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Circular Economy

A 2°C economy must be circular and cities will play a central role in the transition as motors of the global economy. In the coming decades, cities will be increasingly important due to the expected greater urbanisation rates and the significant infrastructure investments and developments needed. Cities are aggregators of materials and nutrients, accounting for 75% of natural resource consumption, 50% of global waste production, and 60- 80% of greenhouse gas emissions [1].

The linear ‘take-make-dispose’ model is leading to economic losses as a result of structure waste and negative environmental impacts. In response to a linear economy, the circular approach aims to decouple growth from finite resource consumption and is restorative and regenerative by design.

In European cities, a major challenge is to expand circularity beyond traditional resource recovery in waste and water sectors and to provide systemic solutions able to be demonstrated and replicated effectively elsewhere. Yet, circular economy requires a different way of thinking and investing resources in the traceability of materials and products and for this reason, it is not easy to mainstream this approach in the daily practice and management of cities. There are key specific features to be considered when addressing circular transitions in cities [2]:

  • When focus on a specific value chain, it is necessary to support the entire ecosystem and not only the production itself, including activities like storage, distribution, retail activities, etc. This represents a significant burden for local authorities as cities have a very limited control and influence along the process and the chain to product design. This value-chain perspective is especially relevant when addressing food or materials consumed in cities, as most of the emissions arise outside the city, such as from farmlands or industrial areas. Surprisingly, cities climate targets generally do not include emissions from materials, calling for urgent solutions to address these emissions effectively.
  • It requires availability of data and constant traceability of products, materials, stocks, flows and impacts.
  • Financing the transition often relies on public funding because the initial investment is too high or because many associated activities are not profitable yet or at all. For example, to treat municipal solid waste (MSW), cities do not have the adequate infrastructure and are relying on obsolete treatment plants. In some cases, the technology already exists but it is either not available yet to local authorities at commercial scale or competing standards make it difficult to choose the right solution.
  • There are also regulatory barriers, often linked to the size of local industries. Large industries might require approval from the national government (taking lot of time) while SMEs might not have enough capacity to take such initiatives.
  • Stakeholder engagement and behavioural change: engaging with multiple stakeholders is key for the circulation transition, including citizens and “triple helix” stakeholders. Especially at the start of a new initiative campaigning and incentives are needed, to align individual agendas.
  • Governance: the circular transition requires social and organisational innovations.

On the other hand, there are a number of factors that uniquely position cities to drive the global transition towards the circular economy and greatly benefit from the outcomes of such a transition [3]:

  • Proximity of people and materials in the urban environment: Reverse logistics and material collection cycles can be more efficient due to the geographical proximity of users and producers and can create new business models. The proximity and concentration of people enables also sharing and reuse models.
  • Sufficient scale for effective markets due to the presence of both a large and varied supply of materials, and a high potential market demand for the goods and services derived from them.
  • The ability of city governments to shape urban planning and policy. Local governments have a large and direct influence on urban planning, the design of mobility systems, urban infrastructure, local business development, municipal taxation, and the local job market. Furthermore, it is expected that on a global scale, 60% of the buildings that will exist in 2050 are yet to be built [4]. Since these investments will largely need to be made in cities, it presents a massive opportunity for local governments to use their influence to apply circular economy principles.
  • Digital revolution with technologies like asset tagging, geo-spatial information, big data management, or widespread connectivity. Digital technology has the potential to identify the challenges of material flows in cities, outline the key areas of structural waste, and inform more effective decision-making on how to address these challenges and provide systemic solutions.

NetZeroCities has mapped a total of 32 Circular Economy solutions, encompassing 24 technical solutions (described in this section) and 8 instruments (described in Section 2.8).Technical solutions have been grouped in different categories and sub-categories depending on the type of resource. Thus, four main categories have been defined (Waste, Water, Energy and Food), together with different sub-categories to cover the wide range of resources related to the circular economy:

WASTE CATEGORY

There are three main elements for the integrated and sustainable waste management in a city:

  • Waste collection, usually driven by a commitment of authorities to protect and improve public health and environment conditions,
  • Waste disposal, driven by the need to decrease the adverse environmental impacts of solid waste management; and
  • Waste prevention, reuse, recycling and recovery of valuable resources from organic wastes, driven by both the resource value of waste and by wider considerations of sustainable resource management.

Successful interventions, represented by the previous three physical elements, need to be supported by governance in terms of inclusivity (both for users and providers), financial sustainability and proactive policies. Next, the different waste subcategories are described, including specific strategies and solutions for their efficient management.

Municipal solid waste (MSW) is one of the key areas of municipal environmental policy and is also the item on which town councils spend most resources. In fact, European cities are mostly promoting circular economy in this sector of solid waste and recycling. Among the measures available, it can be cited the Municipal Solid Waste (MSW) separation at source within district level that can be implemented for example by means of the pay-as-you-throw (PAYT) solution. PAYT system is an economic instrument based on incentives which enable the real production of waste in each home or business to be calculated, and the tax is determined by the amount and type of waste that is thrown away. Thus, pay-as-you- throw systems promote waste prevention and recycling and enable the 'polluter pays' principle to be applied. In Europe, the most common model is pay-per-bin, followed by the chamber system especially in densely populated areas. This scheme is common in German cities, such as Dresden, Heidelberg, Hamburg, Berlin, Freiburg and Düsseldorf.

On the other hand, the anaerobic digestion of the organic fraction of MSW (and the co-digestion with other organic waste fractions) is a common process implemented throughout the world as it offers a sustainable source of biogas while valorising municipal waste. Anaerobic digestion also produces digestate, a nutrient-dense mixture that can be used by farmers as a high-quality fertilizer.

Textiles are one of the key circular sectors in Europe. For this waste, different measures based on urban recovery and processing techniques, or waste to feedstock optimization can promote circular textiles in cities. For example, the Amsterdam Pilot, which is being implemented within the Reflow Project will increase the recycling percentage of home textiles, through redesigning diverse methods for collection with citizens, while providing feedstock for the recycling industries. Another example is city of Jätehuolto (LSJH), which is planning a processing plant for all of Finland's post-consumer waste textiles in the Topinpuisto circular economy centre. The facility will enable the recycling of post-consumer textiles, converting them into recycle fibre.

Figure 1: Circular textiles conceptual view

A variety of new technologies are being developed in response to European legislation and market forces that aim to recover critical raw materials (CRM) from end-of-life appliances. These diverse resource recovery processes are often regrouped under the concept of “urban mining”, which considers cities’ waste streams as economically important reserves of metals needed for digital and low-carbon technologies. At European level, The Urban Mine Platform displays all readily available data on products put on the market, stocks, composition and waste flows for (1) waste electrical and electronic equipment (WEEE) and (2) vehicles and batteries, for all EU 28 Member States plus Switzerland and Norway [5].

  • Recycling WEEE has been gaining increasing attention as a potentially economically important source of critical elements. Recycling WEEE avoids the environmental impact of landfilling hazardous materials while also reducing the need for primary extraction of critical materials, and the significant environmental damage extraction causes. Moreover, the EU is currently dependent on imports to supply much of its required CRM and harvesting from waste stocks, thus helps mitigate the risk that supply could be disrupted.
  • On the other hand, the transition to a low-carbon economy will lead to an exponential increase in the demand for batteries and related raw materials (such as lithium, cobalt, nickel and manganese). From a circular point of view, recycling and recovery of battery raw materials are not enough, and innovations based on materials substitution, materials and products redesign can change materials requirements substantially. The Digital Battery passport is a digital twin of a physical battery and basically will be a sustainability certificate that contains all applicable information on environmental, social, governance, and life-cycle requirements involving all actors in the battery value chain [6].

Plastics are among the key sectors identified in the EU Circular Economy Action Plan. The need for solutions that promote circularity in this sector will be increasing as their consumption is expected to double in the coming 20 years [7] . Plastic Waste Management, which refers to the prevention, reuse, recycle, recovery and disposal of plastics, is crucial to achieve circular plastics in Europe. Another alternative measure to promote circularity is expanding the use of bio-based and compostable materials.

Current recycling rates in Europe are only about 10% as current practice is not set up to facilitate the production of secondary plastics [8]. An influx of new materials is required to replace plastics that are lost and to compensate for downgrading of quality. Mixing and downgrading effects are causing serious problems, making a large share of used plastics literally worthless. Although current plastic recycling is very low, recent studies have shown that 56% of plastics could be mechanically recycled [8].

Figure 2: Plastics life cycle [9]

Packaging is the main value chain in European plastic industry and represents 40% of the total plastic uses. In order to reduce the demand of (over)packaging waste and promote circularity, several measures can be implemented: (i) Production of materials from renewable raw materials that can be used as packaging materials, (ii) Decrease the material amount, for example by using thinner multilayer structures, (iii) Replace multilayer structures by mono-materials, (iv) Recycling of packages and packaging materials, which is affected by package design and the materials used in the packaging and which is widely linked to waste management and collection systems and (v) use the recycled packaging materials in the production new materials. The final target would be fully recyclable packaging, which is based on renewable raw materials.

The construction sector is responsible for over 35% of the EU’s total waste generation [10]. Material use for buildings can decrease by 30% by means of more efficient measures including:

  • Material efficiency building designs: Eliminating waste from building designs may appear trivial yet entails the massive potential for emissions reductions as construction projects often use more materials than is needed. For example, it is often possible to achieve the same structural strength using only 50–60% of the cement currently being used. Urban mining model to assess circular construction opportunities and optimize resource use and exchange and Circular Life Cycle Cost (C-LCC) for deep renovation can be two solutions to promote material efficiency.
  • Reduce construction waste. Up to 40% of urban solid waste is construction and demolition waste, and Europe currently landfills 54% of this waste. The use of the Residual Value Calculator for construction parts/material (as part of business model/value chain) can reduce material demand and waste generation.
  • Recycled building materials. This is perhaps the most well-known way to decrease the emissions from new material production. However, to scale materials recycling, it is necessary to design materials and products for disassembly and high-value recycling already from the start. This is vital to ensure that they can be used as inputs for new products when they reach their end-of-life. Among the measures to promote the recycling of building materials it can be cited: (1) the optimal management of waste at the end of building life cycle, (2) the reuse of local building waste (e.g. local waste material bank), (3) Online register with building and infrastructure material/parts/products for reuse/circular use or (4) the Building material passport (defined within the Instrument category).
  • Sharing business models. Sharing business models could increase the utilisation of existing buildings and thus reduce the need for new office space to be built. In the circular economy, service-based business models, such as sharing, can increase the utilisation of underused buildings, spaces, and construction components. For example, in London, peer-to-peer renting, better urban planning, office sharing, repurposed buildings, and multi-purposed buildings increase the value of new buildings and can double the utilisation of 20% of the city’s buildings in 2036, saving over GBP 600 million annually.
  • Prolonging the lifetime of buildings is a way to reduce the amount of new material and thereby the associated emissions. A structure built traditionally has an expected technical lifespan of 50–100 years, but usually, after 20–30 years, it is not economically valuable. Demolition is often the go-to solution. In the circular economy, the economic value of a building is maintained by extending its ‘functional’ lifespan. Cities can stimulate longevity in buildings through modular, flexible, and durable designs. Modular design typically reuses 80% of the components in a building’s exterior so that it can stand for 100 years or more, coupling modularity with durability. Such design approaches also ensure a building can be adapted to changing user needs and offer easier maintenance and renovations.

WATER CATEGORY

Under a circular economy approach, the full value of the urban water is recognized and captured as a service, an input to processes, a source of energy and a carrier of nutrients and other materials. The European Union (EU) is threatened by serious water shortages. One third of EU territory is already experiencing water stress, posing threats to agriculture, the environment and drinking water. Extending the lifecycle of water resources is essential in a time when water shortages and droughts becoming more intense and frequent and affect a greater number of people. Different circular solutions have been identified in function of the location or scale within city boundaries:

ENERGY CATEGORY

Circularity can be centred on two overarching principles:

  • Energy efficiency to maximize product use. For example, it can be cited the industrial symbiosis for facilitating cross-sectoral energy and material exchange.
  • Energy generation, including the recovery of by-products and waste. For example, the production of biofuel based on black liquor from the paper industry. At building level, bio-waste can be treated for biogas production. Finally, the “Contingent approach” guarantees the energy saving/production. This solution is based on GIS data of buildings and supports the upscaling of renovation solutions by identifying the specific buildings, within the building stock, where a previously successfully applied solution can be repeated. For municipalities, this can be an instrument to plan and operationalize energy transition plans.

FOOD CATEGORY

While the food value chain is responsible for significant resource and environmental pressures, an estimated 20% of the total food produced is lost or wasted in the EU. Therefore, in line with the Sustainable Development Goals and as part of the review of Directive 2008/98/EC38 referred to in section 4.1, the Commission will propose a target on food waste reduction, as a key action under the forthcoming EU Farm-to-Fork Strategy, which will address comprehensively the food value chain.

To design and implement circular food cities it is important to first assess food-related flows going into and leaving the city. Urban Metabolism Mapping can help to better understand these flows. Another important step towards circular flows in the food industry is the implementation of regenerative agriculture practices. Also, in order to reduce losses, it is necessary to know how the waste is generated, either food waste or human waste. Valuable nutrients and chemicals can be extracted and then used as fertilizers, plastic, chemical or textile feedstock, food compounds, or for animal feed.

Finally, in order to encompass the full value chain of producing food for human consumption, it is necessary to find and use alternative protein sources. While alternative proteins are studied, the easiest shift in the consumers' diet is to exchange meat with fish intake. Nevertheless, this higher consumption must be done avoiding overfishing and improving the current catching processes: fish by-catch and discards account for approx. 30% of the total world capture fisheries, which translates into approximately 30 M of tons of the available resources, not utilized for human food products.

References:

[1] UNEP, Resource Efficiency as Key Issue in the New Urban Agenda, http://www.unep.org/ietc/sites/unep.org.ietc/files/Key%20messages%20RE%20Habitat%20III_en.pdf

[2] NetZeroCities: Deliverable 13.1: Report on city needs, drivers and barriers towards climate neutrality

[3] Ellen MacArthur Foundation 2017. Cities in the Circular Economy: an initial exploration

[4] NRDC-ASCI, Constructing Change (2012)

[5] http://www.urbanmineplatform.eu/homepage

[6] https://www.globalbattery.org/battery-passport/

[7] https://ec.europa.eu/environment/circular-economy/pdf/new_circular_economy_action_plan.pdf

[8] Material Economics, 2018, “The Circular Economy - A Powerful Force for Climate Mitigation.”

[9] Woldemar d’Ambrières, « Plastics recycling worldwide: current overview and desirable changes », Field Actions Science Reports, Special Issue 19 | 2019, 12-21

[10] Eurostat data for 2016

 

LIST OF CIRCULAR ECONOMY SOLUTIONS IN NetZeroCities:

WASTE CATEGORY

Municipal solid waste (MSW):

Textiles:

Electronics and ICT:

Batteries and vehicles:

Plastics:

Packaging:

Construction and buildings:

Other waste:

 

WATER CATEGORY

 

ENERGY CATEGORY

 

FOOD CATEGORY

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CommunicationLeadershipInfrastructureEmploymentResilience goalsAwareness RaisingCommunity engagementEntrepreneurshipAnalytics and modellingData accessDigital solutionsMeasure and assess impactAir qualityBiodiversityBuildings and constructionCarbon CaptureCircular economyClimate resilienceGreen hydrogenHeating and coolingIndustryLand-useNature-based solutionsRenewable energyTransport and mobilityWasteWater