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THE EU CIRCULAR ECONOMY
A POLICY ANALYSISVeronika Feheregyhazy
Helen Scheithauer Nina Schneider
Background
Introduction
Goals• Increase recycling/re-use of municipal waste to
70% in 2030
• Banning landfillling of all recyclable and biodegradable waste by 2025
Legally enforceable, environmental
• A 30% reduction of waste by 2025
• Maximum landfillling rate of 25%
Non-enforceable, environmental
• Simplify the reporting obligations affecting SMEs
• Harmonise and streamline the calculation of the targets and improve the reliability of key statistics
Legal and Economic
Introduction
Implementation & Evaluation
• Administratively– Easier reporting through clear definitions and calculation methods– More transparency– Establishment of early-warning system
• Financially: Facilitate and promote private direct investment
• Due to criticism: Already updated e.g. by making targets country-specific
• Evaluation :Roadmap– Ex-Ante evaluations of existing policies on waste and product design & and large number of
prior studies on initial situation of the EU member countries– Initial Impact Assessment (IA) regarding e.g . cost & benefits, administrative burden,
implementation arrangements and potential difficulties in transposing the directive– Initial IA as basis for further IA’s for all changes and updates of program– Inter-service steering group assisting in IA’s
Introduction
Rationale of Analysis
Resource EfficiencyHelena Scheithauer
Stakeholder: Government & Corporations
SD Area: Environment & Economy
Packaging and Packaging WasteNina Schneider
Stakeholder: Government
SD Area: Environment
Green Action Plan for SMEs
Veronika Feheregyhazy
Stakeholder: Corporations
SD Area:Economy
Introduction
WASTE MANAGEMENT: PACKAGING & PACKAGING WASTE
Goal: changes to waste life-cycle
Waste management: Packaging & Packaging Waste
Recycling and preparing for re-use of packaging
waste to be increased to 80% by 2030
Phasing out landfilling by 2025 for recyclable waste in non-hazardous waste landfills (max rate 25%)
An early warning system to anticipate possible compliance difficulties
and promote dissemination of best
practices in all Member States
Improving coherence of waste legislation by
aligning definitions and remove obsolete legal
requirements
EconomicStrengths- Recycling waste back into the economy creates jobs- Breaks linkage between economic growth and waste
generation- Less landfill volume reduces maintenance cost for
States- Allows environmental cost to be borne by producers
of waste
Weaknesses- Imperfect production substitutability of recycled with
virgin raw materials- Circular Economy is artificially created requiring
economic resources and capital- Difficult to attribute life-cycle of every product,
difficult to assign specific costs to Polluter/Producer
Opportunities- Reduced import of raw materials from other countries- Opportunity to exchange best practices/information
with other nations to develop own economy
Threats- Decreased competitiveness of local products by
polluting manufacturers with increased cost structures
- Increased regulations may dissuade investors from considering EU
Waste management: Packaging & Packaging Waste
Environmental PreservationStrengths- Reduce ecosystem strain, by reusing resources (e.g.,
waste)- Nonhazardous landfill space saved, retaining natural
capital- Food waste reduced, reducing deforestation, strain on
fertile soil- Reduce landfill volume, reduce negative
environmental effects- Material-specific targets to increase gradually from
2020 – 2030
Weaknesses- Long time for Circular Economy package to be
implemented, delay of environmental benefits- Material Input Per Service unit: environmental cost of
recycling may surpass virgin manufacturing- No mention of hazardous waste management. Only
about the traceability of hazardous waste.
Opportunities- Universal positive image for green policies and
programs, build a good reputation in the global market
Threats- May threaten industries built on waste management,
deforestation, natural resource extraction, etc.
Waste management: Packaging & Packaging Waste
Equitable/Social DistributionStrengths- Increased support and guidance for all Member States
on procedures, definitions and best practices- Increased support for at-risk Member States,
accountability measures to increase success rates - Recycling waste back into economy as secondary raw
materials increases jobs, welfare distribution- Long term: Higher QOL
Weaknesses- Member States begin with varying degrees of
economic resources, no funding available from EC for waste management programs less-developed States need
- Delay of social benefits due to length of policy implementation
- Transition from old to new Circular Economy may have negative social effects (e.g., job loss, etc.)
Opportunities- May attract more tourists, students, teachers
(intellectual capital) due to cleaner, healthier environment
Threats- Increased immigration (to healthier countries) may
cause lower QOL, uneven distribution of benefits, congestion and other neg. effects.
Waste management: Packaging & Packaging Waste
Implementation and Evaluation• Feasibility
– Jan 22, 2015: EC discarded waste, recycling and incineration laws within Circular Economy
– MEPs blamed business lobbying– Efforts in 2015 end to re-table a more ambitious proposal
• Implementation– 2 Process Evaluation Requirements:
- Annual/bi-annual reports for progress to Eurostat 18 months after each waste directive’s reporting period
- Three annual implementation reports sent to Commission’s DG Environment.
Commission prepares overall Implementation Report summarizing aggregate progress of waste legislation
Waste management: Packaging & Packaging Waste
Potential Market and Governance Failures
• Information asymmetries: Member States unable to properly communicate requirements to stakeholders
• More problematic for less-developed nations
Market Failures
• Lower levels of accountability
• Falsification of data related to waste management programs
• Overall corruption
Governance Failures
Waste management: Packaging & Packaging Waste
Recommendations
Strong information campaigns: 1) emphasize LR/SR benefits of effective waste management system; 2) best/worst-case scenario projects for better
visualization; 3) comprehensive training for WFD for relevant
stakeholders
EC retains consultants for third-party organizations (UNIDO) to
assist less-developed nations by providing guided roadmaps
Waste management: Packaging & Packaging Waste
GREEN ACTION PLAN FOR SME’S
Goal: turning environmental challenges into business opportunities
Greening SMEs for more
competitiveness and sustainability
Green entrepreneurship for the companies
of the future
Opportunities for SMEs in a greener
value chain
Access to the markets for green
SMEs
Governance
Green Action Plan for SMEs
Economic EfficiencyStrengths- Closing of knowledge gaps- Easier access to financing- Green technologies attractive and affordable for SMEs- Rewards for businesses using green technologies- Increases number of innovations- Increased competitiveness
Weaknesses- No punishment mechanisms- Little attention on role of waste management industry- Role of consumer is neglected
Opportunities- European SMEs as leaders in green tech and
solutions - Facilitation of worldwide export of European
technologies - Decreases dependency - Opportunity to change the mindset of companies- Most new innovations come from SMEs
Threats- Copying of European innovations by foreign
companies- Too many subsidies (inefficiency & dependence)- Not enough integration of SME associations- Lack of recognition of specific needs of micro, small
and medium-sized companies
Green Action Plan for SMEs
Environmental PreservationStrengths- Improved material efficiency decreases pressure on
environment- Decrease in demand for rare earth and critical
resources
Weaknesses- GAP was developed under the assumption that
economic growth is needed- No concrete tools mentioned how to assess the
“greenness” of a technology
Opportunities- Increased awareness for environment by SMEs
Threats- May result in easy solution and not in the best ones
Green Action Plan for SMEs
Equitable/Social DistributionStrengths- Improved education and trainings for companies and
employees- Job enrichment- New technologies for developing countries
Weaknesses- Little attention towards social sustainability
Opportunities- Encouraging green innovation can give economic
boost- Creation of new jobs
Threats- Exclusion of the local community as stakeholder
Green Action Plan for SMEs
Implementation and Evaluation• Feasibility
– Communication is the key issue– Need for tailored communication campaigns
• Implementation and Evaluation– EC has committed itself to regularly monitor all actions on the GAP, including:
• Review of the financial resources needed and used • Dialogue with relevant SME stakeholder • Effectiveness of the specific programmes.
– Annual SME Performance Review for each Member State
Green Action Plan for SMEs
Potential Market and Governance Failures
• Inefficiency: Too many subsidies
• Asymmetric informationMarket Failures
• Voting Issues: Lack of involvement
• Bureaucracy: Inappropriate or insufficient information, different interests
• Decentralization Issues
Governance Failures
Green Action Plan for SMEs
Recommendations
Communication and Information
Cooperation and Partnerships
Legislative actions
Country-specific implementation
Green Action Plan for SMEs
A RESOURCE-EFFICIENT EUROPE
Goal: Utilizing resources more efficiently
Empowerment of consumers
Technological improvements
Transition in energy, industrial, agricultural and
transport systems
Consumers' and producers'
behavioral change
Exploiting synergies and
addressing trade-offs
Public support for R&D
Building up the knowledge base and consistent
analytical approach
A Resource-efficient Europe
Economic Efficiency Strengths - Trade policy to tackle the challenges in commodity markets and on raw materials - Addresses supply and demand side at the same time - Lowers costs - International cooperation benefits- Market integration - Strengthens EU's competitiveness
Weaknesses- No clear directions on how to achieve goals
Opportunities- Coherence between the EU's raw materials and external policies - Opening up of new markets/liberation of existing markets - New/greener technologies to enhance effective production
Threats- Diversity of range and state of economies in the different member states - Global resource scarcity - International cooperation and the EU's position in the global market
A Resource-efficient Europe
Environmental Preservation
A Resource-efficient Europe
Strengths - Specific medium and long-term objectives and
means for reaching them- A new biodiversity strategy for 2020- Early action on adaptation to climate change- Identifies waste a resource
Weaknesses- No clear-cut measuring indicators of
environmental damage- Bad environmental status in some countries
Opportunities- Proposals to reform many related policies- A water policy for increasing water efficiency- Resource life cycle assessment- International cooperation: knowledge transfer,
best practice
Threats- Much coordination needed between different
policy areas and strategies- Threat of causing unwanted side-effects- Global climate change
Equitable/Social DistributionStrengths- Addresses the hidden costs of resource use that society has to bear; thereby creates an opportunity for behavioural change - Tools in place to monitor progress and respond to stakeholder's input - Stakeholder involvement - Promotes good governance - Produces positive externalities
Weaknesses- Information and data availability and reliability
Opportunities- Evaluation and adjustment of policy on a case-by-case basis furthers equity - Knowledge generation and transfer - International cooperation - Strengthening of competitiveness; job creation
Threats- Biased decisions in case-by-case decision making -Focus of policy and trade-offs -The “losers” of change
A Resource-efficient Europe
Implementation and Evaluation• Feasibility
– very feasible: strategic, integrated; proposes concrete action– main issue: complexity
• Evaluation• “Progress Report on the Roadmap to a Resource Efficient Europe”
– Resource Efficiency Scoreboard: Eurostat – The Life Cycle Data Network
• “Analysis of an EU target for Resource Productivity”– Rationale for a target of increasing resource productivity – Resource productivity: GDP divided by Raw Material Consumption (RMC
A Resource-efficient Europe
Potential Market and Governance Failures
• Not addressing the supply and the demand side of the market
• Not addressing hidden social costs
Market Failures
• Not addressing hidden social costs
• Failing to deal with the complexity
Governance Failures
A Resource-efficient Europe
Recommendations
Green Action Plan for SMEsA Resource-efficient Europe
Education and Training
Environmental Indicators + Resource
Efficiency Target
Raw Material Consumption Data
Conclusion/Implications• Resources are used more efficiently, waste is becoming a resource• Job creation • More competitive stance on the global market
EU’s position and perception as one unified body speaking with one voice
Required:
More specific information
available for SME’s
Setting shared standards in all member states
Reflective regional economic
developmentGood cooperation
Environmental Indicators + Resource
efficiency target
Thank you for your Attention!
Any questions?