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# 52014DC0398

**COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF THE REGIONS Towards a circular economy: A zero waste programme for Europe /\* COM/2014/0398 final \*/**

  

Towards a circular economy: A
zero waste programme for Europe

1.
Introduction: a circular economy in support of
sustainable growth

Valuable materials are leaking from our
economies. In a world where demand and competition for finite and sometimes
scarce resources will continue to increase, and pressure on resources is
causing greater environmental degradation and fragility, Europe can benefit economically
and environmentally from making better use of those resources. Since the
industrial revolution, our economies have developed a ‘take-make-consume
and dispose’ pattern
of growth — a
linear model based on the assumption that resources are abundant, available,
easy to source and cheap to dispose of. It is increasingly being understood
that this threatens the competitiveness of Europe.

Moving towards a more circular economy
is essential to deliver the resource efficiency agenda established under the
Europe 2020 Strategy for smart, sustainable and inclusive growth.[1]
Higher
and sustained improvements of resource efficiency performance are within reach
and can bring major economic benefits.

Circular economy systems keep the added value
in products for as long as possible and eliminates waste. They keep resources
within the economy when a product has reached the end of its life, so that they
can be productively used again and again and hence create further value. Transition
to a more circular economy requires changes throughout value chains, from product
design to new business and market models, from new ways of turning waste into a
resource to new modes of consumer behaviour. This implies full systemic change,
and innovation not only in technologies, but
also in organisation, society, finance methods and policies. Even in a highly
circular economy there will remain some element of linearity as virgin
resources are required and residual waste is disposed of.

Industry already recognises the strong
business case for improving resource productivity. It is estimated that
resource efficiency improvements all along the value chains could reduce
material inputs needs by 17%-24% by 2030[2] and a better use of
resources could represent an overall savings potential of €630 billion per year for European
industry.[3] Business driven studies
based on product-level modelling demonstrate significant material cost saving
opportunities for EU industry from circular economy approaches and a potential
to boost EU GDP by up to 3.9%[4] by creating new markets
and new products and creating value for business. It is not surprising
therefore that companies are continually working to improve resource
management, but they are held back by a range of market barriers.

The high-level European Resource
Efficiency Platform,[5] bringing together selected
governments, businesses and civil society organisations, called for action to
move to a more circular economy, which relies more on reuse and high‑quality
recycling and much less on primary raw materials.

With the Roadmap to a Resource
Efficient Europe in 2011,[6] the Commission proposed a
framework for action and underlined the need for an integrated approach across
many policy areas and levels. The main ideas of the Roadmap are now developed in
the Seventh Environment Action Programme (7th EAP).[7]

Moving to more circular economic models
promises a much brighter future for the European economy. It would allow Europe to rise to the current and future
challenges
of global pressure on resources and rising insecurity of supply. Pumping
resources back into productive use again and again, cutting waste and reducing
dependence on uncertain supplies is a direct route to improving resilience and competitiveness.
By helping to decouple economic growth from resource use and its impacts, it
offers the prospect of sustainable growth that will last.

Resource
productivity in the EU grew by 20 % in 2000‑2011, but this may be in
part due to the effects of the recession. Maintaining this rate would lead to a
further 30 % increase by 2030 and could boost GDP by nearly 1 %,
while creating over two million jobs more than under a business‑as‑usual
scenario.[8]
Stepping up efforts to increase resource productivity will go hand in hand with
existing objectives of Community policy such as reducing carbon emission,
increasing energy efficiency, sustainable reindustrialisation of the EU economy, and securing
access to raw materials, whilst reducing environmental impacts and greenhouse
gas emissions.

There
is a wide range of proven measures to promote resource efficiency that have
shown pay-offs and the potential to be applied on a more systematic basis. The
steps needed to ensure that these changes are job-rich are also being
undertaken, in particular in the Communication on Green Employment and the Green
Action Plan for SMEs.[9]

2.
Setting up an enabling policy framework

Markets are an
important driver of resource efficiency and circular economy, as materials and
energy have become the principal input costs for many companies. However,
whilst markets are already driving change there are a number of market barriers
to effective and efficient management of resources. Waste prevention, ecodesign,
reuse and similar measures could bring net savings of € 600 billion, or
8 % of annual turnover, for businesses in the EU, while reducing total
annual greenhouse gas emissions by 2‑4 %.[10]
However, for this to happen the market barriers that prevent these
opportunities from being developed need to be overcome.

Whilst resource
productivity can benefit a wide range of sectors, it will also allow European
firms to benefit from the fast growth in markets for eco-industries, which are
forecast to double between 2010 and 2020. Internationally, resource-efficiency
improvements are in demand across a wide range of industrial sectors.

Existing infrastructure,
business models and technology, together with established behaviour keep economies
‘locked‑in’ to the linear model. Companies may lack the information,
confidence and capacity to move to circular economy solutions. The financial
system often fails to provide for investment in efficiency improvements or
innovative business models, which are perceived as more risky and
complex, deterring many traditional investors. Conventional consumer
habits can also hinder new products and services development. Such barriers tend
to persist in a context where prices do not reflect the real costs of resource
use to society, and where policy fails to provide strong and consistent signals
for the transition to a circular economy.

Building on
evidence of key products, materials and value chains, the Commission
will work with stakeholders to develop an enabling framework for the circular
economy using measures which combine smart regulation, market-based
instruments, research and innovation, incentives, information exchange and support
for voluntary approaches. Such a framework will contribute to the objective of
a sustainable industrial renaissance in the EU and rely on proactive consumers
and business, with a special focus on SMEs. Internationally, the EU should work closely with other partners,
both at the multilateral and bilateral level, so as to ensure the maximum
impact of the circular economy concept.

The Commission
will:

further analyse
the major market and governance failures which hamper the avoidance and reuse
of material waste, taking account of the heterogeneity of material types and their
uses, to contribute to an enabling policy framework for resource efficiency at
EU level.

2.1. Designing and innovating for a circular
economy

Circular economy approaches ‘design out’
waste and typically involve innovation throughout the value chain, rather than
relying solely on solutions at the end of life of a product. For example, they may
include:

reducing
the quantity of materials required to deliver a particular service
(lightweighting);

lengthening
products’ useful life (durability);

reducing
the use of energy and materials in production and use phases (efficiency);

reducing
the use of materials that are hazardous or difficult to recycle in products
and production processes (substitution);

creating
markets for secondary raw materials (recyclates) materials (based on standards,
public procurement, etc.);

designing
products that are easier to maintain, repair, upgrade, remanufacture or recycle
(ecodesign);

developing the
necessary services for consumers in this regard (maintenance/repair services,
etc.);

incentivising
and supporting waste
reduction and high-quality separation by consumers;

incentivising
separation, collection systems that minimise the costs of recycling and reuse;

facilitating
the clustering of activities to prevent by-products from becoming wastes
(industrial symbiosis); and

encouraging
wider and better consumer
choice through renting, lending or sharing services as an alternative to
owning products, while  safeguarding consumer interests (in terms of costs,
protection, information, contract terms, insurance aspects etc).

An important starting-point is the
design of production processes, products and services. Products can be
redesigned to be used longer, repaired, upgraded, remanufactured or eventually
recycled, instead of being thrown away. Production processes can be based more
on the reusability of products and raw materials, and the restorative capacity
of natural resources, while innovative business models can create a new
relationship between companies and consumers.

The following conceptual diagram
illustrates in a simplified way the main phases of a circular economy model,
with each of them presenting opportunities in terms of reducing costs and
dependence on natural resources, boosting growth and jobs, as well as limiting
waste and harmful emissions to the environment. The phases are interlinked, as
materials can be used in a cascading way, for instance; industry exchanges
by-products, products are refurbished or remanufactured or consumers choose
product-service systems. The aim is to minimise the resources escaping from the
circle so that the system functions in an optimal way.

Some EU policies and instruments already
provide tools and incentives in line with the circular economy model. The waste
hierarchy that underlies our waste legislation is leading progressively to
adoption of the preferred options of waste prevention, preparation for
reuse and recycling, and discourages landfilling. Chemicals policy
aims at phasing out toxic substances of very high concern. Some ecodesign
measures for energy-related products include requirements on durability and to
facilitate recycling. The Bioeconomy Strategy[11] promotes the sustainable and integrated use of biological resources and waste streams for the production of food,
energy and bio-based products. Climate policy creates incentives to
save energy and reduce greenhouse gas emissions.

A
common and coherent EU framework for promoting the circular economy will help
bring such elements together with Horizon 2020 to address the research and
innovation challenge.[12]

In order to support
design and innovation for a more circular economy, the Commission will:

under the
EU Research and Innovation Programme (Horizon 2020), demonstrate the opportunities
for moving towards a circular economy at European level with large‑scale
innovation projects targeted at cooperation within and between value chains,
fostering skills development and supporting the market application of innovative
solutions;

establish a reinforced partnership to
support research and innovative policies for the circular economy;

facilitate the
development of more circular models for products and services, including
through a more coherent product policy, and further develop the application of
the Ecodesign Directive by paying further attention to resource efficiency
criteria, including for the future priority product groups in the 2015- 2017
Work Plan; and

encourage the cascading principle in the sustainable use of
biomass, taking into account all biomass using sectors so that biomass can be
utilised in a most resource efficient way.

2.2.
Unlocking investment in circular economy solutions

The EU and the Member States should encourage investment in circular economy innovation and its take‑up,
and, against the background of the reform of the financial system, address barriers
to mobilise more private financing for resource efficiency. Recent Commission
proposals on non-financial reporting,[13] long-term financing[14]
and occupational pension funds[15] have integrated
requirements to disclose relevant environmental information to investors or
consider investment risks related to the scarcity of resources and climate
change.

In order to
reduce the risk for investors, innovative financial instruments are being
developed, such as the Natural Capital Financing Facility of the Commission and
the European Investment Bank. Public private partnerships (PPP) are also
effective instruments for leveraging private action and investment in resource
efficiency. The Sustainable Process Industry through Resource and Energy
Efficiency (SPIRE) PPP and the Bio-Based Industries Joint Technology Initiative
are actively contributing to circular economy goals.

Policy has a
further role in providing the right signals for investment in
resource efficiency by eliminating environmentally harmful subsidies and
switching taxation
away from labour towards pollution and resources. Progress on
environmental tax reform in EU Member States is addressed within
the European Semester of economic policy coordination.

In order to
unlock investment in the circular economy, the Commission will:

take up promising
areas identified by the Resource Efficiency Finance Roundtable[16]
including innovative financial instruments, reflecting resource issues in
accounting rules for companies, clarifying the sustainability responsibilities
of financial institutions (fiduciary duties), developing methodologies for ‘resource stress tests’ for companies, and exploring the
potential of the bonds market to channel additional finance for resource
efficiency projects;

prepare guidance
on the possibilities offered by the new public procurement directives in the
field of Green Public Procurement (GPP), and a recommendation on monitoring Member
States’ performance in achieving the indicative 50 % GPP target[17],
support
innovative instruments, such as pre-commercial procurement and public procurement
for innovation, and facilitate the establishment of GPP networks among
public authorities; and

further integrate
circular economy priorities into EU funding and encourage Member States to use available EU funding in programmes
and projects on the circular economy, in particular through the European
Structural and Investment Funds..

2.3. Harnessing
action by business and consumers and supporting SMEs

Business and consumers remain the key
actors in the transition to a more circular economy. Upstream and
downstream decisions in the value chain need to be better connected, providing
coherent incentives between producers, investors, distributors, consumers and
recyclers, and ensuring a fair distribution of costs and benefits. Market
mechanisms need to be employed to ensure the most efficient allocation and use
of resources, and where there are market failures or innovation bottlenecks,
these must be addressed. Functioning secondary materials markets need to be
developed. Particular attention should be paid to enabling entrepreneurs to tap
into potential new markets linked to circular economy, and to ensuring that the
necessary skills base is available in the labour market. Consumers should be empowered to make informed choices through better information on green credentials of different products.

The European Resource Efficiency
Platform has identified[18] significant opportunities
for business at different stages in the ‘loop’ feeding back materials back into the
production process or various segments of the supply chain of origin or in
other supply chains.. These are based on experience of successful initiatives that
could be scaled up and applied more widely, and include:

in the production phase, sustainable sourcing
standards, voluntary schemes led by industry and retailers, and industrial
symbiosis to provide markets for by-products;

in the distribution phase, improving information on the
resources contained in products and how they can be repaired or recycled,
referred to in the recommendations of the Platform as a ‘product passport’; and

in the consumption phase, collaborative
consumption models based on lending, swapping,
bartering and renting products, and product service systems to
get more value out of underutilised assets or resources (e.g. cars, tools,
lodging).

The Environmental Footprint pilot phase set
out in the Commission’s Building
the Single Market for Green Products Communication[19]
is bringing stakeholders together to develop
a common, agreed way for measuring the environmental impact of products and organisations.
After the pilot phase, the Commission will assess whether these methods are
successful so that they can be applied in existing or new instruments to
improve environmental performance of products.

Such measures should be scaled up to
ensure good framework conditions and a level playing‑field for existing
and new businesses to adapt to global resource megatrends, to reward the best
companies, to encourage new entrepreneurs to develop the business solutions of
tomorrow, to test them on the market and to provide credible information to
consumers. The multi-stakeholder process launched in the context of the
European Consumer Agenda[20] has highlighted the need
for effective tools against misleading and unfounded environmental claims.

The labour force has to be equipped with
the relevant skills in order to ensure an effective, job-rich transition.[21]
The Green Employment Communication[22] creates the framework
for unlocking the job creation opportunities of a more circular and resource‑efficient
economy. National,
regional and local authorities and social partners also have an important role
in developing targeted and coordinated support in the form of investment,
infrastructure, technology and skills, in particular focusing on the needs of
SMEs. They are also well positioned to facilitate a shift of consumer choice to
more sustainable products and services, and encourage behavioural change.

To support
action by business, in particular SMEs and consumers, the Commission will:

build on the
results of the Environmental Footprint pilot phase running until 2016 and set
out how to apply the use of environmental impact measurement in product and
process design and in providing consumers with better information on environmentally
sustainable choices;

trigger broad
stakeholder cooperation through coordination and support action under Horizon
2020 and its instruments, including the European Institute of Innovation and Technology, the European
Structural and Investment Funds, the Eco-innovation Action Plan, the Green
Action Plan for SMEs, and the European Consumer Agenda;

build on the Raw
Materials European Innovation Partnership stakeholder commitments that are
directly linked to resource productivity;

support job creation
and skills development through
enhanced policy coordination, directing European funding to programmes and
schemes that support green growth, improving information and monitoring,
including through the European Semester process, and working with social
partners, education and training institutions and
other stakeholders; and

support best practices exchanges at
the international level.

3.
Modernising waste policy and targets: waste as a
resource

Turning waste into a resource is part of
‘closing the loop’ in circular economy systems. The
objectives and targets set in European legislation have been crucial drivers of
improved waste management; they stimulate innovation in recycling and reuse,
limit landfilling, reduce losses of resources and create incentives for
behavioural change. But in the EU we still generate about five tonnes of waste per
person per year on average, and little more than a third of that is effectively
recycled.

The European Union has set out its
political commitment[23] to reduce waste
generation, to recycle waste into a major, reliable source of raw materials for
the Union, to recover energy only from non-recyclable materials and to
virtually eliminate landfilling. Taking waste policy further will bring
significant benefits for growth and job creation at relatively low or no cost,
while contributing to a better environment. With respect to global markets, an
ambitious waste policy is expected to drive innovation and help make EU
companies even more competitive in the provision of waste management services
and offer new market opportunities to EU exporters.

3.1. Defining waste targets for a move
to a recycling society

Europe has made substantial
progress in turning waste into a resource and promoting sustainable ways of
waste management such as recycling. However, performance varies considerably between
Member States. Six have already effectively eliminated the landfilling of
municipal waste, reducing it from 90 %
to less than 5 % in
the past 20 years and reaching recycling rates of 85 % in certain regions. In others over 90 % of waste is still
landfilled and less than 5 % is recycled.

Strong policy signals are needed to
create longer‑term predictability for investment and change so that
materials, such as plastics, glass,
metals, paper, wood, rubber and other recyclables, re-enter the economy as
secondary raw materials at competitive prices. Setting clear recycling targets
for the period to 2030 will provide such predictability. Separate collection at
source along with sound methodologies to calculate recycling rates will ensure
high quality recycling and contribute to the development of markets for the
supply of high quality secondary raw materials. To
that effect, the existing measurement method to assess what is actually
recycled should be clarified as some Member States currently report waste collected
as waste recycled despite significant material loss between these phases. Landfilling
of all recyclable waste shall be prevented by
2025.
Member States should endeavour to virtually eliminate landfill by 2030. Energy
recovery, including waste-to-energy recovery and
use of bio-fuels, will have a role to play with respect to non‑reusable
and non-recyclable waste. This will require more efficient use of the unevenly spread
energy recovery capacity currently available in the EU, together with measures
to avoid overcapacity.

Successful implementation can create
more than 180 000 direct jobs in the EU by 2030, in addition to the estimated
400 000 jobs that will be created by the implementation of the waste
legislation in force[24]. They will lead to satisfying
between 10 and 40% of the raw material demand in the EU, while contributing to
achieving the 2030 EU target to reduce greenhouse gas emissions by 40% – 62 Mt of CO2eq per year would be
avoided in 2030.

In order to
boost the economic, social and environmental benefits gained from the better
management of municipal waste, the Commission proposes to:

•
boost
reuse and recycling of municipal waste to a minimum of 70% by 2030;

•
increase
the recycling rate for packaging waste to 80% by 2030, with interim targets of 60%
by 2020 and 70% by 2025, including targets for specific materials;

•
ban
the landfilling of recyclable plastics, metals, glass, paper and cardboard, and
biodegradable waste by 2025, while Member States should endeavour to virtually
eliminate landfill by 2030[25];

•
further
promote the development of markets for high quality secondary raw materials,
including through evaluating the added value of end-of-waste criteria for
specific materials.

•
Clarify
the calculation method for recycled materials in order to ensure a high
recycling quality level.

3.2. Delivering simplification and
better implementation of waste legislation

Targets leave flexibility to Member
States to decide how to achieve them. However, there is significant potential
to further simplify and improve the implementation of waste legislation at
national level and to reduce the current disparities.

In 2012, the Commission developed a
Waste Management Scoreboard and roadmaps with specific recommendations for the
Member States with the weakest performance. It will continue to focus particular
attention on the Member States with the largest distance to the targets, seeking
to address, in partnership with them, implementation weaknesses at an early
stage.

Economic measures have proved
instrumental in improving national waste management, in particular through landfill
and incineration taxes, pay-as-you-throw and extended producer responsibility
schemes, or incentives for local authorities to promote prevention, reuse and recycling.
Landfill bans have also proved effective. Setting minimum requirements for producer
responsibility schemes at EU level will help cut costs and eliminate barriers
faced by producers having to respect several national schemes in the EU.

European funds can support Member States’ efforts focusing on integrated waste
management including separate collection, reuse and recycling infrastructure. Landfilling
or stand‑alone incineration should not be supported in future.

Making the best use of available waste
management capacity in the EU would require better planning and
information-sharing and may involve tolerating more shipments of waste within
the EU towards the most modern and efficient installations, at least as a
transitional measure.

There is scope for further streamlining
and facilitating national‑level data collection and reporting, and
increasing the reliability of data and its consistency across the EU. Adopting
common indicators will facilitate better monitoring and benchmarking of Member
States’
performance.[26]

Actions to further simplify the waste acquis
and ensure effectiveness and efficiency will
build on efforts undertaken already to cut the administrative costs of waste
policy, for example, through exemptions from requirements for take-back for
certain SMEs or efforts to put in place mandatory electronic data interchange
for waste shipments.

To ensure that
the benefits from EU legislation are delivered via simplification and better
implementation, the Commission proposes to:

•
address
overlaps amongst waste targets and align definitions;

•
significantly
simplify reporting obligations for Member States, including clarifying and
streamlining calculation methods for municipal, landfill and packaging waste
targets;

•
allow
Member States to exempt SMEs or undertakings collecting and/or transporting
very small quantities of non-hazardous waste, from the
general permit or registration requirements under the Waste Framework
Directive;

•
introduce
annual
reporting through a single entry point for all waste data and
make waste statistics consistent with the requirements of EU waste legislation,
while
benchmarking national methodologies against statistical standards;

•
require
the development of computerised data monitoring systems and
third‑party data verification in Member States;

•
establish
an early warning mechanism to ensure that Member States put in place an
appropriate set of measures to meet targets on time;

•
lay
down minimum operating conditions for extended producer responsibility schemes
that could be further developed at national level or in EU guidance documents,
and promote the use of economic instruments in Member States; and

•
promote
direct investment in waste management options at the top of the waste hierarchy
(prevention, re-use, recycling).

3.3. Tackling specific waste challenges

Tailor-made approaches are needed to address
particular waste challenges related to significant loss of resources or
environmental impacts.

Waste prevention: As
a first priority affecting all the phases in a circular economy, it should be
ensured that less waste is generated. Waste prevention
programmes have recently been adopted by the Member States, as required by the
Waste Framework Directive, and are currently reviewed by the European
Environment Agency. Following their assessment, the Commission will develop
initiatives promoting good practices in waste prevention in the EU.

Marine litter: Marine
litter pollutes beaches, causes harm to marine life and creates a long‑term
waste problem which is expensive to clean up. The 7th EAP calls for a
Union-wide quantitative headline reduction target supported by source-based
measures.

Full implementation of the measures in
the revised EU waste legislation package could deliver marine litter reductions
of 13 % by
2020 and 27 % by
2030. Setting a dedicated reduction target for 2020 would give a clear signal
to Member States currently developing measures to achieve ‘good environmental status’ for marine waters by the 2020
deadline under the Marine Strategy Framework Directive, and would provide an
impetus for the development of marine litter action plans within the four
Regional Sea Conventions. Other EU-level measures, incorporating inter alia the
results of the ongoing evaluation of the Port Reception Facilities Directive[27], will also contribute to
the achievement of the target. A second stage of the reduction target will be
developed in due time, based on further analysis of the reduction potential
from other land- and sea-based sources, and taking into account the commitment
made at Rio+20 to achieve significant marine litter reductions by 2025.

Construction and demolition waste: Markets
for recycled materials are essential to increasing the recycling rate of
construction and demolition waste. Design for better management of construction
and demolition waste, increasing recyclability and recycled content in
construction materials, will be included in a framework for the assessment of
the environmental performance of buildings, as outlined in the Commission’s
Communication on Resource Efficiency Opportunities in the Building Sector.[28]

Furthermore, under the proposed early
warning mechanism, Member States’ performance will be monitored
against the target of 70 % recycling by 2020, with measures including increased
landfill charges for construction and demolition waste, or additional sorting
obligations on major demolition sites to improve the quality of recyclates.

Food waste:

It has been estimated that up to 30% of
all food produced around the world is lost or wasted. The Commission is
considering presenting specific proposals to reduce food waste.

Hazardous waste: Proper
management of hazardous waste remains a challenge, with data on the actual
treatment path missing for part of this waste stream. As a first step, record‑keeping
and traceability will be strengthened through the setting‑up of hazardous
waste registries and identifying capacities and bottlenecks in Member States’ hazardous waste management
systems. These registries might be progressively expanded to other types of
waste like it is already the case in several Member States.

Plastic waste: Plastic
production in the EU is expected to increase at a rate of 5 % annually. While
only 24 % of
plastic waste is recycled, close to 50 %
is landfilled, and the rest is incinerated. The public consultation on plastic
waste carried out by the Commission in 2013[29] pointed to significant
potential for using plastic more sustainably and showed strong support for eliminating
the landfilling of plastics and for the better design of plastics and plastic
products. The Commission’s
recent proposal allowing Member States to restrict the use of plastic bags,[30]
and the proposals in this Communication for increased recycling and abandoning
landfilling are important steps to improve plastic waste management.

Recycling of critical raw materials:
While all raw materials are important, critical raw materials deserve
particular attention as their production worldwide is concentrated in few
countries, while many of them have low substitutability and low recycling
rates.
The Commission promotes efficient use and recycling of critical raw materials
in the framework of the Raw Materials Initiative[31] and
the European Innovation Partnership on Raw Materials.

Illegal waste shipments: The
Commission will step up action to ensure compliance with relevant EU legislation,
in particular Regulation (EC) No 1013/2006 on shipments of waste as recently
amended in order to reinforce waste shipment inspections.

Recycling of phosphorus: Phosphorus
is a vital resource for food production, but it has significant security‑of‑supply
risks and its current use involves waste and losses at every stage of its
lifecycle. Following the Consultative Communication on the sustainable use of phosphorus,[32]
the Commission is developing a framework for further action.

To address
specific waste challenges the Commission:

proposes an
aspirational target of reducing marine litter by 30 % by 2020 for
the ten most common types of litter found on beaches, as well as for fishing
gear found at sea , with the list adapted to each of the four marine regions in
the EU;

envisages measures
to stimulate markets in recycled materials derived from construction and
demolition waste and develop a common EU assessment framework for the
environmental performance of buildings;

proposes that
Member States develop national food‑waste prevention strategies and
endeavour to ensure that food waste in the manufacturing,
retail/distribution, food service/hospitality sectors and households is reduced
by at least 30 % by 2025;

envisages developing
a proper registry system for at least hazardous waste in all Member States;

further to its
proposal to reduce the use of lightweight plastic bags, proposes that
plastics be banned from landfill by 2025;

Proposes that
Member States shall include measures regarding collection and recycling of
waste containing significant amounts of critical raw materials in their
national waste management plans; and

is considering developing
a policy framework on phosphorus to enhance its recycling, foster
innovation, improve market conditions and mainstream its sustainable use in EU
legislation on fertilisers, food, water and waste.

4.
Setting a resource
efficiency target

In the 7th EAP, Member States and the European Parliament agreed that the European Union should establish indicators
and set targets for resource efficiency, and assess whether it would be
appropriate to include a lead indicator and target in the European Semester.
Following wide consultations, resource productivity, as measured by GDP
relative to Raw Material Consumption (RMC), has been identified as a
candidate
for
a resource productivity target.[33]

A realistic target to increase resource
productivity, endorsed by the EU and its Member States would focus political
attention and tap the currently overlooked potential of a circular economy to
create sustainable growth and jobs and increase the coherence of EU policy.It    would
be a proportionate way to ensure this coherence and encourage action.

The EU is already forecast to increase
its resource productivity by 15 %
between 2014 and 2030 under a business‑ as‑ usual scenario. Using
smart policies to promote the transition to a more circular economy, as called
for by the European Resource Efficiency Platform, it would be possible to
double this rate. While contributing significantly to the sustainability
dimension of growth, increasing resource productivity by 30% would also have a
positive impact on job creation and growth of GDP.[34]

Industry would benefit from this improvement
in resource productivity through enhanced competitiveness.[35]
Resource costs can make up a significant part of their cost structure, and they
need available and predictable supplies.[36] There would be both
immediate financial gains, and longer term strategic benefits, as growing
global demand drives up resource prices and volatility. Becoming most resource
efficient will therefore help Europe meet its reindustrialisation objective.

A resource productivity target, while
not binding and set at the level of the EU, would provide an impetus for those Member
States that do not already have a target at national level to develop measures
that take account of resource use. It would lead to more balanced measures,
that consider the wider economic, social and environmental consequences and
fill this gap.

Member States would be free to undertake
the balance of policies and actions that are most economically and
environmentally advantageous in line with wider policy objectives. In doing so,
they would benefit from a range of already proven - but not widely deployed - good
practice that they could adopt and tailor to their own needs and circumstances.
The review
of the Europe 2020 strategy is currently underway[37]
supported by public consultation to gather all views on its development. The
Commission therefore considers that any decision on setting a resource
productivity headline target should be taken in the review, after taking into
account the results of public consultation together with recommendations of the
European Resource Efficiency Platform.

To ensure that policy makers are aware
of the overall picture of resource pressures on the environment, other
indicators, in particular for water use and finite land resources, need to be
taken into account. Eurostat has published a Resource Efficiency Scoreboard since
2013 as part of the Europe 2020 indicators.[38] This is designed to
monitor implementation of the Roadmap to a Resource Efficient Europe,
communicate the link between resources and engage stakeholders further in the process
of measuring societal progress beyond GDP.

In order to tap
the potential of resource efficiency in the context of sustainable growth:

•
 the
Commission will take the recommendations of the European Resource Efficiency
Platform on a
headline target for resource efficiency into account
together
with outcomes
of the
public
consultation in the ongoing review of the Europe 2020 strategy;

•
In
parallel, the Resource Efficiency Scoreboard used to monitor indicators of the use
of resources other than carbon and materials (in particular, land and water)
will be developed further; and

•
National
statistical offices should work to establish a commonly accepted methodology within
the European Statistical System in order to calculate raw material consumption
at national level.

[1] COM(2010) 2020, COM(2011) 21.

[2] Meyer,
B. et al (2011)
"Macroeconomic modelling of sustainable development and the links between the economy
and the environment". Study for the European Commission (DG Environment), available at http://ec.europa.eu/environment/enveco/studies\_modelling/pdf/report\_macroeconomic.pdf

[3] "Guide to
resource efficiency in manufacturing: Experiences from improving resource
efficiency in manufacturing companies". Europe INNOVA (2012).

[4] Ellen
MacArthur Foundation (2012) Towards the Circular Economy: Economic and business
rationale for an accelerated transition.

[5] http://ec.europa.eu/environment/resource\_efficiency/re\_platform/index\_en.htm.

[6]     COM(2011) 571.

[7]     OJ L 354, 28.12.2013, p.
171–200.

[8]     Modelling the Economic
and Environmental Impacts of Change in Raw Material Consumption (2014), Cambridge Econometrics et al.

[9] Reference
to Communications to be adopted simultaneously

[10]    The opportunities to
business of improving resource efficiency (2013), AMEC et al.

[11] COM(2012) 60

[12]    See the annex to this
Communication.

[13]    COM(2013) 207.

[14]    COM(2014) 168.

[15]    COM(2014) 167.

[16]    MEMO/13/110.

[17] COM/2008/400

[18]http://ec.europa.eu/environment/resource\_efficiency/documents/erep\_manifesto\_and\_policy\_recommendations\_31-03-2014.pdf

[19]    COM(2013) 196 and
Commission Recommendation 2013/179/EU.

[20] COM (2012) 225

[21] COM (2012) 173

[22]    COM (2014) 446

[23]    7th EAP

[24] SWD(2014) 207

[25]    A certain proportion of
‘residual’ waste is non-recoverable and may therefore be landfilled, since no
alternative treatment option is currently available. This would be limited to a
maximum of 5 %.

[26]    For instance, four
calculation methods are allowed for the recycling target on municipal waste.
Depending on the method chosen, the results might be quite different (around 20 %).

[27] Directive 2000/59/EC

[28]    COM(2014)
445

[29]    COM(2013) 123.

[30]    COM(2013) 761.

[31] COM(2011) 25

[32]    COM(2013) 517.

[33]    RMC is an aggregate indicator
measuring (in tonnes) all the material resources used in the economy, while
taking into account the resource use embedded in imports. Currently it is
available for the EU and some Member States. Countries for which RMC is not yet
available can use Domestic Material Consumption in the meantime.

[34]    SWD (2014) 211.

[35] Stakeholders preferred
RMC as a measure of resource use because it captures the resource use embedded
in both imported and domestically produced products, and so allows for a fair
comparison of their respective resource efficiency.

[36] Recent studies on the
steel and aluminium sectors show that raw materials make up around 30 to 40 per
cent of their cost structures, larger than for example labour costs.

[37] COM(2014) 130 of
19.3.2014; Taking stock of the Europe 2020 Strategy for smart, sustainable  and
inclusive growth.

[38]    http://epp.eurostat.ec.europa.eu/portal/page/portal/europe\_2020\_indicators/ree\_scoreboard.

Annex: How can Horizon 2020
contribute to the circular economy?

Circular
economy represents a development strategy that entails economic growth without
increasing consumption of resources, deeply transform production chains and
consumption habits and redesign industrial systems at the system level. It
relies on innovation being it technological, social and organisational. It
requires a new portfolio skills and knowledge as well as new financial
instruments, multistakeholders’ involvement. In terms of actions, it may be
supported by demonstration, market uptake, awareness, dissemination and
internationalisation.

In
terms of content, it requires a strong integration across the Industrial
Leadership (part II) and Societal Challenges (Part III) parts of Horizon 2020.
Since circular economy considers the whole value chain potential, it requires
support from all stages of the research and innovation chain. Therefore
contribution from the other parts of Horizon 2020 dealing with Excellent
Science (part I), Spreading Excellence and Widening Participation (part IV),
Science with and for the Society (part V), Non-nuclear direct action of the
Joint Research Centre (part VI) and the European Institute of Innovation and
Technology (part VII) will be also needed to a certain extent. The contribution
of various Horizon 2020 parts to the circular economy are summarised below. To
note that the SPIRE PPP and JTI BBI are supported by Horizon 2020 and that they
contribute strongly to the goals of circular economy.

|| || || HORIZON 2020

|| || || Excellent Science || Industrial Leadership || Societal Challenges || Spreading excellence and widening participation || Science with and for Society || European Institute of Innovation & Technology || Joint Research Centre

|| || || European Research Council || Future and Emerging Technologies || Marie Sklodowska-Curie actions || Research infrastructures || Leadership in enabling and industrial technologies || Access to risk finance || Innovation in SMEs || Health, demographic change and wellbeing || Food security, sustainable agriculture and forestry, marine and maritime and inland water research || Secure, clean and efficient energy || Smart, green and integrated transport || Climate action, environment, resource efficiency and raw materials || Europe in a changing world – inclusive, innovative and reflective societies || Secure societies - Protecting freedom and security of Europe and its citizens

CIRCULAR ECONOMY - COMPONENTS || Technological innovation || Design of materials and processes || ++ || ++ || || ++ || ++ || || + || || + || + || || + || || || || || ||

Design of products || ++ || || || || + || || + || || + || || || + || || || || + || || +

Resource management (waste, water, energy and raw materials) || || + || || ++ || + || || + || || ++ || + || || ++ || || || || ++ || || ++

Social innovation || New production and consumption models || || || || || || || || + || ++ || + || || ++ || + || || || ++ || || +

Citizens' involvement || || || || || || || || || + || || || + || || || || ++ || ||

Product service models || || || || || || || + || || + || || || ++ || || || || + || ||

Design services || || || || || || || + || || + || || || + || || || || || ||

Organisational innovation || Integrated solutions and systems || || + || || || + || || + || || ++ || ++ || ++ || ++ || || || || + || ||

Logistics || || || || || || || || || ++ || || ++ || + || || || || || ||

Business models || ++ || || || || || || + || || ++ || || || ++ || || || || + || || +

Policy supporting tools || || || || || || || || || ++ || || || ++ || + || || || ++ || || ++

Skills and knowledge || Entrepreneurship || || || + || || || || || || || || || || || || || || + ||

Capacity-building and multi-disciplinarity || || || + || || || || || || + || || || || || || + || + || + ||

Financial instruments || || || || || || ++ || + || || || || || || || || || || ||

Awareness, dissemination and internationalisation || || || || || || || || || + || || || + || || || || ++ || ||

Multi stakeholder involvement || || || || || + || || || || + || || + || ++ || || || || ++ || ||

Demonstration and market uptake actions || || || || || ++ || || || || + || || + || ++ || || || || + || ||

+
Important contribution

++ Very strong contribution

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