Circular economy could be worth up to $700 billion in consumer goods savings alone
The UK-based Ellen MacArthur Foundation, a charity that works with business and education to accelerate the transition to a circular economy, has called for faster adoption of circular business models. In its second volume of ‘Towards the Circular Economy’, which focuses on opportunities for the consumer goods sector, the Foundation quantifies the economic benefits of circular business models and lays out pathways for action. Read more…
The report argues that the time is now right for greater investment. The consumer goods sector globally accounts for 60% of total consumer spending and 35% of material inputs to the economy. It also absorbs more than 90% of agricultural output – a key area of the economy facing increasing challenges. The report, featuring analysis by economists, McKinsey & Co, suggests that the adoption of the circular economy could be worth up to $700 billion in consumer goods savings alone. It would also have benefits for land productivity and supply chain stability.
The report says that in the food sector, collecting and processing household food waste to generate biogas and return nutrients to agricultural soils represents a huge opportunity given that one tonne of food waste is worth €19 in electricity, €13 in heat and €4 in fertiliser. In the beverage sector, manufacturers could reduce material inputs and the price of packaging by moving to re-usable glass bottles, for example reducing the cost of a hectolitre of beer by 20%. Other examples include textiles, where around €53 billion in savings is possible through increasing the amount of clothing collected and reused or remade.
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