What is a Circular Economy and why do we need it?

6 Minute Read

April 22, 2018. Earth Day.

This was the day I gave my very first talk on sustainability. As I prepped for the talk and awkwardly rehearsed in the lady cave of my Brooklyn apartment, I knew I couldn’t even begin to scratch the surface of sustainability without talking about the circular economy. After all, it’s such a key component of sustainability.

The talk went great, by the way, even though I was totally sweating bullets through my shirt. Plus, when I get nervous, my Trini accent comes on strong. It’s quite amusing now that I think back on it.

All that nervousness aside, I was still able to communicate to the audience how important circular thinking was for sustainability and for our sustainable future.

The terms linear economy and circular economy come up a lot when talking about sustainability because they define just how sustainable or unsustainable a system (or planet!) is. So let’s dive into each of these ideas, so you can understand the differences.

Linear Vs. Circular Economy, which is better?

A circular economy is a system where every component feeds into, and supports, the other parts of the system. A circular economy, often called a closed loop system, can sustain itself indefinitely. And the concept is based on a “regenerative economy”, where resources are extracted, used, and deposited back into the system to be reused.

Regenerative…sounds sustainable, right?

Totally!

But here’s the thing…if you look at how our entire economy currently functions, you’ll see a linear economy in full effect. In a linear economy, the main rationale is to take, use, and toss. In comparison to the circular economy, a linear economy is based on an “extractive economy”, where resources are extracted, used, and disposed of, often never to be used again.

The problem with a linear economy is that it’s not sustainable. You see, there are only so many resources you can pull from. Eventually, you’ll run out.

By looking at these two ideas, you can see that one can continue to run indefinitely (circular economy), while the other can only function for so long without running out of resources (linear economy).

Side note: there’s also a “recycling economy” which can technically fall into either category depending on how efficiently or poorly it’s executed.

Here’s a visual to show you how the 3 different economies work (in the context of trash, waste and resources).

Circular Economy Diagram

As you can see, the linear economy produces a lot of trash and essentially converts resources to waste. The recycling economy cycles through those resources a few times, but often still end up in the trash. And the circular economy continues to cycle all resources, never allowing them to become waste.

Aside from my little sketch above, there are a ton of great circular economy infographics out there to help you better understand the concept. Here’s one of my faves that breaks it down in the simplest way possible.

Circular Economy Examples

Since the beginning of time, every single atom, drop of water, and bowel movement has been regenerated into something else, redeposited into the Earth, or transformed into another resource. In fact, if you look at anything that exists in nature, you’ll see the circular economy at play. Here are a few examples:

Oceans evaporate into clouds, which rain on dry areas, trickling into the soil as well as into rivers and streams that flow back into the ocean. This naturally occurring circular economy repeats over and over and it’s how we satisfy all of our water needs as humans.

A tree receives it’s nutrients from the soil, which enable it to grow and flower. When the leaves fall to the ground, they break down into nutrients and are absorbed back into the soil. The soil transfers nutrients back into the roots so the tree can continue to grow.

Cows eat grass. When they digest that grass and have a bowel movement (aka, when they poop!), the feces are broken down into the soil, creating natural fertilizer. That soil then fertilizes the grass, which enables it to grow and provide more food for the cowwies!

As you can see, circular economy principles are pretty simple. The idea is to “eliminate waste and pollution, circulate products and materials, and regenerate nature” (The Ellen MacArthur Foundation). In a circular economy, nothing is wasted. Pretty genius, right?!?! Thanks Mother Nature!! You’re a total badass!!

Linear Economy Examples

On the other hand, if you look around, you’ll see examples of linear economies everywhere (but only in man-made situations):

Much of the world’s electricity, fuel, and heat currently come from fossil fuels, which are nonrenewable resources that won’t last forever. You see, we can’t replenish the number of fossil fuels we currently use. So the question is: what will we use when they run out?

In the Western world, we douse our gardens and lawns with chemical pesticides and fertilizers all to optimize for short-term output. This naughty habit diminishes the plant’s ability to thrive in the long run and those chemicals often do more harm than good.

Over the decades, the fashion industry shifted its model from quality goods that are built to last, to mass-produced goods that are low quality, inexpensive and disposable. This has lead to people buying more clothes and using them less, creating an excess of discarded clothing.

It’s important to note that there are a few benefits of linear economies: (1) they maximize for short term profit and (2) they have much less operational factors to consider since the idea is to simply toss products or byproducts when they are no longer needed. But the thing is: those are short-term benefits that are limited by short-term thinking. If we want a planet that can flourish indefinitely, we need to start thinking more circular.

But when your entire economic system runs on a linear economy (like ours does!), there’s lot that has to change to switch to a circular economy. And there are more operational factors to consider since you can’t just throw sh*t away.

The world doesn’t have infinite resources. And at the rate that the globe currently consumes, those resources can only last so long. The truth is, we simply don’t have enough resources on Planet Earth to continue the way we’re living. What happens when those resources run out?

This video does a great job of comparing a circular economy model to a linear economy model:

And if you wanna dive a lil deeper, Cradle to Cradle is hands down my top circular economy book recommendation.

Conclusion

As you can see, the circular economy is the sustainable winner in this comparison. That’s because there’s only one Planet Earth, and she can’t produce resources fast enough to keep up with how quickly we go through them. This is why it’s so important to understand the circular economy and start redesigning the way just about everything works on the planet.

PSSST!!! Guess what?!?

I’m building a course on the circular economy! It sounds nerdy, I know, but talking about sustainability gets my juices flowing. But you already knew that! Anyways, I’d love for you to take the course for a spin before I launch it out into the ether!

Drop your email here to be the first to take my circular economy course for a spin! We’re still testing it out, so you can be part of the process to help make it that much better!

P.S. If ideas like sustainability and climate change get you jazzed or even a little anxious at times, then this is a great way to take action and get yourself educated! Besides, who doesn’t like getting first access to things before anybody else!