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Circular City Transformation: 5 pathways and 15 actions towards circular urban environments

In this report we show that we can save as much as 75% of the total energy needs in the future circular city, according to experts’ scenarios and calculations made by Sweco. The key is a system perspective that makes it possible to share resources, energy and means of transport through cooperation across sectors and property boundaries.

Børnehuset Svanen will be the world’s first circular kindergarten, in Gladsaxe Kommune, Denmark. The school is being built as a circular building, where part of the materials from the former Gladsaxe School are recycled, minimising waste volumes and reducing CO2.

For fifty years now, Earth Overshoot Day has marked the date when humanity’s demand for resources over the year exceeds what the earth can renew in that same year. After that date has passed the global community starts using natural resources borrowed from future generations.

By 2050, two thirds of every three people will live in cities. In this Urban Insight report, we show that although cities are part of the overshoot problem, they can take the lead in the transition to circularity and gradually start to function within our planetary boundaries.

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The circular city in 2040 – cutting today’s energy needs by 75 percent

According to scenarios and calculations from Sweco’s experts, we can save as much as 75% of the total energy needs in the future circular city. The key is a system perspective that makes it possible to share resources, energy and means of transport through cooperation across sectors and property boundaries.

We call it urban symbiosis.

The circular city 2040: when the vision of urban symbiosis becomes reality

We have estimated the value of energy-efficient architecture and new construction, locally produced, shared and stored energy, fully shared mobility, locally produced food and a maximised urban agriculture with waste used for biogas as well as AI and digital twins for optimisation and visualisation.

The circular city’s total energy needs per square metre in 2040 will then be only a quarter compared to today.

Experts have based this calculation on a Circular City District, a proposed circular retrofit and urban development project in Sweden, with 6,000 homes. It serves as an example case for a small to medium-sized city that needs to expand while still being able to achieve the climate goals. We have assumed that the population will reach approximately 90,000 by 2040.

Scenario for a maximised, resource-efficient and circular city in 2040

  1. Through wise design choices in the early stages of house construction, we avoid large amounts of carbon dioxide emissions at the design stage.
  2. Energy-efficient architecture and sound district planning enable sustainable behaviour patterns and minimise emissions.
  3. By planning for the district to produce both food and biogas, we contribute to the city’s nutritional and energy needs leading to significant gains. This provides the capacity to locally grow around 2.7 tonnes of food per year. The benefits of local food production are numerous. The food waste from urban food production could cover, the local school’s total needs for electricity and heat.
  4. Achieving a 97% reduction in carbon emissions, when walking, cycling and electric mobility services have become the norm in 2040. By promoting walking, cycling and a new form of collective, zero-emissions and electrified transport, we will reduce car driving to 200km/month, which is an 80% reduction compared with the current situation.
  5. Using a holistic approach when looking at the district as a resource hub has become self-evident. The system perspective provides economies of scale and new conditions through actor collaboration and urban symbiosis, for example through ‘energy communities’. We start from a system approach that can be optimised through synergy in terms of all flows, needs and resources: heating, electricity consumption, electricity charging needs, transport needs, local food production, biogas….all with the support of AI.

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5 Pathways to ‘going circular’

Circularity paves the way forward for cities to instead be part of the solution through a systemic and holistic approach that can deliver social, environmental, and economic benefits to society. The World Economic Forum estimates that a transition from business-as-usual to adopting nature-positive solutions could generate USD 10.1 billion annually in business opportunities and 395 million jobs by 2030.

To clarify the opportunities, challenges and actions, this report showcases projects and suggests five pathways for the circular transition: mindset shift, ecological resilience, track, trace and connect, governance measures and systemic thinking. We’ve also provided 15 concrete actions to take.

Each chapter in this report represents a pathway to become a circular city. Each one highlights five pathways that we have identified as fundamental processes for developing a thriving, liveable and resilient circular city.

  1. Pathway 1 – Mindset shift (the city as a shared space)

  2. Pathway 2 – Ecological resilience (the city as an ecosystem)

  3. Pathway 3 – Track, trace and connect (the city as the driver of change)

  4. Pathway 4 – Governance measures (lessons learned from circular cities)

  5. Pathway 5 – Systemic thinking – (the next step)

Pathway 1 – Mindset shift

The city as a shared space. At the city level, the circular transformation affects how we plan our built environment. For example, buildings and plots are mostly approached within their boundaries with little attention to their neighbouring surroundings and wider conditions. Here landowners, developers and municipalities play an important role. Such an attitude limits the development potential of a site and the opportunities to generate enough critical mass for circular systems. More than a technical barrier, it poses another challenge for the transition: the need for a behavioural shift, from atomistic and fragmented practices to shared and integrated action.

Even though technical considerations are obviously crucial in our journey to circularity, the issues – and the required efficiency gains – are too complex to be tackled by technical innovations only. The overarching processes and design choices are fundamental.

Accordingly, we argue that an essential part of the solution is generally overlooked: the social aspect. To create a circular environment, it is crucial to plan, design and build in a strategic way that supports society’s adaptation to a more circular lifestyle. We won’t achieve a new way of living, working and commuting if we focus solely on finding a solution per lot or per building. Instead, we must work towards a circular area development strategy that encourages neighbourhoods to upscale their circular strategies and that incentivises behavioural changes.

Pathway 2 – Ecological resilience

Humans are the only living beings on this planet who understand what waste is. Every other living creature is part of a cycle, where nothing is wasted and every resource is reused.

On 29 July 2021, according to the Global Footprint Network (GFN), humanity’s demand and extraction of natural resources outpaced the rate at which the planet regenerates them during a single year. Here the emphasis is on the shrinking biocapacity of ecosystems (predominantly forests, wetlands and groundwater reserves) to sustain our production-distribution-consumption paradigms. While the economics of linearity are obviously at play, another aspect is often overlooked – ecological regeneration.To plan for a healthy amount of urban greenery, the 3-30-300 rule was raised as a suggestion by Cecil Van Konijnendijk, professor in Urban Forestry at UBC: Everybody should be able to see three trees from their home, live in a neighbourhood with at least 30% tree canopy (or vegetation) cover, and be no more than 300 metres from the nearest green space that allows for multiple recreational activities.

The self-sustaining metabolism of a city

We can think of circular urban planning as analogous to an ecosystem’s metabolism. The fundamentals are defined by a self-sustaining system with no waste, where transformation processes take place through the exchange among different systems that define the city’s ecology.

On the one hand, cities are in a constant exchange with the biosphere, which performs many of the necessary functions cities need to operate. On the other, the presence of natural capital as a unique variable within urbanisation is an indicator of an urban region’s capacity to deliver
much-needed ecosystem services.

Put differently, natural capital is a fundamental system in an urban region’s metabolism and, as such, the planning, design and engineering of cities and their infrastructure should be about connecting them with their natural foundations.

The role of ecosystem services in a resilient city

Why is nature valuable to us? Seemingly obvious, this question lies at the core of all attempts at sustainable and resilient spatial development. The Millennium Ecosystem Assessment (MEA), the Economics of Ecosystems and Biodiversity (TEEB) and other recently developed tools enable us to understand the myriad services that natural systems can provide to us.

Traditionally, technical innovations have aimed to replace ecosystem services with human-made counterparts, such as sewage and electricity infrastructure. While these were groundbreaking in improving our health and well-being in an era of industrialisation, they promoted a technocratic view that prevents us from understanding the benefits of a more natural approach to problem-solving.

We need to integrate natural ecosystems in our cities to capture great values, such as the potential of vegetation to purify air or contaminated water, or water detention and retention for preventing flooding. Providing scope for green and blues infrastructures through streets, public spaces and buildings is also part of health-promoting cities that offer a better quality of life.

Pathway 3 – Track, trace and connect

Did you know that one third of all city waste that flows through Europe today comes from demolition? What tools would a circular city need to access that waste, and turn trash into cash? In this chapter we zoom into two tools that cities can use to become a circular. These tools enable the coordination of chambers of commerces, municipalities and other stakeholders and resource flows to improve public awareness, accessibility and connectivity. We end the chapter by describing four tools that enables innovation and circular economy.

Benefits of the transition towards circularity

The progressive transition to a circular economic system is an indispensable component of the future cities of Europe. A recent study estimates that applying circular economy principles across the EU economy has the potential to increase EU GDP by an additional 0.5%, corresponding to more than EUR 77 billion by 2030 and creating around 700,000 new jobs. So the business case is clear, both for circular cities and individual companies, since manufacturing firms in the EU spend on average about 40% of their expenses on materials. Closed-loop models can increase their profitability while protecting them from resource price fluctuations, as seen during the pandemic.

From trash to treasure

A circular waste system strengthens a city’s economy by keeping money and materials circulating throughout the local area. At the same time, it creates jobs in different industries, both for smaller and larger communities, whether urban or rural.

For example, implementing such systems requires a network that can coordinate the links among resources, production and consumption to promote circular flows. Digital tools can increase the necessary connectivity within the system and facilitate monitoring processes, stakeholder relations and cyclical resources. Some examples of circular economy tools include materials passports, smart logistics and systemic mapping.

Visualisation: Area development in Wickevoort, the Netherlands, illustration by AM.

Potential market and innovation

Building on the EU’s common market and the potential of digital technologies, the circular economy can strengthen the EU’s industrial base and foster business creation and entrepreneurship among SMEs. Innovative models based on a closer relationship with customers, mass customisation, and the sharing, collaborative economy will not only accelerate circularity but the dematerialisation of our economy, making Europe less dependent on primary materials. A circular economy involves the further development of a sound monitoring framework contributing to measuring well-being beyond GDP.

Pathway 4 – Governance measures

To highlight the urgency, some EU member states have begun to formulate government plans for the circular economy.

– 20 of 27 EU member states have a government plan for the circular economy.
– 26% of them were published in the past two years.
– 58 % of them were published in the past year.

Lessons learned from circular cities in Europe

Two European cities, Amsterdam and Glasgow, have collaborated with stakeholders to make progress on implementing successful circular economy strategies.


When it comes to transitioning to a circular economy, Amsterdam is a global leader. In 2017, the city received the World Smart City Award thanks to its pioneering approach to circular development, particularly its efforts to generate electricity locally, reduce fuel consumption and recycle waste more efficiently.

Value sharing

As with any economic transition, businesses and institutions must be able to take an active role in the circular transition process. The City of Amsterdam serves as a facilitator, creating the right conditions for development, accelerating research and data acquisition, and working together with businesses and partners like the Amsterdam Institute for Advanced Metropolitan Solutions and the Amsterdam University of Applied Sciences.

Circular neighbourhoods

Amsterdam’s city government has also decided to make circular, innovation-oriented purchasing the new standard. For example, the rapidly developing area of Buiksloterham will be fully circular. The district will feature a biodigester, which will be maintained by the Waternet network. In this way, Buiksloterham will serve as a test case for how to maximise the recovery of energy (gas and heat) and resources from wastewater. There are also many other, smaller-scale circular initiatives throughout the city. For example, the Betondorp (‘concrete village’) area was recently renovated using recycled concrete.

More uphill than expected

A recent study showed that actual material use in Amsterdam is 61 times higher than previously thought.

Material use is currently still increasing, and a trend reversal is needed to achieve the goal of using 50% less primary abiotic material by 2030. In addition, new estimates suggest that the ecological impact of material use is greater than previously thought. The CO2 emissions
from consumption (scope 3) outweigh all other types of emissions in Amsterdam. At the same time, support for solutions is strong among the people of Amsterdam.


The city of Glasgow is addressing the complex issues entrenched in the mindset of a throwaway society. The concept underpinning the circular economy is not a new one: “making things last” and “mend and repair” were common mottos of generations past. The principles of creating locally, extending the life of materials, taking care of and repairing items, and ultimately reusing wherever possible all support the city at its most basic level.

Circular businesses as enabler

One of Glasgow’s success factors is an initiative called Circular Glasgow. The initiative emerged from the Glasgow Chamber of Commerce, working alongside key partners Zero Waste Scotland and Glasgow City Council. Open to businesses of any size, it is a network whose members share ideas about how to develop businesses across the city interested in how a circular economy can support business growth and climate change targets. Its circular advantage payback for businesses and society is expressed in four benefits: reputation, revenue, resilience and relationships.

Pathway 5 – Systemic thinking

For fifty years now, Earth Overshoot Day has marked the date when humanity’s demand for ecological resources exceeds what the earth can regenerate in that same year. In this report, we have highlighted the importance of taking a holistic approach to the transition in complex systems like our urban environments. We hope that we have inspired you to take the recommended pathways to become a circular city and help make Earth Overshoot Day obsolete.

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The next step

By taking a broader perspective, you can leverage a greater variety of opportunities that can function in tandem with the transition. It is fundamental to address distinct contexts and scales, different resources and stakeholders, and the multiple circular strategies that can be adopted, from refuse to reuse or recycling.

Throughout this report we present strategies, actions, tools and references that offer a range of holistic approaches for creating circular cities and reveal processes that are often neglected in technology-oriented development. These approaches can address several parts of a resource lifecycle to reduce the need for primary materials and cycle our waste streams through innovative ways of living, planning and building.

Examples include shared spaces, infrastructure and services; ecological infrastructure that highly values ecosystem services and is a natural part of the fabric of a city; social accessibility and empowerment opportunities derived from circular initiatives and processes; and digital tracking and tracing of material flows through monitoring platforms that can manage the circularity of resources and the multistakeholder network.

We must carefully consider strategies that address behavioural changes, such as a willingness to share spaces, resources and infrastructure instead of individual ownership (to “narrow down”). Instead of short-term plans, we should envision future-proof strategies that can extend our use of resources, such as modular design, cradle-to-cradle, and processes that facilitate reuse, repair and remanufacture (to “slow down”).

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Alternative and regenerative resources should be explored to limit extraction of primary materials, such as water reuse, renewable energies and urban mining, which sources materials from construction and demolition (to “regenerate”). Lastly, the connection between resources and stakeholders throughout the system has to be well coordinated in order to close cycles – strategies here rely heavily on collaboration within the multistakeholder network where synergies can be explored. To this end, digital tools and platforms as well as mapping instruments should be developed to facilitate coordination of data among stakeholders, for example for residual energy exchange, material reuse and recycling and other uses (to “cycle”).

To achieve a real transition we need to move away from individual interventions towards coordinated action that can promote systemic synergies. We need to address the transition as a multi-stakeholder process that considers and integrates different stakeholders. Together, we can shift from urgency to agency, paving a pathway for European cities to achieve circularity. To show the huge potential of a fully circular city we have shared our unique calculations for an imaginary mid-sized Swedish city in 2040 where true urban symbiosis cuts its current total energy needs by 75%.

Value of the circular city 2040

In April 2022, the European Commission announced 100 cities participating in the EU Mission for climate-neutral and smart cities by 2030. These cities can use the checklist as one of the tools to accelerate the needed transition.

The concept of the circular city is consistent with the EU’s major initiative for 100 climate-neutral cities by 2030:

  • Co-living and multi-purpose buildings, activating unused space
  • Consider the concept of urban planning as analogous to an ecosystem’s metabolism
  • Enhanced and shared walking and cycling facilities. Most of these facilities will be equipped with solar panels and photovoltaic cells capable of generating renewable energy.
  • Engineered water and wastewater solutions that combine urban design and biology.
  • As much as 90-100% of buildings and materials in the cities remains preserved and untouched,
  • Every city should have its own material bank and resource flow mapping.
  • Youth are included and have an important say in urban planning.

Along the way, best practices, case studies and guides are presented to support cities in replicating good practices and enabling them to work together to overcome barriers. Together, we can develop and deploy solutions and become early adopters of the policies and practices to get to climate neutrality.

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