How the circular economy is taking off in the US

Laptops made of plastic from old laptops. Aluminium car body parts made from old cars. Chemicals leased out, recovered, and leased again. These are just a few examples of how the circular economy, once seen as a Scandinavian speciality, is starting to spin in the United States.


What’s driving the circular economy in the US?

Economics, for one. “It’s cost efficient and carbon efficient,” says Carrie Majeske, manager of global sustainability integration at Michigan-based Ford, explaining why the auto manufacturer is boosting recycled aluminium content. “It helps insulate us from oil price volatility,” adds Nigel Stansfield, global chief innovations officer at flooring supplier, Interface. The Atlanta-based company recovers nylon from its used carpet tiles, and sends it back into its supply chain. David Lear, executive director of corporate sustainability at Dell, which has started a closed loop plastic recovery system, says that the Texan company uses 10m kg of plastic in their computers each year. “Using recovered plastic instead of virgin material definitely saves us money,” he says.

Market opportunities also play a part in driving the circular economy and they have spawned a clutch of new businesses, explains Andrew Morlet, CEO of the Ellen MacArthur Foundation. He cites New York’s Ecovative, which has developed a packaging material grown from mushrooms. “They take biowaste – like sawdust and crop products – put it into moulds and grow mushroom roots around them.” It forms robust packaging which “can be chucked on the garden as compost”. The company is working on compostable plasterboard, too.

Purists might point out that this isn’t strictly a closed loop. But in the sense of putting what would otherwise be waste back into nature’s resource chain, it is certainly circular. It’s a compromise Interface learnt early, says Stansfield. “Recycling an old carpet tile into a new carpet tile sounds good, but it’s not always the most practical solution. We took a biomimicry approach: nature recycles everything [but] it doesn’t necessarily remanufacture.”

A growing interest in zero waste is also propelling companies down the circle line, says Morley: “People are exploring automated exchanges for post-industrial byproducts, a bit like the industrial symbiosis programmes in Europe.” Reducing the burden – regulatory or otherwise – of managing your waste stream plays a part, too. “General Motors is looking at leasing models for chemicals. Instead of buying the solvents they need, using them, then having to work out what to do with them, they can lease them from specialist suppliers who then recover them, clean them and put them out into the market again.”

Many of these motives echo those which have seen the circular economy gain momentum in Europe, but there are some distinctive American aspects, too – not least, politics.

“Talking about climate change, or even resource scarcity, is much more politically loaded in the US than Europe,” says Sally Uren, CEO of Forum for the Future. For companies nervous of venturing into such sensitive territory, the circular economy is reassuringly neutral. “It’s branded with a clear business case: if you reuse this stuff and save waste, it will save you money. And no-one can argue with that,” Uren says.

That said, there are some chunky barriers on the roundabout. The American economy is still largely neophiliac: people like and trust new stuff, and can’t quite believe what’s gone around will be as good. At Ford, Carrie Majeske talks of the struggle to get recycled material included in technical specifications, for example of car bumpers. “We’re trying to make sure we get more into each vehicle each year,” she says.

There’s an element of conservatism too. “We don’t have the same regulatory framework as Europe,” says John Atcheson, founder of Stuffstr, an app-based initiative to encourage consumers to maximise the lifetime of their purchases. “And we don’t have companies who have embraced it as a broad strategic objective – like Philips, or Kingfisher, or M&S.”


What could increase the revolutions?

Regulation is, unsurprisingly, high on the list, particularly for the role it can play in ensuring a decent supply. “We need a reliable, high quality material feed-stream,” says Majeske. “That needs the right policies and the right investment. It starts with the municipalities. If they have a mixed stream recycling system [avoiding the need for consumers to separate waste] that’s a big plus.”

Stansfield agrees: “California’s put a levy on flooring materials [to encourage] end-of-life uses. Thanks to that, we’ve been able to set up hubs in that state to be key suppliers to Interface.” Similar legislation across the US would drive the market, he believes.

Certification helps, too. Stansfield points to the way the Leadership in Energy and Environmental Design (LEED) system for buildings has stimulated Interface’s market, by including the use of post-consumer recycled materials as key criteria.

But the biggest boost might come from technological innovations now under way – particularly the internet-of-things. “That will create much more active tracking of materials, and that can create business models which simply were not affordable before,” predicts Morlet.

As companies start to embrace circularity they start to see their supply lines differently. “Instead of a linear chain, people are thinking in terms of value networks,” says Uren.

America might have been slow off the blocks, but Morley is confident it’s catching up. “We’ll see some big players start to do significant things in this space, and provide real industry leadership. And increasingly, we’ll see government bodies looking to enable that to happen, and remove some of the regulations which get in its way.”

So watch this (circular) space.