ABOUT THE CIRCULAR ECONOMY
ABOUT THE CIRCULAR ECONOMY
Before we discuss the circular economy, we should consider what an economy is.
An economy is a human invention, a human construct. Therefore, it stands to reason that if we’re going to the trouble of creating an economy, then, at a minimum, that economy ought to serve current and future generations. This economy should be sustainable, and prosperous with strong intergenerational equity (passing on a better future to our children and grandchildren). Readers can judge for themselves whether our current human construct, our current economy, is delivering those minimum outcomes.
Three pillars of a circular economy.
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Optimised material flow management at a very basic level can equate to resource management. That is, the optimised management of physical material flows. However, at a much deeper level, optimised material flow management is about optimising everything that is materially influential to a system or an economy. This is because an economy is made up of much more than just the flow of physical materials.
Optimised material flow management includes the optimised management of money, energy, infrastructure, carbon, nutrients, labour, skills, training, goods and services and much more. All the elements of an economy.
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Local value adding is about leveraging maximum value from the identified material flows at the local level.
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Local renewable energy powers every element of the circular economy
Energy is the master resource of any economy. Nothing does or can happen within an economy without energy.
In a linear or throughput economy, energy flows into a cities, towns, and regions in many forms and this is predominantly non-renewable energy sourced from highly manipulated energy markets. These highly manipulated energy markets ensure the residents and businesses of these cities, towns, and regions are price takers with minimal real control over the cost of that energy. To compound this unsustainability, huge quantities of ‘energy dollars’ are exported out of these cities, towns, and regions to pay for that energy.
What happened? We used to be so good at this stuff.
There’s a town in Western NSW that used to produce its own gas at an industrial scale. They didn’t drill or frac, they actually produced the gas.
That gas was used for:
local industry,
the commercial sector,
the residential sector,
street lighting,
and to generate electricity.
The vertically integrated company that produced and distributed the gas was local and the capital for this endeavour was raised via the local stock exchange. The complete vertical integration was run by locals and the energy and local value-adding dollars were captured and circularised within the community.
This western NSW town was Broken Hill and the first meeting held to discuss this local gas strategy was held in the members' room of the Broken Hill Stock Exchange on the 21st of November 1887.
News reports of the day stated: After a long discussion on the subject matter of the meeting, the following resolution was unanimously adopted: "That it is desirable to form a gas company for Broken Hill to be called the Broken Hill and Suburban Gas Company limited".
The manner in which the gas was produced was very polluting and ultimately unsustainable. Nonetheless, this was the globally leading technology for the period, as was the underlying local business model. This Broken Hill model was applied throughout Australia and during the war years this gas was even used to fuel land transport when petrol and diesel were in short supply.