Building the evidence base for circular economy adoption in 10 industrial sectors 

 

Across the UK, industries are changing how they use materials. From recycled steel to (virtually) zero-waste sugar production, circular economy practices are helping to cut emissions and support the UK’s net zero goals. 

However, many of these circular practices occur across supply chains, while site-based regulation – particularly the Environmental Permitting Regulations (EPR) – focuses on individual facilities. This can create challenges where circular approaches don’t fit neatly within existing regulatory frameworks. 

To investigate this, the Environment Agency commissioned a research study across 10 industrial sectors. We were appointed to carry out the work – identifying real-world examples, assessing the influence of regulation, and gathering insights into the barriers and enablers affecting adoption. 

The findings are captured in the newly published report, Net zero: Investigating the role of site-based regulation in developing a circular economy: summary. 

Mapping circularity across 10 industrial sectors  

Our research focused on 10 key sectors including steel, cement, construction, textiles, vehicles, food and drink, glass, paper, chemicals and plastics. Together, these sectors offer significant potential to accelerate the shift to a low-carbon, resource-efficient economy. 

We gathered data through extensive research, long-list screening and stakeholder interviews with organisations across the selected sectors. This informed our analysis of circular practices already in operation in the UK. We then developed 24 case studies in collaboration with companies, trade bodies and academic partners – building a consistent and detailed evidence base. 

The case studies ranged from upcycling surplus bread into beer, to advanced plastics recycling using supercritical steam. Each example explored the specific drivers, barriers and metrics involved. For instance, CELSA Steel UK achieved a 356 kgCO₂e reduction per tonne of recycled steel, while British Sugar reported virtually zero waste by producing co-products from process outputs. 

What the case studies reveal 

In many of the case studies, reducing greenhouse gas (GHG) emissions and improving resource efficiency were identified as the main drivers for adopting circular economy practices.  

However, organisations also noted that the benefits – including lifecycle GHG reductions – often arise across supply chains rather than within a single facility. This makes them difficult to be fully realised under current permitting frameworks, which are designed around individual sites. 

The case studies also highlighted barriers to wider adoption. These included issues around the quantity and quality of available feedstock (the raw materials needed for recycling or reuse), as well as a perceived lack of financial and commercial incentives.  

Furthermore, the use of a wide range of metrics – from basic indicators to detailed lifecycle assessments – underlined the need for more consistent, sector-specific measures of circularity.  

Overall, the findings point to the importance of systems-level thinking and stronger cross-sector collaboration to realise the full potential of the circular economy. 

Regulatory challenges and opportunities 

Another key aspect of our research was to explore how the Environmental Permitting Regulations (EPR) affect the uptake of circular practices. Organisations had mixed views: some considered the framework to have a neutral impact, while others pointed to challenges such as the permit variation processes. 

The findings highlighted three key areas where improvements could be investigated:  

• Permitting – opportunities include streamlining approvals for small-scale trials, consolidating permits when variations are made, and enabling system-level approaches that go beyond individual sites. 

• Enforcement approach – organisations pointed to the need for clearer, sector-specific guidance on what circularity means in practice. 

• Monitoring and reporting – insights underscored the need for consistent sector-specific circularity metrics in reporting. 

A robust foundation for future change 

As this report shows, circular economy practices are already delivering value across UK industry – reducing emissions, minimising waste and improving resource efficiency. With the right regulatory support, these approaches can scale up and accelerate the transition to a low-carbon economy. 

The evidence base that we have built gives regulators and policymakers practical insights into the conditions that enable circularity. It also shows industry which practices are working today – and where barriers still need to be overcome. 

Furthermore, the findings strengthen the EA’s role as a progressive regulator – providing the evidence it needs to support the industry’s shift to circular models and to inform the UK’s path to net zero.