When it comes to achieving the goal of a net-zero emission by 2050, much of the focus is on energy-related carbon reduction through energy efficiency and renewable energy. However, this will only take us halfway to the necessary reduction in emissions. Much more may be accomplished by altering our business practices and exploring different company models, goods, services, supply chains, etc. This is where the circular economy plays a crucial role in our efforts to achieve a net-zero future.
Decarbonization and The Circular Economy:
More than reducing operating emissions is required to reduce the carbon footprint. We must act on material resources- how they are made, how much we utilize them, what they are made of, and how we dispose of them. Due to their resource usage and waste, the fashion, food, construction, and electronic industries account for a significant amount of worldwide scope 3 emissions. The circular economy addresses the “embodied carbon” of products and services. It also assists companies in various industries to fulfil scope 3 carbon targets.
The Problem of Sustainable Production and Consumption:
Production and consumption are increasingly being recognized as major challenges by consumers and corporate leaders. The Climate crisis was identified as one of the top hazards in the Global Risk Report published by the World Economic Forum. The report includes the following:
- Environmental damage.
- Failure to take climate action.
- Natural resource crisis.
- Biodiversity loss as climate-related problems.
The report anticipates that humans will require around 1.75 planets to get the necessary resources for their consumption and absorb their waste, including carbon dioxide and other greenhouse gasses.
By 2030, we will require five planets if we live like western consumers. Thus, these reports show that we are facing a future with limited resources. Natural resource extraction and processing are responsible for 90% of biodiversity loss and 50% of global emissions. It is apparent that mankind is living above its means, and we are at a critical juncture at which we must act. Circularity is one of the environmental drives to reduce natural resource hazards and reduce enough emissions to meet the United Nations Sustainable Development Goals or the goal of the Paris Agreement of limiting global warming to 1.5 degrees Celsius.
How to Reach Net-Zero Using Circular Strategies:
Businesses may use circularity in four important ways to reduce carbon emissions and get toward net zero. Among them are the following:
- Closing the loops to get more out of all materials while lowering the embodied carbon
- Narrowing loops to minimize the number of resources
- Slowing loops by long-lasting manufacturing products
- Cleaning loops to minimize pollution and other negative effects of production and utilization
Innovation through circularity is necessary to transition to a net–zero economies. There are a few important impact areas for achieving success and implementing circularity throughout an organization:
- Partnership innovation– Developing new collaborations or innovative processes with current partners to reap the benefits of circularity.
- Process innovation– refining existing business processes and creating new circular processes.
- Product innovation– developing or renovating products to gain additional circular advantages.
- Packaging innovation– innovating packaging to improve circularity performance.
- Proposition innovation– developing updated customer propositions that are circular by design.