Regenerative Economy: The Lesser-Known Part of the Circular Economy

July 03, 2020

The idea of the 'circular economy' is gaining attention in activism circles, but fewer people know about its important subcategories.

The term, ‘circular economy’ is starting to be the center of more and more environmental initiatives these days. But what does this even mean?

In a basic sense, a ‘circular economy’ refers to an economy that doesn’t rely on our current model of extracting materials from the environment, using them, and then disposing of them in an unsustainable manner. In this model, economic activity is what’s responsible for continuously building and reinforcing the overall health of our economy.

Now, you might be asking: how do we achieve this? According to the Ellen MacArthur Foundation, there are three core components:

  1. Decreasing the amount of waste we make.
  2. Ensuring more materials are in use rather than throwing them away.
  3. Transitioning to a ‘regenerative’ economy.

While the first two are fairly intuitive, the last part isn’t as much. What does a ‘regenerative’ economy really mean?

Think of the word ‘regenerate’. It’s about restoring something back, perhaps to a better form than it is right now. That’s the essence of a regenerative economy. Simply put, we shouldn’t just try to stop harming nature with our economy… we should try to actively restore it to a better form.

Now let’s make that more specific by looking at an example.

The Regenerative Economy In Agriculture

While the regenerative economy is great in theory, it’s even better in implementation! One common example of creating a regenerative economy is found in agriculture. We’ve all seen the crowded images of current factory farming, and as it turns out, there’s a lot of potential to transition our current agricultural economy to a more regenerative one.



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In both how we raise livestock and grow crops, current agriculture quantifiably degrades the quality of soils, leaks chemicals into the environment (Source). Soil plowing specifically has also released greenhouse gas emissions into the atmosphere at ENORMOUS scales — about 147 billion tons of carbon has been released into the atmosphere worldwide since the beginning of agriculture (Source).

Because of the sheer impact of such a practice on the environment, innovators and scientists began to implement the regenerative economy model as a way to restore degraded land, reduce chemical runoff, and increase biodiversity as a whole.

One example of a solution that has been implemented is the increasing use of a practice called rotational grazing to raise cattle and other grazing livestock. Farmers allow their livestock to move around across large natural environments as they would in natural herds.

This practice along with many others ensure that the land doesn’t lose its pasture by helping improve soil health. Most importantly, however, it actively improves the health of the environment. Or, as the name implies, it regenerates it! Studies predict that this will save hundreds of billions of dollars over the next few decades (Source).

The Regenerative Economy And Plastic Production

This same type of thinking that was used for the agriculture industry can be applied to other areas of our economies — such as how we produce and use plastic materials. Currently, about 50% of plastics are single-use, showing how our current system quite definitely could benefit from principles of the regenerative economy (Source).

The first thing to note is that plastic production is a fairly modern phenomenon. We started producing plastics in the 1950s and since then, we now produce more than 380 million tonnes of plastic every year (Source).

Yes, it is initially shocking to see how all of this plastic was generated over a relatively short period of time. However, after doing some more research, this massive increase in production actually makes sense. Due to the benefits that plastics had over other materials at the time, more and more corporations have opted to use plastic instead of fabrics, metals, wood, etc.

That being said, plastic can’t appear out of thin air. We did have to give up some resources to produce plastic and gain all of its benefits. In particular, we use energy from fossil fuels, release greenhouse gases from the production process, and use water to make plastics, among other processes. We also have to factor in how these resources are depleted when plastics are being transported, used, disposed of, etc.

So... given all of this information, how can we actively do good from our plastics usage? One solution is to turn plastic waste into a monetizable currency. This idea stems from unlocking the inherent value in plastic material for a good cause.

Unlocking The Value Of Plastics

Let’s look at a few numbers for some more context. As of 2015, there were over 7.82 trillion kilograms of plastic produced. If we were to assign a monetary value to this plastic (even though prices for plastics fluctuate), let’s just say that they were worth $0.01 USD per kg even though that’s several factors lower than its average value (Source). Doing some quick math, that would mean that we’ve created over $78.2 BILLION worth of material value from this plastic.

In reality, this number is a lot higher (due to higher average prices for plastic material). We can actually analyze the fate of all plastics produced between 1950 and 2015 to get a better sense of this number:



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This diagram is simpler than it looks. It shows what happens to different amounts of plastic, as it goes from being produced (on the left) to being disposed of (on the right) (Source).

Here, we see that about 70% of plastics produced were only used once and 64% lost their material value from not being recycled (although incineration can recover a smaller amount of value from plastics). This demonstrates how hundreds of billions of dollars of value in plastic materials have been lost thus far — much more than the number we calculated. And, if we don’t do anything about this problem soon, that number will continue to grow.

How Can We Achieve A Regenerative Economy?

One of the most significant ways for us to implement the regenerative economy would be to transform plastics into some form of currency, thus giving individuals and corporations an incentive to reuse plastic as much as possible.

It is important for us to realize that solving the economic problem with plastic pollution isn’t entirely separate from solving its environmental problem. Both have to be done to address the problem in a scalable manner.

For us to unlock the value in plastics, we would need to reduce the amount of plastic that is only used once and then burned or thrown away (and the most feasible alternative is recycling). Simply put, we must reduce the number of single-use plastics that we’ve been producing. This is especially needed in developing countries, which typically face more challenges in raising recycling rates to unlock the value in plastics (Source).

The results of this can be seen with case studies of organizations like Plastic Bank. They enable new recycling infrastructure in developing countries and work with local community members (that often live in poverty) to collect recyclable plastics. This not only prevents plastics from entering open dumps that can leak them into the environment (Source), but also does good from improving the livelihoods of these local waste collectors.

The organization has helped launch recycling centers in developing countries where waste collectors gather materials including plastic that would have otherwise been thrown away. Plastic Bank can sell these recyclable materials to product manufacturers and use the revenue to pay the waste collectors a higher wage.



Here, we see the value from the material we use is UNLOCKED to improve the livelihoods of the waste collectors in developing countries (as well as to support Plastic Bank’s operations to increase recycling infrastructure).

Other methods that can be used to help us achieve a regenerative economy include (Source):

  1. Ensuring that 100% that plastic products are designed to be fully reusable, recyclable or biodegradable
  2. Increasing the use of post-consumer recycled plastic content in plastic contents
  3. Adopting reusable plastic alternatives that can replace virgin plastics as a whole

While there are many other solutions out there that can be applied to implement a regenerative economy, these are some of the more-commonly applied ideas that have been used by corporations thus far. For example, in 2019, Dove switched their packaging to 100% recycled plastic bottles (where technically feasible) in North America and Europe.

Ultimately, however, it’s up to corporations, organizations, and the government to work collectively to try and reduce the amount of plastic waste generated — and so far, the regenerative economy seems to be a great model that we can implement to achieve that goal.

All this aside, it’s important to realize how plastic materials and agriculture aren’t the only aspects of the regenerative economy! A truly regenerative economy needs to incorporate this shift in vision to all industries — where every product manufactured, used, and reused goes towards not just minimizing bad, but actively promoting good. That being said, implementing a regenerative economy in the plastics industry might have loads of other benefits that can help us work towards solving the plastic pollution crisis itself.

Overall, this is one of the largest visions to aim towards in all aspects of our economy, but it’s not just a theoretical utopia as we’ve seen in many cases. The regenerative economy will be a key part of our transition to the future of the ‘circular economy’ and it’s up to us to support that vision and unlock its benefits.


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