the circular economy discussion on how to tackle the allocation of responsibility and credits for recycling.

In a situation where all the material for recycling is fully utilised:

• We have seen unfortunate examples where producers seek to wipe off part of their environmental impacts on a high-value by-product, using allocation methods in violation of the ISO standards on LCA, instead of taking responsibility for how their by-products are being treated. An example is where the meat industry seeks to make their meat products look better by allocating part of the meat production impacts to the leather industry – an industry that cannot influence the meat production because there is less supply of hides than what is needed to meet the demand (a situation that is observable from marginal purchasers of leather products needing to accept synthetic alternatives). Instead, meat producers with an ISO-compliant life cycle approach take responsibility for their hides, and to choose the least environmentally impacting processing route, thus stimulating improvements in the leather industry – improvements that are much more difficult for the leather industry when left alone and even burdened on top with “responsibilities” for agricultural activities over which they have no influence.
• We have seen examples where producers seek to take credit for the imaginary benefits of recycling a fully utilised waste material that would anyway have been recycled, compare their recycled products to virgin products, and spending their efforts on competing for the already fully utilised waste material. Instead, producers that follow an ISO-compliant life cycle approach take credit for the actual expected benefits that their recycling activities provide as services to the producers of the waste, and spend their efforts on competing for making the largest benefits from the recycling activity itself.

In a situation where the material for recycling is not fully utilised, i.e. where surplus materials are being disposed of in e.g. a landfill or stockpile, the options and incentives for greenwashing are smaller because here the users of the surplus materials indeed should take credit for removing materials from the landfill or stockpile, thus reducing environmental impacts. The largest errors we see are when suppliers of the surplus materials seek to take credit for the recycling benefits of that part of the material that is being utilised, when in fact the extent of this recycling is determined by the demand for the surplus material and therefore cannot be influenced by the material suppliers.

So, in conclusion, true circular responsibility is when producers take responsibility for how their by-products and wastes are treated, and avoid taking credit for non-existing recycling benefits.

At the end of 2015, the European Commission adopted a Circular Economy Package (European Commission 2015). The intention is to move away from current linear business models (make-use-discard) to a future of circular business models (reduce, reuse, remake, recycle). "Closing the loop" is the objective for the next decades.

The concept of a Circular Economy (CE) is that of maintaining the value of products as much as possible within the economic sphere. Therefore, a lot of attention is on the last stages of the economic processes, i.e. the treatment of waste. Re-use and recycling should gradually phase out landfills and incinerators. At the same time, the residues, which inevitably leave the economic sphere, should be harmless for the environment.

The implementation of a CE is seen as a challenge that will reshape our economies, affecting positively the entire society, from the economy to the social sphere, from the environment to the human wellbeing.

All these objectives can be considered absolutely noble, doubtless. However, some considerations are necessary.

First of all, I think we need to focus on the final aims of the new circular economies. Do we want to eliminate the greenhouse gases emissions? Do we want to reduce the use of land? Do we want to reduce the impact on biodiversity? Do we want to phase out poverty? Etc.

Then, we have to plan the best way to reach our goals.

I’m sure that with adoption of CE principles there would be improvements for the environment and, in general, for the economy with respect to the current situation. Yet, we could put all our attention on some predetermined aspects while excluding some others that could be of equal, or even more, importance. A CE may not necessarily be a dematerialised economy and a focus on recycling may distract from improvements in material efficiency or prevention of by-products generation.

Therefore, how sure are we that a CE is the best way to fulfil all our goals?

Here the LCA community comes into play. LCA is now a mature tool for analysing the environmental impact of anthropogenic processes. LCA has a wider perspective where all the phases of a product life cycle are scrutinized. Searching for crucial hotspots and the comparison of alternative pathways is the daily job of an LCA practitioner.

We therefore welcome the EU Action Plan for the Circular Economy and the political visions for a more sustainable future stipulated in the new EU-legislature. But we encourage the LCA community to contribute to the implementation of CEs, because our knowledge and expertise is needed, now more than ever.

Reference:
European Commission (2015). Press-release: Closing the loop: Commission adopts ambitious new Circular Economy Package to boost competitiveness, create jobs and generate sustainable growth, dec 2. 2015: http://europa.eu/rapid/press-release_IP-15-6203_en.htm