Sizing and scaling the circular economy

14 October 2014

The world’s largest aluminium recycling centre opened last month in Germany. We take a look at some of the challenges and opportunities that face the Nachterstedt Recycling Centre.

The Nachterstedt Recycling Centre can recycle 400 000 tonnes of aluminium scrap annually, returning a record-breaking amount of used material back into the circular economy. The Centre will be capable of recycling more than 18 different kinds of materials, including used beverage cans and other forms of aluminium scrap from consumers, construction and industrial applications.

The Centre can recycle, re-melt, cast, coat and finish the recycled aluminium, supplying a variety of high-end aluminium material for a range of consumer and industrial products. 

In early September, Forum for the Future and leading circular economy experts came together in Nachterstedt, Germany to discuss the challenges facing Novelis, the company that set up the centre, and the challenges the aluminium recycling industry and society face in order to sustain circular economy advances like this.

Three significant barriers to meeting the size and scale required to create a circular economy were discussed. 

  • Circular sourcing on a scalable level is fundamental to establishing a more circular economy. In order to reach its 80% recycling targets, Novelis needs to be recycling between three and four million tonnes of aluminium every year. Closed-loop scrap recovery contracts with its customers will be key in helping Novelis to achieve that goal. But Novelis and other closed-loop pioneers will need to find avenues to meet targets and drive the circular economy forwards.  
  • Technological advancements enable the Nachterstedt Recycling Centre to process a wider variety of scrap than has been possible in the past, which widens Novelis’ market opportunities for source material by allowing it to take scrap metals that others may not traditionally accept. 
  • Changing consumer mind sets is one of the most important and intractable challenges to address on a global scale. A lack of infrastructure and incentives means that recycling rates continue to lag in many parts of the world. Changing habits and beliefs through consumer education could tip the scales in time, but the focus group raised questions around what investments are needed, and who the key change agents (brands, industry, government) are that need to be involved.

The barriers experienced by Novelis are similar to the barriers the Circular Economy has here in New Zealand. Look out for the Circular Economy opportunities report which we will present in November. This will explore  the barriers and opportunities,  and identify the business models that will unlock the Circular Economy in NZ.

The full results and infographics from Forum for the Future’s Nachterstedt workshop can be found by clicking here.

Click here to view a video about the Nachterstedt Recycling Centre.

Parts of this story were originally published by Novelis’ Chief Sustainability Officer John Gardner in a blog post which can be accessed by clicking here.