The European Commission’s Circular Economy Package – Red Tape or Real Progress?

 In Blog

When the Commission launched its long awaited strategy and action plan in December the stated intention was to stimulate Europe’s transition towards a circular economy, which would boost global competitiveness, foster sustainable economic growth and generate new jobs.

Initial reaction to the proposals was mixed and as you might expect focused on individual groups interests and objectives.  Now we have had some time to reflect on the content of the proposals it is perhaps worth looking to see whether they are simply rhetoric, likely to increase bureaucracy, or have the capability to deliver a real step change in the way we manage materials in the future.

In the spirit of starting the new year with a sense of optimism let’s start by taking some of the positives. Overall the direction of the proposals looks good and ultimately anything that seeks to coordinate member states in improving the way we manage our secondary resources must be viewed as positive.  The debate and media coverage resulting from the proposals has also certainly helped raise the profile of the circular economy and put it in to context.

Some of the key features also look like they may have the potential to have some positive impact.  Taking the opportunity to review and standardise waste definitions is one that really stands out to me.  This is of particular importance when we are looking at whether material should be classed as waste or not and when classification should start and end.  We need to look at how we avoid an instantaneous classification from say packaging to waste – just because someone has decided to place it in some form of receptacle.  This simply increases the cost of managing this material; forces it in to a ‘waste’ system where we are likely to lose both volume and quality; and does nothing in terms of helping us develop the resource mind-set that we will need for the supply chains and products of the future.

Another point that stands out for me, is the drive to consolidating targets and the way that we report data.  This must be helpful in enabling us to better understand material flows and identifying whether our actions are having the desired impacts.  One interesting statistical observation in the proposals is that whilst 45% of waste material from large companies is resold, this figure falls to only 25% for SMEs.  The Commission seeks to create common standards and market tools to improve this, which is in itself admirable.  I would challenge however whether the root of this issue lies in ‘standards’ – small businesses operate to high standards too.   The market is volume driven.  Large volumes generally mean the material is easily accessible and often pre-segregated and this draws it through the system more efficiently.

Many people, however, regard these proposals as a watered-down version of those tabled and withdrawn in 2014.  The question therefore remains – do the proposals go far enough?

Personally, I believe that whilst it is important to have a long-term game plan and I recognise that some developments such as new infrastructure and technology will take time, the setting of 15 year targets results in a lack of urgency.  The implementation of some shorter step targets would in my opinion support a steady progression towards the overall target and avoid the usual ‘frenzied’ activity as the performance or regulation deadline draws near.

The proposals support the introduction of ‘economic instruments to incentivise the waste hierarchy’.  This is likely to increase the use of pay as you throw or reward schemes for waste producers.  On this point there appears to be a imbalance between the stick used to influence waste managers and the carrot that is offered to producers.  Perhaps some positive commercial incentivisation might also work for those responsible for managing the waste we produce?

Food waste is an area where we once again appear to lack ambition and commitment.  Here we once again see TEEP rear its ugly head, providing a simple ‘get out of jail free card’ to any state not wishing to introduce mandatory separate collections.  The result will be a continuation of the inconsistency we see in the UK today with three of the four countries choosing to separately collect whilst the largest producer, England, continues to ‘opt out’.  This will continue to have a negative impact on the quality of our recyclable materials and means we fail to derive all the potential value from food waste for use in the production of sustainable energy or agriculture.

A lot has been said about the lack of attention to stimulating the demand for secondary materials and I tend to agree.  Simply creating a supply does little to create a market.  We need to look at ways in which we can support and incentivise designers, manufacturers and retailers in making products with a higher proportion of reused or recovered material and to make them more easily recyclable.  And critically we must ensure that these products are not just commercially viable, but indeed create a competitive advantage.

Perhaps the biggest downside to the proposals, for me, is that they seemingly lack ambition. Whilst they point to the need for more eco design, for example, the focus remains quite heavily on the waste and recycling sector with a strong emphasis on reuse and recycling rather than avoidance.  The approach seems to be to push materials up the waste hierarchy rather than identifying how we can stop them sliding down it.  The targets included are more of an evolution of what went before and it would perhaps have been more inspiring to have seen a fresh and more holistic approach to facilitating the development of the circular economy.

Jan 2017