Understanding EU Climate Policy: Circular Economies

Written by
Daniel Haggart
July 25, 2023

The concept of a circular economy has grown increasingly popular over the past few decades, with interest from governments and the private sector alike. In short, a circular economy is an economic model which tries to close the loop of production and consumption. Unlike the traditional linear production model, which produces goods from raw materials that are often left as waste, a circular economy aims to recirculate goods through the production cycle and reduce the amount of raw materials used in production.

Policymaking plays a massive role in making a circular economy a reality, with a robust framework needed to make the transition from a linear economy. Over the past decade, the E.U. has become the global driver in circular economy policy; however, many struggle to understand the complex policies of the E.U. Public advocacy for change will help put pressure on lawmakers to focus on climate issues, and without adequate public understanding of government policy, that pressure dissolves. This article will cover some of the significant recent E.U. policies relating to circular economy and help break them down.

Circular Economy Action Plan (CEAP 2015):

In 2015, the European Commission released the Circular Economy Action Plan (CEAP). The plan aimed to lay a legislative framework in order to achieve a gradual transition to a circular economy. The Commission took a multi-faceted approach targeting industry, specifically focusing on production, waste management, and recycling as critical areas for a circular economy. The plan also highlights sectors that pose challenges to a circular economy, such as plastics and food waste.

The plan also announced multiple policy initiatives in the E.U., including regulations on product design, meant to improve the lifespan and recyclability of products and regulations regarding the quality of recycled goods. Another large part of the plan was to incentivize change in industry, such as providing businesses with financial incentives to create more sustainable designs. The action plan included a timeline for new legislative initiatives, aiming to adopt most policies within five years of the approval of the action plan.

European Green Deal (2019):

In 2019, the E.U. approved a massive policy package focusing on the environment, known as the European Green Deal. The package focused on several environmental areas, including transitioning to a circular economy. The E.U. acknowledged that the 2015 action plan had come up short, and new regulations were needed to facilitate change. The E.U. called for a new action plan to be drafted, with added focus on sustainable product design and regulation limiting the amount of environmentally harmful products in E.U. markets.

The Commission planned to build upon existing policies, such as the 2018 Plastics strategy, to target resource-intensive industries such as textiles, construction, and electronics. These industries consume large amounts of raw materials, and reducing material consumption will be key in a transition to a circular economy. The Green Deal also calls for support for the development of sustainable technologies to support industry, such as clean fuel cells that rely on renewable energy.  

The European Green Deal took groundbreaking steps in achieving a circular economy. Building on the ambitions of the 2015 CEAP and subsequent policy, the Green Deal launched new initiatives across the board and called for action to be taken across the E.U. and across the globe to make a circular economy a reality. Aiming for carbon neutrality in the E.U. by 2050, the European Green Deal has promised to bring vast change.

New Circular Economy Action Plan (2020):

One year after the approval of the European Green Deal, the Commission presented a New Circular Economy Action Plan. This new plan aimed to accelerate the transition to a circular economy while maintaining a competitive economic model. The plan highlights the benefits of a circular economy, including opportunities for job growth in the industry and improved products for consumers.

The Commission acknowledged the success of past E.U. policy initiatives in reducing waste in product design, highlighting the Ecodesign Directive, which regulates design efficiency in energy-related products. The directive covered the designs of over 30 product groups, and along with other design measures, saved E.U. consumers €120 Billion, and lowered product energy consumption by 10% in 2021.

Similar to the 2015 action plan, the Commission called for a new legislative initiative focused on product sustainability, with some of the key areas including: improving the lifespan of products, banning the destruction of unsold goods, and restricting single-use products. This new policy package was meant to work alongside existing tools to limit the environmental footprint of product design.

The Commission also presents the Circular Electronics Initiative, a policy framework focused on electronics. The initiative aims to improve the durability and efficiency of phones, laptops, and tablets while also making technology more optimal for reuse and recycling. Similar initiatives were also called for regarding batteries and packaging, improving the reusability of products across the board. Future proposals may include “right to repair,” or measures requiring producers to offer repair services on broken goods.

Another focus area for the plan was plastics, commending the success of recent initiatives, such as the 2019 Plastics Directive, which restricted single-use plastics, specifically banning single-use plastic straws, cutlery, and plates. The removal of single-use plastics from the market is very beneficial to World Cleanup Day, as single-use plastics are estimated to account for between 44% and 68% of litter found in E.U. riversides and beaches. The commission sought to build on the success of these initiatives; the commission called for new regulations mandating recycling requirements and also called for new policy regarding microplastics.

The plan also calls attention to the issue of waste management, urging for a revamping of E.U. waste laws that are now seemingly ineffective. The Commission calls for waste laws on both an E.U. and national level that prioritize waste reduction and recycling, helping build the framework required to support a circular economy. A circular economy is only possible with proper infrastructure, such as a market for recycled materials to be used in production.

Over the past decade, these pieces of legislation have driven the path toward a circular economy built on sustainability. While significant progress has been made, there is still much work to be done in order to achieve a green future. We must continue to demand action from lawmakers and new policies enabling a circular economy and a society built on renewable energy.

The concept of a circular economy has grown increasingly popular over the past few decades. Let's break down some of the significant recent E.U. policies relating to circular economy.
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