Monday, February 6, 2023

What Is a Closed-Loop System?

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What is a closed-loop system? Is it a meaningful way to reduce emissions and reduce environmental impact, or is it just another buzzword with little merit?

The concept of the closed-loop economy has been around since the beginning of time. Early examples include the potlatch ceremonies of Indigenous peoples in North America, in which goods and resources were shared among members of the community.

The Indigenous people of the Amazonian rainforest have been living in harmony with their environment for thousands of years, too, as have most tribal cultures on the planet — using only what they need and recycling all of their waste. The philosophy behind these ceremonies was that everything is connected and nothing should go to waste. That changed when capitalism replaced tribalism.

The closed-loop or circular economy is re-emerging, however, as an economic system in which businesses operate in a way that minimizes waste and maximizes resources much like our ancestors. In a closed-loop system, materials are reused or recycled instead of discarded as waste.

Amazon Rolex National Geographic
Courtesy Deb Dowd | Unsplash

The closed-loop economy has gained traction in recent years as a way to address the growing problem of waste and resource depletion as well as climate change across a number of industries. Businesses are beginning to adopt closed-loop practices, and governments are implementing policies to encourage closed-loop thinking.

There are many benefits to closed-loop systems, including reducing pollution, conserving resources, and creating jobs. Closed-loop systems also have the potential to create economic value by closing the loop on resource use.

What is the circular economy?

The circular economy is the bedrock of a closed-loop system. It plays an important role for businesses and governments to understand and implement in order to create a more sustainable future, often seen as a more viable alternative to the traditional linear economy, in which resources are used once and then discarded.

LVMH-sustainable
Courtesy LVMH

In recent years, there has been a renewed interest in the circular economy as businesses and governments around the world strive to become more sustainable in order to meet the Paris Accord target of keeping global temperature rise from surpassing 1.5°C.

The European Union has been a leader in this effort, with its Circular Economy Package which was released in 2015. The goals of the E.U.’s Circular Economy Package are to reduce waste, maximize resource efficiency, boost competitiveness, and create jobs.

What is a closed-loop system in manufacturing?

A closed-loop system is a manufacturing process where waste materials are reused to create new products.

Closed-loop manufacturing is the process of reusing waste materials to create new products. In a closed-loop system, there is little to no waste because everything has a new purpose. This type of manufacturing is also sometimes referred to as a “zero-waste” or a “cradle-to-cradle” system.

Recent examples include Stella McCartney’s new partnership with fiber recycling platform Protein Evolution. And the world’s largest luxury group LVMH — parent to Louis Vuitton, Christian Dior, and Fendi, recently joined the Circular Bioeconomy Alliance, launched by King Charles in 2020.

How do closed-loop systems work in fashion?

The fashion industry is one of the most polluting industries in the world. It’s responsible for ten percent of global carbon emissions, and huge amounts of water and chemical waste — about 20 percent of the world’s wastewater comes from fashion production alone.

It’s also one of the biggest industries moving toward a closed-loop system. The nature of the industry lends itself well to closed-loop manufacturing, from deadstock materials to fully biodegradable options.

Gomorrah compostable t-shirt
Gomorrah’s biodegradable t-shirt | Courtesy

There are a few different ways that closed-loop systems can work in fashion. One common method is through garment take-back programs, where customers return their used clothes to the retailer. The clothing is then cleaned and repaired, if necessary, before being made into new garments. Consumers often receive a discount on a new product that may also be made with returned materials.

Another way closed-loop systems can work is by using sustainable materials that can be easily recycled. For example, some brands are using Econyl, a recycled nylon made from waste such as fishing nets and carpet flooring. There are also biodegradable materials, now being used in a growing number of garments. Most recently, Ganni launched a fully circular t-shirt.

Closed-loop manufacturing benefits

By recycling textile fibers and other materials, closed-loop systems can contribute to a circular economy, where resources are continually reused instead of wasted. This helps to make fashion more sustainable and less damaging to the environment. Reducing waste in manufacturing, and closed-loop can help brands achieve their carbon-neutral or net-zero goals.

Slow Factory's Open Edu
Courtesy Tima Miroshnichenko | Unsplash

While closed-loop systems are not yet perfect, they offer a more sustainable way of producing and consuming fashion. As awareness of the environmental impact of the fashion industry grows, closed-loop systems are likely to become more popular and widespread. In the meantime, closed-loop systems offer a few ways for fashion brands and consumers to reduce their impact on the environment.

Reduction in waste

One of the biggest benefits of closed-loop manufacturing is that it reduces the amount of waste produced. In traditional manufacturing processes, wastes are often dumped into landfills where they release greenhouse gases and contribute to climate change.

Improved efficiency

Another benefit of closed-loop systems is that they are more efficient than traditional manufacturing processes. This is because there is no need to transport raw materials or finished products back and forth between different locations.

Cost savings

Closed loops are financially responsible, too. Businesses can save money by using a closed-loop system because they don’t have to pay for new raw materials or for the disposal of waste. Additionally, since the process is more efficient, businesses can save on labor costs. Closed-loop systems provide businesses with significant cost savings compared to traditional manufacturing processes.

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