The Concept of Circular Economy in the Context of Implementation

of Innovative Technologies

Pavel Petrov

, Konstantin Pavlenko

and Oleg Ushakov

Siberian State University of Geosystems and Technologies, 10 Plakhotnogo St., Novosibirsk, 630108, Russia

Department 2Municipal State-Funded Educational Institution General Secondary School No. 112, 8 Krasnoufimskaya St.,

Novosibirsk, 630056, Russia

Keywords: Circular Economy, 5R Concept, Special Economic Zone.

Abstract: This paper investigates the formation of special economic zone (SEZ) mechanics on the basis of the 5R

concept. Practical implementation of the concept in the context of implementation of innovative technologies

within the new SEZ contains specific proposals: the SEZ resident appraisal rating system that can evaluate

current environmental friendliness of the residents as well as control and stimulate their activity was

developed; separate waste collection system and action plan that can not only draw attention to environmental

issues but also reduce growth in plastic waste were suggested. The research purpose is to develop a method

of effective use of circular economy concept mechanics when creating a new SEZ. Innovative technologies

for the SEZ functioning organization are used as the object of the research in this paper. Circular economy

concept implementation mechanics for comprehensive solution of innovation problems of the new SEZ are

the subject of the research.

1 INTRODUCTION

Urgency of the proposed solution stems from the fact

that the problem of hydrocarbon cycle is deep and

complex for Russia. Considering that development of

this sector is promising, effective technologies that

can be used in it are promising as well. By 2010, total

area of both authorized and unauthorized waste

deposits reached 100 thousand ha. By various

estimates, from 7 to 10 billion tons of waste are

generated in Russia every year. The major part of

waste is generated by mineral extraction companies -

6.9 billion tons. 85 billion tons of solid waste have

accumulated in the territory of the Russian

Federation. Only 10% of plastic waste is recycled and

90% of all types of trash is dumped at landfills.

Circular economy is a generalized term based on

waste minimization and renewable resource

utilization in contrast to the linear economy (take,

make, dispose).

The 5R system is an element of the circular

economy. Waste minimization principles.

https://orcid.org/0000-0002-5956-0155

https://orcid.org/0000-0002-6685-3650

https://orcid.org/0000-0002-9621-4059

Technologies are a combination of engineering

and scientific knowledge used to obtain a certain

product or service.

The advantage of our technologies: increase in

recyclable raw materials; elimination of trash impact

on the environment; availability of containers in the

system; payback period is 6-8 years; reduction of

costs for electricity, garbage removal, fuel

consumption; expenses involved in construction of a

plastics processing plant start from 6.5 million rubles;

for example, construction of an operative waste

sorting plant with a capacity of 200 thousand tons per

year in Novokuznetsk required only 1 billion rubles.

2 RESEARCH METHODOLOGY

The following general scientific research methods

were used in this paper: analysis, comparison,

generalization and systematization of information.

Petrov, P., Pavlenko, K. and Ushakov, O.

The Concept of Circular Economy in the Context of Implementation of Innovative Technologies.

DOI: 10.5220/0010663500003223

In Proceedings of the 1st International Scientiﬁc Forum on Sustainable Development of Socio-economic Systems (WFSDS 2021), pages 42-46

ISBN: 978-989-758-597-5

The purpose of this paper is to develop a method

of effective use of circular economy concept

mechanics when creating a new SEZ.

In order to achieve the purpose, the following

research problems were set:

 to investigate theoretical issues of formation of

circular economy concept mechanisms when

creating a new SEZ;

 to analyze existing mechanisms of circular

economy concept implementation with regard to

the object under observation;

 to offer a set of recommendations for

comprehensive solution of innovation problems

of the new SEZ.

Innovative technologies for the SEZ functioning

organization are used as the object of the research in

this paper.

Virtual object under observation in this research

is the city of Novosibirsk and the industrial site of the

SIBUR Company in the city of Tobolsk.

Circular economy concept implementation

mechanics for comprehensive solution of innovation

problems of the new SEZ are the subject of the

research.

The elements of novelty are a dedicated online

survey conducted based on Google Forms and a

developed SEZ resident appraisal rating system

(environmental friendliness rating).

3 RESEARCH RESULTS

Our team selected the city of Novosibirsk and the

industrial site of the SIBUR Company in the city of

Tobolsk as the object of the research. We focused on

the issue of municipal solid waste volume reduction

and improvement of plastic waste collection

efficiency. The reasons for selecting the object: the

problem of MSW landfill overfilling; high waste

volumes; availability of raw material processing

infrastructure. Consequently, active measures aimed

at waste collection and management have to be

implemented.

Areas of concern that have allowed coming up

with the offered solution: the city of 1.6 million

people generates 645.15 thousand tons of trash per

year; 45 thousand tons of plastic waste are generated

over a year; more than 100 plastic products

companies in the city; 334 unauthorized landfills

were found in the region. The problem of MSW

landfill overfilling and large waste volumes together

with availability of raw material processing

infrastructure show that active measures aimed at

waste collection and management have to be taken!

The first element of novelty in this paper is a

survey of city residents in order to evaluate the

effectiveness of waste collection measures. The

questionnaire was developed specifically for the

research. Small online survey based on a Google

Form and dedicated to waste sorting at home was

conducted in our locality. The number of people in

the survey - 112. It was found that 62% of people does

not sort trash. The main reasons: 41% of people does

not know how to do that; 34% of people sees no point

in it, which is shown in Figures 1 and 2.

Figure 1: Results of responses to the question: “Do you sort

trash at home?” (112 responses).

Figure 2: Results of responses to the question: “Why don’t

you sort trash?” (68 responses).

Conclusion: it is necessary to teach people how to do

that and convince them that this is important.

This is why RETHINK is the key direction in

solving the waste recycling problem. In Brazil, the

underclass got involved in waste recycling. As a

result, the city of Curitiba got ahead of all the others

and took the first place in valuable municipal solid

waste collection in the world. One of the main

principles of waste collection in Japan is separate

waste collection. Moreover, this principle is

legislated. Tossing the garbage in undesignated areas

is prohibited and subject to criminal prosecution and

heavy fines. In order to improve efficiency of the

recycle stage, the following is required: Based on

experience of Japan, mandatory separate waste

collection should be legislated. Based on experience

of Brazil, more people should be put to work at

landfills. Reverse vending machines should be placed

in crowded places. More plastic collection facilities

The Concept of Circular Economy in the Context of Implementation of Innovative Technologies

should be opened and a reward for its collection

should be increased. Containers for plastic waste

should be placed in the areas where there are none.

Many people do not sort trash because they simply do

not know how to do that and where to take it

afterwards. The best way of plastic waste sorting is to

place separate containers for PET and other types of

plastic. If every type of plastic has its own separate

container, the people may get confused and become

reluctant to this more complicated way. And raw

material recycling plants perform their own re-

sorting. For example, Armada-Polymer Company

does that in Novosibirsk. Sales of finished products

are relevant to the following areas of activity:

recyclables are desirable in chemical industry; flakes

and granules are cheaper than primary products,

which is cost-efficient for polymer product

manufacturers; depending on the quality of granules,

cleanliness of recycled plastic, flakes may be

appropriate for food container production; some flake

types can only be used as an additive to plastic

materials in production of wash basins, goods for

gardeners, PVC pipes, construction materials; plastic

bottles are used in production of new bottles, PES

fibers for clothes and shoes, house and outdoor

furniture. The following operating plastic waste

processing enterprises are located in Russia:

Khartiya, LLC - the company offers a full range of

services in transportation, sorting and recycling of

MSW and oversize bulk waste in the territory of

North-East Administrative District and East

Administrative District of Moscow. ECO-UFA, LLC

- the company provides operating and strategic

management of the project for collection,

transportation, high-level processing and recovery of

secondary raw materials, land disposal of municipal

solid waste from all the districts of Ufa. Eco-city,

LLC - the company collects waste paper,

polyethylene and plastic for further processing and

recycling. According to our records, out of 7 groups

of plastic-containing products in Russia, no one

recycles polyvinyl chloride (produces dioxins when

combusted) and other types of plastic, such as water

dispenser bottles, baby bottles made of

polycarbonate, biodegradable plastic products.

Everything else is efficiently recycled or can be

recycled in Russia.

We have discovered through an analysis that

around 2.5 million tons of plastic waste were in

Russia in 2019. If we assume that growth in waste

increases by an average of 10% per year, then we will

have 4.4 million tons of plastic waste by 2025. If new

approaches to the problem of plastics pollution are

gradually implemented in our country, we will be able

to reduce growth in plastic waste down to 3.5 million

tons by 2025, which is shown in Figure 3.

Figure 3: Forecast of growth in plastic waste in the Russian

Federation, million tons (volume growth of 10% per year,

processing growth by 2%).

Our forecast is based on open-source information

(rupec.ru; www.polymerbranch.com).

In reliance on the analysis of literature sources and

results of enterprise practices, one can tell that issues

related to a variety of disadvantages during

implementation appear on each stage of 5R concept

implementation.

Our solution for organization of a new special

economic zone functioning is based on the circular

economy concept with emission minimization and

renewable energy sector. We were inspired by

Hammarby Sjöstad in Sweden (rodovid.me). More

than 4 million tons of trash are generated in this

country every year. More than 1.3 million tons of

waste were additionally imported from other

countries in 2015. Yet, 99% of all waste is recycled:

34% is reprocessed; 49.2% is combusted to generate

energy; 16% goes in the compost; 0.8% goes to

landfills. We can all learn from them.

Target audience of potential SEZ residents is

represented by four focus groups — the companies

that are interested in solving the problem of plastics

pollution. The first one is the world leaders in the use

of plastics: the Coca-Cola Company, PepsiCo,

Nestle, Danon; the second one is the sector of

consumer goods, foreign companies as well, such as

Unilever, Colgate-Palmolive, Mars; the third one is

fast food; the fourth one is the public, enterprises of

the region and other regions. In other words, on one

hand we have consumers with high environmental

responsibility and on the other - the SIBUR Company

with its enormous scientific and innovative potential.

According to declarations of the companies specified

above, total amount of plastic waste will be 10 million

tons per year. According to provisions of

environmental policies, the companies plan on

recycling 28 million tons by 2025. Which means that

there will be a lot of work.

Suggested tax preferences in comparison to the

existing SEZ in Naberezhnye Chelny and an option

without preferences are presented in table 1.

WFSDS 2021 - INTERNATIONAL SCIENTIFIC FORUM ON SUSTAINABLE DEVELOPMENT OF SOCIO-ECONOMIC SYSTEMS

Table 1: Tax preferences for attraction of investors and

residents of the SEZ.

Preferences New SEZ Priority Social

and Economic

Development

Area,

Naberezhnye

Cheln

Without

preferences

VAT on the

sale

Exemption

for 5 years

18%

Income tax,

incl.

Russian

Federation

Tumen

Oblast

0-13%

0-5%

18%

Corporate

property tax

Exemption

for 10

years

2.2%

Land tax Exemption

for 5

ears

0% 1.5% on

avera

Transport

tax

Exemption

for 10

years

Collected

Reduced

rate of

insurance

for 5 years

Compulsory

pension

insurance

Compulsory

social

insurance

Compulsory

health

insurance

28%

20%

2.9%

5.1%

7.6%

1.5%

0.1%

30%

22%

2.9%

5.1%

Customs

duty relief

(duty-free

zone

rocedure

)

0% Collected Collected

As we can see, opportunities for attraction of

investors and residents do exist. Moreover,

administrative, social and economic preferences were

presented. Administrative preferences are special

legal status and simplified business registration

procedure. Social ones are creation of jobs for

competent persons; preservation and development of

intelligent potential. Economic ones are reduced rates

of housing services and utilities; reduction of office

lease prices; accelerated amortization scheme with

coefficient 2; foreign investments in industry;

stimulation of domestic producers. We suggest

introducing economic preferences on the basis of

environmental impact evaluation and environmental

friendliness rating described below.

As the second element of novelty, we have

developed a procedure for determining

environmental friendliness rating of a company.

Economic preferences will be granted based on its

results. We should prepare environmental

friendliness rating of residents on the basis of the

expert method and use it to determine the scope of

activities and preferences of the SEZ residents.

Quantitative criteria (resident ranking criteria) are

determined using the 5R system; they are assigned

with weight coefficients:

1) rethink - the number of awareness events held (the

number per quarter/weight coefficient 0.2);

2) refuse - the amount of disposable unrecyclable

cutlery used (kgs per quarter/weight coefficient 0.1);

3) reduce - CO

emission reduction criterion. The

more negative the company is about CO

, the higher

the score is in our rating (the number of

vehicles/weight coefficient 0.3);

4) reuse - the amount of processed raw materials used

(kgs per quarter/weight coefficient 0.2);

5) recycle - the amount of raw materials brought for

recycling (kgs per quarter/weight coefficient 0.2).

In our view, the formula of current environmental

friendliness of residents may appear as follows:

(1)

where x is ranking criterion; a is weight coefficient; хꞌ is

maximum criterion value.

Our formula of current environmental friendliness

of residents can be used to determine their rankings

in the rating. For example, the more electric cars the

company has, the higher the number of awareness

events held by it per quarter and the amount of

processed raw materials used by it, the higher the

ranking will be and the more economic preferences it

will get. Maximum value can be determined in

reliance on common sense and expert opinion. For

example, we can set one awareness event per day (the

maximum of 66 eco-events per quarter. 90-24 (3

months-24 weekend days)) This is a relative

coefficient, total in relation to maximum.

Protection measures against environmental

impact of the SEZ enterprises include: setting an

environmental emission limit for our SEZ; emission

monitoring; sanctions for violation of the emission

limit; incentives for those obeying it.

Separate waste collection system for the zone

under discussion. MetroTaifun Company system

operation principle was taken as a basis of our system.

The system carries waste and recyclable materials to

The Concept of Circular Economy in the Context of Implementation of Innovative Technologies

a drop-off point via underground/land pipelines, the

length of which can be up to 4 km. Our system can

sort 4 types of trash: plastic (orange containers),

organic (black containers), paper (blue containers),

glass (green containers). These containers will be

placed in public places, at production sites and in

residential quarters. Trash from these containers will

be carried to a drop-off point via underground

pipelines and from the drop-off point it will be

transported to a recycling facility or for incineration

or disposal. Containers can be placed outside or built

into building walls. Since they are sealed, no smell is

emitted and they cannot become a nesting place for

rodents because trash is not exposed to environment.

Social environmental issue awareness events. In order

to solve this problem, action plan based on the 5R

concept (rethink, refuse, reduce, reuse, recycle) was

developed:

 give compulsory eco-lessons in all schools of

Russia and place information stands in schools

and other educational institutions with

information on the importance of waste sorting;

 upload video content (social advertising) to video

hosting platforms and social networks;

 place reverse vending machines in crowded places

and open more plastics collection facilities;

 place containers for plastic waste where there are

none.

 ban on composite types of consumer goods and on

excessive packing.

If new approaches to the problem of plastics

pollution are gradually implemented in our country,

according to our forecast, we will be able to reduce

growth in plastic waste down to 3.5 million tons by

2025.

4 DISCUSSION

Highlights and obtained research results were

discussed and won approval at a scientific conference

and Case-in International Engineering Championship

in the spring of 2020.

5 CONCLUSIONS

This paper investigates the formation of special

economic zone mechanics on the basis of the 5R

concept. Procedure for an enterprise activity planning

in the context of new engineering system

implementation was reviewed. Practical

implementation of the concept in the context of

implementation of innovative technologies within the

new SEZ contains specific proposals: online survey

based on a Google Form and dedicated to waste

sorting was conducted; the SEZ resident appraisal

rating system that can evaluate current environmental

friendliness of the residents as well as control and

stimulate their activity was developed; separate waste

collection system and action plan that can not only

draw attention to environmental issues but also

reduce growth in plastic waste were suggested.

Summing up what has been said, our concept

offers the action plan based on the circular economy

with waste recycling, emission minimization,

renewable energy sector and environmental

friendliness rating.

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WFSDS 2021 - INTERNATIONAL SCIENTIFIC FORUM ON SUSTAINABLE DEVELOPMENT OF SOCIO-ECONOMIC SYSTEMS