Measuring the circular economy

circular economy legislation

Dr Georgina Davis, Chief Executive Officer of the Waste Recycling Industry Association Queensland, says Australia can’t afford to wait for a perfect circular economy policy.

Rhetoric and procrastination while waiting on ‘perfect policy’ seems to be hindering any meaningful progress towards a circular economy, despite the clarity and urgency associated with why we do need to move away from current economic models. 

Resource use is responsible for 50 per cent of climate emissions and about 90 per cent of biodiversity loss, and that is before we consider water stress, environmental pollution, carbon, and social inequity. 

Although most jurisdictions have not even commenced talking about resource efficiency targets, a notable exception is the Netherlands that has committed to halve primary resource use by 2030 as part of its circular economy transition by 2050. 

January 2023, saw a proliferation of circular economy-related reports, starting with the release of the UK’s Independent Review of Net Zero (Mission Zero) by the Rt Hon Skidmore. The Mission Zero report clearly aligns the net zero agenda with circular economy outcomes, with one of the report’s 25 recommendations being; ‘to launch a taskforce to work jointly with industry to identify barriers and enablers and develop sector-specific circular economy business models for priority sectors’. 

The report also noted the damage that inconsistent policies and a lack of coherence across government was having with regards to implementation of resource productivity, with little effective cross departmental governance eroding confidence to the sectors that will drive real change and develop green skills. Sound familiar?

last word circular economy
Dr Georgina Davis, Chief Executive Officer, Waste Recycling Industry Association Queensland.

The Circularity Gap Report 2023 then noted the global economy to be only 7.2 per cent circular today, reducing from 9.1 per cent in 2018; so of the 100 billion tonnes of virgin materials extracted annually, only 7.2 per cent makes it back into the economy in the form of recycled materials.  

The report identified four key global systems accounting for the majority of emissions and waste – the built environment; food systems; mobility and transport; and manufactured goods and consumables. It then outlined 16 circular economy solutions across these systems to reverse the current overshoot, thus reducing impacts and limiting global warming to below two degrees.

There are obstacles to progress the change needed, not least there is still no clarity or a single definition or understanding of the circular economy or ‘circularity’, a point that has now been raised in more than 100 published critiques.  

There is no doubt that the term is uncritical, extremely descriptive and highly normative and that the concept is far from new. Indeed, does it diminish the more highly defined and practiced policy and process theories?  

Another issue is its measurement. If we are still not getting the current metrics for recycling right, how do we determine suitable metrics for the circular economy? How do we set a metric that drives resource productivity which we can measure and report, and what are appropriate targets?  

Personally, I am in favour of legally-binding targets as someone needs to be responsible. Motherhood statements, feel-good targets and voluntary schemes just lead to abject failure and have no role beyond pilots and trials. However, if targets are mandatory, they need to be measurable. 

Resource efficiency and productivity are a measure for circularity but how would an economy, such as Australia, impose resource efficiency and material consumption targets when we are so highly reliant on export income, and we import 60-70 per cent of our consumer items?  

Some jurisdictions have set resource productivity targets against gross domestic product (GDP) and there is debate if this is a good or bad thing. GDP at least is measurable and is a familiar metric used by markets and governments, thus potentially allowing for a granular measure. But will it necessarily lead to the desired outcome? 

To move away from the issues of GDP other jurisdictions, such as Wales (UK), have set ‘one planet’ resource use targets but how do we measure this? There is always difficulty with introducing new metrics. 

Is residual waste a useful measure of a circular economy? If you are a local government, maybe. Then how do we measure co-benefits of the circular economy such as social value or green skills development? 

Metrics need to be simple and focused. While more tangible targets such as landfill diversion may have been fit for the past century it is insufficient for the circular economy. And total waste may indicate consumption trends while residual waste only shows what resources we are wasting and consumption. 

Given the findings in the Mission Zero report (and others), where are the Resource Use Plans for specific sectors that contain binding targets? These would require baseline data as well as suitable metrics for ongoing measurement and reporting. It would also be useful for sector or regional plans to have metrics including total waste produced per unit of production (which could be a proxy measure for resource efficiency) and if we could add bin weights for commercial and industrial, we can start to measure other useful trends. 

So how does our sector interact and how did we assume so much of the responsibility for delivery, (for recycling through to the circular economy) when we know 80 per cent of impacts happen at the design, manufacture to retail stages?  

It is so much easier to address resource productivity and circularity through virgin materials extraction, product design, import standards, retail models etc.  

How do we accelerate data development (including methodologies) and reporting (including metrics) given commitments to carbon reduction and biodiversity? We cannot meet 2030-50 targets without redressing our resource use and resource patterns.

My message is that we cannot wait for circular economy policy to be perfect, we need progress urgently.  

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