Q&A: Minnesota companies create ‘circular economy’ coalition

More than 25 Minnesota businesses, which include the state’s largest employers, have come together on a strategy for creating a “circular economy” to eliminate waste and rely on renewable energy.

The Minnesota Sustainable Growth Coalition will be led by the Environmental Initiative. The members include many familiar names with local and international reach — 3M, Andersen Corp., Aveda, Best Buy, Cargill, General Mills, Hormel Foods, Target and Xcel Energy, to name a few.

“This is the first effort in the United States and in North America of companies who are working together for the creation a circular economy,” said Mike Harley, executive director of the Environmental Initiative.

Mike Harley

Mike Harley

“This is a transformational frame for sustainability, which is so often incremental. These are big companies, with big brand names, who are beginning to wrap their heads around new business-model changes and how to transition the economy as a whole in that direction.”

The concept of a circular economy has been around since the late 1970s, but it has gained steam with support from the Ellen MacArthur Foundation and the growing number of companies that see operating sustainably as an important principle. The basic premise is reusing materials and promoting renewable energy — a waste-not-want-not approach to the manufacturing and disposal of goods.

The movement is being pushed by corporations’ realizing that resources are finite, from metals to oil to clean air and water, Harley said. Businesses suffering resource constraints have begun planning for a different sort of future, he added.

In a recent discussion with Midwest Energy News, Harley addressed the circular economy philosophy and why it creates excitement among corporations that see in it an opportunity to make their businesses more sustainable and to showcase the Twin Cities as a global leader.

Midwest Energy News: In a time when shareholder value has been enshrined as the gold standard for investors, why should any business care about a circular economy?

Harley: Businesses are interested because they are feeling the constraints of natural-resource limitations and the constraints of an economy in which not all of our people are engaged. In our region, businesses are understanding they have to reinvent and reimagine their future in a way they can decouple growth from those natural-resource constraints.

But that makes it sound like businesses are willing to let go of growth. Is that the case?

No, the circular economy is fundamentally about growth and return on investment. That’s why members of our coalition have chosen to describe themselves as a growth coalition, but the growth they want is a growth that is truly circular and sustainable.

How do you define the circular economy?

The circular economy basically generates no waste. It works like nature does, in which all forms of capital are preserved and restored and built upon over time. Businesses and the economy work for a return on investment of financial capital, but also for ecosystem health, natural resources and human capital.

It sounds utopian.

It sounds idealistic for our economy and for businesses that think in a very different way now. But the reality is that businesses are interested in a circular economy because of natural-resource limitations. It’s also about the constraint of an economy where not all of our people are engaged and able to offer their talent. Whether its water availability or carbon regulation on energy or the conversation around disparity in our region, businesses are recognizing that somehow they need to reinvent and re-imagine the economy in which they operate.

Can you give an example of the circular economy?

There’s been a strong movement to capture more of our organic waste. But what the companies in the coalition are thinking about is what would a public-private partnership look like that could capture as much organic waste as possible in our region — ultimately all of it — and combine it with anaerobic digestion to derive energy value from that waste. That’s an at-scale application of circular economy principles that turns waste into resources and takes advantage of every aspect of that waste in a way that does not generate carbon dioxide or leaves energy waste on the table.

Are there others?

District Energy is looking at capturing the heat content of wastewater along University Avenue in St. Paul for district energy. As we discharge wastewater, we’re leaving an enormous amount of energy on the table.

How does energy play in this area?

We have been having a conversation over the last couple of days with coalition companies over the idea of becoming powered by 100 percent renewable energy. It doesn’t mean they’re committing to a goal of 100 percent, but it’s a recognition that the economy must be circular and that all energy must be renewable.

 

Which companies in the coalition have embedded the circular economy in their thinking?

Herman Miller, Ecolab and Dow have thought a lot about the circular economy in North America. Dow, which is part of the coalition through Dow Water & Process Solutions, has the circular economy as one of its pillars of sustainability.

We have a lot of big retailers in the Twin Cities, Target and Best Buy, in particular. How might the circular economy impact them?

They might reinvent their entire business model around the circular economy where there might be leasing of products that are returned to companies after use — cradle to cradle. Target is actively working on that, and it will change their business model away from selling stuff to people who send it to a landfill at the end of its useful life. We could see a retailer working with manufacturers and other companies driving value.

What do you expect to happen soon?

We expect companies to buy renewable energy together. They will be capturing organic waste together. We’re going to have some concrete examples of this work happening at-scale within 12 to 18 months.

What will this do for the region?

The great challenges that face us globally in sustainability are health, clean energy climate change. Minnesota has often been at the margin of these conversations because we haven’t been organized in a way that allows us to project our leadership and share the solutions that developed here with the rest of the world. A significant part of this is about raising the visibility of Minnesota as the home of a significant amount of ability, innovation and leadership.

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