Developing Scotland's circular economy: consultation on proposals for legislation

Introduction

What is a circular economy?

A traditional “take, make and dispose” linear economy involves taking resources from the ground, air and water; making them into products and structures; then disposing of them.

A circular economy is an alternative approach to this, in which resources are kept in use for as long as possible, the maximum value is extracted from them whilst in use and then products and materials are recovered and regenerated at the end of each product’s viable life cycle.

A more circular economy can benefit: the environment, by cutting waste and carbon emissions; the economy, by improving productivity and opening up new markets; and communities, by providing local employment opportunities and lower cost options to access the goods we need.

One simple way to express the concept of a circular economy is that it is designed to reduce the demand for raw materials in products; to encourage reuse, repair and manufacture by designing and selling products and materials to last as long as possible; and to recycle waste and energy to maximise the value of any waste that is generated (figure 1). The policy proposals for the circular economy bill are set out in the following chapters under these ‘reduce, reuse and recycle’ themes.

Figure 1: a circular economy approach to production and consumption
(source: Zero Waste Scotland)

Another way to describe this is the ‘waste hierarchy’, which describes the order of preferences for action to reduce and manage waste (figure 2). This sets out the optimal use for materials, starting with prevention (an alternative term for ‘reducing’ the use of materials), moving to reuse and then recycling, including energy and material recovery. It is only when we have exhausted all of the other alternatives that disposal through landfill should be used. A circular economy should always endeavour to keep materials in use as high up the waste hierarchy and for as long as possible.

Figure 2: the waste hierarchy (source: Scottish Government)

Circular economy objectives

The Scottish Government’s circular economy objectives can be summarised as:

• Reducing waste;
• Reducing litter;
• Reducing carbon and resource footprint;
• Increasing recycling rates and quality of recyclate; and
• Maximising economic opportunities.

Our work directly links to the UN Sustainable Development Goal 12: Ensure sustainable consumption and production patterns. Creating sustainable growth is a key part of the Scottish Government’s Purpose and the circular economy particularly contributes to the Environment and Economy outcomes under the National Performance Framework. Progress is measured through the carbon footprint and waste generated indicators.^[1]

Progress

Circular economy policy in Scotland was set out in ‘Making Things Last’ (2016), one of the first national circular economy strategies in the world.^[2] This was recognised by the World Economic Forum where Scotland was awarded a ‘Circulars’ award for Cities and Governments in 2017. Policy is underpinned by key principles, which include:

• Applying the waste hierarchy – prevention and promoting reuse is paramount;
• ‘Polluter pays’ – those who produce pollution should bear the costs of managing it to prevent damage to the environment or human health;
• Proportionality – Government intervention or regulation should only happen when necessary; and
• A sound evidence base and assessment of effectiveness.

Implementation of the approach is measured through a series of ambitious targets, as set out in figure 3.

Figure 3: Scottish Government targets

Recycling

• 60% of household waste to be recycled /composted and prepared for re-use by 2020
• 70% of all waste to be recycled / composted and prepared for re-use by 2025

Food waste

• reduce all food waste arising by 33% against the 2013 baseline by 2025

Waste prevention

• reduce waste arising by 15% against the 2011 baseline by 2025

Landfill

• no more than 5% of all waste going to landfill by 2025
• no biodegradable municipal waste going to landfill by 2025

We are making progress on meeting these targets. For example, the most recent statistics show that:^[3]

• Scotland continues to exceed EU requirements in the amount of biodegradable municipal waste landfilled – levels fell by 6% to 1.02 million tonnes in 2018, compared to an EU requirement of 1.26 million tonnes by 2020;
• the carbon impact of household waste generated and managed has decreased by 15% from 2011 to 2018 – equating to a reduction of more than one million tonnes of carbon dioxide equivalent; and
• the percentage of waste from all sources recycled or composted in 2017 was 59.2%.

Other achievements include:

• Support for more consistent household recycling collections across Scotland through the Scottish Household Recycling Charter and its code of practice, agreed jointly with the Convention of Scottish Local Authorities.^[4]
• A sector-based approach to tackling food waste, set out in the recently published Food Waste Reduction Action Plan.^[5]
• Building on the introduction of the single-use carrier bag charge in 2014, further action to tackle consumer demand for a throwaway culture and reduce waste more quickly, including banning plastic cotton buds and microbeads.
• Through Zero Waste Scotland’s Circular Economy Investment Fund and business support services, investment of £5.8 million in domestic projects^[6] and support to 164 businesses to develop circular economy products or services. Co-funded by European Regional Development funding, these projects have identified projected benefits of 66,000 tonnes CO2, 262 jobs and attracted £7 million investment from other parties.
• A cities and regions approach to the transition towards a circular economy and zero waste society through Zero Waste Towns and Circular Cities and Regions initiatives. These local initiatives are important pilot projects that allow testing of different approaches through community networks.
  
  

While we have already made important progress against the ambitions set out in ‘Making Things Last’, we recognise that there is more to do.

Key Challenges

Most of the climate impacts linked to products and materials occur in the production and consumption phase of the lifecycle. Preventing waste will therefore have the biggest impacts on our environment. Whilst we have reduced waste arising by 4.3% since 2011, we need to reduce this by a further 1.3 million tonnes compared with 2017 to meet our target of 15% reduction by 2025.

In terms of climate impact, food waste sent to landfill is particularly problematic as it releases methane, a greenhouse gas many times more potent than carbon dioxide.

Trends in the global fashion industry are also having a significant impact: WRAP’s ‘Valuing Our Clothes’ report stated that, across the EU and UK, clothing is the eighth largest sector in terms of household spending and is ranked fourth in terms of its impact on the environment. Clothing contributes around five per cent of the carbon footprint and six to eight per cent of the water footprint of all the UK’s goods and services. It also accounts for more than 1 million tonnes of wasted materials each year.^[7]

Around 13% of Scotland’s waste is currently processed outside Scotland.^[8] This represents a lost economic opportunity. As we work to change the way we use and reuse materials, we need to stimulate the development of reprocessing infrastructure within Scotland to deal with future waste and materials as close to source as possible.

Whilst recycling rates have increased over time, with 59.2% of all waste being recycled in 2017, household recycling rates (44.7% in 2018) need to improve. A valuable recycling system is not only about the volume we are collecting, it is increasingly about the quality and the value of the materials we are collecting for recycling.

Finally, waste crime is estimated to cost over £500 million each year to the UK economy.^[9] Criminal activity within the resource management industry undermines investment by legitimate operators in the valuable sorting and reprocessing infrastructure we need.

Current and future activity

Circular economy and waste policy is a complex landscape, with Scottish, UK, European and global dimensions to consider. The system for production of our products and materials involves supply chains that span the globe. Similarly, when we have used and consumed products and materials the waste and resource management system often has a global chain of custody.

Given this complexity, it is important to consider both legislative and non-legislative measures that will help us achieve our goals. We are working with the European Commission, UK Government and other devolved nations on measures, including legislation, that will give new impetus to circular economy businesses and a modern, effective and efficient resource management system. These sit alongside our own ambitious plans, where we are taking forward measures in partnership with our agencies and stakeholders.

Our intention is to use the circular economy bill to bring forward measures that require primary legislation, recognising that these are complemented by the other legislative and non-legislative activities summarised below and set out in more detail in the rest of this document. Figure 4 shows the timeline of expected deliverables over the next six years, to 2025.

(i) Scottish Government initiatives

We are already taking steps to implement a Deposit Return Scheme for single-use drinks containers, covering a wide range of materials and aiming for a 90% return rate. The scheme will improve recycling rates, tackle littering, encourage wider behaviour change towards materials and stimulate investment in high quality sorting and reprocessing.^[10]

Following its recent recommendations on single-use disposable beverage cups, the Expert Panel on Environmental Charges and Other Measures (EPECOM) will be considering further measures in relation to other single-use items.^[11]

Our Food Waste Reduction Action Plan (FWRAP)^[12] makes clear what measures we believe are required to achieve our ambitious food waste reduction target of 33% by 2025. The FWRAP is designed to engage with every part of our food supply chain, to reduce unnecessary demand and avoidable waste and to optimise how we use our organic resources, including by promoting research and innovation in emerging bio-technologies.

In line with FWRAP, we will consult later this year on additional food waste measures in more detail. These include:

• Reviewing the current rural exemption and food waste separation requirements for food waste collections;

Figure 4: Expected deliverables to 2025

^* Subject to consultation and/or passage of legislation

• A potential obligation for food retail sites, over a certain size, to redistribute edible products in line with the food waste hierarchy; and

• A mandatory national food waste reduction target.

As part of our move to a net zero emissions economy, we have announced a Green Investment Portfolio. This portfolio will seek out and help structure major projects in the circular economy, as well as in sectors such as renewables, transport and property, that both require private sector investment and can deliver environmental benefits. The Scottish Government will present these projects internationally in 2020 and at investor gatherings, with the intention of reaching a pipeline of £3 billion worth of investable projects in three years.^[13]

The goal to embed circular economy skills and thinking in the future workforce will form a key part of the Scottish Government’s new manufacturing programme, Making Scotland’s Future. It will also shape the training, leadership and skills development programmes offered by the National Manufacturing Institute Scotland’s Manufacturing Skills Academy.

(ii) UK-wide initiatives

We are founding signatories of the UK Plastics Pact, led by WRAP, a collaborative initiative that seeks to create a circular economy for plastics. It brings together businesses from across the entire plastics value chain with UK governments and NGOs behind a common vision and ambitious set of targets, including 100 per cent of plastic packaging to be recyclable or compostable by 2025.^[14]

There are common producer responsibility schemes across the nations of the UK covering packaging, electrical and electronic equipment, batteries and end of life vehicles.^[15] We are working jointly with the UK, Welsh and Northern Irish Governments on reform of packaging regulations through a revised extended producer responsibility scheme (EPR), which will make producers liable to pay the full cost of dealing with packaging waste while stimulating investment in collection, sorting and reprocessing.^[16] Enabling powers were included in the UK Environment Bill introduced to the UK Parliament on 15 October 2019, with the revised scheme intended to be in place by 2023.

Also included in the Environment Bill were enabling powers to allow for:

• minimum resource-efficiency standards for products and information and labelling requirements;
• electronic waste tracking;
• food waste targets; and
• food surplus redistribution.^[17]

This Bill has now fallen with the dissolution of the Westminster Parliament.

Pending clarity on the legislative programme of the incoming UK Government, we will continue to work with the other UK administrations on EPR and other areas of common interest to ensure that any proposals meet our ambitions in Scotland, whilst fully respecting the devolution settlement.

(iii) Alignment with European legislation

The Single-use Plastics Directive (SUP) was published in June 2019 and was created in response to the evidence of harmful plastic litter in oceans and seas growing ever greater. The Directive includes proposals to target the 10 single-use plastic products most often found on Europe's beaches and seas, as well as lost and abandoned fishing gear. The plastic products include:

• cutlery;
• plates;
• straws;
• stirrers for beverages;
• balloon sticks;
• food and beverage containers and cups made of expanded polystyrene;
• products made from oxo degradable plastic; and
• cotton bud sticks (which we have already banned).

We fully support the EU vision of phasing-out single-use plastics wherever possible and have committed to keeping pace with the deadline set out in the Directive. In 2020, we will consult on a proposed legislative approach to ban or restrict the sale of the SUP’s priority plastic items by 2021. We will take into account equality interests and apply exemptions where appropriate.

Implementing these SUP changes will align with the requirements set out in the EU Circular Economy Package, which came into force in July 2018. Member States have until July 2020 to transpose the package and bring into force the laws, regulations and provisions necessary to comply with the requirements. The package includes measures for amendments to six European Directives on the handling of waste, two of which (Waste and Landfill) will require amendments to Scottish legislation. We intend to bring forward a consultation on how best to transpose these requirements into Scottish law before July 2020.