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Last edited 10 Aug 2016

Circular economy

The latest buzz words in the market are 'circular economy'. Given the phenomenal rise of circular economy thinking in recent years, the waste hierarchy as it stands may no longer be a valid starting point for business.

'Business as usual' sees contractors and the supply chain following the waste hierarchy; reduce, reuse and recycle, to a greater or lesser extent. But the concept of the circular economy goes beyond the 3 R's and aims to maximise total material resource efficiency.

The traditional 'linear' model preaches the concept of 'make, break, and discard'. The circular economy is a concept in which everything is engineered to be constantly reused or recycled. It requires rethinking of design, manufacturing, selling, re-using, recycling and consumer ownership to keep resources in use for as long as possible and to extract maximum value.

There is massive economic advantage for businesses adopting a circular economy. The Department for Environment, Food and Rural Affairs (Defra) calculates profit of up to £23 billion per year for UK businesses through low cost or no cost improvements and McKinsey estimates a global value of $3.7 trillion per year (ref WRAP).

The Dutch are hot favourites in the race to becoming a circular economy and Japan has already shown a huge success in changing their linear manufacturing and consumption system into a more circular, collaborative system. The approach adopted by Japan is highly effective and contributes a significant proportion of the country's GDP, employing hundreds of thousands of people.

As the EU set new, challenging waste targets and reviews proposals to ban sending plastics, wood, textiles and food to landfill, the circular economy may be the answer to our resource and employment challenges.


This article was created by Ritu Rajashekar of --KLH Sustainability as part of an ongoing series of posts for Designing Buildings Wiki.

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