The Circular Economy: Restorative to Regenerative
Hitesh Kumar Rajpurohit
Engineering & Planning | MGL | Ex IndianOil-Adani Gas | Member of PMI® | Teach For India
According to the Environmental Protection Agency (EPA), the oil and gas industry in the United States generates about 18 billion barrels of waste fluids every year. Switching from a linear to a circular economy is one potential approach for the O&G business to fight waste.
The World Economic Forum defines circular economy as "an industrial system that is restorative or regenerative by intention and design." The circular model closes the loop by bringing items back into the cycle after usage so they can be reused, recycled, or repurposed, as opposed to the typical linear 'take-make-waste' approach, which turns raw materials into products that are used once and discarded.
A circular economy concept seeks to reimagine growth in order to benefit both people and the environment. It means gradually disconnecting economic activity from finite resource consumption and designing waste out of the system. The circular business model creates economic, natural, and social capital by relying on renewable energy sources. A circular economy minimizes material consumption, redesigns materials, products, and services to be less resource intensive, and reclaims "waste" as a resource for the production of new materials and products.
Circular economy might not only reverse planetary boundary overshoot, but it could also reduce global demand for material extraction by one-third. This reduction is based on removing fossil fuels from the global equation, particularly coal, and lowering demand for high-volume minerals such as sand and gravel, which are mostly used in construction and infrastructure.
Recycling and Circular Model:
Recycling involves converting waste materials into new materials and objects. This process itself uses energy and creates emissions, so can still contribute to global warming. In an ideal circular economy, products are redesigned so they last through several life cycles – rather than being immediately recycled. This can include refurbishing and redistributing products.
We need to understand that recycling is not an effective strategy for dealing with unused resource volumes in a growth model. We will find ourselves in a never-ending pursuit of continuously generated waste, rather than seeing the avoidance of waste as a path to beneficial innovations on many levels. Of course, it is easier to think about recycling. This avoids changing the whole of our volume-based production model. But in a world where we have to shift our consumption patterns and use less energy, recycling no longer has all the answers.
Much of the environmental damage during the last century may be linked to increased greenhouse gas (GHG) emissions, and the Circularity Gap Report 2021 discovered that material handling and usage account for 70% of worldwide GHG emissions.
Total material extraction is increasing globally: it has more than tripled since 1970, but has nearly doubled since 2000, reaching 100 billion tonnes now. This increase is not exclusively the result of the world's population doubling since 1970, since per-person material consumption has only increased by a factor of 1.7. For example, whereas virgin material demand was roughly 7.4 tonnes per person in 1970, significantly less than today's approximately 12 tonnes, this growth in per-person material demand has not been uniformly spread across countries, and it is anticipated to reach 190 billion tonnes by 2060.
The following three principles can help bring a shared focus to business leaders and policy makers: