Circular Economy Is Essential to Achieve SDGs
The concept of the circular economy has gained widespread attention in recent years as an alternative to the traditional linear model of production and consumption. In a circular economy, resources are used for as long as possible, and waste is minimized. This approach prioritizes mainly the following three elements: the use of renewable energy such as solar energy and wind energy, the use of sustainable materials such as wood, hemp, and steel, and the reduction of carbon emissions. Circular economy is regarded to be an essential tool to achieve the Sustainable Development Goals (SDGs) set by the United Nations.
In recent years, human beings — not only scientists but also ordinary people — have witnessed significant impact on the Earth from climate change. Today, achieving the SDGs is becoming increasingly critical for almost all industries. And the steel industry is no exception. The steel sector has been under increasing pressure to transition to a more sustainable and circular production model.
The Steel Industry Is Resource-Intensive but Steel Is Sustainable
Steel is a vital material in our daily lives; from buildings around us to cars we drive, from appliances we use to watches and jewelries we wear, we need steel in almost every aspect of our lives. Moreover, it is estimated that global steel demand will continue to increase by more than a third through to 2050.
As mentioned above, steel is a sustainable material that could be well utilized to establish a circular economy. However, traditional steelmaking is often criticized for its resource-intensive nature. It also generates significant amount of waste and greenhouse gas emissions.
Having these contradictory features, can steel be the key to achieving circular economy? If so, how can circular economy and the steel industry work together to reduce the environmental impact of the steel industry while making the most of the material’s permanence?
The Sustainable Steel Production: How Circular Economy Helps
Steel production is resource-intensive and generates significant greenhouse gas emissions, making it a challenging industry to make sustainable. However, the circular economy can help the steel industry transition to more sustainable production methods. The circular economy approach prioritizes using renewable energy sources, sustainable raw materials, and waste reduction. By adopting these principles, the steel industry can significantly improve resource efficiency.
The circular economy helps sustainable steel production by using recycled and secondary raw materials. Rather than relying solely on primary raw materials, which require significant energy and resources to extract, the steel industry can use scrap metal and other recycled materials to produce new steel products. This reduces the steel production process’s environmental impact while conserving natural resources.
Another way the circular economy can help sustainable steel production is by designing long-lasting products. By creating products that are built to last and can be easily repaired or upgraded, the steel industry can minimize waste and extend the life of its products. This reduces the need for new steel production and lowers the environmental impact associated with waste disposal.
By adopting business models that prioritize resource efficiency, such as sharing or leasing models, the steel industry can optimize the use of its products. These models incentivize the steel industry to design products that are easy to disassemble and reuse, making the most of the raw materials used in production.
Recycling and Reuse of Steel Products
Recycling and reusing steel products play a critical role in the circular economy. Steel is one of the most recycled materials in the world, and it is estimated that around 85% of the steel used in construction and manufacturing is recycled. The following are some key reasons why the recycling and reuse of steel products are essential in the circular economy:
- Steel is a durable material: Steel has a long lifespan and can be recycled multiple times without losing its properties. This makes it an ideal material for the circular economy as it can be reused multiple times, reducing the need for primary raw materials and minimizing waste.
- Recycling steel saves energy and reduces greenhouse gas emissions: Recycling steel uses significantly less energy than producing new steel from primary raw materials. According to the World Steel Association, recycling one ton of steel saves 1.8 tons of CO2 emissions.
- Steel recycling is cost-effective: The cost of producing steel from recycled materials is often lower than making it from primary raw materials. This is because the energy and resource costs associated with mining and processing raw materials are avoided, and the cost of transporting and disposing of the waste is reduced.
- Reuse of structural steel in construction: Steel structures such as bridges and buildings can be dismantled and reused in new construction projects. This not only reduces the amount of waste sent to landfills but also reduces the need for new steel production.
- Recycling end-of-life vehicles: Steel is a significant component of most vehicles, and recycling end-of-life vehicles is a critical part of the circular economy. Steel from these vehicles is recycled and used to produce new steel products.
- Recycling of steel packaging: Steel packaging, such as cans and tins, is widely recycled and can produce new steel products.
Life Cycle Assessment of Steel Products: The Environmental Benefits of Circular Economy
Life Cycle Assessment (LCA) is a methodology that evaluates the environmental impacts of a product throughout its entire life cycle, from raw material extraction to end-of-life disposal. LCA can be used to assess the environmental benefits of circular economy practices in the steel industry. Here are some key points to help you understand the environmental benefits of the circular economy in the steel industry based on LCA studies:
- Circular economy practices reduce greenhouse gas emissions: LCA studies have found that recycling steel can significantly reduce greenhouse gas emissions compared to producing new steel from primary raw materials. One study found that using recycled steel to produce new products reduces greenhouse gas emissions by 58-86%. The European steel industry has adopted circular economy practices, such as using recycled materials and improving resource efficiency. According to a study by the European Commission, these practices have reduced greenhouse gas emissions by 50% and energy use by 60% since 1975.
- Circular economy practices conserve natural resources: LCA studies have found that recycling steel reduces the need for primary raw materials, such as iron ore and coal, which saves natural resources. For example, one study found that using recycled steel to produce new products reduces energy use by 74% and water use by 40%.
- Circular economy practices reduce waste: LCA studies have found that recycling steel reduces waste by diverting materials from landfills and reducing the need for new steel production. One study found that using recycled steel to produce new products reduces waste by 97%.
- Circular economy practices save energy: LCA studies have found that recycling steel uses less energy than producing new steel from primary raw materials. Study found that using recycled steel to produce new products saves up to 85% of the energy required to produce new steel from primary raw materials.
Circular Business Models in the Steel Industry
Circular business model can help to reduce the industry’s environmental impact by promoting the reuse and recycling of steel. This model is focused on creating a closed-loop system where resources are conserved, and waste is minimized.
Tata Steel, a leading steel producer, has implemented a circular business model using recycled steel in its production processes. In 2020, the company used 5.7 million tonnes of recycled steel, representing 28% of its total steel production. This has helped to reduce the company’s carbon footprint by 2.7 million tonnes, equivalent to taking 600,000 cars off the road.
The company has also implemented a “circular by design” approach, which involves designing products that can be easily disassembled and recycled at the end of their lifecycle. The company has developed various sustainable building products, including roof and wall cladding made from recycled steel.
Benefits of a Circular Business Model in the Steel Industry
Implementing a circular business model in the steel industry has several benefits, including:
- Reducing carbon emissions and environmental impact
- Conserving resources by reusing and recycling steel
- Increasing the industry’s resilience to supply chain disruptions
- Enhancing the industry’s reputation by promoting sustainability and social responsibility
Future Trends in Steel and the Circular Economy
As the world moves towards a more sustainable future, the steel industry must adapt to new trends and challenges to remain competitive. One key trend is the circular economy, which emphasizes the reuse and recycling of resources to create a more sustainable and resilient economy. In this context, the steel industry has both challenges and opportunities.
Challenges in the Steel Industry’s Transition to the Circular Economy
One of the main challenges facing the steel industry in its transition to the circular economy is the need for more infrastructure and systems for collecting and processing scrap steel. This is particularly challenging in emerging markets where the infrastructure for waste management and recycling needs to be better developed.
Another challenge is the high costs of implementing circular practices, including the need for new technology, processes, and infrastructure. Companies may also face regulatory challenges, such as the need to comply with new environmental regulations and standards.
Opportunities for the Steel Industry in the Circular Economy
Despite the challenges, the circular economy presents several opportunities for the steel industry. For example, by using recycled steel, companies can reduce their carbon footprint and environmental impact. This can also lead to cost savings, as recycled steel is often cheaper than virgin steel.
The circular economy also offers new opportunities for innovation and collaboration. For example, companies can work together to develop new recycling technologies, create new markets for recycled steel, and design products that are easily disassembled and recycled at the end of their lifecycle.
Steel is a critical material for the circular economy. The industry can reduce its environmental impact and increase resilience by reusing and recycling steel and developing sustainable products and technology. While there are challenges, companies that embrace the circular economy can reap benefits such as cost savings, innovation, and a better reputation. There is still much to be done, but companies like Tata Steel have already made progress. As the circular economy grows, steel will continue to be a central player, and collaboration and innovation can create a more sustainable and resilient economy.