The circular economy is a key part of combating climate change and biodiversity loss. But despite this, only 7% of the global economy is in the circular economic loop.
Currently, the adoption and processing of materials account for 50% of global greenhouse gas emissions and 90% of biodiversity loss. The use of natural resources has tripled over the past 50 years and is expected to nearly double by 2060 if nothing is done to change course.
The problem is well known. The European Union aims to tackle it by increasing and tightening regulations, and countries as well as companies are setting themselves ambitious goals. Amidst regulations, it is sometimes forgotten that investing in the circular economy also brings economic benefits, and throughout the EU it is estimated to create around 700,000 new jobs.
Packaging waste regulations shape the recycling of packaging waste. The regulations define the requirements regarding packaging materials and their recyclability. The goals are to increase the use of recycled plastic in packaging, reduce the amount of single-use packaging and promote the reuse and refilling of packaging. By 2030, 70% of all packaging should be recyclable.
3 major changes in the circular economy
1. Product design: The design stage determines 80% of a product’s environmental impact. This makes it essential to consider the circular economy in the packaging design phase. Packaging should be made increasingly recyclable, and reusable where possible.
2. Use of recycled materials: The EU’s packaging waste regulations highlight the importance of using more recycled materials. Recycled raw materials are not as price-competitive as virgin raw materials, but this must change. The market for recycled raw materials is also driven by quality; it must be high enough for the materials to be suitable for packaging new products.
3. Logistics: Logistics volumes and networks need to be adapted to better support closed-loop solutions. This can’t be achieved without new ways of thinking.
Companies can boost circular practices by turning their waste and side streams into someone else’s raw material. Additionally, companies can create circular economy plans to assess the potential business opportunities the circular economy can bring.
A case in point: Closed-loop system for Kiilto’s professional hygiene product packaging
Kiilto piloted a closed-loop system for the packaging materials used in its professional hygiene products. In this kind of system, packaging materials of professional hygiene products are collected, cleaned and processed again, with the recycled material used to produce new packaging for new products.
Customers of Kiilto’s professional hygiene products collected and rinsed empty high density polyethylene (HDPE) plastic packaging as part of the closed-loop system. A Kiilto logistics partner then collected and temporarily stored the packaging. The plastic was delivered to a recycler and processed into recycled granulate. This was supplied to a packaging manufacturer, who produced new packaging from it. Finally, the packaging was filled at Kiilto’s factory and delivered back to customers.
Creating a closed-loop system requires collaboration throughout the value chain. Success hinges on customers and partners being actively involved and genuinely engaged. Closed-loop systems are awin for everyone: zero waste, maximum climate impact.