Beyond Emission Reductions: Circular Economy Indicators for the Energy Transition of the Power Sector

Abstract

The energy transition moves our society from fossil fuels to renewable energy. However, the change impacts the planet through resource depletion and waste accumulation, ultimately risking the transition’s success. Indicators such as renewables share and emission intensity do not represent these impacts on global material availability. This paper proposes a novel set of three circular economy (CE) indicators oriented toward power systems to complement the current decision-making processes. These indicators are (i) relative material impact, (ii) absolute material impact, and (iii) energy self-sufficiency. These indicators provide operative criteria based on a CE definition, representing commonly overlooked concepts such as resource self-sufficiency and absolute material impacts. The effectiveness of these indicators in discriminating among different energy development plans is shown by applying them to a case study in the Tarapacá region, Chile. The proposed indicators integrate resilience to power systems planning by incorporating the material dimension. The notion of limit is deemed critical when designing a power system from a circular economy perspective and is structurally considered in the definition of the proposed indicators.