EXCLUSIVE: Circular Economy Taskforce looks to identify risk hotspots
The risks around a circular economy are being examined and mapped out by the Circular Economy Taskforce, as the consortium prepares to report on its initial findings next month.
Speaking at the Sustainable Business resource scarcity conference in London this week, Green Alliance associate Julie Hill, who chairs the government-backed taskforce, revealed that much of the taskforce's thinking had centred on issues around materials supply and risk.
She said that while it was clear that recovering materials would mitigate a whole range of supply risks, it was still not clear what this would mean for pricing.
"Price is determined by actors in the marketplace and they differ for different materials and products," she told delegates.
"They differ for secondary materials as they do for primary and that is an area that needs a lot more examination. How far can one hedge against price volatility through recovery of secondary sources?"
Hill also said that the main problem facing businesses wanting to engage with this agenda was how to sell the circularity idea to investors and defining what the future would look like in terms of value capture.
"How certain can you be that if you are going for a circular model, what the revenue flows might be and whether people will buy into to it?" she questioned. "Can you even sell it to consumers?"
According to Hill, there are a number of barriers to achieving circularity. She warned that while it was important to encourage new business models, there was no guarantee, even when these were adopted, that the recovery infrastructure would be in place to enable businesses to get hold of the material.
"You can have an innovative new business model redesign, but will there be the infrastructure to bring these materials back if as a business you are not physically doing it yourself?" she asked.
On a merchant basis, Hill explained that businesses could invest in the infrastructure themselves, but questioned whether those working at the business model end would be visionary enough to guarantee material supply into these facilities.
Hill went on to tell delegates that one of the main reasons why circularity had not become a reality in the UK was because businesses weren't sure about the future drivers and price advantages of taking a circular approach.
She finished by offering a list of potential solutions to overcoming some of these barriers, including taxing carbon, better infrastructure finance, more individual producer responsibility, the public sector leading on procurement and some regulation.
"There is a menu of things that could be done if there was the political appetite to do it," she added.