Circular Economy in Europe – Developing the knowledge base

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EEA, Circular Economy in Europe – Developing the knowledge base, EEA Report n. 2/2016, 18.01.2016

Type Article
Link europe
Topics Circular Economy


The EU wants to achieve a 2050 vision of “living well within the limits of our planet”. If it can acquire the role of leader in the path towards a circular economy, that could be an advantage for it, as it would be able to “drive innovation” (p. 9) in, for example, better products and services.

At p. 11 there is a non-exhaustive list of technical, economic and social enabling factors required for a transition to a circular economy: high-quality recycling, repair and reuse, upgrading, product-service systems instead of product ownership, collaborative consumption, collaboration and transparency along the value chain, industrial symbiosis, data, monitoring and indicators, etc.

--> Most of the listed enabling factors (especially those I reported above) scream “Internet of Things!”. Hence, IoT can be defined as potentially effective across-the-board tool to be employed for purposes of a circular economy, given that IoT – if properly used – can actualize many of the latter's enabling factors.

--> Another tool is across-the-board with respect to the technical, economic and social enabling factors of a circular economy: the legal tool, the policy-making tool. The legal variable is in fact critical for the success of the circular economy: indeed, a lack of intervention from legislators and policy-makers towards circularity would not only not positively foster the realization of a circular economy (i.e., “the legislator does not intervene, so the process will be slower: he could have helped making it faster”, e.g., through incentives for business models and product designs which foster circularity, increasing transparency, and moving tax burden to activities damaging the environment), it would even be challenging (“existing policy frameworks [do] not [keep] up with changing social technological and economic contexts” (p. 18), and therefore they are calibrated on the traditional and almost obsolete model – in that context, the old linear economy –, therefore nurturing and supporting it) [Cf. with Strategies for Manufacturing].

The Report depict the most significant and critical enabling factors:

  • 1. Business model innovation: product-service systems (they are beneficial for consumers as they are transparent about the whole cost of the use phase (p. 15) [but remember the pain of paying], but negative consequences for businesses can be envisaged); collaborative consumption (sharing business models, like online sharing marketplaces, but lower sales made by businesses and diminished tax revenues for governments; the use or not of sharing models is also influenced by cultural factors); waste-as-a-resource business models.
  • 2. Eco-design (product redesign or new product design) to made products more durable, upgradeable and repairable (a negative consequence is longer use of inefficient products).
  • 3. Reuse: product components that are not waste are used again for the purposes for which they were conceived.

In order to succeed in implementing the circular economy there is also need for data about the effectiveness of the measures adopted and about the quantitative and qualitative progression of circularity: “More robust data are needed on new business trends ad sustainable consumption relating, for example, to eco-design, the sharing economy, and repair and use” (p. 30). “Overall, in the transition to a circular economy, it will be crucial to monitor how far the environmental benefits of circular approaches are realized or countered, for example by rebound effects”. --> The monitoring needed in order to gather this data could be performed employing, again, the Internet of Things.