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The Circular Economy-New Idea, Re-Modeled

December 5, 2022/in Blog, Business, Economics, Supply Chain, Sustainability/by Glenn Meeks

The definition of a circular economy is straightforward but transitioning to the new model remains challenging. Consumers and business leaders have grown accustomed to a wasteful, linear product lifecycle. Manufacturers fabricate goods, ship them to retail outlets, and people buy the items they believe provide the most significant value. But what happens afterward? Most people discard old or broken products without a second thought. Yet, a circular economy breaks the cycle of wastefulness, providing an alternative to the current system and a way to fight climate change.

The Circular Economy – The New Idea

According to the U.S. Environmental Protection Agency, a circular economy “keeps materials, products, and services in circulation for as long as possible.” The typical product lifecycle entails fabricating new items from raw materials, sometimes natural resources, but there is little emphasis on sustainability. If there’s a choice between saving money on production or operating with sustainability, most choose the easy route.

A circular economy takes a different perspective. There is a concerted effort to eliminate waste at a fundamental, systemic level. Products manufactured in the current linear economic structure will not be returned to the manufacturer and recycled.

In a circular economic model, they would. The manufacturer can repair, reproduce, or recycle products using re-fabricated parts, creating a return-loop that promotes and operates with less waste – and lower manufacturing costs. The most vital concept is to be as efficient as possible while maintaining sustainability, including (if possible) using renewable energy.

Circular Economy-Recovered and Recycled

A circular economy isn’t a theoretical framework because real-world examples exist. The difference is that the global economy has yet to shift to a new model. Still, businesses continue to demonstrate how to accomplish the feat and push back on climate change.

Supply Chain

Many international companies in consumer facing industries, like automotive or electronics, are implementing closed loop-reverse logistics programs to capture savings in their manufacturing processes. These businesses enabled a “reverse logistics” system in coordination with partners and suppliers. These organizations gather and reassemble disused components and re-sell them via their reverse logistics supply chain. The result is greater efficiency since reassembled parts cost significantly less than new components. Those savings get passed to consumers, and all parties’ benefit. These industries have renovated hundreds of thousands of parts and components that meet similar specifications as new components.

Wood Pallets

Companies in the wood pallet industry have adopted similar systems, where new products are recycled and re-manufactured from existing pallets. Circular economics in this sector have spawned businesses that recover wood in the form of used pallets and other wood waste and re-purpose it as viable products all the way through the end and beyond of its own product lifecycle. The recycled pallets have the same functionality despite being reused in the supply chain more than once. If waste byproducts occur, those byproducts get used in other ways, such as using leftover wood for compost, or even wood pellets. This way, every ounce of recycled wood has a purpose and reduces the number of trees required to meet demand.

Why is It Important?

Reduce, Reuse, and Recycle seem aimed at a personal level of responsibility to start and that is great. However, a circular economy model offers a different path forward. It allows businesses and consumers to participate in a healthy economic system that protects the environment and fights climate change. The assumption that circular economics introduces unnecessary costs is inaccurate because real-world examples prove it’s possible. The next step is the widespread deployment of circular economic principles, and that’s where the global economy stands today. There’s a clear choice between conducting business as usual or moving on to a sustainable system.

Circular Design – How Reduce, Reuse, and Recycle Can Be Part of Product Design

November 28, 2022/in Blog, Science, Sustainability, Wood Packaging, Wood Pallets/by Glenn Meeks

The principles of circular design are integral to the concept of a circular economy, a new economic model that values sustainability and efficiency. Many products don’t return to the manufacturer in today’s linear economy, nor would they arrive in a recyclable condition. Sustainability wasn’t a priority when mass consumption became the norm, and many products were never designed for systematic reuse. The economic system today follows the “make, take, discard” product lifecycle, but circular design provides an opening for a sustainable economy.

Circular Design – A Definition

Circular design entails a fundamental shift from wastefulness toward sustainability from the product’s conception to its fabrication. Everything is designed for reuse multiple times instead of designing for failure or obsolescence. It’s a change that maximizes economic efficiency since products and their components are recycled instead of thrown away. Circular design enables innovation in ways that the linear economy can’t provide and entails the following principles.

Circular Design Principles

According to the Ellen MacArthur Foundation, the four principles of circular design are:

Understand
Define
Make
Release

The result is a new product lifecycle designed for sustainability with each iteration. It incorporates the three “R’s” principles – reduce, reuse, and recycle – and supports the creation and manufacturing of products that can be reused time and again.

Understand

The first principle is to understand where the most significant opportunities are ready and available. Not every product or service lends itself to circular design because the business doesn’t operate on a sustainable model.

Understanding the current product design, its shortcomings, and its lifecycle gives business leaders a direction when adopting circular design. The idea is to construct products and processes that are regenerative and restorative instead of destructive and wasteful. Changes in the model can include a more robust connection from fabrication to services where downstream recycling is regenerative and/or restorative and maintains a viable product (read: pallets) that is reusable throughout its lifecycle.

Define

The defining principle articulates the specific business processes that can benefit from circular design. The supply chain is a perfect example. The challenges in supply chain operations may differ from company to company, yet they aren’t insurmountable.

It takes a multi-disciplinary, collaborative effort between provider and customer to identify processes and transition to a more sustainable design that includes the materials used to make the products. The definition of success must be clear and attainable because the following principle relies upon clarity. If the purpose seems elusive, the proper course is to return to narrowing down and understanding the opportunity.

Make

Here is where businesses can take action and prioritize which products and/or processes are likely to succeed according to clearly defined sustainability objectives and which ones need further development. One strategy is to test concepts with rapid prototyping and to embed feedback mechanisms to optimize the design.

An easy low-hanging fruit to pluck is re-examining the raw materials that go into a product. Is it feasible to make the item with biodegradable materials, or is it a better candidate for recycling? Can it incorporate both into production? The answers boil down to what the user needs. Many times, different versions of the same product may be necessary to test and achieve circularity since the design requires innovation and creativity. This is where research and development take place, literally and figuratively. Think of the purpose of facilities like the Virginia Tech – Center for Packaging and Unit Load Design.

Release

The last principle is launching the new design, but it doesn’t stop there. Circular design demands continuous improvement and a constant focus on efficiency. That’s why it’s best to launch and learn, releasing products to redesign and refine processes, with the ultimate goal of creating a circular product lifecycle. Creating a circular economic system demands no less than a concerted, multi-pronged approach.

Circular Design and the Wood Pallet Industry

The question is: do real-world examples of circular design exist? And the answer is yes. The wood pallet industry is a prime example of how design can enable circular economics to the company’s benefit. Wood pallets don’t require new raw materials each time. Manufacturers can produce them from sustainably sourced wood, recycled wood components, or a combination of both. Another example is a pooled pallet rental system which many large enterprises rely upon in transporting their finished goods.

Either way, the pallets, and components are designed to be used multiple times, bolstering the product lifecycle with increased sustainability. The pallet industry leverages its natural advantage in sustainable processes, and companies can legitimately validate forward-thinking sustainability goals and demonstrate genuine positive action for environmental concerns. The old wasteful business model is transformed into a circular system, and companies establish trust with their customer.

Conclusion

Efficient design processes focusing on reuse can lower material costs end to end. A circular-designed product doesn’t have a single lifecycle but rather several. The overarching concept is to battle climate change by reimagining how products reach consumers, starting at the design level. The four principles of circular design provide guidance, but it’s incumbent upon business leaders to commit to the new paradigm.

Talking To The Source: Dr. Jennifer Russell of Virginia Tech and the Circular Economy – Part 2

October 19, 2020/in Blog/by Glenn Meeks

*Editor’s Note: The viewpoint and statements of the following post may not reflect the views of Nature’s Packaging, however, we are always committed to providing an open forum for all members of the forest and forest products community.

What is value retention and how do we all stand to benefit from it?

In the past 100 years western culture and society has become normalized to the idea that products can just be ‘thrown’ away – that things have no value once we are finished with them. Our focus on convenience, variety, and an expectation of low-prices means that products once made to last 10 years (e.g. clothing) now cycle through retail stores and personal closets within only a few months. And global waste streams are exploding with these ‘unwanted’ items.

But if we think about the entire life-cycle of a product — from the extraction of the materials, it’s fabrication and manufacture, its use, and what happens when it is no longer wanted — you get a different perspective on the inherent value of the product.

Value can be related to the materials that are used, where they come from, how the products are assembled, who assembles it, how long it will last, and the variety of ways that it can be used, beyond the function that was originally intended.

Circular Economy challenges the us to find ways to extend product lives (e.g. make products last longer by designing them to be more durable, investing in maintenance, and finding opportunities to reuse, repair, refurbish, and even remanufacture them when they are no longer useful to the original owner).

Value retention is a fundamental shift in how we assess and understand the value of things – beyond price and brand – and thus, what we decide to do with those things when they are no longer wanted or needed.

Specifically, the Value Retention Processes that were studied in the UN Report relate to:

reuse – where a product gets to serve an additional life providing functionality to someone else, instead of being directed to landfill.
repair – where a product is returned to functionality for the original owner, through relatively smaller outlays of new materials, energy, and labor.
refurbishment – where a product is brought back to full functionality, and potentially even upgraded to provide new functionality and performance for a new user.
remanufacturing – a standardized industrial process where a product is fully disassembled, its component parts recovered and tested for quality, and those parts reassembled into a new product that meets or even exceeds the performance and quality standards for a new version of the product.

Through these activities, we can reduce environmental impacts, create employment and revenue opportunities, and continue to use products that provide important functions for individuals, businesses, and governments.

What are some of the barriers to change and how can they be overcome?

One of the greatest barriers to change right now lies in the attitudes and behaviors of individuals. We have been normalized to expect ‘new’, without realizing the environmental cost of that expectation.

We have also been conditioned to see reuse, repair, and multi-service lives as something that could be a significant risk, from economic, performance, and safety perspectives. A cultural focus on consumer convenience, immediate gratification, and low prices, makes it very difficult for consumers to make more sustainable decisions.

An example of this is the cost of repair: Many people opt to replace a broken product because the cost to have it repaired is actually higher than the cost of the product. That initial price comparison is typically as far as the decision-maker goes; other important factors that are usually not considered are that the independent repairer owns a local community business, is highly skilled, is trying to make a living, and can prevent ~95% of the product from going into the waste stream.

On the other side of the example is the low-priced new replacement product: the low-price is often a factor of overseas production, lower product quality, and shorter lifespan. What is a ‘good’ decision in this example, and how can the consumer legitimately gather all of the details needed to make the good decision?

Many organizations struggle to know how to make changes to be more circular, and to effectively communicate these opportunities to shareholders and stakeholders.

A feeling that “…if it ain’t broke, don’t fix it…” often keeps organizations locked-in to conventional processes and approaches; in other words, it can be hard to get organizations to make changes until there is a crisis, such as a major supply chain issue.

How do wood pallets fit into the circular economy model?

There are three main principles of circular economy:

To minimize the waste associated with the production, use, and end-of-life of products and materials.
To extend the productive/service life of products and materials, and thus increase the productive utilization over multiple service lives.
To regenerate natural systems.

The wood pallet industry already practices circular economy in many ways; particularly for wood pallets that are designed to have multiple service lives (trips), and for which systems are in place to recover, evaluate, repair, and reuse those pallets.

For the first principle, many wood pallets are constructed from wood that is actually by-product of another wood manufacturing process – thus, waste from another process is used as the input to wood pallet manufacturing. There are many examples of repurposed wood pallets – once these pallets are no longer viable to serve as pallets, they are often integrated into alternative uses, instead of being directed to landfill as waste.

For the second principle, wood pallets are often recovered and repaired multiple times by wood pallet companies as part of the planned service life of the pallet – thus, the design of both the pallet and the system integrates repair over multiple use cycles, rather than requiring a new pallet every time.

Finally, wood pallets are constructed of a durable biomaterial that can be used to regenerate natural systems when they can no longer be used for anything else.

Many wood pallet companies choose to mulch the scrap wood materials that cannot be used any longer for pallets, and this mulch can be used in landscaping and biosphere applications – thus, enabling some of the embodied materials within the wood to be returned to the natural system, although it is important that this is only done with wood that has not been chemically treated.

Wood pallets are an excellent example of circular economy principles, in practice; an important thing for the industry to consider is how to more fully-embrace circular economy thinking, and where these systems can be further optimized and improved to reduce negative environmental impacts.

Talking To The Source: Dr. Jennifer Russell of Virginia Tech and the Circular Economy

October 12, 2020/in Blog/by Glenn Meeks

Dr Russell, what is your role at Virginia Tech, and what is your area of expertise?

I am an Assistant Professor in the Department of Sustainable Biomaterials, at the College of Natural Resources and Environment. My area of expertise is in economic systems-modeling, with a focus on the environmental impacts associated with industrial use of resources and energy.

Our conventional economic system generates a significant amount of solid waste, consumes a significant amount of fuel and energy, and distributes a lot of pollutants into the water and atmosphere. This system becomes even more problematic when we consider that every product requires materials that must be extracted from the earth and that are destined to go to a landfill when the user is finished with it.

Given all of this, I study how we can incorporate innovative changes into business models and material flows in order to achieve a system that is more ‘circular’ — in which flows of waste materials and products can be integrated as inputs into new production and manufacturing. This effectively reduces the loss of valuable materials into landfills, and it offsets some of the need to extract new materials and resources for inputs to production.

Throughout this system, there are opportunities for reduced energy consumption, reduced emissions, and even increased employment opportunities. This alternative economic framework is called “Circular Economy”, and it is a concept that governments and businesses around the world are engaging with and adopting, increasingly, over the past 10 years.

What is your current area of research in the topic of the “circular economy”?

I am very interested in contributing to the realization and operationalization of circular economy practices and processes – in other words, how are we making these changes now, given the legacy systems, infrastructure, and cultures that exist (and that might pose challenges).

Much of the research in circular economy is focused on high-tech innovation and industrial solutions – these are very important; but also important are the activities, processes, and behaviors that are accessible to everyone around the world.

For this reason, a lot of my current research is focused on the challenges and opportunities related to the increased practice of repair and reuse. Arguably, anyone in the world can engage in these practices, and there are not really many stringent barriers to people participating in repair or reuse.

These processes have also been common-practice for many communities for centuries – they are not ‘new’; However, the ways in which we value these activities, as a society, has changed. Where, a century ago the mending and repairing of goods and equipment was common practice and expected, many categories of goods and equipment have become ‘disposable’; there is a lot of evidence of the decline of the independent repair community, and the relegation of reuse to something only done for charitable purposes.

Other ways I am exploring this theme of ‘operationalizing circular economy’ is through the lens of local policy solutions – how are community leaders and municipal governments engaging with the ideas of circular economy to move it forward in ways that respect local conditions and priorities.

You recently co-authored a UN report, “Re-defining Value – The Manufacturing Revolution”. Why is re-thinking how we manufacture industrial products and deal with them at the end of their useful life so important?

Industry’s singular pursuit of ‘efficiency’ has led to some major environmental and economic challenges. Not only do we have millions of tons of valuable materials being sent to landfill each year because, as a society, we have become normalized to the idea that things can just be ‘thrown’ away; we are also facing a realization that many of the resources and materials that we have relied on for the past 100 years are finite, and that we might actually run out of them.

Although the word “sustainability” is now used in a variety of ways, fundamentally, industry decision-makers are starting to think about the longevity, security, and resiliency of their supply chains – our ability to ‘sustain’, ourselves, our economies, our health, our way of life, and the future of our children.

The analogy of a “linear economy” really highlights this challenge: We take materials from the ground; we convert them into products; we use those products; and then we throw them away – a figurative “take–>make–>dispose” system. When we manufacture products in a linear system we also generate other negative environmental impacts associated with production: for every new product made, energy and fuel are consumed, solid waste and pollutants are generated, and emissions are released into the atmosphere.

Unlike nature, a linear economy does not replenish stores of valuable materials, and it does not return any nutrients back into the environment; it depletes resources in one place, and concentrates wastes and valuable materials alike into inaccessible landfills. It is easy to see that this model is really not sustainable at all.

The idea of cycling materials, components, and products within a circular economy is really about mimicking nature: In a forest there is no waste – every item within that ecosystem is part of an elaborate food web that includes plants, bacteria, herbivores, omnivores, and carnivores. The solution to our challenge of finite materials and environmental damage is to find the industrial analogy of a food web: In other words, how can we organize and manage material and product flows so that there is no waste, and so that we do not run out of the materials we need to keep our economies running?

Goals to achieve zero-waste to landfill can be helpful, because they focus on finding valuable applications and outlets for materials and products that are no longer wanted by the original owner. However, we cannot rely on recycling alone: Only a small subset of products and materials can be recycled; many products have components and materials that are so integrated, that we cannot separate them out to be recycled (e.g. old laptops and smart phones); and recycling processes can require a lot of energy. Further, many of the products entering the waste stream are still functional and have a lot of residual value.

Many of these waste stream challenges can be addressed much further upstream in the process, through improved design and manufacturing practices: designing products to be easily disassembled, easily repaired, modular, and/or upgradable are key ways that we can enable a product to have multiple long service lives.

Manufacturing products and reorienting business models in a manner that allows for the use of recaptured parts, instead of new parts, can significantly reduce the amount of new materials that are required for production, as well as the associated cost, energy, and time.

Join us next week on the Nature’s Packaging Blog for Part 2 of this interview.