Are we on the path to a Circular Economy?

In October 2022, all Australian Ministers for the Environment decided Australia should transition to a Circular Economy (CE) by 2030. We haven’t moved very far in that direction though. One reason for this is that Governments are not very good at shaping economic outcomes. Another reason is that Government departments operate in independent silos rather than as the hands and feet of a body. As a consequence, we have a patchwork of rules and regulations, initiatives, grants and all sorts of things operating in an uncoordinated way, achieving very little.

But instead of talking in the abstract, I would rather give a few examples of what could and should be done.

Take car tyres. We import all of them. We use them until they are at the end of their life and then collect them (due to a National Stewardship Scheme), shred them, turn them into new rubber products or a fuel for cement kilns in Southeast Asia. Off they go, leaving the country again.

Could they add to a CE in Australia? I think so.

The tyres could go through a pyrolysis process, yielding the following outputs: a pyrolysis oil, a recovered carbon black, steel and a gas. The gas is used to heat the pyrolysis plant, the steel is recycled into new steel, the carbon black goes back to tyre manufacturing (not in Australia) or into the asphalt industry (in Australia) and the oil is used as a fuel or is refined into higher quality products. All of these outputs can be used in Australia.

Asphalt, in roundabout numbers, is made out of a mix of aggregates and sand (95%) and bitumen (5%) as a binder. We can get sand and aggregates from recycling of building and demolition waste. We can make bitumen in Australia. We could make Australian roads from Australian resources, if we had a mindset that said: this is not a waste anymore, it is now a product. Problem is, we do not have that mindset, and, certainly in New South Wales – once a waste, always a waste. The rules and regulations stand in the way of circular thinking. They prevent us to develop that mindset.

This is where Mandatory Product Stewardship can help. It puts an obligation onto the maker or seller of a product to find a second use for the product after its first life, so to speak. That puts pressure on the market. Problem is that most stewardship schemes are voluntary and don’t cover all products. Imagine trying to catch small fish with a net that has holes in it as big as a white shark. That’s what we are currently trying to do.

Another example:
The Sydney Basin was always a great contributor of food to the population of Sydney. Market gardens in particular produced a large portion of the vegetables the ever-growing population needed. Now that Western Sydney is developing ever faster with the growth of the new Aerotropolis, the agricultural land, and with it, the market gardens disappear.
At the same time the Government has mandated the collection of Food and Garden Organics (FOGO) by 2030. There is a little problem in that there aren’t enough facilities that can process all the FOGO that will be collected.

Now imagine a large property outside the Sydney basin along a major highway and possibly even a rail line. That property could house a large-scale FOGO processing facility, including anaerobic digestion (AD), that can receive all types of food waste. The property is large enough to accommodate some large-scale modern glasshouses that can produce vegetables all year round. These glasshouses need water, electricity, heating in winter, cooling in summer and CO2 during the day to help boost plant growth.

An AD facility produces biogas, which can be used to run a generator to produce electricity. The engine’s waste heat can be used to heat and also, via an absorption chiller, to cool the glasshouses. The exhaust CO2 can be captured, cleaned and fed into the glasshouses when needed. The glasshouses can deliver their left-over plant matter (see how I don’t use the word “waste” – mindset!) to feed the AD process. The circle closes.

This is standard operating procedure in many European countries.

The NSW Government has started a low carbon manufacturing grant program to support these sort of initiatives. However, no one in Government actually coordinates the development of precincts I described above. It is assumed industry will do it. But industry hasn’t got a Circular Economy mindset (yet). Industry needs to make money to attract the investment it requires. It has to operate within the framework the Government provides by necessity. That framework says: ‘Once a waste, always a waste’. Industry is also waiting for regulations for AD facilities. Without clear and reasonable regulations there will be no investment into AD facilities.

There are still many loops to be closed.

Of particular frustration to industry is how long it takes for Government to do anything.
Example: In November 2021 the NSW EPA commissioned an independent review into the NSW Resource Recovery (RR) framework. In September 2022, the so-called Wilkinson Review was released with 22 recommendations on how to improve, refine and strengthen this framework. The NSW Government supported most recommendations, either in full or ‘in principle’. In July 2023, the EPA published a Delivery Plan on how to implement the 22 recommendations, describing when actions for the implementation would commence and, according to the Table 1 “Action timeframes’, when they would be ending.
Admittedly, the EPA kept one of those timeframes, sort of. The response regarding asbestos contaminants was supposed to be finished in April 2026 and in June 2026, the EPA published a trial to allow household asbestos waste , meaning not from commercial collectors, to be disposed of free of charge for a period of two years. Not exactly what the industry was looking for, but something. Breadcrumbs.

In relation to the recommendation to allow so-called ‘end-of-waste’ pathways, the Delivery Plan showed a timeframe until April 2028. Anyone who knows even a little about the CE knows that without an ‘end-of-waste’ pathway, achieving a CE is mere luck. From July 2023 to April 2028 is nearly 5 years. Does it really have to take that long?

Fact is, until this issue is delivered in a reasonable and practical manner, investments into CE activities will find other States, where this issue has already been resolved.
CE by 2030? I don’t think so.

Frank Klostermann
Technical Director
SLR Consulting