General rights
Copyright and moral rights for the publications made accessible in the public portal are retained by the authors and/or other copyright
owners and it is a condition of accessing publications that users recognise and abide by the legal requirements associated with these rights.
Users may download and print one copy of any publication from the public portal for the purpose of private study or research.
You may not further distribute the material or use it for any profit-making activity or commercial gain
You may freely distribute the URL identifying the publication in the public portal
If you believe that this document breaches copyright please contact us providing details, and we will remove access to the work immediately
and investigate your claim.
Downloaded from orbit.dtu.dk on: Aug 10, 2022
Product/Service-Systems for a Circular Economy: The Route to Decoupling Economic
Growth from Resource Consumption?
Kjær, Louise Laumann; Pigosso, Daniela C. A.; Niero, Monia; Bech, Nynne Marie; McAloone, Tim C.
Published in:
Journal of Industrial Ecology
Link to article, DOI:
10.1111/jiec.12747
Publication date:
2019
Document Version
Peer reviewed version
Link back to DTU Orbit
Citation (APA):
Kjær, L. L., Pigosso, D. C. A., Niero, M., Bech, N. M., & McAloone, T. C. (2019). Product/Service-Systems for a
Circular Economy: The Route to Decoupling Economic Growth from Resource Consumption? Journal of
Industrial Ecology, 23(1), 22-35. https://doi.org/10.1111/jiec.12747
Kjær, L. L., Pigosso, D. C. A., Niero, M., Bech, N. M., & McAloone, T. C. (2018). Product/Service-Systems for a Circular
Economy: The Route to Decoupling Economic Growth from Resource Consumption? Journal of Industrial Ecology.
DOI: 10.1111/jiec.12747
Forum paper for Journal of Industrial Ecology
(
initially submitted for special issue on: “Exploring the Circular Economy”)
Product/Service-Systems for a Circular Economy: the route to
decoupling economic growth from resource consumption?
Louise Laumann Kjaer*, Daniela C. A. Pigosso, Monia Niero,
Nynne Marie Bech, Tim C. McAloone
*Corresponding author
Address correspondence to:
Louise Laumann Kjaer
Produktionstorvet building 426
llkj@mek.dtu.dk
Summary
Product/Service-Systems that focus on selling service and performance instead of products are
often mentioned as means to realize a Circular Economy, in which economic growth is decoupled
from resource consumption. However, a Product/Service-System is no implicit guarantee for a
Circular Economy, and Circular Economy strategies do not necessarily lead to decoupling
economic growth from resource consumption in absolute terms. Absolute resource decoupling only
occurs when the resource use declines, irrespectively of the growth rate of the economic driver. In
this forum paper, we propose a two-step framework that aims at supporting analyses of
Product/Service-Systems and their potential to lead to absolute resource decoupling. In the first
step, we present four Product/Service-System enablers of relative resource reduction that qualify as
Circular Economy strategies. In the second step, three subsequent requirements need to be met, in
order to successfully achieve absolute resource decoupling. Conditions and limitations for this
accomplishment are discussed. Danish textile cases are used to exemplify the framework elements
and its application. We expect that the framework will challenge the debate on the necessary
conditions for Circular Economy strategies to ensure absolute resource decoupling.
1
Kjær, L. L., Pigosso, D. C. A., Niero, M., Bech, N. M., & McAloone, T. C. (2018). Product/Service-Systems for a Circular
Economy: The Route to Decoupling Economic Growth from Resource Consumption? Journal of Industrial Ecology.
DOI: 10.1111/jiec.12747
<heading level 1> Introduction
The Ellen MacArthur Foundation has stated that “The circular economy provides multiple value
creation mechanisms that are decoupled from the consumption of finite resources.” (Ellen
MacArthur Foundation 2015a, p. 22). Circular Economy (CE) is increasingly seen as a solution to
tackle the current resource scarcity issue while ensuring economic growth and job creation (EC
(European Commission) 2015).
CE is often linked to the performance economy, where goods are sold as services through
business models based on renting, leasing and sharing, while the manufacturer retains ownership of
the product (Stahel 2010). The idea of using “a mix of tangible products and intangible services
designed and combined so that they are jointly capable of fulfilling final customer needs” (Tukker
and Tischner 2006a, p. 1552) is at the core of the Product/Service-System (PSS) concept.
In the editorial of Journal of Industrial Ecology’s special issue on CE, PSS were highlighted as
means to facilitate CE through e.g. product life extension and product sharing (Bocken et al. 2017).
Given the fact that PSS are often mentioned as means to realize CE, there is a risk that all PSS
could be perceived to have this potential. However, PSS do not automatically lead to a reduction in
resource use, as previously highlighted by several authors (e.g. Tukker 2004; Pigosso et al. 2010;
Kjaer et al. 2016; Tukker and Tischner 2006b). In addition, strategies aiming at resource reduction
do not automatically lead to an enhanced sustainability performance (Bilitewski 2012; Andersen
2007). In the above-mentioned special issue on CE, an important question (among others) was
raised: “when do CE practices lead to net environmental benefits?” (Bocken et al. 2017, p. 1). This
was on the agenda in Zink and Geyer (2017)’s paper on CE rebounds, explicitly challenging the
ability of CE to live up to the concept’s intuitive promise of reducing environmental impacts
through less production and consumption. While their argumentation adds valuable inputs to the
discussion we aim to raise with this forum paper, there is still a need to explicitly address and
clarify the resource decoupling potential of CE strategies in the context of PSS. Resource
decoupling represents the aim of decoupling economic growth from resource consumption.
Resource decoupling seeks to reduce the rate of resource depletion and costs by raising resource
productivity, which is expected to simultaneously reduce environmental impacts (UNEP 2011).
Resource decoupling can be relative or absolute. While relative resource decoupling focuses on
obtaining less environmental damage per growth rate, absolute resource decoupling occurs when
the resource use declines, irrespective of the growth rate of the economic driver (UNEP 2011). In a
growing population with an increasing average income, absolute decoupling will occur when the
rate of relative decoupling is greater than the rates of increase in population and income combined
2
Kjær, L. L., Pigosso, D. C. A., Niero, M., Bech, N. M., & McAloone, T. C. (2018). Product/Service-Systems for a Circular
Economy: The Route to Decoupling Economic Growth from Resource Consumption? Journal of Industrial Ecology.
DOI: 10.1111/jiec.12747
(Jackson 2009). Since relative decoupling is not enough to ensure an overall decline in resource
consumption, this paper focuses on absolute resource decoupling.
The questions we aim to answer with this forum paper are: “When does PSS enable a CE
strategy? And when does a CE strategy lead to absolute resource decoupling?”
With this paper, we wish to inspire a more critical view when proposing PSS as means to enable
CE. Such proposals should be supplemented with arguments on how the PSS enables a relative
resource reduction and ultimately how absolute resource decoupling can be ensured. Therefore, we
provide an initial attempt to show the complex route from PSS to absolute resource decoupling with
the purpose to initiate a discussion on how to guide future research that can help increase the
probability of CE strategies actually fulfilling the ultimate sustainability-related goal of absolute
resource decoupling.
<heading level 2> Aims and limitations of CIRCULAR ECONOMY (CE)
While the concept of CE and its practice have been mostly developed and led by practitioners,
i.e. consultants, business foundations and policy-makers, the scientific research content is still
young (Korhonen et al. 2018). CE traces back to different schools of thought (Ghisellini et al.
2016), ranging from Environmental Economics to General Systems Theory, from Industrial
Ecology to more recent theories about the Performance Economy (Stahel 2010), Cradle-to-Cradle,
(McDonough and Braungart 2002), Biomimicry (Benyus 2002) and Blue Economy (Pauli 2010).
Blomsma and Brennan (2017) found that CE offers a new framing around the multitude of waste
and resource strategies and provides a discursive space for debate on how they relate to each other
in terms of trade-offs and synergies.
Geissdoerfer et al. (2017) combined different contributions in the field and defined CE as “a
regenerative system in which resource input and waste, emission, and energy leakage are
minimized by slowing, closing, and narrowing material and energy loops. This can be achieved
through long-lasting design, maintenance, repair, reuse, remanufacturing, refurbishing, and
recycling” (p. 759). As such, CE incorporates several actions for waste minimization and reduction
of virgin resource consumption, all of which are linked to the three main “actions” within the 3R´s
principles: Reduce, Reuse and Recycle (Ghisellini et al. 2016). A comprehensive review of CE
definitions by Kirchherr et al. (2017) showed that the 3R framework was the most commonly
employed conceptualization of the ‘how-to’ of CE. The 3R’s are embedded in the well-known CE
illustration, depicting the so-called technical and biological metabolisms (Ellen MacArthur
Foundation 2013). The technical metabolism illustrates how the value of technical materials should
be kept through continuous loops based on strategies such as maintain (i.e. inner loop based on
3
Kjær, L. L., Pigosso, D. C. A., Niero, M., Bech, N. M., & McAloone, T. C. (2018). Product/Service-Systems for a Circular
Economy: The Route to Decoupling Economic Growth from Resource Consumption? Journal of Industrial Ecology.
DOI: 10.1111/jiec.12747
reduce), reuse/redistribute and refurbish/remanufacture (i.e. middle loops based on reuse), and
recycle (i.e. outer loop).
Some authors challenge the focus of CE on waste minimization and resource reduction. They
emphasize the beneficial design and innovation opportunities of the CE (e.g. De Pauw et al. 2014;
Braungart et al. 2007; McDonough and Braungart 2013) and argue for the importance of supporting
“eco-efficiency” with “eco-effectiveness”, where products maintain their value over time to
positively recouple the relationship between economy and ecology (Ellen MacArthur Foundation
2013).
In this paper we take the position that the ultimate aim of CE is to keep the value of products,
materials and resources in the economy for as long as possible, and to minimize waste generation,
i.e. ultimately reducing resource consumption. Furthermore, CE as a concept also focuses on
economic value creation (Lieder and Rashid 2015). Thus, we believe that the CE concept should
aim at combining an overall reduction in resource consumption with business opportunities, i.e. to
ensure absolute resource decoupling. Making absolute resource decoupling operational in a business
context is however not straightforward and some challenges have to be overcome.
While CE strategies may incorporate all of the 3R’s, CE practitioners often emphasise circular
strategies aiming at “closing loops”, i.e. reuse and recycle (Kirchherr et al. 2017). A challenge here,
however, is that initiatives aimed at reusing and recycling resources will only reduce primary
production when secondary products/materials actually displace the primary production (Zink and
Geyer 2017). In a reality of growing demands, secondary (reused/remanufactured/recycled)
products are often sold in addition to primary (new) products, resulting in environmental impacts of
both the primary and secondary production (Zink and Geyer 2017). Thus, in order to ensure a net
resource reduction, CE strategies based on reuse and recycle should confirm that actual
“displacement” takes place. Furthermore, Geissdoerfer et al. (2017) found that “…it seems clear to
most authors that the Circular Economy is aiming at a closed loop, eliminating all resource inputs
and waste and emission leakages of the system…” (p. 8). If this is truly the goal of CE and the
perception within the CE community, this would ignore that also circular systems consume
resources and create waste and emissions. There are technical limitations to materials recycling
(Grosso et al. 2017) as well as dissipative losses in any loops, thus the vision of 100% material
recycling may still be regarded as only theoretically possible in a distant future (Korhonen et al.
2018), and the feasibility of a closed loop economy is still unknown (Haupt and Zschokke 2017).
Another issue in assessing the effectiveness of CE strategies is to avoid to optimize one stage of
the life cycle (e.g. end-of-life) at the expense of other stages (e.g. production) (Niero and Hauschild
2017). A systemic life cycle perspective is therefore needed to avoid such burden shifting between
4
