# Circular Economy Strategy Selection Through a Digital Twin Approach
## 1 Introduction  
The current industrial landscape is undergoing a transformative shift driven by an urgent need to address sustainability challenges. In recent years, the global environmental crisis, manifested through escalating greenhouse gas emissions, resource depletion, and ecological degradation, has underscored the necessity for industries to adopt environmentally conscious practices. The industrial sector, which is responsible for a significant proportion of global emissions and waste generation, holds a crucial role in achieving sustainability targets. However, other sectors also strongly contribute to increasing such emissions, like the transportation sector, which need to be improved [1]. In this context, international agreements and legislative frameworks such as the Paris Agreement [2] in 2015 and the European Climate Law [3] have provided a compelling impetus for action. The European Climate Law, for instance, mandates a net reduction in greenhouse gas emissions by at least 55% by 2030, while establishing legally bindinggoals to achieve carbon neutrality by 2050. Several approaches can be used to reach these objectives, like the use of low-carbon passenger transportation structures. These regulatory milestones reflect the increasing alignment of governmental policy with the principles of sustainable development, emphasizing the integration of environmental stewardship within economic and industrial strategies, while also paying attention to social aspects [4]. Among the most promising approaches to addressing these challenges is the adoption of a Circular Economy (CE) paradigm. Unlike traditional linear economic models, which are based on extraction, production, consumption, and disposal [5], CE advocates for a regenerative system designed to minimize waste and maximize resource efficiency. This shift towards circularity represents a significant evolution in industrial production, offering both environmental and economic benefits. The main applications of CE principles are in the strategies for reusing or recycling materials. Recycling usually operates on products in the disposal phase and aims to recover the raw materials without preserving the original functionality of the product. Reuse aims to maintain the original functionalities of the product and, depending on the final quality level of the product required, can be achieved using five different strategies [6]: direct reuse, repairing, reconditioning, refurbishing, and remanufacturing (in ascending order according to the final quality level of the product). The implementation of circular strategies has gained momentum within the industrial sector, especially for the environmental benefits they have been demonstrated to bring. For example, remanufacturing a product has the potential to reduce the use of raw materials and waste disposal up to 80% compared to new products [7], while reducing CO2 emissions by 87% [8]. However, adopting CE strategies is often complicated because of the high investments needed to transform a factory based on a linear economy approach into one based on a circular approach. In fact, their implementation in real-world industrial settings often requires significant restructuring of supply chains, manufacturing processes, and business models. Additionally, industries must contend with uncertainties surrounding the costs and feasibility of these transitions, particularly in sectors reliant on complex production systems [9]. To address these challenges effectively, industries must rely on robust decision-making frameworks informed by quantitative evaluations of sustainability. Simulations have emerged as a powerful tool for evaluating the feasibility and effectiveness of implementing CE strategies since they allow for the creation of virtual models of production systems, enabling the exploration of different scenarios and their potential outcomes without making costly changes to real-world operations.