Towards Circular Economy in Päijät-Häme

Maarit Virtanen & Anni Orola (eds.)

The Kiertoliike project was implemented in 2016–2018 by Lahti University of Applied Sciences (LAMK), Lappeenranta University of Technology, Muovipo-li Ltd., Lahden Työn Paikka Ltd. and Lahti Region LADEC with support from the European Regional Development Fund. The main outputs of the project included regional material flow analysis, the Päijät-Häme Circular Economy Road Map, a circular material library, circular economy business models and pilots on recycling, repair services and material collection.

The Päijät-Häme Circular Economy Road Map is available at http://www.kohtikiertotaloutta.fi/english/.

The main results from the material flow analysis and mapping of circular business opportunities are summarised in this publication. The full articles are available in Finnish in the Kiertoliike final publication at http://urn.fi/URN:ISBN:978-951-827-291-8.

Introduction

Päijät-Häme region material flows were studied under Kiertoliike for pro-viding information for the Päijät-Häme Circular Economy Road Map and the development of circular business models. The studied material flows were phosphorus, nitrogen, plastics, textile, wood, ash and metal. The information collected included material inputs to the region, production in the region and the circulation of materials, i.e. material recycling, energy recovery, disposal of stocks and deposit in landfills. The information was gathered from official statistics, environmental permits, companies, literature and national statis-tics.

The study on phosphorous and nitrogen flows focused on nutrients and bi-omasses. About 5 000 and 470 t of nitrogen and phosphorous, respective-ly, are added annually to fields. In addition, approximately 1 800 and 420 t of nitrogen and phosphorous, respectively, return to fields via manure. The amounts of nitrogen and phosphorous retained in the environment are about 550 and 630 t, respectively.

The amount of plastic generated in the region is approximately 39 300 t an-nually. Most of the plastics are still utilised for energy production despite in-creasing material recovery. In 2015, only 11% of the plastic waste was recy-cled as material, and 55% of this took place abroad.

Päijät-Häme RegionMaterial FlowsVille Uusitalo- Lappeenranta University of Technology Maarit Virtanen, Kirsti Cura & Kati Manskinen - Lahti University of Applied SciencesJenni Syvänne - Muovipoli Ltd.

There are no statistics on the amount of textile waste in Päijät-Häme, but the national Texjäte textile waste research estimates that about 3 370 t of textile waste is generated per year. Only approximately 11% of this waste is utilised as material.

Around 371 200 t of wood waste is generated in Päijät-Häme annual-ly. In total, 138 600 t of demolition wood is transported to the region, and only approximately 19% of wood waste is utilised as material.

The amount of ash generated in the Päijät-Häme region is around 75 000 t per year. The utilised proportion is approximately 55%, which is less than the average in Finland. In total, 1 000 t of ash is utilised as fertiliser.

About 60 620 t of metal is collected from such sources as electric and electronic waste in the region annually. In addition, 2 570 t of met-al is transported to the region from other parts of Finland. Most of the metal is recycled outside Päijät-Häme.

Approximately one-third of all produced food is discarded as waste. How-ever, production of food that is not consumed requires the use of nutrients and other inputs, thus also leading to environmental impacts. Households also produce wastewater, including nutrients from eaten food. This leads to the accumulation of large amounts of nutrients as biowaste or wastewater in cities. Within previous years, urban agriculture and communal gardens have gained increasing interest due to their positive environmental and social im-pacts.

This has created a demand for nutrients and applicable soils in cities. These could be produced locally through a composting process using biowaste gen-erated in households. The target of this analysis is to study whether there could be business opportunities for locally produced nutrients. This would support the targeted circular economy and provide an opportunity for house-holds and communities to engage in farming.

A business idea is to have customers sign a yearly agreement to provide biowaste for regional composting and to use soil and nutrients in the region for urban agriculture or landscaping. A set annual price in this study is 20 € for a single hou-sehold, but this could vary depending on biowaste amounts.

Business from Intensification of Nutrient Recycling in HouseholdsIlona Hintukainen - Lappeenranta University of Technology

According to the economic analysis, the largest expenses are related to salaries and to supporting material purchase for composting. The analysis shows that small-scale processing of only biowaste is not profitable. The process becomes lucrative when the amounts of bio-waste are large enough, which requires a sizable composting facility. However, in this case, biowaste from a big area will be required, and the approach ceases being small scale and regional.

Nutrients are unevenly distributed globally because of global food and feed transportation and the use of mineral and fossil fertilisers. This causes prob-lems due to both the lack and overuse of nutrients. One solution could be to export excess nutrients from nutrient-rich regions to nutrient-poor areas. For example, Finland is facing eutrophication challenges in water systems, where-as Ivory Coast and Ethiopia lack phosphorous and nitrogen, respectively, due to such factors as crop export and biomass burning for cooking.

There are various possibilities for nutrient transportation, but this study focus-es on the use of biochar as nutrient carrier. The use of biochar also enables the increase of soil carbon content, which mitigates global warming and possibly improves soil quality for cultivation. According to literature review, the pro-duction costs for 1 t of biochar vary from 100 to 200 €. Transportation costs from Europe to Africa in containers vary from 50 to 100 € for 1 t. According to a rough life cycle assessment performed for transportation, only 7–10% of biochar global warming mitigation potential is reduced due to fossil fuel use in the transportation.

In addition to nutrient-poor regions, wealthy Middle East regions that lack high-quality soil may be interested in imported biochar nutrient mixtures that can be used for establishing cultivations. Funding for the system could be cre-ated by various ways. Wealthy

Export of Nutrients from Finlandto Nutrient-poor RegionsPirjetta Waldén & Ville Uusitalo - Lappeenranta University of Technology

regions may have interest in buying biochar nutrient mixes. Nutri-ent-poor areas, meanwhile, typically also lack liquidity. In these cases, costs could be covered by the establishment of carbon or nu-trient trade systems where private individuals or companies could mitigate their environmental impacts by buying offsets through bio-char and nutrient exports.

Product reuse and repair are an important part of circular economy, which aims, among other things, at lengthening the product lifetimes. Recycling business is a complex system, and it requires from companies various com-petencies and the creation of value chains. According to a study by the Finn-ish Environment Institute, the reuse of products is still rare. For example, the average number of used clothes and shoes bought is 4,3 items per person annually, and for electronic equipment only 0,2 items.

Kiertoliike project included the piloting of two business models on the recy-cling of products and the repairing of products. The Full Service Recycling Centre pilot was implemented with a regional waste management centre, where customers were offered an opportunity to leave usable products for recycling at the same time when they brought waste to the centre. The col-lected products were sorted and sold at a small shop located within the cen-tre. The collection of items worked well and the feedback from the service was positive, but the number of paying customers was small. The conclusion was that the service was not economically feasible. However, the collection of reusable products continues and they are sold in an existing shop in the centre of Lahti.

The Centralised Repair Service pilot took place first in Lahti and after the positive experiences there, also in neighbouring three municipalities. The idea in the service was to offer customers a centralised point to drop off their products in the need of repair, and the collection of ready items from the

Full Service Recycling CentreReetta Jänis, Lahden Työn Paikka Ltd.Maarit Virtanen & Anni Orola, Lahti University of Applied Sciences

same place. The feedback from the service was positive, since repair services were easy to reach and use. In Lahti, the use of service was active but in the more rural communities, it did not take off so well. The main challenge in the service are transportation costs, so ideal-ly repair services would be provided at a centrally located recycling centre.

A business model for a Full Service Recycling Centre was drafted based on the experiences from pilots and different background stud-ies. Ideally, a recycling centre would offer a variety of digitalised re-cycling services with different kinds of transportation and pick-up possibilities. Repair services, rental services and do-it-yourself work-shops would be one part of activities in the centre.

More Action and Responsibility to Circular Economy with Mobile ServiceKimmo Heponiemi & Kati Manskinen - Lahti University of Applied Science

Circular economy and digitalization belong together. Digital solutions help tracking material flows and increase openness in operations. We need collab-oration between different stakeholders to make digital circular economy busi-ness work.

KierrätysAPPI mobile service brings stakeholders together to increase the collection of waste electrical and electronic equipment (WEEE) and bat-tery waste. A company or a private person can announce through the mobile

service that is has a certain amount of certain type of waste batch available. Clients, like recycling companies, can book and collect the waste batch for utilisation. This increases the collection and re-cycling rate of WEEE, which is currently only about 50 %.

Everyone benefits from the mobile service. It helps companies and private persons to get rid of their waste in a quick, easy and respon-sible way. The waste can be tracked, so a proper and responsible re-cycling can be verified. The recycling companies get both increased incoming waste flows and can organize different kinds of recycling campaigns through the mobile service. The mobile service also col-lects valuable information about the waste flows.

KierrätysAPPI is a unique business idea aiming for global markets. It has been developed in AIKO funded project (2017-2018) coordinated by Lahti University of Applied Sciences. The possibilities to make the mobile service commercial are researched in RESELL project, which is funded by Business Finland.

Bulk Refill of Consumable Goods for VehiclesJenni Syvänne - Muovipoli Ltd. Jaakko Zitting - Lahti University of Applied Sciences

The recent implementation of the EU Plastics Strategy and tightened require-ments for recycling call for the streamlining of recycling processes and re-duction of the consumption of plastic materials. According to the EU’s waste hierarchy, preventing the formation of waste must be seen as a primary tar-get. Designing the sale of goods out of individual packaging can greatly ad-vance this objective. In certain products, reusable packaging can even offer the customer added value in terms of service and ease of use.

Refuelling of vehicles can be seen as a service where customers use their own reusable packaging (the car’s fuel tank) for a consumable good. Selling fuel to customers in individual containers would result in significant in con-

venience and an extremely low average life span of the packaging unit. This model of delivery to customers could be adopted in sales of other liquids for vehicles. Windscreen washing fluid could be purchased at the same refill point as fuel and with the same kind of pumping equip-ment. This type of distribution could offer environmental, economic and practical advantages to both customers and retailers.

Business owners at refuelling stations could benefit from reduced di-rect costs in bulk purchases of washing fluids. Indirect savings will be derived from the decreased need for shelf space and workload and from the reduced amount of waste in the stations’ waste collection bins. The environmental brand value offers possibilities for business owners to stand out relative to competing stations. The investment costs for pumping gear and payment system integration can be offset by decreased purchasing costs and estimated increase in sales due to ease of use and increased marketing potential.

The environmental impact of the washing fluid refilling system can be estimated with traffic statistics and average properties of plas-tic washing fluid containers. If the system could reach 10% of the 2,7 million vehicles in Finland (2017), with each consuming two large 4 L containers per year and each container weighing approximate-ly 200 g, the annual reduction in plastic packaging materials would result in 106.757 kg of HDPE. This amount equals the overall plastic packaging waste generated by more than 7.500 people in Finland every year.

Especially in developed countries, linear economies and the ‘take–make–dis-pose’ culture are common. This has led to a decline in the quantity of natural resources and rising material prices. Due to increasing prices and environ-mental challenges, we have started to recycle materials, and recycled mate-rials have become a stream of raw material. Meanwhile, consumers are de-veloping an increasingly positive attitude towards products made of recycled materials.

CFeelIt entrepreneur Vesa Kataja became acquainted with the circular economy concept through his networks. He was developing a new business idea, and after noticing how outdoor furniture can be un- attractive and even bro- ken, he considered de- signing outdoor furni- ture made of recycled or recyclable ma- terials.

The core of the busi- ness is project-based mode of operation that is based on ready- made concepts. All

Starting Circular Business: Case CFeelItKaisa Tuominen - Lahti University of Applied Sciences Jukka Selin - Lahti Region LADEC

furniture pieces are made-to-order, so no stock is needed. Each fur-niture is designed with the customer, who selects the materials that are used. This is also how furniture creates stories; for example, kin-dergarten kids give their pacifiers as raw materials for benches to be placed in a kindergarten yard. Stories can be a triggering agent that makes people interested in recycling and using recycled materials. Such stories in the furniture can be read through codes and smart-phones.

CFeelIt combines many circular economy models into one business. Products are locally made of modular, easily switchable components in addition to recycled materials. CFeelIt products are mostly leased, not sold. The lease contract includes maintenance, which keeps the furniture fit for use for a long time.

The main customers of CFeelIt are cities and housing companies. Customer flow has not been substantial, which might be because the idea is a new, innovative way of making business. It is hard to succeed in competitive tendering because of the lack of ready-made list pric-es. Most customers in the linear economy favour buying ready-made furniture from stock. Finally, despite consumers’ positive attitude to-wards recycling, they are mostly not ready to pay additional for it.