As the COVID-19 pandemic highlights the need for sustainable approaches to economic development, the concept of a circular economy is gaining mainstream attention. Earlier this year, the U.S. Chamber of Commerce Foundation released a new study that reveals significant economic and environmental benefits for embracing a circular economy in the Great Lakes region. The research findings serve as an important blueprint as business and government leaders look for ways to address COVID-19 induced resource constraints and reach circularity at scale.
The events of the past seven months have disrupted society and forced a deep reexamination of how we operate. In many instances, rather than distracting from existing circularity efforts, this period of disruption has further validated the merits of a circular economy. Maintaining a robust pipeline of recycled materials as manufacturing inputs has provided much needed supply relief in resource-constrained scenarios. Additionally, amid sweeping concerns for racial and social equity, transitioning to a circular economy can reduce the need for dated waste processing mechanisms that disproportionately affect communities of color, and simultaneously provide a significant job source for underemployed populations.
As our new normal prompts companies and decision makers to take concrete steps toward a circular transition, the U.S. Chamber of Commerce Foundation’s study "Creating a Circular Economy in the Great Lakes Region" has even more relevance. The research reveals significant economic and environmental benefits for embracing a circular economy in one of the major industrial and manufacturing regions of North America. By adopting circular practices, the Great Lakes Region can save up to $5 billion and cut carbon emissions by up to 120 million tons — the equivalent of taking 25.5 million passenger cars off the road for a year.
The report focuses on three heavily used materials — steel, plastics, and pulp and paper — to measure the impact of circular business practices. What is most encouraging is that these practices are not far-off technologies or infeasible business model shifts. The scale required to accomplish circularity in these three industries is indeed significant given the necessary infrastructure adjustments and range of stakeholders that must be activated, from designing different ways to use reconstituted material into end-products, to configuring more effective material return schemes. But we no longer have to wait to get to circularity. Whether it’s reducing copper contamination and switching to more secondary steel use in manufacturing, bolstering both mechanical and chemical recycling capabilities for plastics, or using lignin as a functional product and optimizing the end use of waste byproducts in pulp and paper manufacturing, these mechanisms are all within current reach of stakeholders.
Creating the economic and environmental case for the circular economy in regions across North America can put us on a path toward reduced waste, increased value from products and reduced levels of harmful emissions.
Through a collection of case studies, the report also details leading businesses with operations in the Great Lakes Region that are taking steps towards making these material streams more circular. Their work, along with a series of actionable recommendations explained in the report, offer a framework that can be applied in other regions to move toward a circular economy, including:
1. Conduct a comparable economic and environmental impact assessment for the region by leveraging existing data
It is crucial to have a baseline measurement of how circular economy practices can lift up a region’s economy and bolster existing sustainability efforts. To justify new investment, several industries already conduct economic impact analyses using any number of vetted mechanisms, such as those which leverage RIMS II data from the U.S. Bureau of Economic Analysis. Stakeholders then will use those results to illustrate long term multiplicative impact in GDP growth, jobs created or other positive outcomes. The Great Lakes report uses previous research on the three heavily used materials in the region (steel, plastic, and pulp and paper) to determine impact on the local economy and its greenhouse gas emissions profile. While our research certainly can be used to build the case for circularity’s potential, specific resources in other regional markets may require a more bespoke analysis.
2. Incorporate circular economy practices into broader environmental and climate goals
Once the potential benefits are calculated, circular economy efforts can be incorporated into broader regional climate action targets — such as those recently renewed by Illinois, Wisconsin and Michigan — as clear pathways to achieve them. By aligning circular practices with broader targets, they become instrumental aspects of these public and trackable goals. Explicitly identifying circularity in these plans can provide a strong signal, clearer guidance and greater incentive for the private, public, NGO and community stakeholders whose effective collaboration is crucial.
3. Encourage the necessary partnerships and collaboration
Many corporate efforts towards sustainability, such as increased recycling rates, reduced water usage or zero waste goals, require only a handful of partners and financial investment. In contrast, companies cannot be circular without joining an entire ecosystem of enabling actors that can serve as secondary markets, recovered material suppliers and otherwise assist in closing the loop. Private sector support for business models that better foster circularity and cross-sector collaboration, such as value creation for waste streams, can lead to increased adoption of circular practices by a wider array of businesses and stakeholders.
Ultimately, creating the economic and environmental case for the circular economy in regions across North America can put us on a path toward reduced waste, increased value from products and reduced levels of harmful emissions. The social benefits are equally significant, ranging from increased job creation to meaningfully contributing to the 2030 Agenda for Sustainable Development. With this report, the U.S. Chamber Foundation hopes to accelerate circularity in the Great Lakes Region by creating an environment where leading circular businesses can deepen their own efforts, inspire and educate businesses in the earlier stages, and stakeholders across the public and private sector can synchronize efforts. Moreover, we hope to provide a model through which other regions can gauge potential impact and refine an actionable agenda that cuts across borders to enable a circular economy at scale.