Circular economy enters the fast lane of development, Schneider Electric promotes industrial green revolution with new quality services
As an economic model centered on efficient and circular utilization of resources, the concept of circular economy originated in the 1960s. At that time, American ecologist Carlson described the dangers faced by the biological world and humanity in his book “Silent Spring”. Subsequently, American economist Polding proposed to reduce the negative impact on the environment through the effective utilization and recycling of resources, and thus the circular economy began to take shape. Nowadays, global attention is increasingly focused on sustainable development and environmental protection. According to the report “The Way to Circular Economy: Towards Sustainable Development” released by Accenture, it is predicted that the overall size of the global circular economy market is expected to reach $4.5 trillion by 2030, and based on the baseline scenario estimate, the overall market will maintain high-speed growth at a compound annual growth rate of 10.7%. Circular economy has become an ideal economic model for achieving sustainable development.
Seizing the opportunities of circular economy urgently requires systematic reform
China is accelerating its comprehensive green transformation, and the circular economy is also entering a new period of rapid development in the domestic market. In March of this year, the State Council issued the “Action Plan for Promoting Large scale Equipment Renewal and Consumer Goods Trade in”, which included “recycling and reuse” as one of the four major implementation actions. Subsequently, specific plans were intensively implemented in various fields such as industry, transportation, and energy. On August 11th, the State Council issued the “Opinions on Accelerating the Comprehensive Green Transformation of Economic and Social Development”, proposing to “vigorously develop the circular economy, deepen the promotion of circular economy to help reduce carbon emissions, promote resource recycling production models; vigorously develop the resource recycling industry, and expand the scale of substitution for primary resources
Under the promotion of policies, it is expected that by 2030, the scale of the energy-saving and environmental protection industry will reach about 15 trillion yuan, and by 2035, the green, low-carbon, and circular development economic system will be basically established. The rise of the trillion dollar market heralds a new round of accelerated development of the circular economy.
Seizing the opportunities of circular economy requires enterprises to undergo systematic changes, which require executable paths and joint efforts from internal and external stakeholders. The systematic transformation of the circular economy is not only about shifting from the traditional linear model of “acquisition, manufacturing, and disposal” to a circular model that promotes resource efficiency, reduces waste, and creates value, but also involves comprehensive transformation at all levels of consumption and production. This includes: using Design&Innovation as the cornerstone, achieving a closed-loop circular economy through Use better, Use longer, and Use again.
Centered around the innovative circular design concept, enterprises should choose green materials to ensure product “optimal use”, select low-carbon suppliers’ green materials, and use digital technology to improve product traceability, ensuring high-quality production of products. At the same time, timely maintenance, renovation, and modification should be carried out according to the usage of the product to extend its service life and achieve “long-lasting use” of the product. Finally, after the product reaches its service life, it is repackaged and refurbished, and the raw materials are recycled to implement “reuse” and avoid further resource consumption.
The ‘Green Path’ of Circular Economy Practitioners
As a practitioner of sustainable development, Schneider Electric incorporated sustainability into its core strategy as early as 2002 and integrated it into all aspects of business operations. The core of circular transformation lies in the “design and innovation” stage, which affects product development and innovation. Schneider Electric adopts a full lifecycle thinking approach to develop and design new products, taking into account materials, packaging, energy use, and recycling processes to ensure that products are easy to maintain and recycle. We also provide designers and engineers with tools and training such as carbon emission calculators, striving to improve the environmental impact of our products through innovative ecological design.
The key to the “optimal use” stage is to procure sustainable raw materials and minimize waste as much as possible. For example, Schneider Electric has increased the use of green materials in its products to 32%, and 70% of its products replace disposable plastic packaging with recyclable cardboard, achieving multiple uses and recycling. In addition, in terms of promoting industry development, as of the second quarter of 2024, Schneider Electric has helped 1000 major suppliers worldwide reduce carbon emissions by an average of 33% at the operational level through the supplier’s “Zero Carbon Plan”.
In addition to using recycled materials and renewable energy, the operation of green and smart factories also promotes a circular economy by creating new efficiencies and flexibility. Schneider Electric has 30 factories and logistics centers in China, including 18 smart factories and smart logistics centers. Meanwhile, 15 factories have been recognized as green factories by the Ministry of Industry and Information Technology.
Thanks to its outstanding achievements in the field of “circular economy”, Schneider Electric was awarded the title of “Circular Lighthouse” in the field of built environment by the World Economic Forum and McKinsey&Company during the 2024 Annual Meeting of the World Economic Forum, providing an excellent example for enterprises from all walks of life to collaborate on green transformation of the value chain.
New quality service system helps industries integrate into circular economy
As an enabler of sustainable development, Schneider Electric deeply understands that circular economy is a systematic engineering, and only through industrial cooperation and mutual empowerment can sustainable innovation and systematic transformation be achieved. To this end, Schneider Electric has launched services including “EcoConsult Consulting Services,” “EcoCare Operations Services,” and “EcoFit ™ The newly upgraded new quality service system, including “adaptation and transformation services”, helps more enterprises integrate into the circular economy.
For example, in the “long-term use” stage, users can extend the product’s lifespan through repair, digital maintenance, and longevity services. According to statistics, Schneider Electric’s “EcoCare Operations and Maintenance Services” and “EcoFit ™ Adaptation and transformation services can help extend the service life of customer assets by up to 25%, thereby reducing the carbon footprint of equipment. Therefore, in 2023, Schneider Electric established EcoFit in Xiamen ™ The Adaptation and Transformation Capability Demonstration Center provides end-to-end capabilities from structural design, component design, factory manufacturing to on-site installation to help customers effectively extend product lifecycle and reduce overall costs.
Schneider Electric EcoFit ™ Adaptation and renovation services
The ‘reuse’ stage covers the recycling of products, components, and materials. At the just concluded 2024 China International Fair for Trade in Services, Schneider Electric officially released the Circular Offer variable frequency cycle machine. When the frequency converter used by customers experiences aging and malfunctions, and there is a need for emergency spare parts, replacement repairs, low-cost upgrades, and other modifications, product information can be provided to Schneider Electric’s service partners to order the same Circular Offer frequency converter at a lower price. Service partners will ship within 24 hours of receiving the order, while Schneider Electric will repair and refurbish the frequency converters returned by customers, thereby achieving the recycling of old frequency converters. The Circular Offer variable frequency cycle machine manufactured by Schneider Electric is not only fully compatible with the new machine in terms of functionality, but also maintains consistent performance and quality assurance with the original factory standards. Customers can enjoy the same quality as new machines at a lower cost, fully reflecting the concept of circular economy.
Schneider Electric Circular Offer Variable Frequency Cycle Machine
As a practitioner and enabler of sustainable development, Schneider Electric’s commitment to the circular economy began over 20 years ago and continues to this day. Schneider Electric is committed to transforming the concept of circular economy from theory to the core of its business, contributing to the construction of a new pattern of green, circular, and low-carbon economic development. Looking ahead to the future, Schneider Electric will continue to use the “new quality service system” as a starting point, relying on its practical experience in sustainable development, as well as its industry ecosystem and comprehensive service capabilities covering multiple fields, to empower major industries to take advantage of the development trend of circular economy, move towards greenness, and remain fresh over time.