Circular economy could slash up to 231 million tonnes of CO₂ from heavy industry per year

Circular economy measures could significantly contribute to abating greenhouse gas emissions in energy-intensive industries, such as steel, aluminium, cement and concrete, and plastics — sectors that currently account for nearly 15% of the European Union’s total emissions. Moreover, integrating circularity measures in these industries would improve the EU’s energy and economic security by reducing import dependency. 

Circularity measures could cut emissions significantly

A new JRC report shows how circular economy practices would contribute to substantially reducing greenhouse gas emissions in sectors such as plastics, steel, aluminium, cement and concrete. Improved materials management, including reduction, reuse and recovery measures, could help EU industry reduce between 189 and 231 million tonnes of CO₂ equivalent per year. Circularity measures could be particularly effective in reducing emissions in the steel sector (by 64 to 81 million tonnes of CO₂ equivalent per year) and the plastics sector (75 to 84 million tonnes of CO₂ equivalent per year).

Reducing energy needs and fossil fuel imports

Circularity measures in these four sectors would also lower EU-wide fossil fuel energy demand by nearly 4.7% compared to 2023.  The EU-wide consumption of electricity would fall by a similar rate. All in all, this could reduce reliance on imported fossil fuels and critical materials necessary for electricity generation, while enhancing the EU’s resilience amid global energy volatility.

Strengthening economic security

Beyond environmental benefits, circular economy strategies would improve the EU’s trade balance by about 4%, corresponding to 35 billion euro. This gain stems from reduced imports of raw materials such as iron ore (decreasing by 22%) and bauxite (lowered by 11%), as well as fossil fuels, with plastics contributing the largest share of the surplus.

Making change happen

The report includes recommendations to help policymakers and industry make informed decisions about circular economy measures that can support the EU's transition to a more sustainable and competitive economy. 

Policy recommendations include promoting technologies to improve the quality of recycled materials, reducing the use of resources through more efficient design, and steering market demand via Green Public Procurement instruments.

These strategies align with EU goals to enhance sustainability and competitiveness, whilst mitigating macroeconomic risks from global dependencies.

Source: EU Commission