Sustainability is a hot topic for any credible company and organizational agenda. Everyone is looking for relevant targets on the triple bottom line areas: social, economic and environmental sustainability. And one area identified as a key contributor to environmental sustainability is the circular economy.

Circular economy is a relatively new concept with a lot of definitions. One way of describing it is using the following three principles:

  • Design out waste and pollution
  • Keep products and materials in use
  • Regenerate natural systems

The Ellen MacArthur Foundation has tried to capture the essence of the circular economy in the diagram below, which is somewhat understandably nicknamed the ‘butterfly diagram’. The diagram tries to capture the flow influenced by cradle to cradle’s two material cycles, which represent two fundamentally distinct flows of material: biological and technical.

In the green you can see the life cycle of biological materials that can safely re-enter the natural world once they have gone through one or more use cycles. In the blue you see the life cycle of technical materials that cannot re-enter the environment. These materials, such as metals, plastics, and synthetic chemicals, must continuously cycle through the system so that their value can be captured and recaptured.

So, how can IoT support the circular economy?

For me, the main obvious contribution IoT can make is by supporting the prolonging and also sharing in most inner loops in the technical lifecycle. This can be done through design of the product, including the opportunity to both upgrade and share in a sustainable business model. But IoT can also support redistribution. This means reducing the overall need to produce products.

Prolonging the life cycle with IoT

Who would today buy an electronic device such as a computer, mobile phone, or even car that cannot be upgraded? There is a clear trend towards more and more functionality, which is implemented in software, not hardware as before. And companies and consumers want products that are future proof, as it makes business sense. Either you want to benefit from the product yourself for a longer time or you want to be able to retrieve some value through redistribution.