Triptych: the vision of the New Economy: Circular in phases
New Economy is working on the transition to a new economy. One aspect of this is the circular economy. In a three-part series of blogs, we'll discuss what's important for shaping the transition to a circular economy.
This blog focuses on the transition to a circular economy in phases.
More and more people are recognizing the importance of the circular economy and are taking steps in their regions or supply chains. While this is a positive development, the debate surrounding the circular economy often lacks concreteness, vision, and depth. Therefore, New Economy is presenting its vision for the transition to a circular economy in a five-part series with the following blogs: Circular in Phases, Longer in the Supply Chain, Eliminating Toxic Elements, Circular Components, and New Revenue Models with Current Products. In this first blog, we clarify the meaning of the ambition to achieve circular 50% production by 2030.
Goals of the Government
In 2016, the central government launched the national programme The Netherlands Circular in 2050 presented. Three strategic goals are formulated:
- Making high-quality use of raw materials in existing chains.
- Replace fossil, critical and unsustainably produced new raw materials with sustainably produced, renewable and available raw materials.
- Developing new production methods and redesigning products.
The Raw Materials Agreement has been signed by many public and private parties and marks the starting point for realizing the ambitions of a circular economy by 2050. A thematic elaboration of the objectives has been developed at various roundtables and translated into five transition agendas. Biomass & Food, Plastics, Construction & Infrastructure, Manufacturing and Consumer Goods. This further defines the objectives for 2021, 2025, and 2030.
At all levels of Dutch society, policies are being developed to stimulate the market to adopt circular practices, and innovative business leaders are taking steps in their production processes. The need seems clear, as do the opportunities. So, what's currently hindering the transition?
The business perspective
The vast majority of Dutch companies are simply producing. The economy has recovered, and they have an order portfolio full of linear orders. They neither sense the urgency nor see the opportunities. On the other hand, there are companies that are taking steps but are criticized for their execution. What is often misunderstood and exploited by critics is the notion that when an organization adopts the circular economy, it must immediately become 100% circular. This is often neither feasible nor desirable in the current phase, as it involves high costs and much remains unknown.
Future ambitions and contemporary reality
We shouldn't be fixated on 100%. The ambition to achieve a fully circular economy is a promising goal and should primarily serve as an incentive to take action now. Innovative developments won't progress when frontrunners punish each other for not meeting the 100% future ideal. It's also paralyzing when 2050 targets are projected onto the current situation.
How to initiate change now?
New Economy therefore always advocates for a phased approach, starting with circular redesign at the component level. Replacing some of the materials with already used materials has a greater impact on 100% than using new materials. This allows an organization to start implementing the circular economy today without having to invest a significant amount of time and money in fully circular product development. Transitions take time and go through various phases. Innovations must evolve, and much of the knowledge and expertise required to create circular products must be developed iteratively. Therefore, it's crucial that organizations don't focus solely on the 100% objectives for the future, but instead consider what they can already do.
Triptych of the New Economy vision:
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