Read this first: Simon Michaux on Why the Green transition and the Circular Economy Cannot Work As Advertised

Context

The concept of the circular economy is based on the idea that products can be reused, and after reuse the materials can be reclaimed to enter again into the system of production.

If all materials could be reused in this way, further extraction of raw materials would be needed only where more goods were in use. The concept thus aligns with the aim of long term sustainability, even where raw materials are becoming scarce.

Wikipedia defines the circular economy as "an economic system aimed at minimizing waste and making the most of resources".

The idea is also related to reflection on the cycles of nature.

"The Circular Economy is based on the abundance of flows generated from our alignment with ecosystemic metabolisms. Put simply, we should be imitating natural cycles as closely as we possibly can.

The Circular Economy holds the keys of positive perspectives about the future of business, the future of the environment and about our future as people. It depicts a world without waste, where unused resources will find a function in an economy that will regenerate itself while growing within our systemic boundaries"

— Alexandre Lemille [1]

Other people doubt the realism of this vision. For example, Kris De Decker, in How Circular is the Circular Economy (2018), gives a critical summary of the limitations of the Circular Economy, pointing out how modern manufacturing makes it difficult to imitate the recycling that nature performs.

Quotes

Maintaining Natural Capital

"‘For the management of renewable resources there are two obvious principles of sustainable development. First that harvest rates should equal regeneration rates (sustained yields). Second that waste emission rates should equal the natural assimilative capacities of the ecosystems into which the wastes are emitted. Regenerative and assimilative capacities must be treated as natural capital, and failure to maintain these capacities must be treated as capital consumption, and therefore not sustainable.’"

- Mathis Wackernagel [2]

The Limitations of the Circular Economy

"Currently the Circular Economy does not account for primary mining for the vast bulk of our metal consumption. I believe that there could be a way of merging mining and industrial recycling. I am trying to bring process engineering and geometallurgical characterization experience from the Australian mining industry and is applying it to develop aspects of secondary residue valorization. The key to this is understanding the relationship between what manufacturing requires and what is possible with recycling of waste streams. I have been studying different energy generation systems and how they interrelate in terms of the Energy Return on Energy Investment ratio analysis and quantity of energy at the point of application. Over time, I have developed an understanding of what I believe is a coming change in practice that will transform the industrial system we now have to something else, which also implies a change in business model behind industrialization. the Circular Economy is a gateway to this. Thus, the current plan to replace fossil fuels is actually a steppingstone to something else."

- Simon Michaux [3]

Status

Federico Savini:

"Despite most EU member states adopting various CE frameworks, the European Court of Auditors measures a mere 0.4% increase in the (circularity) ratio of secondary material use between 2015 and 2021 (European Court Auditors (ECA), 2023). The European Environmental Agency warns that since 2010 the ratio of recycled materials in Europe has increased only 1% and the EU is now even more dependent on raw materials imports than it was a decade ago (European Environmental Agency (EEA), 2024). The overall proportion of minerals handled in a circular manner has decreased and the small steps towards circularity remain limited to biomass and fossil-based materials. Even the recycling rate of plastic, circularity’s low-hanging fruit, decreased between 2011and 2021 (European Parliament (EP), 2024).\ The Netherlands – where CE policies are pioneered and many CE publications appear – is also not performing. In 2023, a Dutch Environmental Assessment Agency report attested that, despite CE frameworks being in place for 12 years, raw material use has not declined (PBL Dutch Environmental Assessment Agency, 2023). The number of Dutch (circular) businesses processing secondary materials has increased slightly, but only in absolute numbers. Today, just 6% of all companies are in the so called ‘circular sector’ and they all depend on state subsidies, which amount to 10% of all subsidies to industry. CE initiatives are still nascent, the report says; unsupported, they die.

The CE is also not happening at a global level, the world’s circularity ratio having dropped from 9.1% to 7.2% between 2018 and 2023 with the increasing extraction of virgin materials (Circle Economy, 2024). Despite the global financial crisis and COVID pandemic, as much raw material has been extracted in the last eight years than during the entire 20th century (Krausmann et al., 2018). Since the Second World War, the global economy’s material footprint has shown no signs of reduction (Wiedmann et al., 2020), yet funding for and publications on the CE have grown exponentially."

(https://journals.sagepub.com/doi/pdf/10.1177/00420980251383341)

Key Ideas

• The key relevant concepts of the P2P Foundation are:
  1. Cosmo-Localization / Cosmo-Localism,
  2. i.e. Design Global, Manufacture Local.

See the Cosmolocalism Research Project of the P2P Lab

• Potential vital updates on the concept of Circularity:
  • Perma-Circularity, which stresses the necessity to avoid growth in the use of material resources
  • Circular Economy 2.0, which introduces the role of Humans in the Circular Humansphere

• Related concepts:
  1. The Blue Economy
  2. Degrowth
  3. Post-Growth

• Theoretical influences on the ideas and practices of the Circular Economy:
  1. Cradle to Cradle
  2. Regenerative design, as in our Category: Regenerative Approaches
  3. Industrial Ecology,
  4. Biomimicry and
  5. Barry Commoner's laws of ecology, (1971);

Useful Learning Resources

Introductory

• Kris De Decker: How Circular is the Circular Economy (2018)
• Which European country is leading the circular economy shift?: (2018)

Deeper Study

• Our article on the Circular Economy
• Optimizing Circular Value (2017) by Alexandre Lemille
• Against wasted politics: A Critique of the Circular Economy. By Francisco Valenzuela and Steffen Böhm. Ephemera, volume 17(1): 23-60

Key Publications of the P2P Foundation

• P2P Accounting for Planetary Survival: Towards a P2P Infrastructure for a Socially Just Circular Society. By Michel Bauwens and Alex Pazaitis. Foreword by Kate Raworth. P2P Foundation, June 2019. How shared perma-circular supply chains, post-blockchain distributed ledgers, protocol cooperatives, and three new forms of post-capitalist accounting, could very well save the planet.
• Peer to Peer and the Commons: a path towards transition. A matter, energy and thermodynamic perspective. Report by Céline Piques and Xavier Rizos. P2P Foundation, 2017.

Related Categories

• Regenerative Approaches : non-extractive approaches to creating value while restoring the health of the planet and its communities
• Our Sustainable Manufacturing section looks specifically at modes of material production that are sustainable for the long term
• Our Thermodynamic Efficiencies section looks at the use of material and energy resources that respect a balanced metabolism between humans and the planet
• Our P2P Accounting section looks at measurement and accounting issues.
• Our Commons Economics section looks at how to establish a sound economic approach
• Our Category: Ecology gives ecological approaches