Achieving a truly circular economy is a shared goal requiring collaboration among stakeholders from various sectors, including the copper industry and its value chain. Circular principles, already in practice at many mine sites to reduce waste and conserve water, represent an essential piece of this sustainability puzzle. However, to realize full value chain circularity—from production and consumption to reuse and recycling—it is imperative for designers, policymakers and industry players to collaborate on creating systems that incentivize circular practices and business models at critical stages in the value chain. As the importance of the circular economy expands, the mining industry is reevaluating its role, recognizing the need to continue to produce the materials necessary to achieve the clean energy transition, while at the same time growing valuable stocks of material in society for the future. How mining companies embrace circularity will depend on their business. Some may choose to integrate recycling operations, while others may pursue leasing options for metals or develop innovative technologies to extract value from waste.
Mining’s significance in the circular economy is undeniable, especially when growing demand for metals, such as copper, is considered. Several factors are driving this demand:
- Population Growth: The global population is projected to reach 9.7 billion by 2050, leading to increased demand for essential materials.
- Economic Development: As more people connect to electrical grids and overall consumption grows, the need for metals escalates.
- The Clean Energy Transition: Initiatives such as renewables (e.g., wind and solar), storage batteries and electric vehicles (e.g., electric vehicles) rely heavily on copper to produce and transmit generated electricity.
Because copper is seen as a linchpin of the clean energy transition, demand for the metal is expected to double by 2050. In addition, if a 1.5°C trajectory is realized, demand could increase even further. Questions over copper recycling and its role in meeting this unprecedented demand have come to the forefront. While recycling plays an important part of the story, due to copper’s durability, versatile nature and long lifespan in applications—lasting up to 50 years in some cases—both recycling and mining will be needed to meet demand. Historically, mining has not been included in discussions about the circular economy, but the landscape is changing.
Mining serves as the gateway to accessing metals crucial for modern society, effectively feeding into an already circular value chain. Approximately one-third of copper demand is met by recycled copper (both manufacturing and end-of-life scrap). The challenge is enhancing the efficiency of the value chain and ensuring metal stocks extracted through mining and processed through refining remain in productive use for generations to come. In other words, mining not only increases the stocks of metal available for use, but it contributes to future stocks available for recycling when these products eventually reach the end of their useful lives.
For example, consider the electronic waste stream. The UN Global E-waste Monitor 2020 reported that 53.6 million metric tonnes of electronic waste were generated worldwide in 2019, making it the fastest-growing waste stream. E-waste includes many different precious metals, which can be reused for generations to come.
Circular Initiatives in the Mining Industry
Mining companies actively explore circular initiatives that reduce waste and pollution at the mine site and enable regenerative practices. These efforts can be grouped into three types of initiatives:
- Waste to Value: For instance, Antofagasta’s Los Pelambres mine recovers steel from discarded mine haulage truck tires for recycling into grinding balls used at the mine. This initiative aims to repurpose 97 tonnes of steel from 156 haulage truck tires during the pilot project.
- Waste Reduction: Anglo American reuses water, securing desalinated water supplies for mining operations, such as their Los Bronces copper mine’s Integrated Water Security Project, minimizing water waste.
- Land Regeneration: Teck’s Highland Valley copper mine collaborates with local communities to rehabilitate previously mined areas, restoring wetlands and biodiversity by replanting native species of trees and reintroducing wildlife.
Mining companies are looking to the future and contemplating fully circular business models. One concept involves the retention of ownership of extracted metal, particularly its value, through leasing arrangements made possible by the advancement of traceability technologies like blockchain. There is no one-size-fits-all approach, and the path forward will be shaped by a combination of policy measures and market forces.
Policy Measures for Achieving Circularity
Efforts to achieve greater circularity in metals’ value chains require well-considered policy measures. The EU is moving ahead with a suite of waste- and product-related sustainability policies aimed at circularity. In the U.S., circularity is mainly driven by the market (with some measures included in the Inflation Reduction Act), particularly by circularity targets around recycled content set by original equipment manufacturers (OEMs). Policies in Asia aim to increase recycling to enhance material availability. For any policy measure or initiative three things are needed to achieve greater circularity in metals’ value chains:
- Coherence: Policymakers must ensure that legislation works cohesively to realize a broader sustainability goal while addressing society’s material needs. Coordination among policymakers, an understanding that sustainability efforts are interconnected, and an awareness of the impacts that chemical policies have on sustainability ambitions—such as net-zero greenhouse gas (GHG) emissions and scrap circularity—are vital. For example, policies placing restrictive requirements on the handling of scrap metal can have negative impacts on sustainability initiatives, slowing progress to keep metals in productive use.
- The Right Metrics: Instead of focusing solely on recycled content requirements, which are hindered by lower levels of scrap in the value chain and purity requirements for metal applications, policy makers should develop metrics to accurately measure circularity performance at different stages of the value chain including mining, smelting, refining, product use, and collection, sorting and disassembly at the end of a product’s life. This will enable incentives to be targeted to the right step to encourage improved performance.
- Appropriate Incentives: Effective incentives should target the bottlenecks in the value chain, removing barriers to circularity. Such incentives can also encourage advanced circular business models like metal leasing and transforming waste into value, making them attractive to metal producers.
Investment in the recycling and scrap sector is increasing, driven by ESG risks and a global commitment to sustainability, increasing regulations and supply chain pressure. The Americas, the U.K., Europe and Japan are witnessing the expansion and innovation of recycling facilities. A future challenge for industry will be demonstrating the sustainability and responsibility of their secondary materials supply chains. Great advances have been made in this area with respect to primary production with the development of responsible mining frameworks, such as those from the Copper Mark, the Initiative for Responsible Mining Assurance (IRMA), Towards Sustainable Mining (TSM) and the International Council on Mining and Metals (ICMM) Performance Expectations. Demonstrating the responsible recycling of metals requires a value chain approach, a deeper understanding of complex supply chains, and evaluation of existing due diligence guidance and requirements to mitigate risks to people, workers and the environment. ICA is working to address these issues through a multi-stakeholder process at the Roundtable for the Responsible Recycling of Metals.
Mining’s role in the circular economy is pivotal, with the demand for essential metals such as copper expected to surge. Collaboration throughout the metals value chain and innovative approaches within the mining industry are driving the circular agenda forward. Policy measures focused on coherence, lifecycle metrics and incentives are critical to achieve improved circularity. As the circular economy gains momentum, mining will play an indispensable role in shaping a more circular world and a sustainable future for all.
