by Peter Perrault
Head of Circular Economy at Enel North America
Climate change and the circular economy are inextricably linked. We cannot address one without the other, and as North America begins to emerge from the worst of the COVID-19 crisis, a unique opportunity exists to tackle the difficulties that surfaced in a holistic manner. A circular approach is largely contingent on geographic, socioeconomic and regulatory parameters, which is why a regional focus is critical. In the recent paper from Enel North America, “Transitioning to a Circular Economy: Opportunities in North America,” we zeroed in on the path to circularity that’s unique to the US and Canada, particularly in the midst of many challenges that make a circular economy even more vital: a global pandemic, racial injustice, political tensions, and some of the most extreme weather events to date.
This transition requires three things: recovery, resiliency, and regeneration.
Recovery in 2021 and Beyond
Recovering from the challenges of 2020, many of which continue into 2021, place us collectively at an inflection point in the transition to circularity. The US (and to a lesser degree Canada) lacks a comprehensive and cross-border policy framework to make this transition, although there are examples at the local, state, provincial, and/or regional level.
Cities and city governments are playing a special role in the recovery; as many commit to combatting climate change and develop their own approaches towards the circular transition, strengthening connections and collaboration with the private sector to achieve their goals. One example in the Great Lakes region is the Circular Chicago Coalition, a multi-stakeholder and cross-sectoral partnership including Enel North America and the Council of the Great Lakes Region. Convened by PYXERA Global, a global non-profit, the coalition aims to address the simultaneous crises of social and environmental justice–economic inequality and excess waste– in Chicago, using its collective power to push for economic, environmental and social change.
Absent a comprehensive national policy, businesses play an even more important part in transitioning their industries to a more resilient, circular model. Early in the pandemic, many safety measures taken seemed to reverse progress made toward circularity. For example, many plastic bag and single-use product bans were lifted; businesses were compelled to provide single-use-only items for concern of surface contamination; and Product-as-a-Service and sharing models were also looked at warily for the same reason.
As we begin to rebuild economically and find a post-pandemic equilibrium, businesses should look for opportunities to return to circular practices. Those that seek to design products for modularity and reparability can unlock secondary markets for goods. Product-as-a-Service business models can maintain the value of goods through service agreements and repurposing. And a sharing economy increases utilization without depleting resources to produce more goods.
Improving Resiliency Across Systems
Climate change has intensified the need for a circular transition and requires us to move to more resilient models. Our systems, infrastructure and supply chains must be able to withstand the extreme conditions and weather events brought on by global warming.
A key element of resiliency involves our energy system – not only because traditional sources are a major source of greenhouse gas emissions contributing to climate change, but also because a resilient power grid is needed to meet demand, especially during emergencies like extreme weather. Expanding the adoption of renewable energy reduces the amount of natural resources we’re extracting for fuel and allows for the implementation of distributed energy resources (DERs), decentralizing our energy system, and making communities and consumers less reliant on a single energy source. When paired with technologies like battery storage, this makes for a more resilient and sustainable energy system.
From an infrastructure perspective, we can make strides to decarbonize and electrify transportation, moving to circular inputs. This update to infrastructure would include robust electric vehicle (EV) smart charging that’s publicly accessible, not confined to private homes, to help support the estimated 18.7 million EVs expected to take the road by 2030. Other needed infrastructure upgrades include building electrification and a comprehensive approach to the electrical transmission, distribution and regulatory system. Additionally, we need to improve our water infrastructure and access to regional materials recovery facilities (MRFs) to better manage resource and materials flows.
The final component of resiliency to consider is our value chains for goods and services. Given the uncertainty of extreme weather cases and global regulatory changes, it’s become more apparent that geographic concentration in companies’ supply networks can be a vulnerability. Instead, establishing distributed and increasingly localized loops for materials and goods creates a more resilient supply chain and spur economic growth in a region. This should be a primary focus for policymakers and business leaders.
Advancing Environmental Regeneration
Regenerating natural resources is often overlooked in the circularity agenda, compared to well-understood principles like recycling. By focusing efforts on regeneration, we can have a greater positive impact on our environment and social systems, rather than simply trying to minimize harm.
Businesses should evaluate all aspects of their value chain for regeneration opportunities. Oftentimes, it requires engaging suppliers, customers and sometimes competitors to improve the environmental impact of your ecosystem.
Enel has identified ways to integrate agricultural practices into the development and construction of our solar plants. It started with planting pollinator-friendly native seed mixes below solar panels at our Aurora plant in Minnesota, which provides wildlife habitat, supports the health of our photovoltaic technology and improves soil conditions. We continue to take the lessons learned from the project and develop more multi-use technologies that are naturally regenerative. Additionally, we require climate change risk assessments for all new development projects and ensure robust restoration planning takes place at the earliest stages of development.
Another business practice supporting regeneration examines opportunities to reduce embodied emissions and potential ecotoxicity associated with materials and construction processes – designing out waste and pollution end-to-end. Enel has a robust sustainable and circular procurement program to engage our suppliers, and has begun requesting (or requiring) lifecycle assessments (LCAs) and Environmental Product Declarations (EPDs) for our largest spend categories.
The time for an inclusive circular transition is now. Starting doesn’t have to come from the top down – it does, however, require cross-sector collaboration to achieve our mutual societal goals. We all have a role to play in this transition – every business, city and region. Embracing an inclusive circular economy is vital for a just energy transition that sustains our environment, provides decent work, spurs economic growth, upholds social inclusion and eradicates poverty. And we’ll need to work together to see it through.
Download the full paper from Enel North America: Transitioning to a Circular Economy: Opportunities for Recovery, Resiliency, and Regeneration.
About Enel’s Five Pillars of a Circular Economy
Enel’s framework for circular economy defines the framework and puts in place key pillars to help guide the effort and keep the business case clear. These same pillars can be useful to virtually any business looking to make this transition.
- Circular inputs: production and use models based on inputs from renewable, reused or recycled sources.
- Life extension: an approach to the planning and management of an asset or a product that intends to extend its useful life, for example, through modular design, simplification of repairs and predictive maintenance.
- Product-as-a-Service (PaaS): a business model in which the client acquires a service for a limited amount of time, while the company retains its ownership of the product, thereby maximizing both the use factor and its useful life.
- Sharing: shared management systems accessed by multiple users of products, goods or services.
- New life cycles: in synergy with the other principles, all the solutions that aim to preserve the value of a material or good at the end of its lifecycle through reuse, regeneration, upcycling or recycling.
About the Author
Head of Circular Economy
Enel North America
Peter Perrault is a Sustainability Management Certified Professional (SMCP) and certified Envision Sustainability Professional (ENV SP) whose experience spans over 15 years working at the nexus of sustainability and technology. He was the first President of the Board of Directors for the Sustainability Management Association, and has “sat on all sides of the table” as a sustainability practitioner; within local government, NGOs, industry groups and global corporations. Peter has held leadership positions with the UN Global Compact Supply Chain Traceability Task Force, the Silicon Valley Leadership Group’s Environment Committee, and was a member of the Technical Working Group that developed the WRI/GHG Protocol ICT Sector Guidance for emissions reporting.
With Enel North America, Peter works across Enel business lines, leading the company’s efforts in the region to transform its business towards an inclusive circular economy and to develop sustainable solutions for Enel customers. He received a Master’s degree in Economics from University of San Francisco and his Bachelor’s degree in Economics with a minor in Political Science from Humboldt State University.
About Enel North America
Enel is a multinational power company and a leading integrated player in the global power, gas and renewables markets. It is the largest European utility by market capitalization and ordinary EBITDA, and is present in over 30 countries worldwide, producing energy with over 88 GW of managed capacity. Enel distributes electricity through a network of over 2.2 million kilometers, and with over 73 million business and household end users globally, the Group has the largest customer base among its European peers. Enel’s renewables arm Enel Green Power is the world’s largest renewable private player, managing around 46 GW of wind, solar, geothermal and hydropower plants in Europe, the Americas, Africa, Asia and Oceania.
Enel operates in the US and Canada through two companies: Enel Green Power North America and Enel X North America. Enel Green Power North America is a leading owner and operator of renewable energy plants with a presence in 14 US states and one Canadian province. The company operates 58 plants with a managed capacity of over 6.6 GW powered by wind, geothermal and solar energy. Enel X in North America has around 4,500 business customers, spanning more than 35,000 sites, representing approximately $10.5B in energy spend under management, approximately 4.7 GW of demand response capacity and over 70 battery storage projects that are operational and under contract. Enel X is revolutionizing the EV charging market with its smart charging solutions deploying over 70,000 charging stations in the US.
Learn more at https://www.enel.com
About Circular Great Lakes
Circular Great Lakes, hosted by the Council of the Great Lakes Region, will be the catalyst for identifying the transformational projects, forming the partnerships, and mobilizing the public-private sector investments required to ensure valuable materials never become waste or pollution in this region, North America’s economic engine, starting with plastics.
To learn more: https://www.circulargreatlakes.org/