The circular economy is coming to Europe. Here’s how

The circular economy. Despite being discussed in sustainability circles and even covered in mainstream media for more than a decade, it’s debatable how much the term has sunk into public consciousness. What has slowly been embedding itself within society, however, are the principles behind it. In place of fast fashion, for instance, people are increasingly using secondhand platforms such as Vinted – the business has reportedly grown 680% over the last 18 months. And instead of reams of bubble wrap and non-recyclable polystyrene, the future of packaging is looking decidedly plastic-free.  

Meanwhile, the foundation for widespread adoption of a circular economy is being laid in the form of legislation. From directives on minimising plastic and the right for customers to repair the products they buy, to proposals around recycling textiles and reducing e-waste, change is incrementally being worked into European law. 

Entrepreneurs have a significant role to play, too. “The startup ecosystem is a very important piece of this puzzle,” says Filipa Moita, marketing manager at Landbell Group, which runs the Green Alley Award. The award recognises European startups for pioneering circular solutions.

“Startups are the brave innovators who come up with a lot of new ideas and develop new ways of doing things,” she continues. “They influence policymakers by demonstrating how a solution can be implemented. And of course, they educate consumers, which is really important. If consumers aren’t behind the circular economy, it won’t happen.” 

Here are three policies set to usher in a circular future, and the startups working in the background to edge us even closer.  

1. Textiles

There are 16 pieces of proposed legislation that work to make fashion more circular – plans that the European Commission wants in place by 2028. In the future, fashion companies will be required to either collect a proportion of their textile waste, or pay a fee to support the waste collection of local authorities. By 2030, the Ecodesign for Sustainable Products Regulation aims to ensure products are designed for circularity, meaning they are durable, reliable, reusable, repairable and upgradable, with a high level of recycled content. And there are also plans to clamp down on greenwashing, tackle the unintentional release of microplastics, and ban the destruction of unsold textiles. 

In Barcelona, Gema Terol is head of marketing and communications for BCome, a platform that helps fashion brands become more transparent. BCome was a 2023 finalist of the Green Alley Award. “Achieving complete recycling of textile waste is extremely challenging,” Terol says. “But the linear ‘take, make, dispose’ model is no longer sustainable.” 

In the future, we’d like to see a greater emphasis on measures that directly address overproduction

She is heartened by the proposed legislation but says more attention needs to be paid to overproduction, and for fashion brands to go further themselves. “In the future, we’d like to see a greater emphasis on measures that directly address overproduction. That might involve setting limits on production quantities, for example.”

Elena Ferrero, CEO of Italy-based Atelier Riforma, which was also a 2023 award finalist, has created an artificial intelligence (AI)-based tool that can catalogue textile waste and connect it to a digital marketplace, where it can go on to be reused. Ferrero agrees on the overproduction point, adding that exploitation of virgin resources, planned obsolescence and littering are key issues as well.

“The circular economy can truly be the way out for all these problems,” she says. 

2. Packaging

The packaging sector is one of the main users of virgin materials and a growing source of waste. The much-lauded EU Packaging and Packaging Waste Directive (PPWD) will tackle this problem by ensuring all packaging is designed for recycling from 1 January 2030, and has the potential to be recycled in such a way that high quality secondary raw materials can be retained. 

There are also proposals to maximise reuse – food takeaway packaging, for example, will have to meet a 40% reusability target by 2040 – and to minimise the size of packaging units in terms of weight and volume. At a local level, deposit return schemes for bottles and cans in Denmark, Finland and the Netherlands have been largely successful, with Scotland, Portugal and other European countries planning on introducing their own schemes in 2025.

Jonne Hellgren, CEO of the Finnish startup RePack, which makes reusable e-commerce packaging, says one of the biggest challenges around reuse has been the lobbying of the single-use sector. “Initial targets for e-commerce were 20% of packaging had to be reusable by 2030 and 80% by 2040. That’s now been reduced to 10% and 50% respectively. The PPWD is the most lobbied legislation in Europe, if not the world.” 

But, he says, legislation has played a role in boosting traction for reuse in France in particular, which gives him hope for the future. “This year, brands that have €50m [£43.7m] in sales have to use reusable packaging for 5% of their online deliveries. That’s going up each year, and the turnover threshold will decrease to €20m [£17.5m]. So the French legislation has played a big role in creating a reuse market and industry. Reusable packaging won’t become prolific in Europe without legislation and/or tax benefits. You need that to build scale and create an actual industry, not just companies running on grants and good wishes.” 

3. Batteries

A new law to ensure batteries are collected, reused and recycled in Europe came into force this year, but it’s just one step in the journey. The new Batteries Regulation aims to ensure batteries are made with minimal harmful substances and have an overall low carbon footprint. It’s the first piece of legislation that addresses the whole lifecycle of the battery, with sourcing, manufacturing, use and recycling covered in a single law. Targets for recycling efficiency, material recovery and recycled content will be introduced gradually from 2025. By 2027, portable batteries in electronic products should be removable and replaceable, thereby extending products’ life, encouraging reuse, and reducing e-waste. 

Simby, one of Green Alley Award’s finalists from 2023, is a Portuguese online marketplace for used electrical and electronic equipment. Its co-founder, José Carlos Carvalho, calls the legislation a “significant step towards more sustainable battery practices”, but adds that “achieving these targets may pose challenges in terms of technology, infrastructure and market dynamics. Striking the right balance between ambition and feasibility will be crucial.” 

Meanwhile, Carvalho sees startups like Simby playing a key role in advocating for sustainable e-waste practices: “We aim to create a sustainable ecosystem that can foster greater public awareness and engagement in e-waste management, contributing to a cleaner, healthier and more resource-efficient future.”

Main image: miniseries