EC publishes circular economy roadmap

By Edward Perchard | 7 May 2015 | Add a Comment

The European Commission (EC) has published an ‘indicative roadmap’ for its upcoming revised ‘Circular Economy Strategy’ (otherwise known as the Circular Economy Package), which aims to deliver ‘a clear and ambitious political vision combined with effective policy tools’ that will ‘drive real change’.

Industry sceptical of revised circular economy plans

Although the document, which seeks to replace the original proposal with a ‘broader and more ambitious approach’, does not outline specific details of how the revised package will work (and warns that it is ‘subject to change’ and ‘does not prejudge the final decision of the Commission on whether this initiative will be pursued’), it suggests that barriers such as market failure must be addressed for a European circular economy to progress.

New package to move away from ‘exclusive focus on waste management’

According to the EC, the previous approach had a ‘rather exclusive focus on waste management, without appropriately exploring synergies with other policies’, such as ‘product policies or the development of well-functioning markets for secondary raw materials’.

The EC also states that the new package should examine how to make waste proposals ‘more country specific’ (potentially through country-specific targets), and ‘how to improve the implementation of waste policy on the ground’. It adds it will also aim to decrease residual waste while increasing the use of secondary raw materials in the EU economy.

Therefore, the new initiative will ‘establish a framework to overcome shortcomings and create conditions for the development of a circular economy’.

As such, the EC will now work on:

a revised proposal on the waste review; and
a communication explaining the rationale behind the approach accompanied by ‘an action plan addressing the full circle and including a list of actions in each pillar of intervention with precise deadlines to be followed-up by the Commission’. This could include a mix of legislative, non-legislative, and financial instruments.

It states that the action plan could therefore include proposals to intervene on the following areas:

materials production and use
product design;
distribution and consumption;
public procurement;
labelling and product information;
waste management;
development of markets for secondary raw materials (e.g. organic fertilizers);
improving framework conditions in priority sectors such as sustainable chemical production, bio-economy, extraction of secondary raw materials, food, construction, plastics, critical raw materials (including phosphorus), and water use;
repair and reuse; and
illegal flows of waste, including hazardous waste.

The EC states that ‘an appropriate stakeholder consultation will be carried out in the preparation for the new initiative, including an online consultation and a stakeholder meeting’. The EC’s Director-General for Environment, Karl Falkenberg, said last month that these consultations will take place ‘before summer’.

‘Action at all stages of the life cycle of products’

The roadmap reads: ‘The circular economy requires action at all stages of the life cycle of products: from the extraction of raw materials, through material and product design, production, distribution and consumption of goods, repair, remanufacturing and re-use schemes, to waste management and recycling. All these stages are linked… and improvements in terms of resource and energy efficiency can be made at all stages.

‘Important barriers to the circular economy arise from market failures (e.g. weak price signals due to lack of internalisation of externalities on some commodity markets, split incentives for actors across the value chain, lack of information for investors or consumers, etc.), but also governance and regulatory failures, some of which can be linked to EU legislation (e.g. some ineffective or insufficient policy tools, unaddressed implementation problems, lack of coherence between policy instruments, creation of administrative burden and barriers, lack of harmonised standards, etc.).

‘This initiative aims at tackling some of those barriers through a comprehensive and coherent approach that fully takes into account interactions and interdependence across the whole value chain, rather than focusing exclusively on one part of the economic cycle.’

‘We need a combined approach’

Speaking in March, the EC Environment Commissioner Karmenu Vella (who wanted to keep the original Circular Economy Package proposals) noted that the new package would include a new legislative proposal on waste targets, as well as aiming to create a ‘genuine market for recyclates’.

He added: “The Circular Economy transformation on the scale we have in mind will never come about simply as a result of legislation. We need a combined approach, where smart regulation is blended with market-based instruments, innovation and incentives. These would provide businesses, including SMEs, with concrete tools and instruments and incentives to promote the transition to a circular economy.

“We want to give a clearly positive signal to those waiting to invest in the circular economy. Above all, the private sector needs regulatory certainty. Clarity promotes investment and investment promotes jobs. The job creation potential of the circular economy is not to be underestimated.”