I am pleased to open our first ever debate on the opportunities of a more circular economy for Scotland. Although this is our first debate on this important subject, I am certain that it will not be the last.
In the traditional economy in which we live or have lived in the past, we take, we make and we dispose. We take resources from the ground, air or water, we make products and then we dispose of them. A circular economy is about retaining the value of our primary resources, designing, reusing, repairing and remanufacturing, and exploring new business models that support a more circular approach.
We are getting better at disposing of goods in a way that lessens the impact on the environment. We are landfilling less, we are recovering energy, particularly from food waste, and we are recycling what we can. I think that we all accept that business as usual is not an option. We must act now to put the value of our resources at the heart of Scotland’s economy.
Creating a circular economy is an economic, environmental and moral necessity. It will create jobs in our communities, it will improve our quality of life and, of course, it is just good sense.
Major new economic powers are emerging in Brazil, India, Indonesia, Korea and elsewhere. The climate is changing, and the world’s population is changing; therefore, our demands for the world’s resources are changing. Globally, by 2030, we may need around 40 per cent more water, 80 per cent more steel and 33 per cent more energy. Those are just some examples of how demand is increasing.
Commodity prices are more volatile these days. As we all know, they have increased sharply since the 2000s. The Ellen MacArthur Foundation has identified a global saving of £1.3 trillion if we were to move to a more circular economy.
We are all politicians here, so we have the means to design and influence action in Scotland, as well as the rest of the United Kingdom and throughout Europe. Therefore, it is our responsibility to show as much leadership as we can in this important area.
Last October, The Guardian identified five countries moving ahead of the pack on taking action on the circular economy. I am pleased to say that Scotland stands alongside Denmark, the Netherlands, Sweden and Japan in leading the way. The Green Alliance, which is a UK environmental think tank, has also said that Scotland is a long way ahead of other parts of the UK in its policy support for resource productivity.
We are all too familiar with products that seem to be designed to be discarded after relatively short use. That could be a mobile phone with a sealed casing or a washing machine sentenced to a short life because the part needed is not available any more. Design for a circular economy is the first step.
When a product has fulfilled its first life, reuse is almost always the preferred option. Reusing a product retains the embedded value of materials and the labour and the energy that were involved in making it in the first place, and it avoids the demand for new resources to create another new product.
Repair is by no means a new concept. We would not dream of scrapping a car just because the alternator had gone, but how often have we replaced a television, a vacuum cleaner or a coat or any other item of clothing because it was too difficult to get it repaired or fixed?
Remanufacture is when we take apart a product and rebuild it to the same standard as—or better than—the original. New resources are avoided, and remanufacturing can be much less energy intensive than manufacturing a new product.
In our traditional or linear economy, there is little incentive to make products reliable and easy to repair, or to design them so that valuable parts can be salvaged when they cannot be repaired. The concept of a circular economy can be daunting, but it starts to make sense once we unpack it into visible, practical things that we can do.
In January this year, the Green Alliance and the Scottish Council for Development and Industry published a report that identifies key opportunities for Scotland in particular sectors. Those include a potential £140 million opportunity from converting whisky by-products into feed for the fish farming industry. Reusing steel from decommissioned oil and gas rigs instead of melting it down for recycling could cut associated carbon emissions by more than 80 per cent.
In March, I published a report that sets out the potential value of remanufacturing to Scotland. Remanufacturing is already worth £1.1 billion to the Scottish economy, and it supports around 17,000 jobs, but the potential exists for its value to grow by £620 million by 2020 and for it to create another 5,700 jobs.
I was privileged to open the fantastic new Scottish institute of remanufacture in Glasgow earlier this year, which was established with £1.3 million of support from Zero Waste Scotland and the Scottish Further and Higher Education Funding Council. That innovative centre will focus on innovation in remanufacturing, collaborative projects and establishing a remanufacturing community in Scotland. It is worth noting that it is one of only four such centres in the world—the others are in Singapore, New York and Beijing—and the first in Europe.
Scotland’s reuse sector is also developing. The Revolve brand, which sets out standards and quality for reused goods in Scotland, is operated by Zero Waste Scotland and partners such as the Community Recycling Network Scotland. Reuse is growing, and many of us will have bought used goods from eBay, Gumtree or elsewhere. We are familiar with that trend. Indeed, my officials tell me that there is a burgeoning industry in pre-loved luxury goods such as designer fashion and handbags—I take their word for it, as that is not something that I have personal experience of, but it is another example of what is happening out there.
With our rich heritage in textiles, Scotland is in a fantastic position to support the reuse sector. Only a few weeks ago, my colleague the Minister for Environment, Climate Change and Land Reform, Aileen McLeod, attended an exhibition in her constituency at which small companies, including Hamish Mash Eco Fashion, were displaying some very smart clothes. Whether we are talking about the gearboxes that are remanufactured by Mackie’s, a family business in the east end of Glasgow, the computer hardware that is refurbished for reuse by Re-Tek in East Kilbride or the textiles that are upcycled into desirable clothing in Dalbeattie, we are talking about quality, everyday products that are being put on the market by credible, sustainable businesses. They are doing that in a way that keeps materials circulating in our economy, thereby reducing our reliance on new materials and new resources.
That complements the work that is already being undertaken as part of the resource efficient Scotland programme, which brings together support on energy, water and materials in a unique approach to help businesses and the public sector. All that activity represents substantial progress, which I intend to build on by bringing those issues together in a circular economy road map. I will publish that strategy and put it out to consultation in the next few months. It will set out the opportunities that suit the characteristics of Scotland as a nation on which we will focus our efforts.
The circular economy is about much more than recycling, but we are all familiar with recycling systems. As we all know, Scotland has some of the most ambitious recycling targets in the UK and beyond, and we aim to recycle 70 per cent of our waste by 2025. However, recycling quality is as important as quantity. Low-quality, contaminated recyclate is sold off cheaply, often abroad, and we must address that. It becomes a low-value commodity, and there is little motivation for householders to recognise the value in the products that they put in their recycling bins. High-value, clean recyclate can be kept in much higher-value use.
One example of what is happening is the work of Dryden Aqua, which is a small business in Midlothian that makes high-tech water filters from waste glass. I had the pleasure—around 18 months ago, I think—of visiting Dryden Aqua. It is an amazing, innovative Scottish company with an international reputation, but it faces a challenge in getting consistent and reliable sources of glass from our local authorities in sufficient quantities. It simultaneously highlights the opportunities of a more circular economy and some of the challenges in making that transition.
That is one of the reasons why I recently established the Scottish materials brokerage service. Despite its name, the service is an exciting idea, and it will bring stability for Scottish organisations in what can be a volatile market. It is all about bringing together materials in the quantities that are required to attract reprocessing infrastructure to Scotland. If all our local authorities and everyone else who collects those materials go through the brokerage service, the volumes will increase. Once there are the proper commercial volumes, we will, I hope, attract more reprocessing infrastructure to Scotland to be built by the commercial sector. That, in turn, would bring about a good income deal for local government in particular.
As I have indicated, glass is one of the priority materials for the new brokerage service to support ambitious companies in Scotland, such as Dryden Aqua. It does not make sense not to have the right collection systems in place for our glass when companies in Scotland can create more jobs and do more business if they can get their hands on that glass. That is why we are addressing those particular challenges.
There is also much to do to improve householder participation in recycling. I am very encouraged by the work of the zero waste task force, which I co-chair with the Convention of Scottish Local Authorities, which is the local government body. The task force has been considering how to reap the benefits of a more circular economy through the services that are provided by local government. It has agreed to develop a charter for more consistent recycling collections in Scotland to improve participation and recycling rates, but also to improve the quality of the recyclate that is collected in the first place, the importance of which I indicated before. I cannot say too much more about that at the moment ahead of the final task force meeting in a few weeks’ time, but I very much hope that the charter will be a significant step forward for recycling in Scotland.
We must remember that we have already picked the low-hanging fruit and we need to up our game on recycling. Simply more of the same will not capture the recyclate that otherwise will be wasted.
The question is often put to me whether the effort that is required to improve recycling outweighs the benefits and whether securing energy from waste, for instance, might be the preferred option in some circumstances. It is important that I am clear about that. Where there is genuinely no better use for materials, using them to generate heat and energy is always better than simply putting them into landfill—into big holes in the ground.
Once we have truly embraced a more circular economy, there may be some materials for which there really is no further use, and energy from waste will still be the only viable option. However, I believe that we are nowhere near that point. We do not want to direct materials down the waste hierarchy to disposal; rather, we want to move them up towards reuse and waste prevention in the first place. Indeed, we have to make the effort to find the game changers that we require that will create opportunities to do something better with our materials in this country. We have to be creative, and we want those ideas to come forward.
Recycling targets that are based on tonnage are pretty blunt instruments. Heavy materials score well on recycling rates, but they may not generate the greatest carbon benefits. Zero Waste Scotland has done some ground-breaking work on a carbon metric for materials to help to shape our future efforts to capture those with the greatest carbon impact. In parallel, it is assessing the scale of carbon savings that a more circular approach in our economy could achieve. We hope to publish the results of that work in due course.
We need to get the principles of a circular economy out to a much wider audience. The Scottish Government is working with Young Scot to organise a weekend event in June for young people to explore the concept of a circular economy. I am very much looking forward to hearing what our young people say and what comes out of that discussion. If anyone is going to come up with out-of-the-box ideas and game changers, it will, we hope, be our young people.
We have to ask ourselves what will engage the public to the same extent as the carrier bag charge that came into force last year, for example. The 5p charge was the subject of conversation throughout the country and it affected everyone in the country. We now see a reduction of between 80 and 90 per cent in bag use in some stores in Scotland.
The carrier bag charge is a small example of action towards a more circular economy. People are now reusing bags rather than demanding a new bag, and they are recognising their value in the first place and the impact on their pockets and the environment.
What is the next big thing that will help us towards a circular economy? What will engage the people of Scotland in action? I do not know whether this is the answer, but this morning Zero Waste Scotland published a report on the feasibility of a deposit return scheme for Scotland, whereby we put in something that we have used, such as a bottle, to go for recycling, and we then get some of our money back.
Is deposit return perhaps the next big thing in Scotland? It makes sense that we should consider such ideas. Deposit return schemes have worked in many countries throughout the world, such as Norway, Germany and Sweden. There are even some schemes in Canada, the United States and elsewhere.
One of the benefits of such schemes, which we should consider seriously, is the fact that they tackle litter as well as improving recycling. If we attach a value to the bottles and cans that we see on the streets, in our communities and in the wider environment, they are more likely to be recycled, as people get money for them. That would help clear up Scotland’s communities at the same time.