CGR UK

The first Circularity Gap Report examining the material flows of the UK economy

The United Kingdom has pledged to reach net-zero greenhouse gas emissions by 2050. Transitioning to a resource-light and low-carbon circular economy is a means to this end. Our Circularity Gap Report the United Kingdom, delivered in collaboration with Deloitte, highlights the role and importance of the circular economy and presents opportunities to reduce material consumption in the UK while doubling its circularity.

Over 90% of the UK’s material use comes from virgin sources. 80% of these materials are extracted abroad

This indicates high virgin material consumption, low material self-sufficiency and high reliance on international trade flows to satisfy UK’s material demand. Like many developed countries, the UK is striving to reduce its environmental impacts domestically—but a significant part of these impacts are still offshored. The nation uses more than its ‘fair share’ of the world’s resources, consuming nearly double the level considered sustainable (8 tonnes of materials per person, per year).

The UK’s population consumes above the global average: 15.3 tonnes of materials per person, per year

Importantly, material extraction and use are not evenly distributed across the UK. While the bulk of materials are extracted in resource-rich but sparsely populated Scotland, Wales and Northern Ireland, the consumption hotspot is the country with the highest population density: England.

The top ten industries contributing 45% of the UK’s material footprint sit within four sectors: Construction, Agrifood, Manufacturing and processing, and Services. The top ten contributing industries to the UK’s carbon footprint are a combination of five sectors: Transport, Construction, Services, Energy and Agrifood. Together, these industries account for roughly 38% of the country’s emissions. The country’s efforts to cut material and carbon footprints should target these sectors.

Circularity metric

The United Kingdom

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Only 7.5% of materials are circled back into the UK economy after use

What’s more, the nation exports far more secondary materials than it imports. This leaves a huge Circularity Gap—but also a massive untapped potential for decision-makers. By implementing circular economy solutions, the UK can tackle systemic inefficiencies, keep materials in use and retain their value at the highest level possible, decreasing total material consumption. This is one of the key pathways to tackling the root causes of the triple planetary crisis of climate change, biodiversity and pollution.

The UK economy has the means to double its circularity

By bolstering the circular economy, the UK can cut its material footprint by 40% and slash its carbon emissions by 43%. Moreover, circular business models can create thousands of jobs across multiple sectors, increase productivity and make the UK’s economy more resilient and competitive. The key to change? Six ‘what-if’ scenarios that, implemented together, can boost the UK’s circularity to 14.1%.

The road to circularity

Six key opportunities to shift to a more circular UK: resource-light and low-carbon.

Build a circular built environment

Material footprint reduced by 10.1%.

Carbon footprint reduced by 19.2%.

Houses in the UK are older and have lower energy efficiency than in other European countries.

Retrofitting and making the most of what already exists is thus an essential circular strategy to reduce energy demand from existing buildings. What’s more, the country may shift to more resource-efficient building practices. This means embedding potential reuse into building design (i.e. deconstruction and disassembly), reducing surplus materials (i.e. via optimised procurement), and resource-efficient construction practices (i.e. off-site construction). Policies like updating building codes and training programmes for key actors—such as architects, engineers and contractors—would support such a shift.

Nurture a circular food system

Material footprint reduced by 8.0%.

Carbon footprint reduced by 7.4%.

Farming claims 70% of the UK’s land, with livestock alone taking up half of the country and acting as a significant source of emissions. What’s more, the UK population consumes more calories per day than is considered healthy while producing vast amounts of food waste—70% of which is avoidable.

To switch to a circular food system, we propose promoting healthy, sustainable diets by replacing carbon-intensive meat and heavily processed foods with plant-based proteins, reducing food waste and fostering regenerative farming. The latter would require tackling nitrogen fertiliser overuse and incentivising more sustainable farming practices.

Advance circular manufacturing

Material footprint reduced by 5.1%.

Carbon footprint reduced by 3.3%.

Three sectors concentrate the bulk of the UK’s manufacturing productive capabilities: automotive, aerospace and life sciences. Metals play an important role in these. However, 80% of metal scrap is shipped for recycling overseas due to the lack of enabling infrastructure in the UK—a missed opportunity.

To reduce virgin materials input, we recommend developing high-value domestic recycling capacity and investing in technologies to reduce industrial waste. For machinery, equipment and cars, the report suggests employing R-strategies: remanufacture, repair and reuse—supported by investment in R&D, infrastructure and necessary industrial skills.

Rethink transport and mobility

Material footprint reduced by 7.0%.

Carbon footprint reduced by 8.4%.

Getting people and products from one place to another is highly emissions- and material-intensive. The transport sector guzzles 40% of energy use in the UK: a growth of 15% since 1980.

A circular transport system focuses on two strategies: reducing or avoiding travel and ‘greening’ the remaining mobility. The former involves investing in high-quality public transport and mobility-as-a-service models. On top of that, UK workers should retain the option of hybrid working and cut down on air travel. For a cleaner transport system, policies should centre on promoting electric vehicles and clean fuels, such as hydrogen, aiming at 100% electric public transport and 50% electric private cars.

Embrace a circular lifestyle

Material footprint reduced by 13.2%.

Carbon footprint reduced by 11.5%.

A circular lifestyle is a low-impact living that values minimalism and conscious living over excess and wastefulness.

Behavioural change is one of the most impactful levers of change, the key to achieving a truly circular economy. Some of the many ways to do this are to support grass-roots circular initiatives like repair cafes, or strengthen community bonds to encourage a sharing culture. Ultimately, UK consumers could buy less, share more, repair frequently and opt for clean energy providers.

Tackle the UK’s import footprint

Material footprint reduced by 8.4%.

Carbon footprint reduced by 3.3%.

A hefty chunk of the UK’s material and carbon footprints arrives on its shores embedded in imported products. The country relies heavily on trade, so tackling this issue would prove tricky. However, overlooking offshored impacts is not an option.

It’s recommended that the UK shift away from high-impact imports and build resilient supply chains. Multiple products can be produced domestically and more efficiently. This would allow for cutting virgin materials embedded in imports by 25%. In addition, to build supply chain transparency and resilience, the UK government can participate in overseas programmes and collaborate with international partners.

The role of businesses in the circular transition

Businesses play a major role in making the UK economy more circular. By redefining value, transforming their business models and applying circular solutions, they can achieve corporate objectives such as value chain resilience, cost reductions, hitting ESG targets and complying with new legislation. Making this shift will require experimentation with new business models, rethinking KPIs and enhanced collaboration across value chains.