Agent-Based Modeling for the Circular Economy: Lessons Learned From Three Case Studies
The circular economy (CE) aims at decoupling human activities from resource use, creating wealth in the process. Recently, many scholars have questioned the link between increased circularity and sustainability, resulting in many methodological approaches being developed for that purpose. This presentation summarizes the insights gained from the application of agent-based modeling (ABM) to study the techno-economic and social conditions promoting circularity and sustainability of three technologies: photovoltaic (PV) modules, hard disk drives (HDDs), and wind blades. Four main categories of agents are defined in the ABM: asset owners, service providers (e.g., refurbishers), recyclers, and manufacturers. Two main CE strategies are represented: lifetime extension (through repair or reuse) and recycling. The developed models start by projecting installed capacities and end-of-life (EOL) quantities. Then the theory of planned behavior - a social psychology model explaining behavior adoption based on attitude, peer influence, and costs - is used to model the asset owners' EOL decision (i.e., landfill, recycle or extend the lifetime of the asset). Then, the quantities of assets flowing to the recycler and service provider agents and quantities of materials flowing to manufacturers are computed. Recyclers' economies of scale are dynamically modeled, and the value generated by the CE strategies for the recyclers, service providers, and manufacturers is computed within the model. When data are available, avoided greenhouse gas emissions resulting from the CE strategies adoption are calculated exogenously from the ABM simulations. Results show that with improved used PV modules warranties, the reuse CE strategy adoption increases from 1% to 23% between 2020 and 2050. Similarly, improved standards could enhance HDDs end-users trust in data-wiping - a prerequisite to reuse - leading to a 3-fold increase in the reuse rate and avoid about 5 million tons of CO2 eq by 2050. Regarding wind blades, 5-15 years lifetime extension could reduce EOL blade quantities by 13%. High costs and logistic issues prevent blades from being recycled in greater quantities. One insight from the case studies is the necessity to have mature secondary markets for reuse to be a viable option. Interestingly, PV reuse is limited by the willingness of PV owners to purchase used modules (on the demand side), while HDDs reuse is constrained by the lack of trust toward data-wiping (limiting the supply of used HDDs). The six limits of the CE concepts presented by Korhonen et al. (2018) are finally used to interpret the results. The HDD case study is an exemplary lock-in, where the first accepted practice (shredding) retains most of the market. The PV results illustrate the technical limitation to reuse, as the growing demand cannot be supplied entirely with used PV modules. The wind case study shows the relevance of clearly defining physical flows - what type of waste should wind blades be considered, how should they be transported and landfilled? - a crucial consideration that also applies to PV modules. Finally, the three case studies highlight the relevance of studying a technology's technical, economic, and market material efficiency potentials altogether and the potential benefit of coupling ABM to life cycle assessment.