Why the Circular Economy is such a hot topic

Circular economy thinking is not new, leading think tank, the Ellen MacArthur Foundation has been cheerleading CE principles to governments and industry for almost twenty years.

European countries have been adopting and integrating strategies to capture and reuse resources already in use, thereby reducing the need to manufacture new materials.

Right now in Australia, circular economy is a hot topic. Following on from draft policy consultations and announcements last year, the Queensland and New South Wales governments recently launched, almost simultaneously, investment in circular economy innovation projects.

So why is there an imperative now? What happened?

China's National Sword policy.

China has long been the preferred destination for the world's recyclable materials - mostly plastics. Each year, more than 30 million tonnes of the world's waste flowed into the country, with Australia contributing around 1.25 million tonnes. Those days are now over and the impact to global markets has been profound, the reliance on linear business models within the recycling industry are now being exposed.

Tied to waste collection and export business models, recycling companies have directed their materials to other regions across Asia such as Indonesia, Malaysia and Vietnam. Besieged by the volume of consumer excess, these countries are now setting deadlines to end waste importation.

Like it or not, the business of waste management in Australia has changed forever and new business models and methods will need to be created. Together with businesses and manufacturers, our local authorities and communities have a huge role in the development and adoption of these processes.

Put simply, we have to change the way we think about waste.

And that's where circular economy comes in. Think of a circular economy as a blueprint for a connected ecosystem of business that thrives on connectivity, transparency, social purpose and sustainability. For example, the waste from one industry, could become part of the supply chain of a different industry, creating a new circular economy.

To move away from the 'take, make, use, throw away' business as usual, product design is critical. Manufacturers will need to create products from reusable materials, incorporate repair into product lifecycles and find solutions for waste that avoids landfill or the need to export.

To illustrate what an emerging business model based on circular economy principles looks like, let's analyse clothing waste.

Australians love their clothes. Each year on average we create more than 23 kilograms of textile waste per person, and that trend is increasing. So what happens to our clothes once they're past our personal use by date?

Many of us donate to charities, send to landfill or like other waste materials, there is export.

In 2016/17 Australia exported approximately 94 million kilograms of textiles. 94 million.

We have learned to recycle paper and plastics and to separate our household rubbish for council collection. So why is there no textile recycling industry in Australia?

The reality is there hasn't been the interest. We care more about old plastic bottles than our favourite t-shirt. Interestingly, polyester, a man made textile - accounts for 60 per cent of the world's production. Polyester is used in clothes and bedding and is a PET plastic - the same material used in a plastic bottle.

Modern clothes are mostly made from blended fabrics and until now in Australia, the technology to separate these materials has been elusive. Local company BlockTexx has developed a world-first separation process that recovers the original fibres from sheets and clothing, ready for reuse.

If the lofty goal is 'no textiles to landfill', the problem of textile waste has to be recognised and all stakeholders will need to play their part in effective solutions.

By applying circular economy principles to the textile waste issue, we can clearly identify stakeholders along the lifecycle of products and pathways for landfill diversion and resource recovery.

If we do this, we can: extend the life of clothing manufacturers and brands design for reuse and repair, and if consumers wear clothing longer, wash less often and donate or reuse unwanted garments.

Recover unwanted and damaged clothing if charities and community organisations work with businesses to find solutions for recycling.

Stimulate new and emerging business models if governments recognise the volumes and impact of textile waste and instigate a mandatory procurement policy for recycled products.

As we can see by the textile waste example, circular economy principles enables governments, businesses and consumers to view waste differently. And through this lens, they can identify and act on the unrealised value held within products and systems.

While the term circular economy might be new to most, if we look past the 'buzzword', what we are really talking about is just old fashioned business thinking applied to a modern problem.