The circular economy train is leaving. Is your company ready?
Every now and then a new study emphasizes that taking care of the environment and the fight against climate change is everyone’s business: individuals, public entities and private companies. There are no clear limits on which responsibilities belong to which sphere, but what is clear is that we are all in the same boat.
Governments are constantly stressing the need for and advantages of the circular economy. Many have already embarked on this journey: the train to a sustainable future is about to leave. Haven’t you packed your company’s bags yet?
First stop: an overview
- By 2030, the world’s population will exceed 8 billion people and middle-class consumers will number about 2.8 billion. By 2030, the world’s population will exceed 8 billion people and middle-class consumers will be about 2.8 billion. By 2030, energy demand will increase by 50 per cent, water demand by 40 per cent and food demand by 50 per cent.
- According to the United Nations, by 2030 75% of the world’s population will live in cities, with the associated energy requirements and waste management.
- Over the past 40 years, annual material extraction has tripled and total resource demand is estimated to reach 130 billion tons by 2050, compared to 50 billion in 2014.
- Growing in this way is unsustainable, which is why the Paris Agreement has set a target of reducing greenhouse gas emissions by 40% by 2030 compared to 1990 levels.
The same agreement underlines the need for a 32% increase in the share of final consumption of energy from renewables, compared to current levels of around 17%.
Second stop: the end of the linear economy or how to stop thinking about waste and transform it into resources.
- The EU disposes of around 600 million tonnes of waste each year, with a very uneven recycling rate per country: it reaches 80% in some countries, while in others it is below 5%.
- The aim of the Europe 2020 Strategy is to achieve much higher levels of recycling and to minimise the extraction of natural resources. Proper waste management is a key element for the sustainable growth of European economies.
- 2,503 million tonnes is the total waste generated in 2014 in the EU, a sad milestone year. The proportion of this waste by country is proportional to its population density and the volume of economies. Construction contributed 34.7% of the total, followed by extractive activities (28.2%), manufacturing (10.2%), water and waste services (9.1%) and housing (8.3%). The remaining 9.5% corresponded to waste from other economic activities, mainly services (3.9%) and energy (3.7%).
- Almost half (47.4%) of the waste treated in the EU in 2014 underwent disposal operations other than incineration (landfill). Slightly more than one tenth (10.2%) of the waste treated in the EU was destined for landfill operations, while the remaining part was sent to incineration, both with and without energy recovery (4.7%) (1.5%).
Third stop: financing to enter (and grow) the circular economy
- 5.5 billion is currently earmarked for the European Structural and Investment Funds (EIE Funds) for waste management.
- EUR 3.4 billion is the allocation between 2014 and 2020 of the EU’s LIFE programme, an instrument for developing actions against climate change.
- A total of €2.1 billion has been invested over the last five years for projects related to the circular economy by the Circular Economy Financial Support Platform.
Fourth stop: objectives for a future circular economy
- At least 55% of municipal waste must be recycled by 2025, according to EU targets. The figure rises to 60% in 2030 and 65% in 2035.
- Recycling should reach 65% of packaging waste by 2025 and 70% by 2030.
- Added to this is a binding target to limit the landfilling of municipal waste in landfills to 10% of the total by 2035.
Last stop: A growing market
- The global market for eco-industries, with a volume of one trillion euros, will double in size in the next 10 years, according to the 7th EAP – the Union’s General Programme of Action on the Environment until 2020.
- The WFP underlines the need to devote at least 20% of the EU budget between 2014 and 2020 to reducing and adapting to climate change.
- A study carried out by the Commission in 2012 estimated that effective implementation of EU waste legislation would result in savings of €72 billion per year, an increase of €42 billion in the annual turnover of the European waste management and recycling sector, and the creation of more than 400,000 new jobs by 2020.
We have compiled some data on the present and future outlook for the environmentally friendly economy. In view of all of them we can confirm that this is the only viable and lasting way to grow. We are facing a train that could be an opportunity to stop climate change, understanding that it is a matter that concerns us all.
Cover image: Mathew Schwartz