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What are we talking about when we speak of the circular economy?

By 2040, we will be sharing this planet with 9 billion people. To guarantee people their right to life, to health, we'll need clean energy.

by Luca Longo
15 October 2018
7 min read
byLuca Longo
15 October 2018
7 min read

Up to now the growth and development of the world have followed a linear path. More production, more consumption, more wealth, more waste. It's impossible to believe that this same model which has been used until now in the world's richest countries can possibly be maintained and extended to all the other countries. We consume more than we need, we waste resources, energy, water, food and materials. Over the last 150 years, we have virtually doubled the levels of carbon dioxide in the atmosphere with our way of living, causing an increase in the greenhouse effect that's already notably altering the planet's climate.

We are still a long way from the objective of keeping the increase in temperature below 2° C, as set out by the Paris Agreements. By 2030 we are supposed to reduce the amount of CO2 being discharged into the atmosphere from 32 to 24 billion tonnes per year. But if current trends continue as they are, it will actually rise above 34 billion.

It is for this reason that Eni – the first among the world's major energy companies – has set itself the objective of contributing to providing energy to the planet via a circular economy model. The Ellen MacArthur Foundation has defined the circular economy's three main principles as “Design out waste and pollution”, “Keep products and materials in use”, “Regenerate natural systems”. What is described here is a model which is perfectly in line with the Sustainable Development Goals, defined by the United Nations with a time horizon spanning the next decade, so as to arrive at the year 2030 living in a more sustainable world, one that is capable of providing energy to people who, thus far, have gone without. 

Energy and the climate are the key factors on which the future rests We are in the midst of an energy transition that's quite different from others that have taken place since the beginning of the Industrial Revolution.

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Dame Ellen Patricia MacArthur, founder of the Ellen MacArthur Foundation, a charity that works with

The global picture: from Canada to developing countries

For the circular economy to change the world we obviously need countries to fully engage, we need political will and direction and we need general rules. To this end, in 2015, the Finnish government set itself the objective of becoming a leader in the global circular economy, establishing a roadmap for bringing such an ambitious project to fruition. Canada is another country that's looking to move towards a circular economy model. In Ontario, in February 2017, legislators agreed on a plan for ensuring a waste-free future. The Netherlands is considered one of the world's most forward-thinking advocates of the circular economy and has set itself the objective of adopting a circular system by 2050. This initiative will focus on five key areas: biomass and food, plastics, industrial manufacturing, construction and consumer goods. In 2016, the Scottish Government developed a strategy to orient the country towards a more circular economy. The two key elements of this strategy are: to establish a single framework for all types of product destined for reuse, repair and regeneration; and to reduce all food waste by 33% by 2025. Scotland was also the first country to join the Circular Economy 100, an Ellen MacArthur Foundation initiative.

Although some countries are already leading the way, a global approach that also takes the developing nations into consideration is absolutely vital: indeed, their involvement in the CE models is of vital importance, since their overall consumption of energy is expected to double by 2040, while the total amount of energy consumed by OECD countries is expected to decrease slightly. Indeed, non OECD countries will play a central role in the world’s circular economy scenario, since they will be in a position to make a significant contribution to the CE, directly emulating the virtuous model systems already established by the advanced nations.

If we want to tackle this problem seriously, we cannot limit ourselves to thinking only in terms of decisions related to the industrialised world. Together, the 35 OECD countries total just 17% of the world’s population, but they produce 63% of global GDP.

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Refining and chemical activities resulting from Eni's focus on bio-production and circularity.

The challenge for major companies

For companies, the challenge is both huge and vital: reducing the consumption of resources, reutilising the same good multiple times, recycling the materials that make up a good at the end of its life cycle.  To achieve these objectives requires Ecodesign: the ability to design the production of a good or service so as to ensure it lasts as long as possible, it's simple to maintain/repair, it can be reworked, updated or upgraded, and it can be easily recycled at the end of its useful life.
Eni has already drastically reduced the carbon footprint of its activities. It is committed to reducing flaring to zero (the controlled burning of methane at facilities and refineries) and thanks to the EST technology it is reutilising heavy waste from its refining activities to produce lighter fuels.

Scientific research and digitalisation are now helping Eni to do even more: if applied across all business areas, smart digital solutions alone can contribute to reducing our CO2 emissions by 20% by 2030.
It's necessary to construct a model for final energy consumption (which accounts for more than 90% of the sector’s emissions) that is more efficient, minimises waste and favours the use of cleaner sources of energy, including through the application of more advanced technologies.  Versalis – Eni's chemical company – has designed, developed and implemented many technologies aimed at recycling plastic from packaging materials. At Eni's facility in Venice, the world's first bio-refinery, used cooking oil is transformed into biofuels. And the Venice bio-refinery will soon be joined by Eni's new bio-refinery in Gela, which is currently close to completion.

The challenge is enormous, but so is the opportunity before us: to save the planet whilst simultaneously creating a new, more inclusive economy together with a whole range of new businesses and jobs which currently don't exist. (Claudio Descalzi)

Working towards an increasingly less polluting energy mix

Over the medium term, Eni is aiming for an energy mix that progressively alters the equilibrium from the more polluting fossil fuels, particularly coal, to those that are less polluting, primarily natural gas which, for the same amount of energy generated, produces half the amount of carbon emissions.
But Eni is aiming towards a growth model that's based on energy sources with low environmental impact. It's investing in the research, development and implementation of renewable energy sources, like solar photovoltaics, solar thermal systems, and the production of biofuels using biomass from organic urban waste, from agricultural or forest waste, and from microalgae cultivated in arid regions. In so doing, the biofuels of the future will not be in competition with agricultural land that's dedicated to feeding the planet.
Eni – once again ploughing a lonely furrow among the world's major energy companies – has created the Commonwealth Fusion System led by scientists from Boston's MIT with the objective of producing clean energy via magnetic fusion within 15 years. This initiative is also supported by some of the planet's most innovative and visionary figures, like Bill Gates, Jeff Bezos, Jack Ma, Mukesh Ambani and Richard Branson, whilst in recent years giants such as Google and Unilever have decided to take real inspiration from the principles of the circular economy.