Circularity for Secure and Sustainable Products and Materials_ A Draft Strategic Framework.pdf

Draft Energy Efficiency and Renewable Energy Strategy for Increasing Product and Material Circularity i U.S. Department of Energy | Office of Energy Efficiency & Renewable Energy

Circularity for Secure and Sustainable Products and Materials: A Draft Strategic Framework October 2024

Draft Energy Efficiency and Renewable Energy Strategy for Increasing Product and Material Circularity ii U.S. Department of Energy | Office of Energy Efficiency & Renewable Energy

Disclaimer This work was prepared as an account of work sponsored by an agency of the United States Government. Neither the United States Government nor any agency thereof, nor any of their employees, nor any of their contractors, subcontractors or their employees, makes any warranty, express or implied, or assumes any legal liability or responsibility for the accuracy, completeness, or any third party’s use or the results of such use of any information, apparatus, product, or process disclosed, or represents that its use would not infringe privately owned rights. Reference herein to any specific commercial product, process, or service by trade name, trademark, manufacturer, or otherwise, does not necessarily constitute or imply its endorsement, recommendation, or favoring by the United States Government or any agency thereof or its contractors or subcontractors. The views and opinions of authors expressed herein do not necessarily state or reflect those of the United States Government or any agency thereof, its contractors or subcontractors.

Draft Energy Efficiency and Renewable Energy Strategy for Increasing Product and Material Circularity iii U.S. Department of Energy | Office of Energy Efficiency & Renewable Energy

Authors The U.S. Department of Energy’s Advanced Materials and Manufacturing Technologies Office coordinated the development of this strategy. The lead authors are:

Kathryn Peretti

Allison Robinson Turner

Michelle Seitz

Acknowledgments The authors would like to acknowledge the valuable guidance and input provided during this report. The authors are grateful to the following list of contributors from within the U.S.

Department of Energy’s Office of Energy Efficiency and Renewable Energy. Their feedback, guidance, and review proved invaluable.

Contributors:

Advanced Materials and Manufacturing Technologies Office: Diana Bauer, Mark Guttag, Maria Keane, Helena Khazdozian, Jeremy Mehta, Matt Roney, Changwon Suh, Dwight Tanner, John Winkel

Basic Energy Sciences: Christopher Bradley

Bioenergy Technologies Office: Andrea Bailey, Gayle Bentley, Jay Fitzgerald, Lisa Guay

Building Technologies Office: Samuel Petty, Alexander Rees, Jay Wrobel

Strategic Analysis: Colin Cunliff, William S. Dean

Geothermal Technologies Office: Lauren Boyd, Jason Braden, Sudeep Kanungo, Angel Nieto, Sean Porse, Jon Payne, Alexandra Prisjatschew

Hydrogen and Fuel Cell Technologies Office: Shaylynn Crum-Dacon, William Gibbons, Theodore Henry, Benjamin Zavell

Industrial Efficiency and Decarbonization Office: Joe Cresko, Felicia Lucci, Paul Majsztrik, Matthew Pearson, Isabelle Rojas, Barclay Satterfield, Marissa Tousley

Office of Fossil Energy and Carbon Management: Marina Sofos

Office of International Affairs: Salim Bhabhrawala

Solar Energy Technologies Office: Noreen Gentry, Susan Huang, Matthew Klug

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Vehicle Technologies Office: Luis Carias, Tina Chen, Jerry Gibbs, Raphael Isaac, Christopher Schooler, Thomas Timbario, H. Felix Wu

Water Power Technologies Office: Collin Sheppard, Kannan Sivaprakasam

Wind Energy Technologies Office: Tyler Christoffel, Richard Tusing.

Draft Energy Efficiency and Renewable Energy Strategy for Increasing Product and Material Circularity v U.S. Department of Energy | Office of Energy Efficiency & Renewable Energy

List of Acronyms ABC Advanced building construction

ADR Acid-free dissolution recycling

AMMTO Advanced Materials and Manufacturing Technologies Office

AMO Advanced Manufacturing Office

ARPA-E Advanced Research Projects Agency - Energy

ARROW(e) Assessment Robot for Resilient Optimized Wind Energy

BETO Bioenergy Technologies Office

BFNUF Biomass Feedstock National User Facility

BIL Infrastructure Investment and Jobs Act (Bipartisan Infrastructure Law)

BOTTLE™ Bio-Optimized Technologies to keep Thermoplastics out of Landfills and the Environment

BTO Building Technologies Office

CELAVI Circular Economy Lifecycle Assessment and Visualization Framework

CO2 Carbon dioxide

CO2eq Carbon dioxide equivalent

CMI Hub Critical Materials Innovation Hub

CMM Critical minerals and materials

CUWP Center for the Upcycling of Waste Plastic

DOE U.S. Department of Energy

EERE Office of Energy Efficiency and Renewable Energy

EOL End-of-life

EOU End-of-use

EPA U.S. Environmental Protection Agency

EPD Environmental product declaration

Draft Energy Efficiency and Renewable Energy Strategy for Increasing Product and Material Circularity vi U.S. Department of Energy | Office of Energy Efficiency & Renewable Energy

E-scrap Electronic scrap

EV Electric vehicle

FOA Funding opportunity announcement

FY Fiscal year

GHG Greenhouse gas

GTO Geothermal Technologies Office

GREET Greenhouse Gases, Regulated Emissions and Energy Use in Technologies

H2CIRC Circular Recycling for the Hydrogen Economy

HFTO Hydrogen and Fuel Cell Technologies Office

IACMI Institute for Advanced Composites Manufacturing Innovation

IEA International Energy Agency

IEDO Industrial Efficiency and Decarbonization Office

LCA Life cycle assessment

MDF Manufacturing Demonstration Facility

MESC Office of Manufacturing and Energy Supply Chains

MFA Material flow analysis

MMT Million metric tons

MORE PV Materials, Operation, and Recycling of Photovoltaics

MRF Materials recovery facility

MSW Municipal solid waste

MSX Membrane solvent extraction

NREL National Renewable Energy Laboratory

NSF National Science Foundation

PEM Proton exchange membrane

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PFSA Perfluorosulfonic acid

PGM Platinum group metals

PV Photovoltaic

RAPID Rapid Advancement in Process Intensification Deployment

REE Rare earth element

REMADE Reducing Embodied Energy and Decreasing Emissions

REMPD Renewable Energy Materials Properties Database

Re-X Strategies that allow EOU or EOL products and materials to re-enter the economy, including reuse, repair, refurbishment, remanufacturing, repurposing, and recycling

RFI Request for information

R&D Research and development

SA Office of Strategic Analysis

SBIR Small Business Innovation Research

SETO Solar Energy Technologies Office

ShAPE Shear Assisted Processing and Extrusion

SIPS Small Innovative Projects in Solar

PARC Partnership To Advance Recycling and a Circular Economy

SSM Secure and Sustainable Materials

STTR Small Business Technology Transfer

TEA Technoeconomic analysis

UNEP United Nations Environment Programme

VTO Vehicle Technologies Office

WETO Wind Energy Technologies Office

WPTO Water Power Technologies Office

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Executive Summary The current economic model, both in the United States and globally, is largely linear;

resources are extracted, products are manufactured and used, and then they are discarded. This linear model results in substantial carbon emissions, energy use, resource extraction, waste generation, environmental degradation, and loss of valuable materials from the economy. The negative impacts of extraction and waste generation are often felt more acutely by marginalized populations. Additionally, existing global supply chains struggle to adapt following disruption. Demand for materials is increasing at a rapid pace and with it, the associated environmental and societal burdens. The concept of a circular economy has been proposed as a more sustainable alternative to a linear economy. Product and material circularity, which involves minimizing life cycle environmental impacts through recirculation of products and materials in the economy, is essential for realizing the economic, environmental, and societal benefits of a more circular economy.

Increasing product and material circularity is also a critical enabler of the U.S. Department of Energy (DOE) Office of Energy Efficiency and Renewable Energy’s (EERE’s) mission.

Circularity contributes to decarbonization by expanding the supply of critical materials needed for the clean energy transition and extending the lifetime of clean energy technologies. Circularity improves material efficiency, which reduces energy demand related to raw material extraction and manufacturing processes, contributing to economywide decarbonization and reducing the associated environmental burden felt by local communities. Creating circular supply chains in the United States strengthens the U.S. manufacturing ecosystem by creating secure, domestic supplies of critical materials;

expanding the manufacturing workforce; and creating better-paying, higher-skilled, and safer jobs than traditional waste management. In addition to the direct benefits of job creation, increased product and material circularity can make U.S.-manufactured products more competitive globally.

This draft identifies unique challenges and potential solutions related to recirculation of products and materials, at their end-of-use (EOU) or end-of-life (EOL) back into the economy. This document aims to describe the potential economic and environmental impact of increasing product and material circularity approaches, strategies, and technologies and to communicate EERE’s objectives in this space. It identifies opportunities, challenges, and enablers for advancing circularity. Finally, this strategy document provides an overview of current efforts across EERE and future focus areas for activities and investments to advance product and material circularity.

Product and Material Circularity Advances the Mission Figure ES-1 illustrates how advancing product and material circularity by creating circular supply chains helps the United States to capture the strategic opportunities

Draft Energy Efficiency and Renewable Energy Strategy for Increasing Product and Material Circularity ix U.S. Department of Energy | Office of Energy Efficiency & Renewable Energy offered by a more circular economy and realize positive impacts on decarbonization, community benefits, security of U.S. supply, and job creation. Previous EERE investments are already having an impact across the mission space by advancing technologies toward deployment and influencing investment and decision making.

Product and material circularity is a strategic opportunity to:

• Minimize environmental life cycle impacts of U.S. manufactured products.

• Reduce the burden on local communities from material extraction and processing.

• Increase supply chain security and resilience.

• Strengthen domestic manufacturing and create good jobs.

• Lead in the development and commercialization of end-of-life processing technologies.

Figure ES-1. Illustration of strategic opportunity for EERE shows how increasing product and material circularity directly contributes to decarbonization, community benefits, U.S. security of supply, and job creation. EERE investments to increase circularity can bend our linear economy into a more circular future.

Current Focus Areas In this strategy we distinguish between products, which are goods sold to consumers, and materials, which are the building blocks of those products. This was done because

Draft Energy Efficiency and Renewable Energy Strategy for Increasing Product and Material Circularity x U.S. Department of Energy | Office of Energy Efficiency & Renewable Energy often different strategies are needed to increase the circularity of products than their constituent materials, although strategies like design for circularity can apply to both.

There are substantial efforts across EERE to advance the circularity of products and materials. Multiple offices have activities related to product and material circularity that are complementary in addressing specific focus areas.

Current EERE focus areas include:

• Materials needed for clean energy technologies, such as critical materials and composites.

• Materials with a large energy and emissions footprint, such as: steel and aluminum, construction materials, and plastics.

• Products whose reuse, repair, refurbishment, and/or redesign could significantly reduce economywide energy and carbon emissions, including buildings, batteries, wind turbine blades and nacelles, solar panels, vehicle components, electrolyzers, and fuel cells.

• Cross-cutting enablers that accelerate technology deployment and guide sound decision making, such as consortia that promote innovation ecosystems, shared facilities, and analysis, including models and data.

Future Work To Advance Product and Material Circularity Because of the large variety of approaches to increasing circularity across the economy, this strategy also presents a framework for how EERE will prioritize which activities to focus on to drive real world impacts. This framework includes a three-step approach comprised of:

• Assessing potential impacts of increasing circularity for a product or material to prioritize products and/or materials with highest potential impacts.

• Identifying the transformation pathway and the barriers to deployment.

• Considering the timeline for deployment and scaling.

Continued, coordinated efforts and investments are needed across EERE to overcome the substantial challenges identified and discussed in this strategy. Future EERE efforts will include developing technologies that unlock product and material circularity as well as supporting technical assistance, data, and tool development to support decision making. The technology advancement and analysis will focus on cross-cutting areas that lower costs, increase speed of circular supply chain development, and deliver maximum benefits, such as:

Draft Energy Efficiency and Renewable Energy Strategy for Increasing Product and Material Circularity xi U.S. Department of Energy | Office of Energy Efficiency & Renewable Energy

• Developing more rapid and cost-effective product, component, and material identification, sortation, and separation technologies which can lower costs, improve quality, and enable economically viable circular supply chains.

• Increasing recovery and reuse of critical materials to enable more rapid deployment of clean energy technologies.

• Unlocking design for circularity, which includes design and material approaches to enable product and material circularity and leveraging digital tools and approaches for system monitoring, assessment, and tracking.

Analysis and the development of analytical and decision-making tools will focus on activities that improve decision making to drive maximum impact. This may include developing data, analysis, and modeling tools to support whole life cycle analysis and support decision making, including at the product and business model design stage.

Policy and business model innovation will be essential in transitioning technologies into the marketplace to have a national-scale impact. Additional work is needed to marry this evolving landscape with research direction to accelerate deployment and amplify impact. As part of that effort, EERE will continue to actively coordinate and engage across DOE, the federal government, and with external stakeholders. Collaboration and engagement activities will focus on:

• Ensuring that fundamental insights and discoveries inform and are incorporated into EERE programs via active engagement with the DOE Office of Science, the Advanced Research Projects Agency – Energy, the National Science Foundation, and the wider research community.

• Coordinating and aligning with the DOE Office of Infrastructure and other agencies to ensure technologies advance through EERE efforts progress toward deployment and adoption.

• Providing technical assistance to support the transition to more circular approaches.

• Leveraging EERE’s convening power to foster collaboration among stakeholders to facilitate design of circular products, systems, and ecosystems.

Actively engaging across the interagency to support activities including the Buy Clean Initiative, the Federal Life Cycle Assessment Commons, and the national recycling strategy. Together, these efforts provide incentives, tools, and strategies to implement circularity technologies and initiatives.

Increasing product and material circularity is critical to EERE’s mission and is an important area of investment for achieving both DOE and national energy and climate goals. By providing an overview of current EERE efforts as well as a framework for

Draft Energy Efficiency and Renewable Energy Strategy for Increasing Product and Material Circularity xii U.S. Department of Energy | Office of Energy Efficiency & Renewable Energy prioritizing future investment related to advancing product and material circularity, EERE aims to increase stakeholder awareness, engagement, and alignment that will ultimately drive national-level impacts. As this is a draft strategy, EERE seeks stakeholder feedback through the corresponding request for information.

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Table of Contents Executive Summary ...................................................................................................... viii

Product and Material Circularity Advances the Mission ............................................. viii

Current Focus Areas ....................................................................................................ix

Future Work To Advance Product and Material Circularity .......................................... x

1 Introduction

1.1 Goal of this Document

1.2 Linear Economy Concept

1.3 Circular Economy Concept

1.4 Product and Material Circularity

1.5 Key Considerations

1.5.1 Importance of Considering Multiple Impacts Across the Entire Life Cycle . 6

1.5.2 Impacts To Consider

1.5.3 Trade-Offs and Win-Wins

1.5.4 Product Lifetime, Material Flows, and Cascades

1.6 Potential for Increased Circularity

1.7 Driving Impact via Increased Circularity

1.7.1 Decarbonization

1.7.2 Community Benefits

1.7.3 U.S. Security of Supply

1.7.4 Job Creation and Strengthening U.S. Manufacturing

2 Product and Material Circularity Supports the Mission

2.1 Vision, Mission, and Objectives for Increasing Product and Material Circularity

2.1.1 Vision

2.1.2 Mission

2.1.3 Objectives

2.2 Framework for Prioritizing Research and Development

2.2.1 Assessing Potential Impacts

2.2.2 Identifying the Transformation Pathways and Barriers

2.2.3 Considering Timeline for Deployment and Scaling

Draft Energy Efficiency and Renewable Energy Strategy for Increasing Product and Material Circularity xiv U.S. Department of Energy | Office of Energy Efficiency & Renewable Energy

2.3 Importance of Advancing Office Missions

2.3.1 Importance of Product and Material Circularity to Office Missions

2.3.2 Strategic Analysis

3 Opportunities, Challenges, and Enablers

3.1 Re-X Pathway Specific Opportunities, Challenges, and Enablers

3.1.1 Redesign to Unlock Circularity

3.1.2 Reuse

3.1.3 Repair/Refurbishment/Remanufacturing

3.1.4 Repurposing

3.1.5 Recycling

3.2 Cross-Cutting R&D Opportunities, Challenges, and Enablers

3.2.1 Reverse Logistics

3.2.2 Advanced Sorting

3.2.3 Quality Assessment

3.2.4 Systems Analysis and Decision Support Tools

3.3 Nontechnical Challenges and Enablers

3.3.1 Incentives

3.3.2 Business Models and Supply Chain Development

3.3.3 Regulatory Harmonization and Standards

3.3.4 Infrastructure

3.3.5 Education, Outreach, and Behavior Change

4 Activities Advancing Product and Material Circularity

4.1 Office Focus Areas

4.2 Product and Material Focus Areas

4.2.1 Critical Materials

4.2.2 Steel and Aluminum

4.2.3 Construction Materials (Cement and Concrete, Glass, and Asphalt)

4.2.4 Plastics

4.2.5 Activities and Key Investments Related to Plastics

4.2.6 Composites

4.2.7 Buildings and Infrastructure

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4.2.8 Batteries

4.2.9 Wind

4.2.10 Solar

4.2.11 Electrolyzers and Fuel Cells

4.2.12 Cross-Cutting Areas

4.2.13 Analysis, Models, and Data

4.2.14 Activities and Key Investments Related to Analysis, Models, and Data ... 75

5 Future Work Related to Product and Material Circularity

References

List of Figures Figure ES-1. Illustration of strategic opportunity for EERE shows how increasing product and material circularity directly contributes to decarbonization, community benefits, U.S.

security of supply, and job creation. EERE investments to increase circularity can bend our linear economy into a more circular future. ...............................................................ix Figure 1. Illustration of the ‘take-make-buy-use-waste’ linear economy Figure 2. Illustration of the circular economy concept showing both the biological cycle (left) and technical, or industrial, cycle (right). Source: Ellen MacArthur Foundation, Figure 3. Conceptual illustration of some product and material circularity pathways emphasizing the role of markets in the circular economy Figure 4. Illustration of different boundaries for studies that measure energy and environmental impacts of products. Adapted from U.S. Department of Energy 2023c Figure 5. Life cycle stages of a photovoltaic power plant Figure 6. Photo of ARROW(e). Photo from Sandia National Laboratories Figure 7. (Right) Illustration of strategies that can be deployed along a circular EV battery supply chain. Source: U.S. Department of Energy Advanced Research Projects Agency – Energy 2024 Figure 8. Illustration of using ShAPE to recycle aluminum, resulting in refined microstructure. Source: Whalen et al. 2023a Figure 9. Illustration of recyclable-by-design carbon fiber reinforced composites utilizing bio-based covalently adaptable networks. Source: Rorrer 2023 Figure 10. The U.S. steel cycle in 2017 with all values in million metric tons steel per year. Source: Reck et al. 2024

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List of Tables Table 1. Re-X Pathwaysa Table 2. Examples of Impacts To Consider When Assessing Impacts of Circularity Table 3. Waste Statistics for Some Commodity Materials in Municipal Solid Waste Table 4: Example of How Material-Specific Data Can Inform Investment Prioritization 18 Table 5. Summary of Material, Product, and Cross-Cutting Activities

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1 Introduction The focus of this strategic framework—and a key enabler for advancing toward a more circular economy—is addressing and overcoming the unique challenges related to recirculation of products and materials at the end-of-use (EOU) or end-of-life (EOL) back into the economy. Increasing product and material circularity positively affects decarbonization, environmental justice, and U.S. security of supply while also strengthening the U.S. manufacturing sector and fostering job creation. Increased product and material circularity is an essential ingredient needed to solve challenges that are top priorities for the Department of Energy’s (DOE) Office of Energy Efficiency and Renewable Energy (EERE).

1.1 Goal of this Document

The overarching goal of this document is to provide a foundation of understanding of EERE’s main objectives and key efforts in material and product circularity that will seed connection and collaboration with stakeholders across the U.S. government, industry, academia, and nonprofit organizations. Through this connection we hope to drive national-level impact through increased product and material circularity. To support this goal, this strategic framework will:

• Describe the potential economic and environmental impact of increasing product and material circularity.

• Communicate EERE’s mission, vision, and objectives for increasing product and material circularity.

• Identify opportunities, challenges, and enablers for unlocking circularity.

• Highlight current and ongoing efforts related to product and material circularity in

EERE.

• Communicate how EERE will continue to advance circularity in the future in partnership with other offices and agencies.

1.2 Linear Economy Concept

The current economic model, both in the United States and globally, is largely linear:

resources are extracted, products are manufactured and used, and then discarded. This take-make-buy-use-waste linear economy model, illustrated in Figure 1, is material and energy intensive, relies on global supply chains that struggle to adapt following disruption, and favors single-use products that create substantial waste and environmental burdens.

In the last 50 years, material use has tripled globally and continues to grow at over 2.3% per year (United Nations Environment Program 2024). Most materials entering the

Draft Energy Efficiency and Renewable Energy Strategy for Increasing Product and Material Circularity

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Figure 1. Illustration of the ‘take-make-buy-use-waste’ linear economy

1.3 Circular Economy Concept

Acknowledging these increasingly problematic trends in material use, the concept of a circular economy has been proposed as an alternative to a linear economy. While there is no universally accepted definition of the circular economy, there is general agreement that it should strive to minimize resource extraction, waste generation, and environmental degradation and maximize the lifetime of products and materials circulating in the economy.

According to The Save our Seas 2.0 Act:

“The term ‘circular economy’ means an economy that uses a systems-focused approach and involves industrial processes and economic activities that – (A) are restorative or regenerative by design; (B) enable resources used in such processes and activities to maintain their highest values for as long as possible;

and (C) aim for the elimination of waste through the superior design of materials, products, and systems (including business models)” (U.S. Congress 2020).

This definition draws strongly from the work of the Ellen MacArthur Foundation, which defines a circular economy as:

“A systems solution framework that tackles global challenges like climate change, biodiversity loss, waste, and pollution. It is based on three principles, driven by design: eliminate waste and pollution, circulate products and materials (at their highest value), and regenerate nature” (Ellen MacArthur Foundation 2023).

The circular economy concept with circular pathways in both the ecological and technical spheres is illustrated in Figure 2.

The concept of a circular economy is broad and includes many potential contributing pathways both in the ecological and industrial spheres. DOE supports development in many of these areas including biomass utilization, carbon capture and utilization, waste reduction, increased efficiency, reduced material requirements via lightweight design or improved materials, and renewable energy generation (Bioenergy Technologies Office 2024, Office of Fossil Energy and Carbon Management 2024a, b; Better Buildings 2024;

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Buildings Technologies Office 2024; Vehicle Technologies Office 2024; Office of Energy Efficiency and Renewable Energy 2024a).

Figure 2. Illustration of the circular economy concept showing both the biological cycle (left) and technical, or industrial, cycle (right). Source: Ellen MacArthur Foundation, 2019

1.4 Product and Material Circularity

While all aspects of the circular economy are important and can provide energy and environmental benefits, this strategy is more narrowly focused on product and material circularity. It is also worth noting that material efficiency and material circularity are also distinct. One can increase material efficiency through circularity, but there are many other pathways to improve material efficiency, including material substitution, manufacturing efficiency, and reducing the amount of material needed for an application.

What Is Product and Material Circularity?

Product and material circularity aims to minimize life cycle impacts though increasing recirculation of products and materials in the economy.

Focusing only on the industrial sphere (the right side of Figure 2), multiple strategies have been proposed and are summarized in Table 1. Collectively, these strategies that allow

Draft Energy Efficiency and Renewable Energy Strategy for Increasing Product and Material Circularity

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Some pathways (R0-R2: refuse, rethink, and reduce) deliver benefits related to reduced material consumption but do not necessarily address challenges associated with increasing recirculation of products and materials once they have entered the economy.

While associated actions like increasing manufacturing efficiency, reducing production waste, or lightweighting components are important activities to reach our nation’s climate and clean energy goals, they do not inherently fit within the scope of this strategy as they do not impact how the product or material is handled at EOU or EOL stages. Likewise, incineration for energy recovery does not lead to recirculation of materials in the economy and is, therefore, not in the scope of this strategy.

For products and materials to recirculate in the economy, markets play a critical role, as illustrated in Figure 3. Business models and incentives must be aligned across the entire supply chain to ensure recirculation is economically viable. In addition to a technically feasible physical flow of goods, multiple market activities must take place for a circular pathway to be viable. If markets are not established or if incentives are not well aligned to promote utilizing them, the circular pathway will break down. A vivid example of the importance of markets in material circularity occurred when China implemented its Operation National Sword policy in 2018, leading to a collapse in the export market for recyclable materials and resulting in the halting or curtailing of some municipal recycling programs in the United States (Katz 2019).

Innovations to enable Re-X pathways must be both technically and economically feasible for all handoffs in the system. For example, remanufacture of an engine is only possible if, in addition to technical processes to restore the engine’s function, there are used goods markets to accept this input, component markets for the remanufactured engine, and a product market for equipment with the remanufactured part. The importance of these markets is critical to the success of the Re-X pathway and should be considered early in technology and supply chain development.

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Table 1. Re-X Pathwaysa

Re-X Strategy Description Example

R0: Refuse Make product redundant by abandoning function or by offering the same function with a radically different product.

Avoid production.

R1: Rethink Make product use more intensive (e.g., sharing models or multifunctional products).

Create X-as-a-service ownership models.

R2: Reduce Increase efficiency in product manufacture or use by using less energy or materials.

Reduce vehicle weight.

Pr od uc t a nd M at er ia l C irc ul ar ity

R3: Reuse Reuse by another consumer of product that still fulfills original function.

Create a secondhand clothing marketplace.

R4: Repair Repair of defective product to be used with its original function.

Replace a faulty part in a car.

R5: Refurbish

Restore an old product and bring it up to date.

Retread a tire.

R6: Remanufacture Use parts of discarded product in a new product with the same function.

Bring used engine back to original condition.

R7: Repurpose Use product or its parts in a new application or for a different function.

Give an electric vehicle battery a second life as grid storage.

R8: Recycle Process materials from discarded products into feedstocks for new products.

Use scrap as an alternative to virgin feedstock.

Draft Energy Efficiency and Renewable Energy Strategy for Increasing Product and Material Circularity

6 U.S. Department of Energy | Office of Energy Efficiency & Renewable Energy a Descriptions are adapted from Potting et al. (2016).

Figure 3. Conceptual illustration of some product and material circularity pathways emphasizing the role of markets in the circular economy

1.5 Key Considerations

To realize increased product and material circularity impacts across the entire life cycle, we must consider potential trade-offs, product lifetimes, material flows, and cascades to inform decision making. Such assessments are nontrivial, because there are multiple methods with different levels of granularity, temporal resolution, and data requirements (Walzberg et al. 2021).

1.5.1 Importance of Considering Multiple Impacts Across the Entire Life Cycle Impacts across the entire life cycle of a product or material, including extraction of raw materials, manufacturing, transportation, product use, and EOL stages, need to be assessed to avoid unintended consequences. This cradle-to-grave analysis considers resources, energy, emissions, and wastes across the entire life cycle and is illustrated in Figure 4. To draw meaningful conclusions about relative impacts of different options, it is imperative that the boundaries used in the analyses are the same.

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Figure 4. Illustration of different boundaries for studies that measure energy and environmental impacts of products. Adapted from U.S. Department of Energy 2023c

Key Concepts for Life Cycle Assessment

Life Cycle Assessment (LCA): A methodology for assessing the environmental impacts associated with the entire life cycle of a product or process (Industrial Efficiency and Decarbonization Office 2024).

Embodied Energy: The estimate of all the energy that is used to produce a material or product, including mining, manufacturing, and transportation.

Embodied Emissions: The estimate of the greenhouse gas emissions associated with production of a material or product, including mining, manufacturing, and transportation.

1.5.2 Impacts To Consider

Utilizing a holistic perspective is crucial when making decisions related to circularity. To understand the impacts and benefits across a product or material life cycle, there are multiple dimensions that can be considered to inform decision making. These dimensions can include economic, environmental, and social factors. Examples of these types of impacts are shown in Table 2. The ability to calculate quantitative metrics related to these impact categories will vary depending on the availability of data and models.

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Table 2. Examples of Impacts To Consider When Assessing Impacts of Circularity

Economic Environmental Social

Cost of energy Greenhouse gas emissions Human health impacts

Cost of materials Embodied carbon Education opportunities Employment Energy use Cultural preservation Industry expansion Waste generation Rural development Trade impacts Biodiversity Energy access Energy imports Water use and impacts Energy security Market demand Air quality Food security

Climate resilience Land use impacts Equitable distribution of impacts and benefits

Cost of waste management Soil health

Impacts on specific groups and communities

1.5.3 Trade-Offs and Win-Wins

There are potential trade-offs when balancing impacts across an entire product life cycle.

Minimizing greenhouse gas (GHG) emissions could result in increased water usage.

Design choices to optimize material reduction may conflict with the ability to reuse or recycle the product.

Product design and material selection will be influenced depending on which EOL pathway is being optimized. Designing a product for reuse may require more material to ensure durability, resulting in higher initial embodied energy and emissions compared to a lighter-weight, single-use version. The more durable product may only reduce total impacts if enough reuse cycles are realized. Thus, reuse may only be preferable when there is a system and infrastructure in place to ensure the product is actually recovered and reused.

When considering if a product should be repaired or replaced, it is important to consider both the impacts of producing a new product as well as those related to the use of the product. For products whose use phase impacts are dominant, upgrading to a substantially more efficient product while recycling the old may be the best option. For products with most of their life cycle impacts in the cradle-to-gate phase, focusing on lifetime extension or enabling multiple uses is preferred.

Upgrading a product for increased efficiency during use represents a potential win-win, in that it both extends the product’s lifetime and decreases use impacts. One example would be upgrading a building envelope to improve energy efficiency rather than constructing

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9 U.S. Department of Energy | Office of Energy Efficiency & Renewable Energy an entirely new building. However, if the upgrade is only cosmetic, replacement may be more beneficial because older buildings were designed to poorer energy efficiency standards (Hertwich et al. 2019).

1.5.4 Product Lifetime, Material Flows, and Cascades

In addition to impacts from different phases of product or material life cycle, the product use lifetime as well as overall material flows in the economy need to be considered.

The duration of product use varies tremendously, from minutes for some packaging, to a few years for a cell phone, to one or two decades for a car, to decades for buildings and infrastructure. These vastly different lifetimes result in different timescales at which EOU or EOL circularity benefits can be realized.

Several aspects related to product lifetime and material flows are worth considering, including:

• Nominal versus actual lifetime. The amount of time a product is used may vary substantially from the length for which it could be used or the length for which it was designed to be used. For example, repowering a wind site after fewer than 10 years leads to replacement of blades that would still nominally have had 20 years of service life left.

• How quickly products circulate. The time between manufacture and disposal of a product determines when the benefits of design for circularity can be realized.

• Who bears the costs and who captures the benefits of redesign for circularity. For example, designing a building for deconstruction and reuse may increase the costs and complexity during design and construction. However, the benefits of this circularity may not be realized for decades, and the building may change owners before then.

• Shifting patterns of production and consumption. Societal shifts can affect product and material flows. For example, cardboard for recycling was traditionally collected from industrial or commercial settings, but with the rise of ecommerce, more cardboard is ending up in homes where the recycling rate is lower (Paben 2022).

• Rate of product and technology evolution. For products where substantial technology evolution has occurred during their use, lifetime extension or multiple lifetimes may not be realistic options. For example, cathode ray tube televisions have no viable pathway for circularity other than recycling. Products or components that are relatively stable—such as steel I-beams or screws—have more viable Re- X pathways. Significant business model and incentive structure changes may be

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• Availability of secondary products and materials versus demand. When demand for products or materials is increasing, secondary products or materials will not fully meet the demand due to the delay between manufacturing and the EOL. The exception is if material from EOL products with decreasing demand are recycled and diverted to the growing application. For emerging and scaling technologies, secondary materials will at first be available from manufacturing losses rather than EOL products.

• Post-industrial versus post-consumer scrap availability. Scrap generated during the production and manufacturing stage (new scrap) is available for recirculation almost immediately, while scrap from post-consumer products (old scrap) will only be available at the end of their use. Additionally, the purity and insight into the composition for post-industrial materials is generally higher than for post-consumer materials, which better facilitates recycling.

The flow of products and materials can be complex. A product could circulate in a closed loop, such as when a reusable cup is collected, washed, and reused for a different consumer or when an aluminum can is recycled back into a can. Alternatively, products or materials can circulate via open loops where they re-enter the economy in a different application. Glass from a bottle can be used as a secondary cementitious material in cement, for example, or a vehicle battery can be repurposed for stationary storage.

Because markets and technology are dynamic, closed loops are not always possible and may not always deliver optimal environmental outcomes. Overemphasizing closed loops may result in “unsustainable circularity,” where materials are retained in the economy but emissions increase (Rachal 2023; Allaway 2023). Relying on attributes such as “recycled” without a full analysis will not always yield optimal benefits (Vendries et al. 2020).

Additionally, increasing circularity will not always reduce global demand for virgin materials. There may also be a rebound effect wherein circularity results in lower per unit impacts and costs, resulting in increased production and thus, greater total impacts (Zink 2017).

1.6 Potential for Increased Circularity

The large volume of waste generated each year in the United States represents a substantial opportunity to increase product and material circularity. Although there is limited data detailing all wastes, including industrial streams, the U.S. Environmental Protection Agency (EPA) estimates that 600 million tons of construction and demolition waste and 292 million tons of municipal solid waste (MSW) were generated in the United States in 2018 (U.S. Environmental Protection Agency 2020a).

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Utilizing recycled materials is one option for keeping the value of these materials in the economy and may deliver substantial energy and emissions savings relative to producing goods from virgin materials. It is instructive to consider the amount of material from MSW being recycled, landfilled, or incinerated in the United States each year along with the embodied energy and approximate energy savings from using recycled rather than virgin materials. Examples for several commodity materials are shown in Table 3. The values shown are illustrative since exact energy and emissions savings for recycled materials will depend on supply chain aspects such as transportation distance and the technologies used to produce and process the materials.

Table 3. Waste Statistics for Some Commodity Materials in Municipal Solid Waste

Material Embodied

Energy (MJ/kg)

Millon Tons Recycled/Landfilled/

Incinerated

Energy Savings From Recycled

Materiala Aluminum 210b 0.67 / 2.66 / 0.56d 95%e

Steel 26.5b 6.36 / 10.53 / 2.31d 60%–80%f Glass 10.5b 3.06 / 7.55 / 1.64d 30%g

Paper and Cardboard 35c 45.97 / 17.22 / 4.2d 40%g Plastics 100b 3.09 / 26.97 / 5.62d 33%g a Estimated energy savings when using recycled materials rather than producing the material from virgin raw material.

b Milbrandt et al. 2022; c Milbrandt et al. 2024; d U.S. Environmental Protection Agency 2020a; e Raabe et

al. 2022; f Reck et al. 2024; g U.S. Environmental Protection Agency 2016.

Estimates for the volume of materials entering landfills and for recycling rates can vary depending on the methodologies used. However, all estimates indicate a substantial potential for increasing material and product circularity. For plastic waste alone, it is estimated that in 2019 the United States spent $2.3 billion on landfilling plastics, which had an estimated market value of $7.2 billion and represented 3.4 embodied Joules of embodied energy—equivalent to 12% of the energy consumed by the U.S. industrial sector that year (Milbrandt et al. 2022). To get a picture of potential impacts of recycling on different materials and products, it is instructive to consider both current volumes and projected growth. Several of the fastest growing waste streams (plastics, textiles, and electronics scrap [e-scrap]) consist of materials with low recycling rates and high embodied energy, thus offering significant opportunities to reduce environmental impacts and retain economic value via increased circularity.

Post-industrial scrap and business to business recycling offers potential avenues for manufacturers to improve economics and drive efficiency. Unfortunately, there is little data publicly available that quantifies waste material generated in these processes, making it challenging to know the potential impacts of increasing their rates of recycling.

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While recycling has a role to play in circularity, other Re-X pathways can potentially deliver larger reductions in demand for new materials and related emissions. An analysis of case studies estimates that remanufacturing can reduce new material requirements by between 80% and 98% and repair can save between 94% and 99% (United Nations Environment Program 2018).

Clearly, products entering landfills represent substantial market value and embodied energy. However, recirculating those products and materials back into the economy only makes economic and environmental sense when the processes and activities required to do so have lower costs and environmental impacts than new production and/or disposal.

This requires functioning markets, as illustrated in Figure 3, as well as insight into the total life cycle impacts, as discussed in Section 1.5.1.

With the expansion of clean energy technologies—such as solar panels, wind turbines, fuel cells, and batteries—concerns related to both the EOL fate of these technologies, as well as the potential volumes and hazard of waste, have been raised and may slow deployment (Mirletz et al. 2023). Understanding the potential volume of EOL clean energy technologies in the context of other waste streams is important to inform decision making.

For example, research indicates that by 2050, wind turbine blade waste in the United States could reach 370,000 tons per year (Electric Power Research Institute 2020).

However, this is less than 0.15% of combined MSW and construction and demolition waste generated in the United States in 2018 (Wind Energy Technology Office 2023a).

With these emerging technologies, there is an opportunity to proactively include design that optimizes circularity to increase the domestic supply of critical materials, maximize clean energy production, and minimize life cycle impacts (Norgren, Carpenter, and Heath 2020).