Delivering Scotland's circular economy - route map to 2025 and beyond: consultation

Chapter 2. The case for change

2.1 Progress towards waste and recycling targets

Scotland has a good track-record on the circular economy. Our circular economy strategy Making Things Last^[3] demonstrated Scotland's ambition. We are the first UK nation to introduce bans on a range of priority single-use items, to ban biodegradable municipal waste from going to landfill, and will be the first to implement a Deposit Return Scheme (DRS) for single-use drinks containers. We have had mandatory separate collections of key materials for recycling for nearly a decade, and we are investing a further £70 million through our Recycling Improvement Fund to modernise Scotland's infrastructure.

In line with our commitment to seek to maintain or exceed EU environmental standards, we have met EU targets for the amount of biodegradable waste going to landfill, and for recycling of construction and demolition waste.

However, despite the significant strides Scotland has made, we are not on track to meet our ambitious waste and recycling targets (Figure 1, and see technical annex). The sustainable choices are still not the easy choices for households, businesses or those in the waste sector. It is unlikely that either our waste and recycling targets or our emissions goals will be met in full without large-scale, and rapid system change.

Key: Red indicates a missed target [Minimum 60% recycling of household waste by 2020]; Orange indicates target at risk [All other targets]

2.2 Climate Change Targets

The 2020 Climate Change Plan update^[4] set out emission 'envelopes' for each sector, which reflect the pathway to meeting our statutory targets to reduce emissions by 75% by 2030 (compared with 1990) and to net zero by 2045. In 2019, greenhouse gas emissions from the waste management sector^[5] were 1.5 MtCO₂e. To achieve our emissions envelopes we must reduce this to 0.9 MtCO₂e by 2025 and 0.7 MtCO₂e by 2032. These envelopes are built upon achieving our waste and recycling targets, as the foundation for our pathway to 2025 and baseline for future action.

Scotland's progress in reducing emissions in the waste and resources sector over the past 20 years has been striking (Figure 2). In 2019, waste and resources sector emissions were over 30% lower than in 2011, and 73% lower than in 1998. Nevertheless, like our waste and recycling targets, progress has slowed in emissions reduction; we will not meet waste sector targets set out in the 2020 Climate Change Plan update without new and boosted policy measures. This underlines the urgency of measures set out in this consultation, to ensuring a more rapid transition to net zero and a fully circular economy in Scotland.

Although the waste management sector only directly accounts for 3% of total Scottish greenhouse gas emissions, around 80% of Scotland's carbon footprint stems from our consumption of materials, goods and services. Sustainable resource-use is key to tackling climate change and will be vital for other sectors to deliver their own net zero aspirations. We cannot achieve either our sector emissions targets, or achieve a net zero economy without reaching our ambitious waste and recycling targets. We must reduce consumption and waste, increase recycling, and divert carbon intensive materials from landfill. The 2020 Climate Change Plan update sets out our vision for a fully circular economy by 2045, driven by a focus on:

• Responsible Consumption, where people and businesses demand products and services in ways which respect the limits of our natural resources. Unnecessary waste, in particular food waste, will be unacceptable in Scotland.
• Responsible Production, where a circular economy is embraced by the businesses and organisations that supply products, ensuring the maximum life and value from the natural resources used to make them.
• Maximising Value from Waste and Energy, where the environmental and economic value of wasted resources and energy is harnessed efficiently.

However, we know that hitting our 2025 targets alone will not be enough. We have a much better understanding of the pace and scale of change required to address the climate emergency than we did when we set our targets in 2010. The transition to net zero and a fully circular economy in Scotland will require radical and transformational change. We know that we need to go further beyond 2025, considering all sources of greenhouse gas emissions across the waste and resources sector, including legacy emissions from landfill sites and the carbon impacts of incineration (see Chapter 4).

Scotland's global footprint

Scotland's statutory emissions reduction targets, set out in the Climate Change Plan, are based on emissions from sources located here in Scotland but we must also take responsibility for our global carbon footprint associated with the goods and services we import.^[6]

Scotland's Carbon Footprint^[7] refers to estimates of Scotland's greenhouse gas emissions on a consumption basis. This refers to greenhouse gas emissions which are associated with the spending of Scottish residents on goods and services, wherever in the world these emissions arise.

Consumption of products and materials accounts for an estimated 74% of Scotland's carbon footprint.^[8] We know that delivering a circular economy is a crucial part of tackling this, with some studies estimating that circular actions could eradicate up to almost a fifth of Scotland's carbon footprint by 2050. The proposed actions we set out in this consultation, and in the Circular Economy Bill consultation, are aimed at encouraging more sustainable consumer purchasing, and rapidly moving Scotland towards a circular economy.

2.3 The opportunity for change

We are facing an ever growing climate and nature emergency, and the public have never been clearer that they want to see more ambitious action to address the challenges we face.

We believe it is the right time to begin a national conversation on how we deliver our waste and circular economy ambitions - where government can go further faster to support delivery of a circular economy, and what further support we all need to do our part. It requires us all to be bold, brave and focused on delivering the actions needed.

Through the Route Map, we have the opportunity to build on the progress we have already made, and set out the steps we can take to drive future change.

We are facing a climate and nature emergency. We need to do more to meet our waste reduction and recycling targets and reach net zero by 2045.

Our current waste reduction and recycling targets have been in place since 2010. Much has changed since then. The climate emergency has intensified our focus on emissions reduction, and how we view and treat our waste. 50% of global carbon emissions carbon footprint and 90% of global biodiversity loss and water stress is caused by resource extraction and processing.^[9] And in the current times we live in, we are more aware than ever that a more circular economy is also more self-sufficient – it reduces our reliance on imports and provides increased material security and economic resilience.

We need urgent, system-wide change if we are to achieve our ambitions.

There are a diverse range of incentives that impact our decisions and behaviour. We need transformative, system-wide change, that address 'broken incentives' at every stage if we are to meet our targets by 2025.

The COVID-19 pandemic has also had a major, system-wide impact across our whole economy and society. It has required businesses to adapt, adjusting the products they produce, purchase, and dispose of. As we seek to build a green recovery, it has never been more important that we take evidence-based decisions regarding how Scottish Government invests public money. And as we re-set from the system-wide shock caused by the pandemic, now is the time to embed the system-wide change we need to move to a circular economy and net zero future.

The transition to a circular economy will provide wider economic, environmental and societal benefits.

Our waste reduction and recycling outcomes are a core pillar of our Environment Strategy,^[10] and support progress towards National Performance Framework outcomes for the economy ('we have a globally competitive, entrepreneurial, inclusive and sustainable economy') and environment ('we value, enjoy, protect and enhance our environment').^[11] A more circular economy will also contribute to a range of UN Sustainable Development Goals,^[12] and help to embed our economy in the natural world, recognising the need to live within the sustainable limits of our single, shared planet.^[13]

The decade ahead provides a unique opportunity to increase our economic and social wellbeing, whilst respecting environmental limits and ambition to become one of the most prosperous nations in the world. Our new strategy for economic transformation^[14] recognises that the circular economy represents an enormous economic and industrial opportunity for Scotland as part of this transformation, by improving productivity and opening up new markets.

It is also clear that there are wider societal and community-focused benefits to a circular economy. Delivering a circular economy provides local employment opportunities and lower cost options to access the goods we need. 10,000 tonnes of waste can create up to 296 jobs in repair and reuse, compared to 1 job in incineration, 6 jobs in landfill or 36 jobs in recycling.^[15] This represents a profound opportunity to support communities and stimulate job creation.

Finally, a circular economy keeps valuable materials flowing through our economy, driving greater resource productivity and decreasing costs for businesses, the public sector and households. Food waste alone costs the average Scottish household £440 each year.^[16] As we face the current cost of living crisis, the rapid transition to a more circular economy is needed more than ever.

We must take responsibility for our own waste.

Where we do produce waste, we must maximise its value and reduce its environmental and carbon impact. To support our transition to a circular economy, this means we must take responsibility for our own waste, managing and processing as much as possible here in Scotland.

A large majority of Scotland's waste is already managed within Scotland, but around 14% is currently processed elsewhere,^[17] representing a lost economic opportunity and an environmental cost too.

International waste export legislation is a reserved matter, and we are calling for further actions in this space from the UK Government (see section 2.4 below). We also believe it is important to consider further steps we can take within our competence to boost Scotland's ability domestically to manage its waste, and with it, strengthen public confidence in where recycling goes. This aligns with the Committee on Climate Change's recommendation to take action to ensure waste intended for recycling or recovery are treated as such.^[18]

Positive behaviours, like recycling, are heavily reliant on public confidence in where their waste is going. Recent UK-based research indicates that a lack of information on what happens to recycling once its collected is the top reason that negatively influences public behaviour and participation in recycling.^[19]

There is strong public appetite for more ambitious action, and for clear guidance on the steps we can all take.

We have seen a fundamental shift in public attitudes towards climate change, better resource management, and the waste we produce.^[20] In 2020, 79% of the public indicated that climate change is an "immediate and urgent problem". The level of concern has increased over time, including since the start of the Covid-19 pandemic.

Scotland's Climate Assembly^[21] also underlined the need to "strive to be as self-sufficient as possible, with a competitive Scots circular economy that meets everyone's needs in a fair way"; and "reduce consumption and waste by embracing society wide resource management and reuse practices". The Assembly set 16 goals and 81 recommendations, with a strong focus on transitioning to a circular economy, including maximising reuse and the use of environmental charging.

2.4 Our call to the UK Government

As a devolved nation, we are taking action on policy measures that lie within our legal competence. Some of the policy measures we need to drive the transition to a fully circular economy rely on action by the UK Government. We need to see the UK Government respond positively to the Committee on Climate Change's call^[22] for it to "step up" in areas where key powers are reserved. Where there are existing commitments in place, timely delivery by the UK Government is absolutely vital to unlock the progress we need to see.

There are key examples where we are already working constructively with the UK Government and other Devolved Administrations.

This includes reform of the packaging producer responsibility system to reduce waste and boost recycling, and the development of a digital waste tracking system to provide a step change in the quality and timeliness of waste data.

We also welcome the UK Government's introduction of a 'plastics tax' to incentivise the use of recycled content in plastic packaging, although, in light of comments from the Committee on Climate Change,^[23] it is important the thresholds should be kept under regular review.

However, there are a number of key areas that require further UK Government action, and more urgency. Specifically, we call on the UK Government to:

• Consider new fiscal measures to influence behaviour, including consideration of the role of VAT to encourage sustainable choices.
• Consider measures to reduce consumption of unsustainable material, and boost the competitiveness of recycled materials – for example considering strengthening the UK's approach to product stewardship and standards, where we recognise current powers under devolution can only take us so far without concerted action at UK-level (see Package 1).
• Deliver existing commitments and bring forward measures to influence global markets and reduce imported and exported emissions. This includes making progress on the Committee on Climate Change's recommendation^[24] to "phase out" exports of waste by 2030, which would support Scotland's transition to a fully circular economy.