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Climate Neutrality Requires Coordinated Measures for High Quality Recycling

Author

Listed:
  • Xi Sun
  • Frederik Lettow
  • Karsten Neuhoff

Abstract

For Europe to reach climate neutrality by mid-century, it needs to move toward a circular economy. Waste avoidance, reuse, and recycling save primary resources and avoid emissions in the production of basic materials like steel, cement, and plastics. Without exploring circular economy potentials, switching production to climate-neutral processes alone would result in significant costs and tremendous demand for clean energy. However, enabling the circular transition requires coordinated policy measures. Carbon costs must be fully reflected in basic material prices, while product standards and stakeholder incentives should be aligned with the recyclability of products. In addition, consumer awareness should be raised through reliable information on product environmental impacts, while investment in sorting and recycling infrastructure should be stimulated. Clear targets and definition of responsibilities are necessary for the effective implementation of these measures.

Suggested Citation

  • Xi Sun & Frederik Lettow & Karsten Neuhoff, 2021. "Climate Neutrality Requires Coordinated Measures for High Quality Recycling," DIW Weekly Report, DIW Berlin, German Institute for Economic Research, vol. 11(26), pages 187-195.
  • Handle: RePEc:diw:diwdwr:dwr11-26-1
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    File URL: https://www.diw.de/documents/publikationen/73/diw_01.c.820890.de/dwr-21-26-1.pdf
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    More about this item

    Keywords

    industrial decarbonization; plastic recycling; circular economy; value chain; policy package;
    All these keywords.

    JEL classification:

    • Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy
    • L65 - Industrial Organization - - Industry Studies: Manufacturing - - - Chemicals; Rubber; Drugs; Biotechnology; Plastics
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies

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