ENVI

Committee on Environment, Public Health and Food Safety

Turning waste into opportunity: The EU is adopting measures to accelerate the transition to a circular economy whilst each EU citizen produces nearly half a tonne of municipal waste in a single year. In light of the Circular Economy Action Plan (CEAP) of the European Commission, how should the EU further support Member States in their transition to a circular economy?

Daryna Hoch (Chairperson, UA)

Introduction 

2,5 billions tons of waste that is produced each year by the Member States not only harms the environment, but also threatens EU citizens’ well-being. Only 11.2% of materials in the EU are used in a circular way. This large amount of waste is a result of a currently existing“take-make-use-dispose” linear structure of production and consumption; this leads to businesses and producers not having enough incentives to create more sustainable products. 

30 years after the first mention of the term, “circular economy” finally started gaining traction in the EU in 2015. Circular economy is a concept of resource management that is now a part of legislation of the EU and is recognised in the scientific literature as one of the key drivers for achieving the goals of the Paris Agreement. The main goal of the circular economy is to establish a “closed-loop system”which will limit the resources used for production and reduce waste, pollution, and carbon emissions.Transition to a circular economy must become a priority for governments and other relevant parties to preserve the environment and maintain economic development.

Main Actors

There are several actors that play a vital role in the transition to the circular economy model:

The European Commission’s Directorate-General for Environment is responsible for implementing environmental policy in the European Union. This is a governmental body that has the most impact over which EU policies will be implemented in the field of circular economy. For example, as part of the Circular Economy Action Plan (CEAP), after elaborating a new legislation on single-use plastic products in the EU, the Directorate-General was able to pass the legislation by the EU governmental bodies in July 2019, which entered into force in July 2021.

Another important actor is the UN EnvironmentProgramme (UNEP), an intergovernmental platform created to combat the most drastic environmental issues and implement other policies regarding the environment on a global scale. Annual Policy Dialogue on Circular Economy between European Commision and UNEP is held between the respective representatives to boost the transition to the circular economy. The European Commission works with UNEP to develop new approaches in waste management, expand the lifetime of a product and materials, and endorse on the market eco-friendly products.

National governments are the most important actors, as they set agendas for legislation, elaborate long-term plans and make relevant decisions, therefore directly influencing the transition. Some Member States created their own strategies in support of the CEAP. However, some other Member States, such as Romania, Bulgaria, Croatia, Greece and Slovakia, failed to comply with the existing legislation on waste, which is a crucial part of a transition to the circular economy, therefore being taken legal steps against by the EU governing bodies.

The European Investment Bank (EIB) is another institution that contributes to the circular economy transition by providing financing, advisory support and knowledge sharing. The EIB provides finance to circular economy projects and promoters, even to those with a higher risk profile in order to stimulate the transition to the circular economy.

Businesses, such as large companies and manufacturing plants which are part of the production circle, also play an important role in the transition to the circular economy. The challenges that the business faces while transitioning to the circular economy model, mainly include high upfront cost for industry and renewal of a new resource efficient machinery, risks and technological difficulties.

Infographic by Thomas Celie (Media Team Member)

Past: Actions Taken

  • European Green Deal as a set of political initiatives was proposed by the European Commission with the aim to turn the European continent into climate neutral until 2050. The main targets of the European Green Deal are to reduce pressure on natural resources, elevate the level of well-being of citizens, protect biological diversity and make the economy eco-friendly, which includes transition to the circular economy.
  • The new action called “Circular Economy Action Plan (CEAP) 2.0” was adopted in March 2020 by the European Commision, as part of the European Green Deal, after achieving all of the 54 actions of the previous CEAP. The new Plan has new objectives such as reduction of waste, better managing of resource-based industries, implementing and incentivizing zero-carbon policies and creation of standardised policies of sustainable products in the European region. The Plan introduces the circular economy stages for the entire cycle of production: from creation and production to consumption, repairment, secondary usage, recycling and reuse.
  • Waste Framework Directive and Landfill Directive. These are two important legislations adopted by the EU, which are crucial to the transition to the circular economy. The first one establishes the principles of waste management and waste hierarchy, while the second one introduces basic requirements of landfilling and waste treatment. Non-compliance with these two legislations led to the EU taking legal action against five Member States.
  • Policy Dialogue on Circular Economy is an initiative that promotes EU and UN cooperation in the field of circular economy. Both parties join forces to spread the circular economy around the world, including efforts to drive political momentum in global fora such as the High-Level Political Forum on Sustainable Development in July 2021.
  • Annual Circular Economy Stakeholder Conference is an annual event organised by the European Commission, during which business representatives, NGOs, scientists, public authorities, civil society organisations gather. The Conference serves as a knowledge sharing platform, empowers policy dialogue, provides workshops on the circular economy.
  • CEC4Europe is a non-governmental organisation consisting of scientists and researchers from the field of waste management and landfilling. The NGO conducts the annual Symposium “Science and Research for Circular Economy”, where innovative research topics and new scientifically based solutions in circular economy cases are presented.
  • City Loops initiative is a plan that promotes a circular economy in a holistic way, while involving all the actors – citizens, entrepreneurs, scientific community. The project, funded by the EU, focuses on seven European cities that transition their economies to circular and is serving as an example for the future.

Present: Existing Issues

One of the major issues arising from the transition is that some Member States cannot fully afford all the costs regarding implementation of the circular economy principles or do not harmonise their legislation with the EU’s. This issue also arises from the lack of technical knowledge on how to incorporate a circular economy into existing economic models.

Many initiatives of the European Commission are causing controversy among stakeholders. Representatives of organisations involved in sustainable resource management are disappointed that the CEAP does not provide further efforts to dispose of solid waste from landfills. Even taking into account the progress regarding the waste processing, approximately 175 million tons of waste are still landfilled in Europe each year. This leads to more than 140 million tons of CO2 emissions.

The European Chemical Industry Council emphasises the creation of a single European waste market that would cease the export of waste outside of Europe, promote innovative technologies and provide better access to public and private funding for the construction of new recycling facilities. Another problem lies in waste management. EU waste legislation needs to be revised to harmonise EU legislation on waste management and common practises among all Member States. 

Entrepreneurs and business owners also emphasise challenges such as high cost for removal and product innovation, risks regarding technology and operations, which remain high till final project implementation, risks on the market due to the uncertainty of customer behaviour and acceptance of the final product, and uncertainty related to the residual value of new products. 

In addition, an important issue that needs to be tackled is lack of knowledge of the importance of re-usage and about the circular economy approach and its benefits as a whole by Member States and their citizens. 

Future: Challenges Ahead

While countries such as Ireland are implementing their own national strategies, some Member States are still hesitant to undertake relevant measures and are pressured by their own NGOs to take the transition more seriously, only after which the government starts to act. So, how can the EU incentivize Member States and assist them, while trying to reach the Green Deal goals?

Policies, such as introducing digital product passport, still need to undergo a lot of consideration and reach a consensus in the European institutions in order to be implemented. In addition, the question of how new business models should be implemented and incentivized arises as well, while changing consumerism behaviours of the society.

Even though 95% of European business leaders express the notion that circular economy is a strategic choice, the transition itself still poses a lot of unanswered questions, and some entrepreneurs even consider their businesses to be pressured to comply with the regulations to continue functioning as usual. 

Circular economy in its core is an opportunity for economic growth, environmental protection and even more jobs created. But to get all of the stakeholders to work towards the same goal, while facing immense challenges as of the urge to change customer behaviour, high technological risks and upfront costs, is not an easy task, which needs to be completed, if we want to preserve our planet.