Key themes and takeaways
- The bigger picture. The circular economy needs stable macro-economics, the right incentives and penalties, aligned policy goals and political and corporate will.
- Circularity should not mean no growth. To ensure confidence in the circular economy we need to keep the economy growing whilst reducing/stagnating resource consumption. How to decouple the link between growth and consumption should be front of mind for tech.
- Circular by default. As the economy digitises and moves to the Fourth Industrial Revolution, circularity must be the default, not the linear model we have used so far. Designing for circularity is essential. The circular economy is made a lot easier if products are designed to be easier to repair, reuse and recycle from the outset. This lowers costs and reduced timeframes for getting the resources back into the market.
- Servitisation is a huge opportunity. Particularly for manufacturers, moving to an as-a-service model helps build new revenue streams without not needing to sell goods in the conventional sense. While this has typically been the preserve of B2B markets, some tech manufacturers are beginning to roll out to B2C markets too.
- Consumers are increasingly onboard. Customers (both consumers and businesses) want to understand more about the environmental impacts of their tech products and services and are more open minded about alternative business models than ever before.
- Common standards and metrics. To build the circular economy and get scale there needs to be common standards, metrics, taxonomy, standards and definitions so all players in the circular economy understand each other.
What are the opportunities for tech?
- Moving to service models. Servitisation means the technology supplier retains ownership of the technology through its life, creating an incentive to design circular products. It also creates new business models so the revenue does not end with the sale of a specific device but can be linked to additional services and support.
- Using data. Better leveraging of data on the use and condition of products are key advantages as more devices become connected.
- Materials within electronic devices have an inherent value. Some of the materials in tech are inherently valuable. It means tech firms adopting circular business models are able to recoup finances even when a product finally becomes waste.
- Remanufacturing. This is worth billions of dollars globally and at least £5bn in the UK. However, more needs to be done to enhance corporate acceptance of refurbished and remanufactured products.
- New business models. Technology is enabling older, more established sectors to become more circular in their approach. For example, using technology-driven data insights, the automotive sector can cut the remanufacturing process from 10 days to just three.
- Resources not waste. The dial has shifted a bit, but not too much and there are significant market opportunities that will arise from the realisation that waste is actually precious resources with real value.
What are the barriers?
- Volatile secondary materials markets. Unstable commodity prices and concerns over the quality, scarcity and usability of secondary materials means it is difficult to plan to incorporate recycled content in products.
- POPs and quality of secondary materials. Materials containing hazardous or polluting materials cannot be reused, and businesses will not opt for secondary materials when there is a risk it is neither safe nor compliant.
- Business inertia. Many business-to-business customers are reluctant to buy ‘used’ equipment because of an inherent bias towards “used” goods, so companies must offer cost reductions and as-a-service models to help overcome these objections.
- Reverse logistics is a huge challenge. It is frequently not economically viable to collect small quantities of used equipment. Speakers throughout the day highlighted logistics, collections and takeback as a significant hurdle to circularity.
- Cyber security and privacy. Businesses and many consumers have concerns that data on devices may not be deleted when a device is reused. The challenge for tech manufacturers is to help ensure that consumers know how data is wiped and have confidence in data sanitisation processes.
- Policy challenges are not being met. There needs to be a single market for waste so that “waste” products can be easily shipped to dedicated sites for remanufacturing and refurbishment and specialist recycling. There also needs to be a level playing field between virgin and secondary materials.
For the tech sector the circular economy has moved from abstract theories to concrete action. This has largely been due to companies innovating with new materials and rising regulatory obligations at all stages of a tech product’s life. More does need to be done, but the direction of travel is very much towards more circularity and this will not change any time soon. There are also significant innovations in how digital tools are enabling circularity in other sectors, which shows that the concept of ’tech as an enabler’ is very much alive and well.
Links to external resources
- Presentations from the conference
- Industrial symbiosis (NISP)
- CEDACI project
- John Lewis buy back case study
- EPSRC UKRI project
- Epson Paperlab
- Gumtree etiquette of buying and selling online
- Ellen McArthur Foundation - Circular Electronics Report
- Defra Resources and Waste Strategy
- CEN/CENLEC material efficiency standards
- European Commission Circular Action Plan
- WRAP Switched on to Value Report
- Susanne Baker, techUK
- Professor Paul Ekins, UCL
- Associate Professor Fiona Charnley, University of Exeter
- Dr Richard Peagam, Associate Director, Anthesis
- Owain Griffiths, Business Director, Oakdene Hollins
- Daniel Quelch, CSR Manager, Epson
- Mateo Dugand, Technologist, HP Enterprise
- Mark Dempsey, UK Sustainability Manager, HP Inc
- Bill Skeates, Supply Chain Manager, Sky
- Dr Deborah Andrews, London South Bank University
- Kelly Price, Account Director, Winnow
- Fergus Campbell, Head of Communications, Gumtree
- Leigh Greatorex, Sr Business Development Manager, SIMS Recycling Solutions
- Anthony Levy, CEO, Cistor