Circular Economy Enel Position Paper - December 2020
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Circular Economy Enel Position Paper December 2020
CIRCULAR ECONOMY – ENEL POSITION PAPER
Contents
1. Enel’s vision 3 6. Circularity on thermal asset sites 21
6.1 Secondary materials 22
2. Enel’s activities for combating climate change 5
7. People, regions and cities 24
3. Enel’s Circular Economy governance 7 7.1 Circular cities 24
7.2 Islands 25
4. Designing sustainable products 9
7.3 Social Impacts 27
4.1 Circularity by Design and Circular Procurement 9
4.2 Empowering consumers and public buyers 10 8. The circular economy and decarbonization 29
4.3 Circularity in production processes:
the “smart meters” case study 12 9. The circular economy and finance 30
5. Key products value chains 14 10. Innovation 31
5.1 Batteries 14
5.2 Wind turbines 16 11. The ecosystem 33
5.3 PV 17
Appendix 34
5.4 Buildings and assets 19
Focus on Metrics 34
Focus on Digitalization 35
1. ENEL VISION 3
Enel's vision years, enhancing collaborations with and contributions from
external stakeholders.
This transition has been pursued with the objective of achieving, in
addition to the environmental and social benefits, clear business
benefits deriving from:
New revenues, through the value recovery of assets and
1 Six years ago, Enel embarked on its transition towards a
materials or the development of new services;
sustainable business model, with a decisive acceleration of the The reduction of costs and risks, through redesign, circular
decarbonization process through the development of renewable inputs and value recovery;
sources and the progressive closure of coal-fired power plants. In A focus on innovation, thanks to the continuous
2016, in line with this decision, Enel extended this approach to improvements that the circular economy approach demands.
encompass all the Group's businesses by adopting, amongst other
things, the circular economy concept as a strategic driver. This Enel's circular economy strategy is characterized by the reappraisal
enabled both the launch of new business initiatives as well as the of the business along the entire value chain, starting from the
reappraisal of existing ones through the application of innovative design and procurement phases. Enel's circular economy vision is
thinking to the design, production, operation and end-of-life phases based on the following pillars, which define the areas and methods
of the life cycles of both assets and materials. of application:
The circular economy represents something of a paradigm for Circular inputs: production and usage models based on
enabling Enel to rethink the current development model by renewable inputs or inputs from previous life cycles (reuse and
combining innovation, competitiveness and sustainability so as to recycling);
respond to today’s major environmental and social challenges. This Product as a service: business model in which the customer
approach, in line with our Open Power model, has been purchases a service for a limited time while the company
systematically implemented within Enel over the course of several maintains ownership of the product, thus maximizing the usage
factor and useful life;
1. ENEL VISION 4 Sharing platforms: shared use between multiple users of products and goods; Extension of useful life: approach to the design and management of an asset or product aimed at extending its useful life, for example through modular design, ease of repair and predictive maintenance; New life cycles: any solution aimed at preserving the value of an asset at the end of its life cycle through, in synergy with the other pillars, reuse, regeneration, upcycling or recycling.
2. ENEL'S ACTIVITIES FOR COMBATING CLIMATE CHANGE 5
Enel’s activities for temperatures to 1.5° C as well as to Furthermore, approximately 51% of the
achieve zero emissions by 2050. A electricity generated in 2020 was produced
combating climate change transition that must also be fair and from renewable sources, equivalent to an
inclusive for all, promoting wide-ranging installed consolidated renewable capacity
actions which are founded on climatic, of 45 GW.
energy, environmental, industrial and social
considerations. In order to guarantee ever greater
transparency in the communications and
2 Since the issue of decarbonization In autumn 2020, Enel announced the new relationships with its stakeholders, Enel
represents one of the key pillars of the target of a 80% reduction in direct periodically reports, in line with the
circular economy strategy, it’s important to greenhouse gas (GHG) emissions per international standards of the GRI (Global
recall and outline the Group’s current kWheq by 2030, compared to 2017, a Reporting Initiative), on its activities and
activities in this regard. target certified by the Science Based has made a public commitment to adopting
Targets initiative according to a 1.5°C the recommendations of the Task force on
Climate change is the main global pathway. Climate-related Financial Disclosures
challenge of the 21st century, and (TCFD) of the Financial Stability Board,
responding to this challenge requires the As a demonstration of its continuous which in June 2017 published specific
active involvement of all stakeholders, commitment in this regard, the pattern of recommendations on the voluntary
including those in the private sector. Enel is reducing GHG emissions continued, reporting of the financial impact of climate
fully aware of this challenge, and has enabling Enel to achieve its certified target, risks. The Group also integrated the
developed a business model aligned with set in 2015, of 350 gCO2eq /kWh by 2020, "Guidelines on reporting climate-related
the objectives of the Paris Agreement and i.e. a year in advance. Indeed, GHG information" published by the European
the aim of decarbonizing its energy mix by emissions relating to the consolidated Commission in June 2019, and took into
2050. A journey that was underlined in production of electricity were 298 account the results of the initial work
2019 by responding to the "call to action" gCO2eq/kWh, in 2019, 20% less than in conducted by the European Lab Project
from the United Nations and signing a 2018. Task Force on Climate-related Reporting
commitment to limit the increase in global (PTF-CRR) which identifies good practices
2. ENEL'S ACTIVITIES FOR COMBATING CLIMATE CHANGE 6
regarding climate-related reporting ("How to With a view to achieving a sustainable
improve climate-related reporting"). business model, finance plays a
The Enel Group’s sustainable strategy, fundamental role in enabling the
confirmed and strengthened by the 2021- development of financing tools in line with
2023 Strategic Plan, aims to create value the objectives of sustainable development.
through, amongst other things, the At the end of 2019, Enel issued the world’s
integration of Environmental, Social and first "General Purpose SDG Linked
Governance (ESG) factors. Corporate Bond", the proceeds of which will
not be allocated to individual projects, but
This strategy focuses on achieving the UN’s will support Enel's sustainable strategy,
Sustainable Development Goals (SDGs) based precisely on the UN’s SDG
along the entire value chain, and has SDG objectives. Sustainable finance sources will
13 (Climate Action) as its central goal. The guarantee 48% of Enel's total funding in
decarbonization of the energy mix, through 2023 (rising to 70% in 2030), a significant
increased growth in renewable capacity increase compared to 32% in 2020.
(SDG 7 - Affordable and Clean Energy),
and the progressive closure of coal-fired
power plants, together with the
electrification of consumption, represent the
strategic pillars for the coming three years.
These are supported by two enablers,
infrastructures and networks, in line with
SDG 9 (Industry, Innovation and
Infrastructure), and ecosystems and
platforms, in line with SDG 11 (Sustainable
Cities and Communities).3. ENEL CIRCULAR ECONOMY GOVERNANCE 7
Enel’s Circular Economy competitive solutions by ensuring a All other areas are also actively involved,
coherent implementation across all from digital infrastructures to trading
governance businesses and ecosystems. through to the management of our offices.
The principal business areas include: Moving to the system level, Enel is also
Power Generation: with the aim of doing a significant amount of work both
reappraising the main renewable globally, with major international
organizations and events, as well as in its
3 One of the main challenges to the effective
energy supply chains along their entire
value chain and the management of main countries of operation. These include
and cross-sector implementation of the European countries (Italy, Spain, Romania)
thermoelectric assets through to their
circular economy is that of Governance. To as well as countries in other continents
decommissioning;
support the Group's activities, a light but (United States, Argentina, Brazil, Chile,
broad structure has been created that Infrastructure and Network: with the Colombia, Peru), where Enel is undertaking
includes the holding company level as well aim of using "Circularity by Design" to circular economy collaborations with
as the various business lines and redefine the value chain of major assets institutions, other companies, NGOs,
geographical areas. and render them circular, and universities, etc. to increase knowledge and
accelerating, through digitalization, the understanding regarding the circular
In particular, while the business lines define role of the network as a platform; economy and to support the system
and identify the business models, products, End customers: with the aim of transition.
services and processes within the new fostering its customers’ transition to
context, the units in the geographical areas circularity through new products,
contribute to constructive dialogues and services and consultancy services;
collaborations with institutions, other
companies (from various sectors) and with Suppliers: to guide the entire supply
stakeholders in general. This broad, chain towards circularity.
integrated approach supports the entire
Group’s commitment to find innovative and3. ENEL CIRCULAR ECONOMY GOVERNANCE 8
The classic representation of the five
pillars of the circular economy includes:
Circular inputs Shared platforms
Production and use model based on Management systems in common
renewable inputs or previous life among multiple users of products,
cycles (reuse and recycling). assets, or skills.
Useful life extension New life cycles
Approach to the design and All solutions aimed at preserving the
management of an asset or product value of an asset at the end of its life
aimed at extending its useful life, e.g. cycle thanks to reuse, regeneration,
by means of modular design, upcycling or recycling, in synergy with
facilitated repairability, predictive the other pillars
maintenance.
Product as a service
Business model in which the
customer purchases a service for a
limited time, while the company
maintains the properties of the
product, maximizing the utilization
factor and useful life.4. DESIGNING SUSTAINABLE PRODUCTS 9
Designing sustainable circular production process. Everything a Definition of metrics and KPIs:
company buys represents a significant measure, evaluate and validate
products component of its overall circularity, both in environmental KPIs resulting from a
terms of information, in order to evaluate product’s manufacturing cycle;
the overall impact of its business, as well as
Co-innovation: launching co-innovation
in a transformative sense, i.e. the extent to
projects together with suppliers in order
which reuse and recycling, for example, are
to review production processes and/or
maximized. New and more circular
4 According to Enel's vision, the circular solutions and a "Circularity by Design"
modify purchasing methods according
to circular economy models.
economy doesn’t begin with the material approach may be tested in collaboration
recycling phase but with the asset’s design. with suppliers so as to redesign the value
The "Circular Economy Initiative for
For this reason, right from the very outset chain.
Suppliers' Engagement" project involves
Enel has focused on the entire value chain
around 200 suppliers worldwide across 12
of products, redesigning every single phase We have started working on a Circular
product categories which, as of today,
starting from the design, supply and Procurement strategy, aimed at the
account for more than 60% of the
production, ensuring the full involvement of purchase of goods, works or services that
expenditure for the purchase of materials.
suppliers through structured programs. aim to minimize and/or avoid negative
The initiative is based on the adoption of
environmental impacts and the creation of
the environmental product declaration
waste during their life cycle.
(EPD) with the aim of quantifying, certifying
4.1. Circularity by Design
and objectively communicating the impacts
and Circular Procurement The strategy is based on three fundamental
generated throughout the entire life cycle of
pillars:
supplies (water consumption, CO2
In recent years, the role of procurement has
Engagement of suppliers: reward emissions, impact on the soil, etc.).
changed significantly to become
suppliers via a specific tendering tool for
increasingly more important for the
their commitment to the circular In particular, in order to measure the
implementation of corporate strategies, and
economy transition; circularity of products and their impact in
is therefore one of the key elements of a4. DESIGNING SUSTAINABLE PRODUCTS 10
terms of environmental, energy and corrective actions for poorly performing environment. Our commitment concerns the
material resources, a life cycle assessment suppliers; various business areas that are dedicated
is carried out for certain categories of to the end customer, with respect to both
activities for rewarding suppliers who
products, in accordance with ISO 14040. the energy market and the activities of
perform well;
The output from this assessment is used to Enel X, the Group’s new division
devise a specific protocol for the product the redesign of products/processes with established in 2017 that’s dedicated to
(set of rules, KPIs, metrics) that’s suppliers in relation to specific KPIs that using new technologies to transform energy
transformed into an international standard emerge from the data analysis. into new opportunities.
(PCR = Product Category Rule) through the
EPD system. The EPD is a certified Enel has already started working towards With respect to the energy market, for
declaration that sets out the consumption of the "Circularity by Design" principle with its families and businesses, Enel is
natural and energy resources as well as the main suppliers, i.e. "Circularity" to be implementing solutions aimed at supporting
environmental impacts connected with incorporated into the process from the the circular economy transition in three
manufacturing the product. beginning of the design phases of the principal areas:
product/process because Enel’s entire
Digitalization and new technologies:
Thus far, Enel has published PCRs for wind ecosystem has to evolve at the same pace
initiatives to increase the use of
turbines, photovoltaic panels, insulators, if it is to achieve a truly sustainable supply
electronic and/or interactive billing
meters, switches and is currently working chain.
rather than paper bills, the use of
on PCRs for storage facilities, cables,
electronic channels to eliminate paper-
charging stations for electric vehicles,
based communications, the move
transformers, domestic appliances, public 4.2. Empowering consumers
towards completely digital selling (Enel
lighting and electrical panels. and public buyers
Simplu, in Romania) and via energy
Once the data from all the suppliers has
contracts priced to assist vulnerable
been obtained it will be possible to analyze The circular economy plays a central role in
customers, with the level of poverty
the suppliers’ KPIs and to implement: interactions with today’s customers, since
automatically certified on the blockchain
they are increasingly more aware and
(Fuel Poverty, in Spain);
concerned regarding issues such as the4. DESIGNING SUSTAINABLE PRODUCTS 11
Awareness: programs like Ecoenel in Enel X launched several circular economy reused for maintenance and repair
Brazil that incentivize the collection of projects in 2019, including: purposes in both Italy and Spain; similar
paper/plastic/glass for recycling in processes will also be applied in Latin
PV Revamp & Reuse: in line with the
exchange for discounts on the electricity America;
circular economy principle of extending
bill;
a product’s useful life, Enel X is Circular JuiceBox: Enel X, with the
Green energy: selling green energy to developing a new business model that support of its suppliers, has launched a
the residential market that's exclusively offers second-life photovoltaic systems project to redesign, through the
produced from renewable sources. in Italy, either via direct sales or application of circular economy
“Product as a service” (i.e. maintaining principles, the production processes of
Enel X acts as an accelerator of circularity ownership of the asset and selling only its electric vehicle recharging
within the new ecosystem of suppliers, the energy service provided). Second- infrastructure: JuiceBoxes. Specifically,
partners and customers. It aims to do this life photovoltaic modules will be it has taken action in the material
within its own ecosystem through the generated via the revamping processes selection phase, by applying business
Circular Economy Boosting Program, i.e. a offered to industrial customers with models for the use of sustainable
process of continuous circularity financial support provided for the materials as well as the application of
improvement, applying it both to the photovoltaic systems through major reuse and recycling, designing new
solutions within the portfolio with the related government incentives; JuiceBox housings so as to enable
calculated scoring verified by a certification them to be made from the recycled
Regeneration of the spare parts from
body, and to industrial customers and plastics of products disused by Enel
JuicePoles: by applying the "extension
public administrations through measuring Group companies.
of useful life" circular economy business
the energy circularity and identifying a
model Enel X, in collaboration with its
structured roadmap for increasing the level Another area for strong focus is that of
suppliers, has introduced processes to
through a series of innovative solutions. metrics, oriented towards both its products
recover and regenerate components
and services and towards its customers. With
and functioning spare parts from
this objective in mind, Enel X has developed
JuicePoles, the public electric
a Circular Economy Scoring methodology to
recharging facilities, so that they can be4. DESIGNING SUSTAINABLE PRODUCTS 12
calculate the level of circularity of each of the The program is principally based on the use city as a whole); and at the specific site
products and services offered to customers, of two models, both owned by Enel X, level (focusing purely on the energy
providing a useful comparison tool for end which are validated and certified by Rina aspects of a site chosen by the
consumers who are concerned about (an impartial, third-party certification body). customer).
environmental issues. These are:
The Circular Economy (CE) Score.
Enel X has also developed a service aimed
Based on Enel’s CirculAbility model, the
4.3. Circularity in production
at companies and public administrations,
CE Score is a mathematical
processes: the “smart meters”
the Circular Economy Report, which uses a
assessment that enables the
case study
certified methodology to measure energy
measurement, on the basis of material
circularity and also enables us to outline a The role of Distribution System Operators
flows, energy flows and sales models,
roadmap for improving the identified level of has changed significantly in recent years:
of a product’s level of circularity on a
circularity. from an electricity network aimed at
scale from 1 to 5. The CE Score
efficiently transmitting electricity in one
represents the starting point for the
The Circular Economy Report is also an direction, from large production facilities to
application of the Boosting Program, a
integrated way of representing the Enel X the end user, we have moved to a situation
methodology for identifying all
model and the solutions made available to whereby flows are bidirectional and
opportunities for increasing the initial
customers. thousands of parties can simultaneously be
level of circularity;
both producers and consumers
Enel X aims to accelerate circularity within The Circular Economy (CE) Report. The (prosumers), thanks to new technologies
its ecosystem of stakeholders, suppliers, CE Report facilitates a detailed such as distributed renewable sources,
partners and customers. To this end, it has assessment of a company’s or public micro-generation and vehicle-to-grid.
developed the "Circular Economy Boosting administration’s circularity level,
Program", a program aimed at measuring producing a score on two levels: the The network is increasingly becoming a
and increasing the level of circular maturity corporate level (relating to the system catalyst, having to facilitate the
of both solutions and products, as well as of company’s entire value chain or, in the integration of distributed generation and
companies and public administrations. case of public administrations, to the guarantee efficiency, safety and quality of4. DESIGNING SUSTAINABLE PRODUCTS 13
service. To meet the challenges posed by demonstrates how it’s possible to reduce A long and complex process from an
energy transition and climate change, it’s the environmental footprint of smart meters engineering standpoint, with comparative
essential to be able to count on the by, for example, reusing their constituent analyses and laboratory tests, to guarantee
flexibility of an increasingly digitalized materials when they reach the end of the the same reliability as conventional meters.
network. their life cycle, principally the plastic and In Brazil, the "Circular Smart Meter" is a
copper. And that’s not all, from a systemic virtuous example of how Infrastructure and
In accordance with Enel’s commitments perspective, minimizing the use of new Networks are looking to create a closed-
relating to the UN’s Sustainable natural resources also allows you to reduce loop within their value chain with the reuse
Development Goals and its policy of costs throughout the entire life cycle (from of waste materials within the same
creating shared value, the Infrastructure design, manufacture, operation to disposal), industrial cycle, i.e. to produce the same
and Networks division has embarked on a thus creating further efficiencies. Such product, so-called new generation. The
challenging journey aimed at redesigning its benefits are achievable through a proactive objective in the short term is to apply the
business processes and, more generally, its "Circularity by Design" approach, which methodology also developed on other
value chain, by adopting a circular economy internalizes circularity right from the early network assets (e.g. cables, transformers,
model to reduce environmental impacts design stages. For this reason, in the protections), including measuring the
through maximizing the recovery of design and construction of the "Circular expected benefits (economic,
products and materials at the end of their Smart Meter" it was necessary to measure environmental and social), and to scale up
life cycle. Innovation is a fundamental tool the environmental and economic impacts the methodology on the business’s other
for identifying new processes and with the aim of identifying the components operational processes (e.g. in the
technological solutions to facilitate the that would have the most impact if "sustainable construction site", etc.), thus
circular transition, thus making the network redesigned from a circular perspective; facilitating the creation of high added value.
business increasingly more competitive and recovering and regenerating waste such as
sustainable in the long term. plastic, copper, steel, etc., giving them a
second life as part of new network assets
The first example of an attempt to meet this and finally exploring innovative tracking
challenge is the "Circular Smart Meter" techniques for reverse logistics.
project. Launched in Italy and Brazil, it5. KEY PRODUCT VALUE CHAINS 14
Key product value chains the material used to produce the cathodes
in lithium batteries. Regardless of the
batteries’ state of degradation, the precious
metals used in their manufacture can be
reused to produce new cathode material,
since their quality remains practically
unaltered during use.
5 There are a number of technology supply Enel is aware that the end-of-life
chains, within its activities, for which the management sector is not yet mature
Group's commitment is particularly enough to support the large-scale adoption
significant, largely due to their potential in of these practices. However, the increasing
terms of current and future business use of electric vehicles we’re currently
development. seeing is acting as a powerful catalyst for
the development of a sustainable market for
end-of-life batteries.
5.1. Batteries various solutions (reuse, recycling,
Start-ups, universities and key sector regeneration, etc.). Focus will be placed on
One of the challenges being tackled by players are all involved in analyzing and a variety of different aspects from design
Enel is that regarding the management of evaluating solutions for the management of and standardization to the end-of-life
energy storage systems at the end of their end-of-life lithium batteries and the related recovery phase and the subsequent reuse
life cycle, particularly lithium batteries, environmental, economic and social or recycling, the overall aim of which is to
which have recently played a key role in the impacts. In this context, Enel has started reconsider the entire value chain from a
energy transition process and will continue several collaborations with partners in the circular perspective.
to do so in the near future. recycling and battery material production
Currently, a number of recycling sectors, with the aim of evaluating the These collaborations include participation in
technologies enable the recovery of 95% of benefits that can be derived from the the Global Battery Alliance, the European5. KEY PRODUCT VALUE CHAINS 15
Battery Alliance and in the "IPCEI project to conventional power plant in the Spanish purpose. From an environmental
support the development of a sustainable resort of Melilla. standpoint, therefore, it reduces the
value chain for lithium-ion batteries" (as necessity to produce new batteries, thus
part of this last project, Enel X will develop The project, developed in collaboration with reducing the need for raw materials, and
tools for predicting failures and modeling the battery pack supplier Nissan and the reduces the amount of waste generated.
the degradation of lithium-ion batteries with system integrator Loccioni, uses an
a view to increasing their useful life and innovative approach to facilitate sustainable Specifically in terms of the Melilla project,
safety). battery reuse. The basic idea is simple: the reuse of EV batteries avoids the
once the batteries from the Nissan Leaf car production and use of new raw materials
One of the circular models evaluated by models have reached the end of their life (initial estimates suggest approximately
Enel is based on a "Second life" approach. cycle as an electric vehicle battery, they are 1600 kg of manganese and 105 kg of
assembled into a large stationary storage lithium). The innovative storage system
The concept underpinning the Second Life system at the Melilla power plant so as to implemented in Melilla will serve as a
project is the removal of battery packs from improve network reliability and to ensure technical feasibility model for other
electric cars that have reached the end of service continuity for the local population. installations of this type, a solution that will
their life cycle, and their subsequent use for be of fundamental importance considering
other applications. Indeed, a battery pack The solution developed by Enel in Melilla the significant expected increase in electric
with a residual capacity of 60-80%, despite involves the reuse and interconnection of vehicle use in the coming years, and the
not being sufficient to power a motor approximately eighty electric vehicle battery subsequent increase in the number of end-
vehicle (i.e. for a minimum number of packs, amounting to a total power output of of-life batteries becoming available.
kilometers), can still effectively be used in 4 MW and a maximum stored energy of 1.7
other applications. MWh.
Specifically, the Second Life project From a circular perspective, the reuse of
developed by Enel involves the reuse of EV battery packs as a stationary storage
electric car batteries to create a stationary system facilitates extending the useful life
storage system that’s integrated into a by using the batteries for an alternative5. KEY PRODUCT VALUE CHAINS 16
many more years (an additional 538 GW of
onshore wind energy forecast by 2025
according to Bloomberg NEF NEO 2019),
keeping wind power at the forefront of
renewable energy generation (with a 19%
share of the global growth of renewable
energy sources in the next 5 years
according to Bloomberg NEF NEO 2019).
The average useful life of a wind turbine is
around 20 years; following this period, the
mechanical and structural properties of the
turbines decline and, in some cases,
restoration activities may be necessary to
extend the useful life by a few years, while
in other cases disassembly and
replacement are necessary.
5.2. Wind turbines are also simultaneously committed to
developing and implementing effective While most of a wind turbine’s components
At Enel we believe that environmental solutions for increasing the long-term are relatively easy to recycle (i.e. parts
sustainability is not just limited to the sustainability of the renewable energy. made of metal), a small but significant
mitigation of climate change, but that it Wind power has seen exponential growth number of the non-metallic components, for
must also involve the systematic adoption over the past decade (exceeding the 623 example the blades, are difficult to recycle.
of sustainable and circular practices in all GW threshold of global installed capacity in
business areas. Whilst on the one hand we 2019) with thousands of wind turbines For the most part, these components are
are developing new renewable capacity in installed annually worldwide. Forecasts made of composite materials (typically
order to decarbonize the production mix, we indicate that this trend will continue for glass/carbon fiber + epoxy matrix), as well5. KEY PRODUCT VALUE CHAINS 17
as other more minor materials (such as other recycled products for the construction 5.3. PV
glue and gelcoat), which make recycling sector. We recently launched a new
particularly demanding. Currently, these challenge to further investigate the potential The proliferation of photovoltaics (PV) has
components are mostly sent to landfill. for producing fibers and insulating materials grown at an unprecedented rate since the
from wind turbine blades and to find early 2000s. By the end of 2018,
For this reason, in 2019, we launched a possible new partners interested in photovoltaics were responsible for around
challenge on our Open Innovability platform collaborating with us. So far we have 480 GW of installed capacity worldwide,
aimed at identifying the best available identified many interested companies, and its current rate of growth will see it
methods for recycling or reusing the based in Europe and the United States, reach a global cumulative capacity of 2,840
materials used to make wind turbine operating in the construction, plastics and GW by 2030 and 8,519 GW by 2050.
blades. More than 130 proposals were other sectors.
submitted, from which we identified 18 Considering the average life cycle of solar
solutions. We launched detailed Meeting the recycling challenge requires a panels is around thirty years, large
assessments or proofs of concept with multidisciplinary and multi-sectoral quantities of waste are expected to be
selected partners in order to demonstrate approach that integrates technological generated from the beginning of 2030. The
the technical feasibility of some of them, innovation and the creation of business growth in waste deriving from solar panels
from which a number of initial prototypes models with the development of a represents a new environmental challenge,
have been developed. For example, we’ve regulatory framework and the definition of but also an opportunity to create value and
demonstrated that by sintering and new standards. In other words, one pursue new economic paths. It is therefore
extruding the turbine blade materials, bricks company can’t do it all alone, it requires the essential to identify innovative solutions for
can be produced for use in the construction successful activation of a vast ecosystem of managing solar panels in a circular
sector; using the disused blades taken from different key players. We believe that perspective, from design right through to
three of our wind farms in the United creating this community of key players the end-of-life management.
States, we completed our first full blade interested in contributing to and
pilot in 2019 and we’re evaluating possible participating in this activity is the key to
circular economy solutions for incorporating success.
fiberglass pellets into the production of5. KEY PRODUCT VALUE CHAINS 18
Managing the solar panel supply chain from
a circular perspective requires a two-
thronged approach. Firstly, it’s necessary to
ensure that the panels currently installed
are recovered at the end of their life cycle in
a way that maximizes the value recovered,
and secondly, it’s necessary to apply the
circular concept right from the beginning of
the design phase for the new solar panels
so as to increase their circularity before
they reach the production and usage
phases.
At Enel we are therefore working in a
variety of areas on initiatives aimed at
increasing the overall circularity in line with materials (including considering the
Circular recovery: currently there are
our vision of the circular economy. possibility of using bio or recycled
several options, in many cases not yet
materials);
Circular Design: it’s essential for solar fully developed, for managing the end of
panels to be designed in a way that Circular use and efficiency: life of panels ranging from different
ensures their end of life is taken into considering the increase in the technologies for recycling to solutions
consideration, including possibilities for installation and employment of solar for reuse. We are therefore conducting
repairing and extending their useful life. panels, we have embarked on a various initiatives to identify the
To this end we’re currently working on a number of efficiency maximization appropriate circular technologies and
number of fundamental aspects, such initiatives in order to reduce the impact business models for maximizing the
as modularity, design for disassembly, deriving from the necessary production recovered end-of-life value.
standardization and the choice of materials, the use of soil, etc.;5. KEY PRODUCT VALUE CHAINS 19
5.4. Buildings and assets Regarding new buildings, it’s essential for
them to be conceived with circularity in
The construction industry is a sector that mind, right from the outset at the design
requires significant quantities of resources, phase, with the objective of maximizing the
accounting for around 50% of all extracted end-of-life value recovery. From this
materials. Indeed, it was this industry that perspective, some of the key aspects to
was singled out by the European Union’s consider are:
most recent circular economy action plan
Choice of materials: recycled, bio-
as one of the key sectors that needed to be
material, free from toxic substances, or
reappraised from a circular perspective.
with environmental product declarations
(EPD - Environmental Product
Existing buildings are not designed for easy
Declaration; Cradle to Cradle; LCA -
demolition and recovery of materials at the
Life Cycle Assessment);
end of their life, a circular approach to
building decommissioning therefore Flexibility of spaces to increase their
becomes fundamental in order to recover durability and render them easy to
the greatest possible value, exploring a adapt to different types of use;
variety of possibilities such as reuse and Design and build with the building’s
recycling as well as selective demolition entire life cycle at the forefront of all
techniques, in order to find the best considerations, evaluating all life
possible solution for each component or stages, including decommissioning;
material.
Use models for the structured collection
of information on buildings (Building
Information Models), thus considering
them as banks of materials.5. KEY PRODUCT VALUE CHAINS 20
At Enel we are applying a circular approach Locations: the objective is to act on three increase the utilization factor through
to the management of our assets, power different dimensions: rethinking the design space sharing and the "product as a
plants, networks and offices, developing and management of inputs (materials, service" mechanism, introducing
best practices and implementing those energy, etc.), increasing the utilization innovative models for the management
practices through various initiatives factor and exploiting the end-of-life value of of office space;
conducted within all the countries in which the assets.
exploit the end-of-life value of assets,
we operate.
identifying dismantling solutions that
More specifically, here are some examples:
increase the quantity of material
Circular construction site: the objective is to
rethinking the design and inputs recovered from such activities.
minimize the consumption of energy and
(materials, energy, etc.), considering
materials during the construction of
the building’s entire life cycle, favoring
facilities, by using a circular approach to
choices aimed at reducing energy
reduce the environmental impacts. This
consumption (almost Zero Energy
model encompasses the choice of materials
Building) and that make the most
(including recycled materials), the use of
reasonable use of materials, adopting
renewable energy, minimizing the quantity
systems such as BMS and EMS for the
of materials going to landfill through reuse
management and control of facilities
or recycling and minimizing land use.
and consumption and for actively
involving all the professionals and
Circular decommissioning: the objective is
suppliers that are part of the process,
to maximize the end-of-life value of
so as to extend the useful life of the
activities and equipment by exploring
building and its individual components,
different business models such as internal
always considering the efficient use of
reuse, recycling, sale to secondary markets
resources as an obligation in order to
through auctions, etc.
minimize the environmental impact;6. CIRCULARITY ON THERMAL ASSET SITES 21
Circularity on thermal asset materials that represented a cost to the Redevelopment projects must be an
business rather than an asset. opportunity for writing new stories of
sites energy conversion, sustainable growth
However, this project has shown how it’s and the development of innovative
possible to reverse the paradigm and it ideas that improve creative thinking and
explains how, through an approach to site promote business initiatives;
construction that circular and sustainable,
Throughout the entire project, from
decommissioning and regeneration can go
6 In 2015 Enel launched the Futur-e project, hand-in-hand, with disused materials and
preliminary interviews with stakeholders
through to the decision on which
the world’s first example of a large-scale facilities no longer seen as a burden, but as
redevelopment project to pursue, Enel
redevelopment of an industrial area to be a resource capable of generating significant
must work in collaboration with local
conducted using a circular economy returns for all interested parties: energy
communities via a multi-stakeholder
approach, a vast, unique program designed companies, investors and local
approach so as to encourage the
to find new uses for old thermal power communities.
creation of shared value;
plants. New, innovative and sustainable
uses which reuse existing structures, Therefore, for all sites due to be Ensure environmental protection: soil
infrastructures and connections, with the reconverted, a strategy for their remediation to be performed to the
active involvement of local stakeholders, to regeneration is being devised in line with highest possible standards;
create value for local communities through the following fundamental principles, all of Maximize the reuse of disused facilities,
sustainable economic growth and job which are considered equally important: such as roads, infrastructure,
creation.
Site staff working to be transferred connections to the HV network,
through an internal Group reassignment buildings, etc., for new functions in line
Previously, divestment had generally only
process, thus avoiding any with circular economy principles;
ever been undertaken using a linear model:
redundancies and any loss of know- Contribute to the Enel Group’s
"produce, consume, dispose". With this
how; objectives by collaborating with other
logic, disused power plants were simply
considered collections of worthless waste business lines for the realization of6. CIRCULARITY ON THERMAL ASSET SITES 22
projects such as BESS, e-mobility, investments into large power plants to context of renewable development
digitalization, network stability, etc. smaller, flexible and renewable projects; strategies and objectives and as part of
new sustainable development models.
the Group's decarbonization objectives
Since its launch, the approach followed by which has led to the significant
the Futur-e project has proved to be acceleration in the development of
successful and has therefore been renewable energies within our fleet, so
6.1. Secondary materials
extended to the geographical areas in as to increasingly reduce CO2
The suitable collection and management of
which the Group will manage its emissions and to continue to increase
secondary materials is essential not only to
thermoelectric power plants through the compliance with the requirements of the
ensure compliance with environmental
energy transition process, such as in Spain Sustainable Development Goals
regulations, but also to maximize their value
and Chile. The eventual aim is for this (SDGs).
by developing secondary raw material
project to be seen as international best
markets that are capable of enabling
practice for the end-of-life management of
Within this context, the opportunities for circular flows by creating, amongst other
disused industrial facilities.
redevelopment are therefore widened things, synergies between the various
thanks to the possibility of replacing thermal sectors.
Furthermore, whilst the situation is evolving
energy production sites with new renewable
it also requires a similar evolution from a
or hybrid production facilities (e.g. with gas Enel applies circular economy principles to
corporate strategy standpoint, this is
facilities capable of guaranteeing system the management of secondary materials
primarily necessary due to:
stability during the transition to a fully and manages the recovery of "ash and
National, European and global decarbonized economy), integrating new gypsum" produced by Enel's thermal power
strategies that orient energy business projects with complementary plants.
development towards ever greener and sustainable investments that meet the
more sustainable technologies; needs of the communities where the Indeed, these waste materials represent a
facilities are located. precious resource for the construction
the Group's choice to move our growth
As a result of the above, Enel sites will industry. The most common use for ash is
model from large-scale direct
therefore assume a new role within the in the cement, concrete and brick6. CIRCULARITY ON THERMAL ASSET SITES 23 production market, and for gypsum it’s in For several years now in Italy, 100% of the the production of plasterboard panels and ash and gypsum produced by coal-fired cement. The benefit of using these power plants has been recovered, bringing materials, in addition to reducing the use of significant environmental benefits; in natural raw materials and energy parallel, Enel, with its global perspective, is consumption, derives from their superior trying to export the best practices quality which is thus transferred to the implemented in Italy to the countries (Spain, quality of the final products produced (e.g. Chile, Colombia and Russia) where end- the use of ash in cement is particularly customer markets have been developed suitable for the construction of dams and which encourage businesses to operate tunnels where the permeability and with a view to environmental sustainability. durability of the structures are key).
7. PEOPLE, REGIONS AND CITIES 24
People, regions and cities simultaneously works towards achieving a objectives set in terms of competitiveness,
carbon-neutral electric power industry. environmental sustainability and social
inclusion. A vision such as this requires
Indeed, it is widely accepted that in order to governance to play a central role too, and in
reduce mankind’s impact on the planet, order to enable the transition towards the
cities must play a key role: they are living circular model, it has to be two-fold: both
laboratories within which the planet’s critical top-down and bottom-up. This means that
issues must first be tackled. all the elements of the urban ecosystem
7 7.1. Circular cities (citizens, companies, start-ups,
To design the cities of tomorrow a paradigm organizations, policy/decision makers, etc.)
Collectively, today, cities make up a global shift is required, cities are complex systems need to be strongly involved and able to
urban system, they’re deeply and need to be treated as living organisms, participate and contribute in terms of ideas,
interconnected, and they play an where flows of energy, materials, and proposals, projects and initiatives.
increasingly important role at all levels: information are essential for their
economic, environmental and social. As development. In recent years, thanks to the Technology is also at the core of the
urban growth continues to evolve and circular economy, a new model based on circular city vision, as a tool to support the
develop, cities as a global phenomenon, i.e. circular flows (therefore resembling the achievement of economic, environmental
global cities, simultaneously represent both basic laws of thermodynamics) has and social targets.
a formidable sustainability challenge as well emerged as an opportunity for sustainable
as a priceless source of opportunity. As of development. Although the difference may With the circular vision in mind, we can
today, cities are responsible for over 70% of seem purely semantic, there is actually a view the urban environment in terms of five
global CO2 emissions, and the involvement conceptual distinction between the smart urban subsystems: the built environment,
of the urban system is absolutely key if the and the circular city. The smart city concept energy, mobility, the bio-economy and
energy transition process is to be is primarily focused on the role of material flows (e.g. waste, water, food,
accelerated in a way that ensures nobody is information technology, whereas circular etc.).
left behind, through the progressive cities focus on a more holistic approach that
electrification of energy consumption that encompasses all its dimensions, with7. PEOPLE, REGIONS AND CITIES 25
Each of these subsystems has a key role to the benefit of not just new physical Circular cities therefore represent the only
play in supporting the transition. technologies, but also older technologies as opportunity for driving cities down a
they enable the application of new business sustainable development path and, given
Within the circular city vision, infrastructure models and uses. Significant digital that all the necessary technologies already
is an aspect that pervades all areas and advances in recent years have led to the exist, we consider the holistic approach,
represents the backbone upon which proliferation of solutions such as car one that involves all the sectors and key
circular cities operate: smart grids, smart sharing, waste tracking, pay-per-use and players, to be the correct approach for the
lighting, ports, optical fiber. All these peer-to-peer exchanges enabled by cities of tomorrow to take; the issues that
infrastructures need to be (re)designed in blockchain technologies. still need to be overcome are those relating
order to enable the circular city to operate to the linear model of old and unfit
flexibly and with increased resilience. New The circular city vision is strongly infrastructure, the current legislative ‘silos’
technologies have a key role to play, with interconnected with the Sustainable that do not support circular solutions and a
the most important being renewable Development Goals (SDGs) and can have culture that is still embedded with linear
technologies, electrical appliances and IoT a significant impact on all of them. concepts.
solutions. The majority of the linkages are fairly
obvious, but some of the less evident are
Renewable energy sources, distributed and outlined here below: 7.2. Islands
integrated with electrical appliances (such
as electric vehicles and heat pumps), Enel has placed the circular economy at the Islands, from a circular economy
represent a new paradigm that can, on the center of its strategy and is strongly standpoint, are like living laboratories, and
one hand, eliminate the global and local focused on the circular city vision. Enel’s ever since the days of Darwin they’ve
pollution emitted from current technologies contribution is not just in terms of business beguiled scientists as key hotspots for
and, on the other, improve the quality of life solutions and services, but also leading the change.
for citizens. Big data from digital way in terms of theoretical thinking, and to
technologies, such as sensors, the Internet this end has recently published a Position Mainly due to their special location and rich
of Things, etc., feed artificial intelligence Paper on circular cities1. natural and cultural heritage, islands attract
applications that are capable of maximizing millions of tourists each year. However, 1 To find out more7. PEOPLE, REGIONS AND CITIES 26
despite their attractive qualities, islands Islands usually have difficulties in terms of environment. Both models are aligned in
face distinct challenges and issues resulting waste management, in addition to the terms of their commitment to the
from resource pressure, limited economic shortage of space, the high natural value of sustainable use of renewable natural
diversity and their vulnerability to the effects the vast majority of the land often results in resources and in the concept of waste as a
of climate change. It is these issues that the necessity for its waste to be shipped to source for the creation of new products.
demonstrate the urgency of the circular and managed on the mainland. An One of the key future challenges is the
economy and the isolated nature of island emission-free energy system is also problem of marine pollution, which requires
systems is what renders them perfect practically waste-free, offering significant significant changes regarding the issue of
laboratories for such an approach. additional benefits in terms of circularity as plastic, including ambitious recycling and
well as major savings in terms of waste reuse targets or the improvement and
With respect to energy, island economies management. greening of port facilities.
experience issues relating to energy
scarcity and their isolation from the Tourism is a fundamental engine for local Despite the challenges and vulnerabilities
markets, they rely almost exclusively on economies, but it also places a huge mentioned, islands are in a unique position
imported fossil fuels and therefore have low burden on local infrastructure, especially to lead the way on sustainability, the
economic diversity, high fossil fuel energy, mobility and waste management circular economy and climate action. Island
dependence and high carbon intensity. As systems. The development of a circular communities understand the urgency to act
fuel supply constitutes an important part of economy is inevitably associated with the quickly. They are excellent focal points for
the demand for raw materials, and development of sustainable, circular sustainability education, research and
considering that islands offer great potential tourism and the development of good practice. The political leaders of island
for renewable energy generation and the circular practices on islands can be territories are under increased pressure to
electrification of transport, an accelerated exported to other contexts and territories. make sustainability a priority, evidence of
energy transition process is a feasible which is provided by the various
option and would prevent thousands of tons Islands also provide an excellent link commitments that have been made by
of fossil fuels from entering the loop, which between the circular economy and the blue island states around the world. Small states
is a fundamental lever for starting a circular economy, i.e. that relating to the are, by their very nature, agile in size and
economy. exploitation and preservation of the marine governance, useful players for becoming7. PEOPLE, REGIONS AND CITIES 27
"test beds" of innovation and circularity. fundamental drivers underlying the circular consequent strengthening of the role of
They can quickly react when there’s a need economy concept. services.
to test and scale-up new technologies,
providing real environments for testing new Firstly, a conceptual premise: human labor It’s also interesting to consider the fact that
technologies and production processes. may be defined as the renewable resource initiatives such as 'Industry 4.0' must
par excellence, with the further peculiarity incorporate the vision of the circular
that while a renewable 'energy' resource is economy from the outset, otherwise they
7.3. Social Impacts substantially constant, human labor just accelerate the linear model (with
gradually improves in performance when related consequences also in terms of
The question of what are the social impacts used, whereas if it’s not used it jobs).
of the circular economy is a new and deteriorates.
enormous field of study. There have been a More specifically, the circular model
number of macroeconomic equilibrium Secondly, a linear model is based on focuses on:
studies (European Union, McKinsey, etc.) extraction, production and
Design, planning and innovation: this
which have estimated the possible impacts, decommissioning and is extremely exposed
is the 'heart and soul' of the circular
both in terms of GDP growth and the to the replacement of human labor with
economy and is fundamental in driving
creation of new jobs. automation. Whereas a circular model is
the transition. There will therefore be a
based on maintaining value through
strong focus on these skills and
As a result of the complexity of the circular maintenance, repair and servicing and is
associated professionalism;
economy concept and the rapid evolution of therefore more linked to design and
the institutional, technological and innovation on the one hand, and to 'manual' Maintenance and repair: moving to a
competitive context that surrounds it, these and relationship skills on the other. model based on the repair and
studies have only minimal significance due Also, when considering models such as the systematic maintenance of products
to the inherent level of uncertainty and their product as a service, the approach to generates a regionally distributed
low-level focus. However, some initial interacting with the customer changes: from workforce. In this sense, the Swedish
considerations can be made on the a single, one-off transaction we move example is interesting, where VAT on
towards a more stable relationship with a repair work has practically been halved;You can also read
