What is a circular economy?
Circular economies were pretty much unheard of in the past, but are starting to gain a lot of traction in recent years, especially with the current environmental pandemic we are experiencing.
Looking beyond our current economic state in terms of production, extraction and consuming, often identified as a take-make-waste extractive industrial model. A circular economy model aims to redefine growth, thus focusing on positive benefits for the society as well as planet Earth.
It aims to gradually dissemble economic activity from the consumption of scarce and finite resources and forcing waste out of the system. The base of circular economy is its transition to renewable energy sources, therefor building economic and social capital.
Three principles underline circular economy: Design out waste and pollution, keep products and materials in use and to regenerate natural systems.
There is a world of opportunity when it comes to producing the way we make stuff. Surely there are other materials than the predominantly used plastic and other various single use materials.
A progress known as the “re-thinking progress” explores how through a change in perspective, we can re-design the way our economy works. Designing products – unlike our current system – that can be made to be made again and overloading the system with renewable energy will change the economy forever. The underlining question is whether we can build a restorative economy through creativity and innovation.
In a circular economy, economic activity build, sustains and rebuilds system health. The concept recognises the importance of the economy working effectively in all departments, not just monetary values, but for individuals, small and large businesses and the environment.
The transition to a circular economy does not only amount to adjustments aimed at reducing the negative impacts of the linear economy. Rather, it represents a shift that creates resilience in the long-term as appose to our short sited current economic state.
In addition, it also generates business opportunities and provides great benefits to the environment and society in terms of health.
Technical and biological cycles
The circular economic system circulates between these two cycles. Consumption, (theoretically) happens only in biological cycles, where food and biologically-based materials are designed to recycle back into the system. Finland is a good example as wood is their number one economic contributor. Other processes consist of composting and anaerobic digestion.
This subsequently regenerates living systems – like soil – which provides renewable energy resources for the economy. The technical cycle recovers and restores products, components and materials though means of reuse, repair, re-manufacture or your old traditional form through recycling.
The notion of circularity has deep historical and philosophical origins. Strange for an economic system. It has echoed in various schools of philosophy with the idea of feedback and cycles in real-world systems.
It was revived in predominantly industrialized countries after the second World War when the advent of computer-based studies of non-linear systems unambiguously revealed the complex and unpredictable nature of the world we inhabit.
With current progress, digital technology is the most likely source to drive the transition to a circular economy by radically increasing virtualisation, de-materialisation, transparency and feedback-driven intelligence.
Credit: William Wand – The Figure Head