The polluter has to start paying
Today, it is cheaper to extract new raw materials from the Earth than to use recycled materials. This creates an advantage for extracting virgin materials, making it hard for recycled materials to compete - a huge barrier for the transition to a circular economy. If the polluter must pay the actual cost for polluting, circular solutions will become more attractive.
- The pricing of raw materials and emissions is highly flawed. This is one of the biggest obstacles for the transition to a circular economy, because it makes it very difficult for recycled materials to compete with virgin materials, says Anders Kihl, Director of Strategy and R&D at Ragn-Sells Group.
Today, virgin materials do not fully bear the cost they cause through extraction and processing. Even though the continued extraction of new raw materials is responsible for half of the world’s climate emissions, there is no cost to producers associated with this practice.
The fact that the actual price of a product is not reflected in its market value means that producers actually benefit from contributing to the harmful extraction of virgin materials, instead of circularity. Markets have gotten used to this pricing model and optimised all processes for profitability under these conditions. This is an incredibly effective obstacle to the transition to a circular economy.
- In today’s dysfunctional system, producers are able to manufacture and sell products that are impossible to recycle – or worse – cause pollution further down the chain. And still make a huge profit! They simply pass the bill to someone else. It is time for the polluter to start paying, says Anders Kihl.
Did you know?
One gram of an ordinary PFAS substance today costs about 0,10 euros, while the cost of detoxifying for example water contaminated with PFAS may be several thousand times higher.