Analytics, Economics, EU – Baltic States, Modern EU

Circular economy is a key to putting the member states economies on a sustainable path while delivering on the global Sustainable Development Goals adopted by all EU states. Present report shows that Europe is leading the way in CE’s implementation among other countries in the world. At the same time more remains to be done to increase actions on numerous fronts to sustainable development, waste disposal and efficient use of natural resources.

The potential for sustainable growth in the member states is huge and environmentally-friendly industries are flourishing with all the participating decision-makers acting together.  

CE’s strategic areas and the action plan

The road to CE and a climate-neutral economy would require joint action in seven strategic areas: energy efficiency; deployment of renewables; clean, safe and connected mobility; competitive industry and circular economy; infrastructure and interconnections; bio-economy and natural carbon sinks; carbon capture and storage to address remaining emissions.

Pursuing all these strategic priorities would contribute to making the member states’ economies a true CE’s reality.

General link: https://ec.europa.eu/eurostat/web/circular-economy; the findings of the report were discussed at the annual CE conference in 6-7 March, 2019.

The Commission adopted an ambitious Circular Economy Action Plan in 2015 to stimulate the member states’ transition towards a circular economy (CE), which would boost competitiveness, foster sustainable economic growth and generate new jobs. The proposed actions would contribute to "closing the loop" of product lifecycles through greater recycling and re-use, and bring benefits for environmental quality and the economy in general. The plan would help extract the maximum value and use from all raw materials, products and waste, fostering energy savings and reducing greenhouse gas emissions and would be supported financially by ESIF funding, Horizon 2020, the EU structural funds and investments in the circular economy at national level.

The EU circular economy action plan (December 2015) in:

http://europa.eu/rapid/press-release_IP-15-6203_en.htm

After three years, the Circular Economy Action Plan can be considered fully completed: its 54 actions have now been delivered and implemented. According to the report, implementing the CE’s plan has accelerated the transition towards a circular economy in the states, which in turn has helped the states increase employment. In 2016, sectors relevant to the circular economy employed more than four million workers, a 6% increase compared to 2012.

Circularity has also opened up new business opportunities, given rise to new business models and developed new markets, domestically and outside the EU. In 2016, circular activities such as repair reuse or recycling generated almost €147 billion in value added while accounting for around €17.5 billion worth of investments.

Dealing with plastics

The EU strategy for plastics in the CE has been the first EU-wide policy framework adopting a material-specific and life-cycle approach to integrate circular design, use, reuse and recycling activities into plastics value chains. The strategy has set out a clear vision with quantified objectives at EU level, so that inter alia by 2030 all plastic packaging placed on the EU market would be reusable or recyclable.

On plastic’s strategy see: http://europa.eu/rapid/press-release_IP-18-5_en.htm

To boost the market for recycled plastics, the Commission launched a voluntary pledging campaign on recycled plastics: 70 companies have already made pledges, which will increase the market for recycled plastics by at least 60% by 2025.

However, there is still a gap between supply and demand for recycled plastics. To close this gap, the Commission launched the “circular plastics alliance” of key industries supplying and using recycled plastics.

The rules on the single-use plastics’ agenda and fishing gear, addressing the ten most found items on EU beaches place the EU at the forefront of the global fight against marine litter. The measures include a ban of certain single-use products made of plastic (such as straws and cutlery) when alternatives are available and of oxo-degradable plastic, and propose actions for others such as consumption reduction targets, product design requirements and the “extended producers responsibility” schemes.

To accelerate the transition to a circular economy, it is essential to invest in innovation and to provide support for adapting Europe's industrial base. Over the period 2016-2020, the Commission has stepped up efforts in both directions totaling more than €10 billion in public funding to the transition.

To stimulate further investments, the Circular Economy Finance Support Platform has produced recommendations to improve the bankability of circular economy projects, coordinate funding activities and share good practices. The platform will work with the European Investment Bank on providing financial assistance and exploiting synergies with the action plan on financing sustainable growth. On EU’s financial support see in:

http://europa.eu/rapid/press-release_IP-17-104_en.htm

Turning waste into resources

Sound and efficient waste management systems are an essential building block of a circular economy. To modernise waste management systems in the member states, a revised waste regulation was adopted in May with entering into force in July 2018. The regulation included, among others, new ambitious recycling rates, clarified legal status of recycled materials, strengthened waste prevention and waste management measures, including for marine litter, food waste, and products containing critical raw materials.

Regulation (May, 2018) on organic production and labeling of organic products, see in:

https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=OJ:L:2018:150:FULL&from=EN

In order to modernise waste management systems in the states and to consolidate the European waste management model, the following targets were mentioned:  

• new recycling rates: by 2030 about 70% of all packaging waste and 60% of municipal waste (65% by 2035) should be recycled, while reducing land filling of municipal waste to 10%.
• simplification and harmonisation of definitions and calculation methods and clarified legal status for recycled materials and by-products;
• reinforced rules and new obligations on separate collection (bio-waste, textiles and hazardous waste produced by households, construction and demolition waste);
• minimum requirements for Extended Producer Responsibility;
• strengthened waste prevention and waste management measures, including for marine litter, food waste, and products containing critical raw materials.

The recycling rates and use of recycled materials in the EU are steadily growing: overall, the EU states recycled around 55% of all waste excluding major mineral waste in 2016 (compared with 53% in 2010), though recycling rate of plastic packaging almost doubled since 2005.  

The rate for recovering construction and demolition waste reached 89% (2016), the recycling rate of packaging waste exceeded 67% (2016, compared with 64% in 2010) while the rate of plastic packaging was over 42% (2016, compared with 24% in 2005). The recycling rate for municipal waste stood at 46% (2017, compared with 35% in 2007) and for the waste of electrical and electronic equipment such as computers, televisions, fridges and mobile phones, which include valuable materials which can be recovered (e-waste) in the EU reached 41% (2016, compared with 28% in 2010). Source:

http://europa.eu/rapid/press-release_STAT-19-1509_en.htm?locale=en and

https://ec.europa.eu/eurostat/documents/2995521/9629294/8-04032019-BP-EN.pdf/295c2302-4ed1-45b9-af86-96d1bbb7acb1

However, the revised proposal for wastes are even more stringent: - common EU target for recycling 65% of municipal waste by 2030;- common EU target for recycling 75% of packaging waste by 2030; and - binding landfill target to reduce landfill to maximum of 10% of municipal waste by 2030.

Reference to: http://europa.eu/rapid/press-release_IP-15-6203_en.htm

Biomass and bio-based products

The EU bio-economy strategy was updated in 2018 and proposed 14 concrete actions in three priority areas: 1. strengthening and scaling-up the bio-based sectors, unlocking investments and markets; 2. deploying rapidly bio-economies across the whole of Europe; and 3. understanding the ecological boundaries of the bio-economy.

The Renewable Energy Directive (RED II) contains provisions referring to circular economy and waste hierarchy. These address the risk of conflicting use of biomass resources between energy and non-energy sectors and of creating financial incentives that would undermine the separate collection obligations set out in the Waste Framework Directive. See more in: http://europa.eu/rapid/press-release_MEMO-19-1481_en.htm?locale=en

Circular design and production processes

Smart design at the beginning of a product's lifecycle is essential for ensuring circularity. With the implementation of the eco-design plan 2016-2019, the Commission has further promoted the circular design of products, together with energy efficiency objectives.

Eco-design and energy labeling measures for several products now include rules on material efficiency requirements such as availability of spare parts, ease of repair, and facilitating end-of-life treatment. The Commission has also analysed, in a dedicated Staff Working Document, its policies for products, with the intention to support circular, sustainable products.

On eco-design see: http://ec.europa.eu/growth/industry/sustainability/ecodesign_en

The transition towards a more circular economy requires an active engagement of citizens in changing consumption patterns. The Product Environmental Footprint (PEF) and Organisation Environmental Footprint (OEF) methods developed by the Commission can enable companies to make environmental claims that are trustworthy and comparable and consumers to make informed choices.

Climate neutral economy by 2050

A strategic long-term vision for a prosperous, modern, competitive and climate neutral economy in the member states by 2050 was adopted in November 2018.

This time, the long-term strategy did not set targets, but “created a vision and direction”, i.e. inspire and enable researchers, entrepreneurs and citizens to develop new and innovative industries, businesses and associated jobs. Over 90% of citizens the EU states (according to the special Eurobarometer report in November 2018) believe that climate change is caused by human activity and 85% agree that using energy more efficiently can create economic growth and jobs.

The 2018-strategy takes into consideration the options available in the EU states, business and citizens, and how they can contribute to the economy’s modernisation and improving the quality of life. It seeks to ensure that this transition is socially fair and enhances the competitiveness of the states’ economy and industry on global markets, securing high quality jobs and sustainable growth in Europe, while also helping address other environmental challenges, such as air quality or bio-diversity.

The road to a climate neutral economy would require joint action in seven strategic areas: energy efficiency; deployment of renewables; clean, safe and connected mobility; competitive industry and circular economy; infrastructure and interconnections; bio-economy and natural carbon sinks; carbon capture and storage to address remaining emissions. Pursuing all these strategic priorities would contribute to making our vision a reality. More in:

http://europa.eu/rapid/press-release_IP-18-6543_en.htm

Investment into CE

Over 2016-20, the Commission has stepped up efforts in both directions totaling more than €10 billion in public funding to the transition. This includes:

- €1.4 billion from Horizon 2020 until 2018, of which €350 million allocated to making plastics circular;

- at least €7.1 billion from Cohesion Funds (€1.8 billion for uptake of eco-innovative technologies among SMEs and €5.3 billion to support the implementation of the EU waste legislation); in addition, significant support is available through smart specialisation for market-led innovation and deployment;

- €2.1 billion through financing facilities such as the European Fund for Strategic Investments and Innovfin program.

- at least €100 million invested through LIFE programme in more than 80 projects contributing to a circular economy.

The EU role in progressive circular economy issues has been already recognized by leading international bodies: in January 2019, the Commission received the Circular Award in the public sector category by the World Economic Forum and Young Global Leaders, as recognition of the EU’s impetus in accelerating transition towards a circular economy, which protects the environment, reduces greenhouse gas emissions and increases opportunities for jobs, growth and investment. More in:

https://ec.europa.eu/growth/content/world-economic-forum-recognises-european-commission-champion-circular-economy_en