by Roy Hathaway7 minute read
Defra Resources Minister Dan Rogerson drew a lot of criticism when he said, at the CIWM/ESA conference in June, that a completely circular economy was neither achievable nor desirable.
It was the second adjective which produced the most surprise and dissent. Pressed to explain his view, the minister argued that there comes a point of diminishing returns when the cost of trying to recover additional material for recycling would outweigh the benefits from doing so – whether in terms of energy use, CO2 emissions, other environmental damage, and/or money.
Predictably this did not go down well with an audience that sees a circular economy as the Holy Grail and regards any expression of doubt about its quest as the equivalent of proclaiming belief in a flat earth.
But rather than dismissing the Minister’s remarks as merely evidence of Defra’s lack of ambition in this policy area, it is worth taking a step back and asking ourselves whether he has a point. Is a circular economy achievable? And irrespective of its achievability, is it desirable?
Squaring the circular
To many in the waste and resources sector, the mantra that “waste is a failure of design” says it all. If we just design our products better, then – it is argued – there will be no waste. Everything we make or use will last longer, be re-used a number of times, and will eventually be dismantled and re-manufactured without any waste arising, and – just as importantly – without requiring the use of any additional virgin raw materials.
This is a great vision and one to which we can and certainly should aspire, at least for many manufactured goods such as electronics and vehicles and perhaps buildings and clothing. Although we are a long way from achieving this now, movement in that direction would undoubtedly bring many economic and environmental benefits.
But a moment’s reflection suggests that this model will not hold true for many other products. What about unavoidable food waste, for example? Can we (or should we even want to) “design out” banana skins or potato peelings? Of course we can recover banana skins into fertiliser and energy, but can we stop unavoidable food waste from contaminating other discarded materials and so helping to perpetuate the existence of residual waste?
How about paper production? After paper has been recycled seven times, the fibres are no longer suitable for further recycling. Virtually all paper products are produced with a mixture of virgin pulp as well as recycled material. Perhaps this doesn’t matter if paper usage continues to decline, and if we use sustainable forestry to source the virgin pulp through a renewable source of primary raw material.
And what about mercury, or asbestos? The argument is that, in time, technology will be developed that will allow hazardous or difficult wastes, which currently have to be disposed of or contained rather than recycled, to instead be designed out or become treatable by new methods. But with so much “legacy” waste already in existence we will be dealing with these dangerous materials for a very long time.
It is interesting to note that the European Commission’s recent proposals on the circular economy and waste legislation aim for a 70% recycling rate, and are rightly regarded as “ambitious”. Annex 1 of the Commission’s Impact Assessment states that the remaining 30% of waste generated “…broadly corresponds to the concept of ‘not recyclable’ waste on the basis of the experience of the most advanced Member States/regions.” The Commission evidently doesn’t believe it will be possible to recycle all waste, let alone design it out altogether, this side of 2030.
So is a fully circular economy achievable? Probably not. Does that mean it’s not worth striving for? Not at all. We have a very long way to go before we come up against the limits of what is achievable, and we can make huge economic and environmental gains on the journey.
Surely a circular economy is desirable, even if it is not fully achievable? Wouldn’t an ideal world include a circular economy? Isn’t it just another way of saying that we want to live sustainably, using only one planet’s worth of resources rather than three, and bequeath the world to future generations in good shape? What’s not to like?
However, might Dan Rogerson have a point when he says that there are instances when trying to be circular can be counter-productive? Going after every last bit of recycling in the waste stream could be too expensive relative to the value of the material to be recovered – you reach a point when the marginal cost of trying to recycle a bit more becomes prohibitive.
His argument assumes that prices are static and that the current combination of taxation, incentives and regulation, which govern the economics, cannot be changed. In practice, of course, government (in the broadest sense) can make re-use more attractive, or disposal costs prohibitive, or even ban some disposal routes altogether, and so move waste up the hierarchy or even out of existence. It has been doing so for a number of years: the current waste market, and the modern waste industry, has been created in response to regulation, mostly from Europe. So if the minister’s view is that a circular economy is not desirable because the economics do not stack up, then one could respond that it is the economic and regulatory landscape should be changed so that they really do support the top of the waste hierarchy and the circular economy.
The minister’s counter-argument might be that by intervening in that way, government would impose higher aggregate costs on waste producers and depress the productive economy. On this view, the overall cost of fixing the policy landscape in favour of a circular economy, in terms of lost growth, output and jobs across the economy as a whole, would be higher than the benefits a more circular economy would bring. The task of deciding who’s right in this debate is one I’ll leave to fully qualified economists.
Perhaps the minister believes market forces will produce a circular economy on their own, without the need for government intervention. That might occur if demand for resources grows faster than supply can match, leading to higher raw material prices. Gradually it would then become cheaper and economically more beneficial to exploit secondary resources and move further towards a circular economy. I wonder. Despite all the talk of resource scarcity, my hunch is that we could wait a very long time – perhaps forever – for untrammelled markets to solve our resource management problems for us.
It is more difficult to evaluate the argument that striving for a fully circular economy could result in environmental dis-benefits such as excessive energy use, extra greenhouse gas emissions, or other pollution. As a general rule, recovery of secondary raw materials is environmentally preferable to use of primary raw materials, although the logic becomes more complex in the case of renewable resources such as wood. Again, this issue merits further investigation.
Dan Rogerson may be right when he says that a fully circular economy is not achievable, at least for the foreseeable future. But that does not mean that we should not strive to move in that direction so far and as fast as we can.
His argument that the circular economy is not desirable is harder to sustain, unless one takes the current economic and regulatory framework as a given. If the current policy environment is incompatible with a circular economy and the waste hierarchy, one might hope the Resources Minister would see this as an argument for policy change, not for abandoning the goal of maximising resource efficiency. Provided that the change can be shown to benefit society as a whole, not just for the resource management sector, there is a clear role for government leadership, at both European and national level, to set the necessary fiscal and social incentives in place. Market forces are unlikely to deliver anything approaching a circular economy on their own.
Like other Isonomia authors, Roy writes in a personal capacity. The views above do not necessarily reflect those of the Environmental Services Association.