Why We Need a Circular Economy to Tackle Climate Change


Renewable energy has seen unprecedented growth in recent years as the world fights climate change. However, experts warn that we must do more to stay on track to achieve emission reduction targets. According to the Emissions Gap Report 2022, global annual GHG emissions must fall by 45% in just eight years compared with emissions forecasts under current policies to limit global warming to 1.5C above pre-industrial levels1. Could a circular economy play a role in filling this gap? This article explores why we need a circular economy approach to reduce global GHG emissions and address climate change challenges.

What is a Circular Economy?

A circular economy is an economic system where products and materials are kept in circulation as long as possible, for example, through sharing, leasing, maintaining, reusing, repairing, refurbishing, and recycling. It is an alternative to the current linear economy based on a “take-make-use-waste” approach, where we extract raw materials from the Earth, process them into products, use them, and dispose of them.

The four main circular economy strategies are as follows:

1) Reduce material inputs: e.g., refuse, material-efficient product design and manufacturing, dematerialization, and substitution

2) Keep products and components in use: e.g., increased durability, upgrading, sharing, reusing, repairing, resale, refurbishing, remanufacturing, and repurposing

3) Cycle materials back into the economy, generally through recycling

4) Regenerate natural systems (relevant for biomass materials)2

Why do we need a circular economy to tackle climate change?

  • Today’s clean energy technology, including solar and wind power, is more mineral-intensive than fossil fuel-based technology3. We need a circular economy approach to continue deploying solar panels, wind turbines, and electric vehicles at an accelerated rate.
  • As the Ellen MacArthur Foundation points out, thus far, efforts to combat climate change have been largely focused on renewable energy and energy-efficiency measures; however, global GHG emissions from energy supply and its consumption in buildings and transportation only account for 55% of the total GHG emissions. The remaining 45% is from the production of goods and the management of land4. Transitioning to a circular economy can help address these emissions.

How can circular economy practices help reduce global GHG emissions?

Specifically, circular economy practices can help decarbonization in the following ways:

1) Further cut down GHG emissions from material production (as noted above)

2) Reduce emissions from operational energy use in the built environment and transportation

3) Slash emissions from waste management2

In the next article, we will examine how incorporating circular economy practices in solar PV systems brings environmental benefits.


  1. United Nations Environment Programme, “Emissions Gap Report 2022: The Closing Window — Climate crisis calls for rapid transformation of societies.,” Nairobi, 2022. Accessed: Oct. 01, 2023. [Online]. Available: https://www.unep.org/resources/emissions-gap-report-2022 ↩︎
  2. K. Wang et al., “Circular economy as a climate strategy: current knowledge and calls-to-action,” Nov. 2022. Accessed: Oct. 01, 2023. [Online]. Available: https://pacecircular.org/Circular-Economy-as-a-Climate-Strategy ↩︎
  3. International Energy Agency, “The Role of Critical Minerals in Clean Energy Transitions,” May 2021. Accessed: Oct. 01, 2023. [Online]. Available: https://www.iea.org/reports/the-role-of-critical-minerals-in-clean-energy-transitions ↩︎
  4. The Ellen MacArthur Foundation, “Completing the picture: How the circular economy tackles climate change,” 2021. Accessed: Sep. 01, 2023. [Online]. Available: https://www.ellenmacarthurfoundation.org/completing-the-picture ↩︎