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Halloween, plastic-eating chicks and the circular economy

Posted on October 27, 2017 by Tom Healy

Tom Healy, Director NERI
Tom Healy, Director NERI

“By 2050, there will be more plastic in the oceans than fish, entangling sea creatures and trapping them, mimicking their food, and releasing toxins that poison them: marine turtles feed on plastic bags because they float in the ocean like jellyfish. Alabtrosses, those vast ocean-going birds, are bringing belly-fulls of plastic instead of squid back to their nests to feed their chicks. The chicks can’t digest the plastic, so they die of starvation.”, so writes Professor Jane Stout of TCD in the Irish Times last week (Halloween is a load of rubbish ).

The term ‘circular economy’ might draw a blank for many of us until it is explained. Perhaps, an easy way to explain it is to speak about what a non-circular economy does not looks like – hence the quotation, above. Formally speaking, ‘circular economy’ has been coined to refer to an economy in which natural or man-made products are recycled again and again in such a manner that resources are used in a way that is restorative and regenerative as much as possible. By contrast, a linear or non-circular economy is oriented towards extraction of resources, production and disposal. Images of landfill, tyres and pallets in Halloween bonfires and plastic floating on the seas speak of non-circularity.

In its report, the National Economic and Social Council ( Moving towards the Circular Economy in Ireland ) published last Thursday draws on a wide-ranging discussion involving many actors from Government to business and environmental groups over the last year. Coincidentally, the Central Statistics Office published an updated Material Flow Accounts for 2015 . In the latter publication, a number of interesting trends are identified and which are of relevance to the measurement of the ‘circular economy’. One such measure is what the CSO term ‘Resource Productivity Index’. It measures the ratio of GDP at constant prices to ‘Domestic Material Consumption’ (DMC). The latter refers to all material inputs extracted from the natural environment including biomass; metallic minerals; non-metallic minerals; and fossil fuels plus ‘net imports’ of such materials. 

Chart 1, below, shows trends in GDP and in DMC. Following a sharp drop in GDP in 2009 there was a gradual recovery leading to a sharp upturn in 2015 reflecting unusual corporate behaviour in that year (commented on in a recent blog “ How fast is the economy really growing and does it matter for fiscal space ”). DMC fell sharply following the crash of 2008 but has only very modestly recovered since 2012. The role of the construction sector has been very significant in pulling down DMC through its impact on the extraction of sand, gravel and crushed rock.

 

CSO/Eurostat define the Resource Productivity Index (RPI) as, simply, the ratio of GDP to DMC.

Not surprisingly, the ratio of efficiency given by RPI (Chart 2) has improved since 2013 (although it dipped in 2016). It is difficult to disentangle the impact of construction on the overall efficiency measure but it is likely to have been a major pull factor. We can be sure, however, that the surge in GDP in 2015 as in many other areas of analysis has had a significant impact on the measure of interest here.

A telling comparison is contained in Chart 3. This looks comparatively good – data problems notwithstanding. However, before opening the organic champagne bottle we might note that the Republic of Ireland is third naughtiest in the sin bin of Green House Gas emissions – according to the latest available Eurostat data (Chart 4).  While the recession of 2008-2012 helped, in absolute and relative terms, to reduce GHG emissions, here, the rate has been creeping back up. The agricultural and transport sectors stand out as major contributors to these outcomes. It does not have to be so. Take Denmark which manages to keep a lid on GHG emissions through technologically efficient means notwithstanding its penchant for incineration (see below).

 

 

Is Ireland becoming more efficient and have we grounds for hope in relation to a movement towards a more ‘circular economy’? We need to be cautious due to data issues referred to above. The measurement of economic circularity is particularly challenging given the complex supply chains underlying construction and manufacturing.

In a telling paragraph on page 40 of a recent report to the European Parliament ( Towards a circular economy – Waste management in the EU ) we read the following:

It should be noted that inter-EU trading of waste has emerged to fill incinerator capacities (e.g. around 1.2 million tonnes of the waste incinerated in Denmark, which has a capacity of 4.2 million tonnes, was imported, mainly from the UK and Ireland).

Now if the Republic of Ireland is a significant exporter of waste to Denmark (along with other countries) might there be an opportunity to undertake more recycling at home? The NESC report offers an interesting and important observation on page 27 of its report:

The circular economy would seem to offer a rationale for a fresh approach to an Enterprise Strategy for indigenous sectors focused on clustering. This could increase the reliance on mainly local supply chains and provide resilience in the context of Brexit.

This is a highly dense and suggestive statement but one worth mulling over.  There are opportunities for small and medium-sized enterprises to become more involved in recycling activities at different stages in product and material lifecycles. Even if some sectors (e.g. Food) will be tested to the limits of enterprise endurance by whatever outcome Brexit yields, there is a need, now, for agencies such as Enterprise Ireland to ramp up its intelligence, coaching and advisory role in helping companies to identify new opportunities. I suggest that the circular economy is one such opportunity not least when it involves eco-design for longer lasting products as well as production processes that are restorative.

In a standout table on pages 52-53 of the European Parliament report ( Towards a circular economy – Waste management in the EU ) It is clear that the Republic of Ireland falls well short of other EU member states on its progress in reducing reliance on landfill for municipal waste management (there is a landfill ban in many Northern European countries). At just under 40% of total waste in the form of landfill, Ireland is four times above the EU 2030 target for landfill.  Much remains to be done not least in terms of local investment in alternatives such as material recycling and composting.

All of this goes to show that there is no one measure of the circular economy or progress towards it.  We need to take a wide-eyed look at many indicators.

Given the challenges raised by Brexit together with the long-term goal of achieving a zero-carbon economy, circular economy needs to become not just a talking point but a rally to action by households, enterprises, governments and trade unions. The publication, by IMPACT, of “ A just transition to a low-carbon economy Implications for IMPACT and its members ” earlier this year is very welcome as is the SIPTU paper. “ What a just transition means for workers (there are no jobs on a dead planet

 

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