Creating value
Creating value
Benefits of a circular economy in South Australia
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International studies

This South Australian study drew upon the methodologies and findings of several international reports.

Many of their authors reviewed our South Australian report (see our International Expert Committee).

We wanted to share our literature review with readers who want to dig deeper:
 

  • In 2012 the Ellen MacArthur Foundation set the scene with Towards the Circular Economy Volume 1. This report identified annual net material cost saving opportunities for the European Union of up to US$380 billion in a transition scenario and of up to US$630 billion in an advanced scenario. These projections were based on detailed modelling of eight key sectors, upscaled to the rest of the economy. Volume 2 in 2013 took a closer look at fast moving consumer goods. Volume 3 in 2014 was a collaboration with the World Economic Forum and McKinsey & Company, proposing a joint action plan and finding that globally over US$1 trillion a year could be generated by 2025 if companies focused on encouraging the build-up of circular supply chains to increase the rate of recycling, reuse and remanufacture.
     
  • Another pioneer was The Organisation for Applied Scientific Research (TNO), which analysed the changes the circular economy could bring in the metals sector, the electrical sector, and the use of biotic waste streams, then extrapolated the results to the Dutch economy. The resulting Opportunities for a circular economy in the Netherlands (2013) evaluated the opportunities at €7.3 billion a year (1.4% of 2013 GDP) and 54,000 jobs. As was the case in Towards the Circular Economy, these results represent the overall annual potential, not attached to a particular year of achieving this. This report also showed impressive benefits related to the reduction in greenhouse gas emissions, land use, fresh water use and use of raw materials.
     
  • The European Commission’s Study on modelling of the economic and environmental impacts of raw material consumption (2014) investigated the impacts of achieving different resource productivity targets for the EU28, from a modest 1% per annum improvement through to ambitious 3% per annum improvements. The results showed that resource productivity improvements of around 2% to 2.5% per annum can be achieved with net positive impacts on EU28 GDP, ie that the benefits of higher efficiency levels outweigh the costs of making the improvements to efficiency.
     
  • In 2015, a wave of reports were produced in Europe as the European Commission deliberated its circular economy directive:
    • Zero Waste Scotland’s The Carbon Impacts of the Circular Economy used territorial and consumption carbon footprinting to show that a more circular economy could reduce Scotland’s greenhouse gas emissions by 11 million tonnes of carbon dioxide equivalent per year in 2050
    • Anders Wijkman and Kristian Skånberg produced The Circular Economy and Benefits for Society for the Club of Rome, evaluating the impact of transitioning to a circular economy in 2030 on greenhouse gas emissions, jobs and GPD in Finland, France, the Netherlands, Spain and Sweden
    • WRAP and Green Alliance’s ‘Employment and the circular economy Job creation in a more resource efficient Britain’ looked at gross jobs growth, net job creation, unemployment rate fall and % offset of predicted decline in skilled employment of different circular economy scenarios in 2030. This was followed up by ‘Economic Growth Potential of More Circular Economies’ which applied the same methodology to show expansion of the circular economy could create 3 million extra jobs and reduce unemployment by 520,000 across EU member states by 2030
    • Sitra’s ‘The opportunities of a circular economy for Finland’ suggests that, by 2030, the circular economy will have value creation potential of EUR 1.5–2.5 billion for Finland’s national economy
    • The Ellen MacArthur Foundation’s Growth Within, a circular economy vision for a competitive Europe looked at greenhouse gas emissions, primary material consumption and economic benefits (resource benefit economies, non-resource and externality benefits, GDP increase) of the mobility, food and building sectors in Europe. Extending their results across the economy they found annual benefits of up to €1.8 trillion by 2030
    • The Ellen MacArthur Foundation’s Delivering the circular economy: a toolkit for policymakers looked at Denmark as a case study and indicated that transitioning to a circular economy could lead to 0.8–1.4% additional GDP growth, the creation of 7,000–13,000 job equivalents, 3–7% reduction in carbon footprint, and 5–50% reduction in virgin resource consumption for selected materials by 2035.
       
  • Finally in 2016, Circular Economy in India: Rethinking growth for long-term prosperity, also by the Ellen MacArthur Foundation, shows that a circular economy trajectory could bring India annual benefits of ₹40 lakh crore (US$ 624 billion) in 2050, and greenhouse gas emissions would be 44% lower in 2050 compared to the current development path.