Measuring Economy-Wide Circularity of the United States: An Input-Output Model in Mass Units

The ideal of creating closed material cycles by transforming the way we make, use and repurpose goods has become known as the circular economy. Besides its visionary appeal, material efficiency strategies central to circular economy can allow us to meet decarbonization goals that are otherwise out of reach. Production of basic materials such as cement, iron and steel and petrochemicals is one of the largest drivers of greenhouse gas emissions. Measuring circularity, and understanding its relationship with other sustainability metrics, however, is still difficult due to lack of data in mass units covering the entire economic system. Input-output (I-O) tables were originally created as a means of tracking the monetary flows that represent exchanges of goods and services within an economy, but have found additional uses in life cycle assessment and material flow accounts. In the traditional approach of environmentally extended I-O tables, emissions and energy data augment monetary flows. This approach can lead to price effects that distort physical quantities. Also, circular economy strategies and their goals relate to mass, not monetary flows. Therefore, it is best to simulate them using physical quantities. With these issues in mind, we have developed I-O tables in mass units to measure the flow of goods in the U.S. economy. This allows us to better measure how circular the economy really is, and how policy changes to affect this circularity may also affect decarbonization goals. Improving knowledge of these linkages could allow manufacturers to make changes in their production to achieve their sustainability and decarbonization targets. Our tool also provides a standard approach and public repository for data in physical units, making such data more available, useful, and meaningful. Following an established set of material flow metrics used by the European Union, we have used our tool to calculate material footprints over time differentiated by oil and gas versus other extractive industries. This approach also shows the relative trade balances of the U.S. in materials. We have developed a case study for the iron and steel sector, showing how different decarbonization scenarios affect not only economy-wide greenhouse gas emissions, but also total material use.