The circular economy neighbourhood

Sweden, like many countries, is pursuing the circular economy as a path to decarbonization, to the bio-economy and to ensure their economy has enough material resources. Apart from the climate emergency, pressure from population increases and rising standards are about to create inevitable material shortages. Still developing, the idea of circular economy begs us to envision a circular home, a circular neighbourhood and circular municipality. This article explores what a circular economy neighbourhood might look like, and how a cooperative model might help accelerate the transition in Sweden. The ideas may, of course, apply to other countries.

Potential strategies for decarbonization

The largest use in Sweden of fossil coal and gas and the second largest use of oil is in manufacturing. Second after that is coal and gas burning for heating buildings. Logically, everything that reduces demand for manufacturing and space heating would contribute massively to decarbonizing.

Keep products and materials in the economy longer

The way to reduce demand for manufacturing is to increase the life of products. Every year a product is in use rather than being replaced by a new one is a year with less mining for virgin materials and one less year of emissions from manufacturing. Here we need new business and use models.

Convert buildings to well-insulated energy producers

It makes sense to embark on a programme to provide energy production facilities to buildings (heat exchange, solar wind, etc) whilst insulating them to reduce heating needs.

Share, repair and subscribe and InVEST

Local communities can be part of the transition to longer-life products by cooperating together. They can share products as well as purchasing repair services. Communities can co-purchase local, environmentally friendly products and services, and they can work together to upgrade houses and buildings.

Indeed, this may be right time. Frustrated by the lack of progress with COP26, many people are looking for bottom-up solutions to the climate crisis. The circular economy neighbourhood addresses may of these threads.

The proposal hinges on five basic shared functions all packaged under a locally-owned cooperative purchasing function: sharing, repairing, subscribing, investing and influencing.

Modern IT-based technology makes all of this possible. The technology is readily available for smaller-scale local cooperatives to offer their members a platform for co-purchasing, sharing etc. The platform would both reduce members costs and support circular, planet-friendly products and services by making them more competitive.

Prolonging the life of goods, by repairing instead of buying new as well as sharing, reduces purchases too, which in turn reduces the demand for new manufacturing. All this reduces the need for new materials and manufacturing. Both put a lot of pressure on Earth’s resources.

Here’s how it might work:

Let’s say that the local online market platform is set up, and that there is a store-room where people can pick up their goods. The store-room and pick up are accessed via an app.

One community member, Charlie, has good contacts with a local farmer. He suggests that the farmer delivers what he produces once a week to the store -room. And that the community pays in advance once every quarter.

He then enters the details of his proposal into the app. After some to and fro with suggestionens and preferences on what to eat, enough people sign up to make the arrangement profitable for all.

As members pay their subscriptions into the market, the farmer is paid and a small percentage goes to the cooperative for running the platform and to Charlie to pay for his time in setting it up and maintaining the relationship with the farmer.

This is a win-win on many levels. The farmer delivers all she grows – even the misshapen veggies that she cannot sell. And without many middle-men, the community gets high quality food at a reasonable price. And Charlie gets a little income for his time. The environment wins through less food waste and transport.

Local food is part of the circular economy. Less waste and more nutrient recycling

By subscribing to local food, neighbourhoods can ensure local farmers get a decent price for their food but are still competitive with imported food. Many subscription schemes have the farmer delivering all they produce, with subscribers accepting seasonal produce, less than perfect shapes and varying proportions of different varieties due to growing conditions.

In return, there is much less waste in the system, and less transport. Subscribers can even collect organic waste for the producer to use as soil enhancement.

Local food production, where bio-waste is captured in the value chain and recycled by composting and returning to enhance the soil could be the core of the local bio economy.

Making your voice heard is easy via a local internet -based application

Should neighbours want to transition to the circular economy faster, they need to exert political pressure both local and national. They would need a way to make their voice heard. The circular cooperative would offer such a debate and petition function.

Once up and running, neighbours might want to invest in planet-friendly solutions like local energy companies, bakeries, shops etc. Again, they can invest through pre-paying, say, several month’s worth of products, or put money into the business through preferential debentures.

A cooperative is an ideal structure

Whilst some circular economy experts, like the university of Borås in Sweden, (link in Swedish) propose that the local circular economy be driven by a company, others including this author, are suggesting the cooperative model. A cooperative might be better for several reasons:

  1. In a cooperative, members decide which products to purchase in bulk and how the sharing and repairing functions will work. This means that they do not need to wait for a company to develop the services – they drive that development with their purchasing.
  2. Keeping it on a small scale means that decisions can be made quickly as members develop. No owner is there to try to maximise profit at every twist and turn.
  3. The bulk of GDP is generated not in manufacturing today, but in the supply chain post manufacturing: retail, service, etc. By creating a cooperative that buys in bulk and organises services on contract, the cooperative will be able to reduce their costs. This means that planet-friendly approaches will become highly competitive. Purchasing newly manufactured goods, or purchasing them for individual use will not be able to compete.
  4. By having the local purchasing under cooperative control, new opportunities for members to develop their own business approaches will arise. The local market that knows them and the market they know will be open them.

For more insights into the potential of local community purchasing schemes, a project group is collecting experience, ideas and inspiration on the knowledge-sharing platform at 146help.

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