Is a circular economy the key to a sustainable future?

Technology alone will not solve the world’s problems. But combining technological advancements with circular economy thinking could be our best shot at creating a sustainable industrialised future, argue Andy Kenworthy and James Griffin

There are some wildly different theories on the role of technology in the coming era. Some suggest technology will overcome our global challenges like climate change (as described by Rohan MacMahon here at Newsroom recently), and may even take over our world. Some argue that nearly all our technology is unsustainable, and we will be forced to survive without it.

So how to navigate between these two extremes? The circular economy is one way of doing so. In a circular economy the lifecycles of materials are maximised. Their use is optimised. At the end of life all materials are reutilised. This radically new way of working would be driven by renewable energy and the ambition to restore our world.

But what would technology’s role be within it? Well to some extent we are already seeing it.

The re-emergence of the circular economy idea since the late 1960s helped to shape the sustainable business movement. The emergence of new technologies has combined with this thinking to disrupt entire industries in a number of ways.

Witness the host of online platforms like Uber and AirBnB. They are part of what is being called the ‘sharing economy’. Website, payment and social media technology has enabled people to maximise and optimise the use of resources like their cars and spare rooms.

Then there are the technological advances around the ‘Internet of Things’. This wires more and more household objects and business equipment into the Internet. It creates huge opportunities for maximising and optimising resource through enhanced control and monitoring. For example, heating and washing processes can be more easily set for off peak energy periods. This is particular important for levelling out the natural peaks and troughs of renewable energy. Firms using this technology can also use the sensors to assist in ‘preventive maintenance’ – reducing inefficient downtime from their processes. Companies like Phillips, Fuji-Xerox and Ricoh are already offering some of this capability to their customers.

In the future our electric cars could be part of the 'Internet of Things'. As the batteries run down your car may be called in for a replacement or upgrade. Your old battery may get used in stationary battery packs for home and businesses. It might then go on to be rebuilt into a new car battery.

The circular economy relies on the ability to maintain discreet ‘closed loops’ of technical and organic resources. This means products containing ‘technical’ materials like heavy metals, chemicals and plastics are designed and handled so the materials can be cost-effectively separated and recycled back into the same source materials. Meanwhile, materials that can safely return to the natural world are similarly separated.

Technology is obviously assisting that design. Better use of tracking and data can facilitate the supply chain control and product stewardship required. This can also help connect businesses, making it easier for one company's ‘waste’ or by-product to become another’s source material. The Wishbone Bike Recycled Edition is a current example. The company ships plastic recycled from US carpet to China to make a bike designed in New Zealand.

Distributed ledger technology like blockchain may become the ultimate expression of this kind of control and oversight. They operate as decentralised encrypted records. This offers the potential for incorruptible permanent verification and tracking across entire supply chains, sectors and economies. This would trigger an unprecedented level of transparency. If this technology became ubiquitous, companies would have nowhere to hide bad practice. Consumers could instantly check the provenance of every product they encounter. They would have instance access to environmental and social credentials. New Zealand’s own Conscious Consumers is one of many businesses starting to tap into this. NGOs like WWF are also exploring its potential.

But what if we didn’t need such complex supply chains to get things made? Enter the world of small scale 3D printing. It offers the prospect of producing products on demand inside smaller businesses, or even in your own home. This could cut out many of the inefficiencies of transport, distribution and disposal. Want a part for a machine, a small product or toy? Print it out at home from the manufacturers own specifications. Recycle the old one. Think of the huge benefits this kind of geographically agnostic production could have for a remote economy like our own.

Artificial intelligence offers new ways of processing, analysing and understanding the vast amount of data these new technologies are producing. AI can crunch the data to predict when machines need maintenance. It can improve the circulation and sorting of materials. It can offer ways to make systems more efficient than human thinking alone can achieve.

But all this is not to say that there are not difficult questions to answer and great challenges to meet. For example, how many new hotels and taxis have not been built because of Uber and AirBnB? Are people just travelling more because it is now easier? Are we going to use more energy to pre-heat our homes from our phone rather than keeping our coats on while things warm up?

We also need to consider the social impacts of this new developing economy. For example, there's very real concern that these technologies look set to take a good portion of the work people are currently doing. At the same time, a technology-enabled zero-hours contract ‘gig economy’ probably doesn’t represent the kind of job security and career development many of us have come to expect. How do we ensure the benefits of these developments are shared equitably?

There are also the environmental and social costs of the technology itself. These will only be tackled when it too is part of the circular economy. Technology must be designed and built to last. It must be upgradable and repairable. It has to be created without environmental and social harm.

We are seeing the first signs of this with the likes of Google and Apple switching to renewable energy. But there's still a long way to go before the rest of their operations become circular. Designs like the Fairphone are starting to demonstrate how that might be achieved. At least as phones and computers continue to fall in price, more and more of the benefits are becoming available to more people.

Circular economy thinking will not end the debate on how technology should develop and evolve. It does not seek to. But technological advancement would seem to be with us for the foreseeable future. Circular economy thinking represents one of the most powerful ways of ensuring those developments create a brighter, more sustainable and equitable future.

Andy Kenworthy is communications manager at the Sustainable Business Network, and James Griffin manages the Circular Economy Accelerator, which is preparing a Circular Economy Innovation Series of events around the country, showcasing how technology and innovation can drive the shift we need. It is also hosting New Zealand’s first Circular Economy Summit on August 29, in partnership with WasteMINZ.

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