Why cities are the engine room of the circular economy

Our economy is currently based on a 'take, make, use and dispose' model, but it's no longer working for businesses, people or the environment. In the light of the numbers of local authorities declaring a climate emergency, time is running out for us to act decisively to create a low carbon circular economy.

Why cities are the engine room of the circular economy

Cities play a very particular role in accelerating towards a low carbon circular economy and reducing climate change emissions. London, like all other cities, produces both CO2 emissions within its boundary (through materials production, energy use, transport and the like – so-called ‘territorial emissions’) but is also responsible for emissions outside of its boundary, which are the emissions associated with the consumption of goods and services.

When we buy goods and services that have been created elsewhere, they leave a carbon ‘wake’ created by the extraction or recycling of raw materials, the energy used in production, their transport to markets, and their subsequent use and disposal – an end-to-end view of emissions known as ‘consumption-based’. In fact, cities are responsible for almost the same amount of consumption-based emissions as they are territorial emissions, as a result of the food, clothes, electricals and other items that we buy and use every day.

The good news is that we can make significant reductions in consumption-based emissions through a combination of lifestyle changes as well as by adopting circular business models such as sharing, leasing, re-using, repairing and recycling.

Nearly 90% of consumers strongly believe that society should be more resource-efficient, and the UK’s market for ethical products and services grew by more than £40bn between 2008-2017. In addition, almost half of those aged under 24 say they avoided a product or service in the last year due to its negative environmental impact. All of this points to increasing demand for low-carbon products and services such as those possible in a circular economy.

In recognition of the growing appetite for action on climate change and the circular economy, the first global Circular Cities Week takes place this week (28 October – 3 November). The initiative pushes for the design and implementation of circular economy strategies in cities around the globe, to help keep materials in use for longer, reduce consumption-based emissions and minimise negative environmental impacts.

Cities need to be at the forefront of the movement to develop and scale new ways of doing things – not least because, for the first time ever, more than half of the world’s population lives in urban areas. This population density and the proximity of people, business and civil society living and working together provides an ideal environment in which to test and implement innovative circular economy models.

Cities also need to look hard at consumption from the citizens’ side of the fence if we are to keep climate warming below dangerous levels. The Paris Agreement commits signatories to act to limit global warming to well below 2°C – and to pursue efforts to limit it to 1.5°C.

Consistent with this trajectory, the UK and London have committed to net zero emissions by 2050. That means we urgently need to offer citizens new ways of living sustainably, reducing their consumption of goods and materials, reusing and recycling more; and we need to change ownership models through turbo-boosting renting, leasing and subscription.

As one of the most vibrant business hubs in the world, London is already home to some great sustainable innovators and entrepreneurs, with pioneering organisations leading the way on circular products and business models. Examples of these innovators range from Biohm, a start-up using bio-based materials such as mycelium fungus and food waste to create new, circular construction materials, through to Dame, the first reusable tampon applicator, which has already saved 156 million pieces of single-use plastic from being thrown away.

Wherever businesses are on their journey, we need to bring together organisations of all shapes and sizes to help learn from each other and speed up the transition to a circular economy. Collaboration is crucial – which is why initiatives such as Circular Cities Week are so welcome.

It’s no surprise that the transition to a circular economy could have hugely positive environmental impacts – capable for example of preventing more than 60% of London’s waste. But with London’s population predicted to reach over 11 million by 2050, taking a more sustainable approach to products, housing, office space and infrastructure will also be crucial to our ability to adapt and thrive both socially and economically. By 2036, the circular economy could provide London with £7 billion every year in the sectors of the built environment, food, textiles, electricals and plastics, as well as creating new jobs in the areas of re-use, remanufacturing and materials innovation.

London Waste and Recycling Board is committed to making London the place to be for innovators and circular economy entrepreneurs, and we’ve built a growing community of organisations working together to deliver a more resilient, resource-efficient economy. This includes supporting the best new circular start-ups through our Circular London Accelerator and Advance London programme, as well as investing in the Greater London Investment Fund. Launched by the Mayor of London to provide more than £100 million worth of investment to small and diverse businesses, it will provide at least £14 million of venture capital targeted at circular economy start-ups.

Cities offer a hot-bed of opportunity for entrepreneurs and established businesses who want to create innovative approaches to product design, manufacturing and services. By inspiring collaborations and commitments, we can help many more businesses to thrive through circular models and make an important contribution to tackling climate change while we’re at it.

Wayne Hubbard is chief executive of LWARB

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