In a 2020 poll conducted by the Lowy Institute, nine out of ten participants accepted the need to act on climate change. Additionally, three out of the top five critical threats to Australia’s vital interests related to the environment. Public opinion on the environment has become increasingly focused on sustainability with each passing year, and the novel coronavirus pandemic has only served to further heighten such trends. With the increase in to-go food deliveries and purchasing groceries online, there has resultingly been an increase in the amount of waste produced. For example, during a lockdown in Singapore one survey found that its 5.7 million residents discarded an additional 1,470 tons of plastic waste from takeaway packaging and food delivery alone in the span of just eight weeks.
Even before the pandemic, the world has been facing a serious plastics problem. The human population is currently on track to produce 27 billion tonnes of municipal solid waste by 2050, and recent changes in policy by countries like China who were previously heavily relied on to import and process recyclable materials have left much of the western world scrambling to figure out how to deal with their waste. For Vik Bansal who has been the chief executive officer of the waste management company Cleanaway for the past six years, “closing the loop” by embracing the concept of a circular economy presents the greatest opportunity for not only environmental benefits, but also increased employment and economic growth. Through his revolutionary Footprint 2025 action plan he created for the company, they have been strategically investing in infrastructure that will help change the way Australians look at waste, from a problem to be dealt with to a resource that can be utilized. Below, we explore the concept of a circular economy and Bansal’s work at Cleanaway in steering the country in the right direction.
What is a circular economy?
The way most countries have developed to operate today is with a “take-make-waste” approach to resources, in which raw materials are collected, transformed into products which are used briefly, and then thrown away. This model is the basis of the linear economy, in which value is created by producing and selling as many products as possible. In this system waste is the end point, and because of this all kinds of waste are now threatening our ecosystems, from plastic waste to food waste. In addition to this, before it even reaches the consumer this economic chain also produces enormous amounts of greenhouse gases such as carbon, methane and nitrous oxide. In fact, the extraction and processing of raw materials currently account for a full half of total global greenhouse gas emissions. Water and land are also exploited throughout this process, leading to alarming rates of habitat and biodiversity loss. All in all, according to the Global Footprint Network we are already consuming 75% more resources than the earth can sustain in the long term, and yet much of the world continues to operate as if this weren’t the case.
In contrast to this, a circular economy is a system of closed loops in which raw materials, components and products lose as little of their value as possible. It is regenerative by design, aiming to gradually separate economic growth from the consumption of finite resources and supported by a transition to renewable energy sources. The circular model builds on economic, natural and social capital, and focuses on positive society-wide benefits. Transitioning to a circular economy means going further than simply making adjustments aimed at reducing the negative impacts of a linear economy. It is about a systematic shift that builds long-term resilience, generates business and economic opportunities, and provides environmental and societal benefits. Research has shown that if we applied circular economy strategies for the five most common materials in our economy – cement, aluminum, steel, plastics and food – we could eliminate almost half of the remaining emissions from the production of goods, or 9.3 billion metric tons of CO2e by 2050, equivalent to all current global emissions from transport.
Australia rethinks its view of waste
Even before Covid-19, there was a growing consensus that the circular economy was a pathway to long-term prosperity. In 2019, the Australian government took a gigantic step towards the model with the release of their National Waste Policy Action Plan. The ambitious plan set goals such as banning the export of waste plastic, paper, glass and tyres, reducing total waste generated in Australia by 10% per person, increasing the use of recycled content by governments and industry, phasing out problematic and unnecessary plastics, halving the amount of organic waste sent to landfills, and reaching a national resource recovery target of 80%. However, in order for these lofty goals to come to fruition, there needed to be a swift creation of infrastructure. Thankfully, Vik Bansal had already updated Cleanaway’s mission statement to “making a sustainable future possible” in 2016, and had already spent the three years prior preparing the company for stepping up to the challenge.
Source separation recycling
Before the advent of kerbside collections, recycling involved events like bottle drives, regular paper and cardboard collections and trips to the scrap yard to sell metals. This is known as “source separation recycling” or separating materials by type at the point of discard rather than all placed in one bin and taken to a centralised sorting facility as is the norm today. While kerbside recycling is a practical service that allows for a certain amount of ease and convenience when it comes to recycling waste, food scraps and other non-recyclable items that end up in the bin can lead to contamination within the recycling process which results in a lower-grade quality material. By participating in source separation recycling, facilities are given more control and are able to create more high-quality recycled content. Glass from the bin is often crushed and turned into road base due to contamination, which while being a good way to reuse materials also means that it will have reached the end of its life cycle.
If that same glass were instead collected via a container deposit scheme, the facility could turn it into new bottles, which could in turn be recycled and used again. As the network operator for the New South Wales scheme, TOMRA Cleanaway has worked with the government to facilitate the collection of recycled drink containers, and since the introduction of the scheme in the end of 2017 the litter volume of drink containers has reduced to 37 percent and total litter volume is down by nearly half.
Bansal’s roadmap for Cleanaway’s journey to drive Australia’s circular economy saw them significantly ramping up capabilities in order to ensure they had the infrastructure in place to meet the quickly growing demands on the Australian waste sector. In 2019, they acquired the assets of SKM Recycling, which had gone into administration. The state of Victoria had been set to lose half of its recycling capacity had Bansal and Cleanaway not stepped in, and with the acquisition of its material recovery facilities, plastic recovery facility and transfer stations they were able to quickly gain what would have otherwise taken years to build. Additionally, purchases such as Statewide Recycling and Grasshopper Environmental demonstrated how Bansal has continued to deliver on his Footprint 2025 strategy, ensuring they had the right infrastructure and technology across the waste value chain.
Creating robust local markets
One of the problems that has been found in waste industries across the world has been the lack in demand for recycled products. It does not make economic sense for a company to pelletise plastic if there will be nobody to purchase the pellets once it is complete. Aware of this issue, Bansal has led a strategy focused on value chain extension – working with partners and investing in technology to ensure the value of recyclable material is optimised through recovery and processing to ensure that the loop can be fully closed. With the support of government funding and industry partnership, Cleanaway is working on new facilities and infrastructure around the country to improve plastic and glass recovery. Circular Plastics Australia (PET) is a joint venture with industrial packaging company Pact Group and beverage company Asahi to build a new plastic recycling facility in New South Wales. Cleanaway will provide feedstock through their collection and sorting network, Pact will provide technical and packaging expertise and Asahi Beverages and Pact will buy the majority of the recycled pellets from the facility to use in their packaging products. In this way, Bansal has ensured that the supply will meet the demand, all while creating a truly circular system in which consumer participation, industry participation and governmental support combine.
In Bansal’s opinion, one topic that isn’t brought to the table nearly enough is what to do with the waste that absolutely cannot be recycled. He believes that energy-from-waste is the most sustainable solution for such a problem, which in addition to relieving pressure on landfills is also a lower-cost option for councils and businesses to dispose of their non-recyclable waste. An energy-from-waste facility would reduce greenhouse gas emissions by more than 450,000 tonnes of carbon dioxide a year – the equivalent of taking approximately 100,000 cars off the roads. One cannot ignore the fact that we are still producing some materials that are unable to be recycled, but thanks to new technologies it is possible to still close the loop and create value from them. Cleanaway is in the process of gaining approval for a proposed energy-from waste facility in Western Sydney, modeled on modern facilities overseas that would have the potential to divert roughly one-third of its red bin waste in enough electricity to power over 79,000 homes and businesses.
For Bansal, there is no such thing as waste. He has long-recognized that a linear economy is not sustainable for his company, Australia, or the human race. To ensure that in the future there are enough raw materials for food, shelter, heating and other necessities, economies must become circular. Cleanaway is currently Australia’s largest waste management company, and Bansal knew that with that power came the responsibility to set the tone for how the country would move forward when it came to dealing with waste. His decision was to see every item thrown away not as trash to be discarded, but a resource to be utilized, and as a result has been instrumental in preparing Australia for their imminent shift to a circular economy.