Linn Hille-Dahl

There is so much stuff out there. Isn’t there enough produced by now and all the needed primary resources are extraced? Can we not just reuse all the resources that we have dug up from underneath earth’s surface? In order to improve the usage of existing goods, they have to be placed in a circle where going to waste is not an option. To close that loop, the right data is essential, as well as designing new business models and creating a societal awareness. Providing the needed information; that’s where digitalization comes into place.

What is circular economy?

Circularity means closing the material loop. The idea is to create, deliver and capture value within closed material loops. Ideally, “waste” no longer exists, but finds its purpose somewhere else. The key words are reduce, reuse, repair, repurpose, and recycle. More than often, the end of a product is not taken into account thoroughly enough, during the production. The world would look different today, if the producers of all waste had to take care of it fully.

You might have encountered this in your life as well. You have something you no longer need but it’s actually in perfect condition. You want to get rid of it but nobody you know needs it. Throwing it away would be a pity. On another day, you realize you need something and you think you could get it at a second-hand shop. But then either the second-hand shop doesn’t have it or you don’t find the time checking it out and end up going to the close by shop buying it first-hand. What if all shops were part of circular economy and there was no need for mining or fossil fuel to gain the needed resources? Certainly, a lot has to be done until I can go to the store and get me a tea ball without thinking, getting one second-hand would be more sustainable. There are many online possibilities to sell, buy, rent and share all kinds of stuff. But so far it is just not as convenient.

Digitalization as a means to Circular Economy

Digitalization can boost the circular economy. The key value is the information that is available through digitalization.

Such as the data of the product’s…

• Location
  The accessability increases through the knowledge of location. It is a required information to facilitate the end-of-life collection, refurbishment, remanufacturing and recycling.
• Condition
  Knowledge of the product’s condition allows for accurate maintenance. Advanced diagnostics and prognostics of the components and the product enhance reliability and lead to a longer lifetime.
• Availability
  Data of availability leads to better planning security.

Having the accurate information available helps reducing cost, saving resources and providing trustable data. Open, accurate and big data supports important decision-making in businesses.

Furthermore, digitalization enables co-creation of businesses. It allows them to connect with customer and create a more interactive market.

Another far reaching opportunity of digitalization in the context of circular economy is the so called Internet of Things (IoT), which aims to optimize processes and therefore saves ressources. This is a concept that is used in the context of smart homes and smart cities.

The illustration below depicts the far reaching idea of circular economy in cities.

Figure 97.1 – Digital enablement of cicrular economy in cities. (Figure: Ellen MacArthur Foundation)

Circular Economy touching several UN Sustainable Development Goals:

SDG 8: Decent Work and Sustainable economic growth

• A market with diminishing unsustainable primary resources, where the focus lies on labour and not so much on material goods.

SDG 9: Industry, Innovation and Infrastructure

• An industry where resources are channeled back into the loop. Where the main goal is to expand the lifetime of the product or the components. The process of designing products include a cradle to cradle approach.

SDG 11:  Sustainable Cities and Communities

• Sharing economy is a part of circular economy. It promotes resource efficiency and reduces waste production.

SDG 12: Responsible Consumption and Production:

• Responsible production such that existing material is reconsidered and used in production. In terms of consumption, circularity means that goods are used more carefully, expanding their lifetime. Choosing second-hand and long lasting quality.