Harnessing a data-driven circular economy (en)
Paul Hawken, an American environmentalist, entrepreneur, author and activist who has dedicated his life to environmental sustainability and changing the relationship between business and the environment, has estimated that nearly 99% of the goods we buy will become waste after six months of use.
This is a dramatic picture of a profound implication to which the current ‘take, make and dispose’ extractive industrial linear model has led us. Nowadays the earth’s natural resources are consumed faster than its regeneration rate, leading us to an ecological debt.
The circular economy as a concept has gained momentum worldwide. It aims to boost a transformation of the current economic production model that has proven unsustainable. This is due to the confluence of several factors, such as the increase in the demand for raw materials, accumulation of waste and the expansion of the population and its consumption capacity. Architect and industrial analyst Walter Stahel noticed that in the long run the current linear economy was unsustainable. He realized that closing material cycles could be the right way of decoupling growth and prosperity from natural resources consumption and ecosystem degradation.
The importance surrounding this new paradigm is the opportunity it brings to organizations for uplifting their business models into one designed to reduce, reuse, and hopefully remove waste from industrial processes and households, diverting the waste that goes to landfills and oceans. Instead, it would be re-routing them into the right value chain, creating a healthier economy while reducing environmental impacts. A critical objective of the circular economy is to shift the paradigm so that waste is treated as a potential resource that can be reused and recycled to gain maximum value from its original raw material.
The opportunity behind the circular economy is not only related to the possibility of extending the productive life cycle of materials. It also represents an opportunity for ecosystems and nature in general by reducing and preventing the unsustainable depletion and destruction of natural resources. However, the most interesting opportunity is the exciting economic potential for reinventing a sustainable path for regenerative economic growth. This economic potential considers the natural boundaries of the earth and the challenges ahead of us regarding the population and its expected income growth in the future.
Nature seems to maximize the value of natural resources, where ecosystems have the property of reusing materials without producing waste throughout their cycle. Meanwhile, the story in our present economy (productive and consumption systems) is very different: during 2016 mankind generated some 11.5 billion tons of waste. Most of it has low recovery and recycling rates (only 25%-30 %) while yielding high landfill rates (roughly 70%) (Waste Management & Recycling, UBS, 2017). This volume of waste is expected to double by 2025 and to double again by 2050 (No time to waste, BALM 2013). That information fully represents the type of linear economic paradigm we are trapped in today.
The opportunity of recovering value from waste seems limitless. Of the 11.5 billion tons of waste generated, less than 30% is being recycled. This situation becomes a great opportunity for closing the economic cycle and preventing valuable resources from ending up in landfills and oceans. Moreover, in the emerging world, these low rates of recycling and reuse has shown to be an opportunity for part of the society to improve their life quality.
Recently, more and more families of waste pickers are helping to repurpose waste, not only through collection but also by sorting it and taking an active part in emerging closed-loop business opportunities.
Waste is becoming a resource that is lifting people and families out of poverty and providing cheap resources of raw materials for the manufacture of goods. Examples include construction of for socially inclusive housing, with the blocks made completely with diverted plastic waste (Conceptos Plásticos); production of industrial paint for construction made with Styrofoam (Idea-Tec); and manufacture of skateboards made with discarded plastic fishing nets (Buro).
These closed-loop solutions are emerging in South America, where waste pickers are involved as a critical part of the consolidation of new value chains that helps repurpose waste by transforming it into raw material.
To continue strengthening and scaling these types of closed-loop solutions, the way we treat information must be improved. Real-time information on the availability of waste is a key factor for their success. This is and will continue to be the biggest challenge restricting the substantial increase of recycling rates worldwide.
Unfortunately, without the right information at the right time about the resource location and quantity available, it will continue to be almost impossible to effectively scale the creation of closed-loop solutions that divert waste and transform it into valuable resources. In consideration of this lack of available information, Valopes has been working for three years to create an agile, robust and user-friendly cloud-based platform. It enables industrial waste generators, waste managers, and hopefully waste pickers to improve the quality of data on the waste they are producing, recovering and landfilling. This generates the potential of creating opportunities for the identification of synergies enabling us to divert waste from landfills.
Having this in mind, the possibility of increased implementation of closed-loop solutions harnessed by the power of data and information will not only improve the net efficiency of the economy by creating new business opportunities, but will also have a direct positive impact on society. This will specifically impact on waste pickers already developing a crucial task in emerging countries where there is a lack of recycling infrastructure and culture. Finally, it will also have a direct positive impact on the environment, where the reuse of resources will help reduce its depletion while preserving natural resources.