GLA: Regulation and legislation of the Circular Economy

12th June 2023

The GreenLight Alliance speaks to several members about the obstacles and opportunities to push towards a circular economy within lighting.

The lighting industry has begun to lean into its environmental responsibilities. It has far to go, but it’s happening. What more can be done? When the topic comes up, very often it is followed by a discussion on the associated legislation. This month we enquired of a few GreenLight Alliance members how they feel on the subject of legislation, asking “where are the obstacles and opportunities in terms of accelerating transition to a circular economy within our industry?”

Nigel Harvey, CEO, Recolight

Many companies within the lighting industry are undoubtedly starting to adopt circular economy principles. That is being driven by a growing awareness of the need for real sustainability which goes beyond energy efficiency, and embraces material efficiency as well. Many manufacturers, specifiers, and end users are now building circularity within their products. But to enable us to go further and faster, we undoubtedly need legislation and enforcement to drive the change.

That legislation should incentivise manufacturers and end users to do the right thing, and should also include mandatory requirements for products that are more “circular”.

Incentivise reuse and remanufacture

The easiest way to apply circularity in almost any situation is to keep existing product in use for longer, but with component upgrades to maximise energy efficiency. And although there is now significant interest in remanufacture within the lighting industry, it still only comprises a few percent, at best, of the total market. Government is already giving consideration to amending the WEEE regulations to recognise and reward remanufacture – possibly via a reduction in the WEEE financing obligations. But that should be extended to include fiscal measures that make reuse and remanufacture even more attractive to end users.

Incentivise ecodesign

Designing new products to embed greater longevity, durability, and upgradeability is also important. The government is currently considering incentives that could “ecomodulate” WEEE costs – with lower WEEE fees for “good” products and higher fees for “bad” products. The system is not without its challenges, but may well have merit.

Changes could also include product standards with a mandatory percentage of reused materials – particularly plastics. The painful reality is that unless recycled plastic is used in the manufacture of new products, the need for recycling at all comes into question.

Standardise the metrics

The industry is awash with a multiplicity of environmental product declarations, life cycle assessments, and similar. Knowing which to adopt is undoubtedly a challenge for all in the sector. Government could provide much needed direction and focus by encouraging or mandating a few methodologies.


Defra has already legislated to make producers responsible for the full costs of collection and recycling of consumer packaging waste. For companies selling packaged consumer products, this will mean a significant increase in compliance costs next year. This will act as a strong incentive to reduce the amount of packaging used. Options should also be explored to extend this to commercial packaging.


New legislation is only effective when it is enforced. For far too long, there has been an underbelly of non-compliant product sold within our industry. With the continued growth of online marketplaces, that underbelly has swollen hugely in recent years. It is totally unacceptable for UK based manufacturers and sellers to comply with legislation that is flagrantly ignored by those based mainly in the Far East, but whose products are frequently stocked within the UK and sold via online marketplaces. Any new legislation must make online intermediaries responsible for demonstrating the compliance of product sold via their platforms. Such approaches have already been implemented for some legislation in France, Spain and Germany. The UK should do likewise.

Tim Bowes, Head of Lighting Application, Whitecroft

Over the last three years, I have gained new qualifications, learned new skills, educated and learned from peers within the lighting and wider construction sector, forged new relationships, and contributed to presentations and guidance documents within the field of circularity. Many of the conversations have been inspiring, with the enthusiasm and realisation by many of the opportunity that the circular economy can bring to our sector. However, many of these activities and solutions proposed by our industry continue to happen on the fringe of current market activity.

If we are to remove the obstacles and create opportunities to realise the potential to move from a linear economy to, as Ellen Macarthur said in 2013, “an industrial economy that is restorative by intention and design” at scale, transformational change is needed.

There are many obstacles to the adoption of the circular economy, such as financial constraints, timeframes, lack of infrastructure, cultural, and current business practices. For some, the only way to make this change is through legislation.

Governments are in a position where they are both one of the actors and a key enabler to delivering this change. However, their opportunity to influence others goes far beyond simply legislation. Below are some examples of the ways governments at all levels can support change at scale and address some of the obstacles outlined above.

Provide a test bed

Alongside policy frameworks and legislation, governments can create the market, provide clear leadership, foster partnerships, provide financial support, and support learning. When you consider 14% of all EU spending is from public procurement, and 25% within the UK, they could provide a space for many in the built environment to work and demonstrate how the circular economy can work at scale.


Whether the motivation is social, economic, or environmental, one of the highest sources of value creation identified by the Ellen Macarthur Foundation (see Figure 1) is to maintain and prolong what you have. Today most refurbishment work in the UK incurs a VAT rate of 20%, whereas most new build work attracts a 0% rate of VAT. Campaigns, such as ‘RetroFirst’ launched by the Architects Journal back in 2019, are in place to encourage Governments to cut VAT on refurbishment, repair and maintain to 5% or less. A similar taxation is already in place in Sweden.

Rather than simply change a single policy, a policy mix can be used to amplify any change. Working in tandem with preferential taxation, could the ‘retro-first policy’ proposed recently by the City of London, support the growth in not just the re-use of structural elements but the services that are already in the building, such as lighting?

Urban Mining

Typical LED production contains up to 96 rare earth elements, five processes, and four different factories. In addition to this, 27% of the emissions for an LED occur at its disposal. With risks around geo-political events, growth of low carbon technologies, cost volatility, demand to reduce embodied carbon and inevitable increase in LED waste, will there be a need, desire and opportunity to move towards urban mining? This change would not be easy, and current infrastructure and financial models do not make this viable. Could governments therefore take a lead in identifying LED as a new form of e-waste, and alongside other low carbon technologies. put in place the investment and reverse logistics needed to make the re-use of these materials feasible?

Material Banks

Of the 200 tonnes of waste produced in Great Britain, 60% is produced by the construction industry. In a recent article published by the NLA, it was highlighted that although 90% of materials are recycled from construction sites, only 1% is re-used. While there is some work being done by the likes of Recolight to create material banks for lighting, government intervention and implementation of technological innovation could work alongside a change in the way we design and build in supporting the structural and systemic changes needed to connect those who want with those who have at scale.

While governments will play a key role in the delivery of the circular economy, if we are to make the existing model obsolete, we cannot rely on legislation alone to do this. We all have a part to play in breaking down the barriers and realise the opportunity of the circular economy. Perhaps this will require us all to embrace change, collaborate, listen and inform others and challenge what we know and want to do today to change tomorrow.

Bob Bohannon, Head of Policy & Academy, The LIA

When trying to create change it’s frequent for people to say: “you should change this and here’s why”. I’m guilty of this myself, but on the whole, this approach doesn’t work. In reality, it’s all about motivation and incentives. Introducing circular economy regulations will certainly act as a motivation, but it does bring other important questions into play. Circular Economy is not just about repairability: it’s about maximising the utility of extracted natural resources, keeping them at their highest value for the longest time. So, it’s also about durability.

Lighting is complex, we are not a white goods industry with a limited range of product types, we have hundreds of product types used in hundreds of different applications – how does regulation turn that complexity into simplicity and good law? The Lighting Europe team are trying to do precisely this, and it’s not easy.

You then have the level playing field question: lighting is already highly regulated, if additional circular economy regulation is introduced then there must be an effective market surveillance mechanism in place, and I don’t see any evidence that government has that. Any regulation that places a burden on competitiveness, with no mechanism for market surveillance, does not pass government’s own test for better regulation. Poor regulation disadvantages the law-abiding and does not touch those who flout the law.

I might be sounding negative, but that is not the case. As an industry, we must move away from CAT A fit-outs, or products value engineered so far that not only do they not last, but they are irreparable when they fail. This might be economically sustainable for those involved, but it is not environmentally sustainable – so we either need the industry to adopt self-regulation, for example, TM66 (lent further credibility by its third-party LIA/CIBSE certification under TM66 Assured), or accept the inevitability of government regulation, and hope that it is good regulation without unintended consequences (MEPS is an example of how not to do it).

TM66 is an excellent example of a self-regulating scheme that combines motivation and incentives. The motivation is to improve your product’s circularity by engaging with its assessment. Those using it all report that the moment they start getting their first scores, the first question they ask is ‘how do I get a better score?’ This is exactly what a sustainability metric should be, a transition tool that helps plan and report on the transition and direction of travel.

The incentive is that as TM66 is a cross-industry initiative, its adoption by specifiers is also growing the demand for circular products.

Circularity is inevitable, we lived in a circular world for generations, the move to a disposable economy has been far more recent and the negative effects are all too clear. We have a good self-regulation tool in TM66, and I would not stand in the way of regulation but with the two caveats that it must be good and be supported by effective market compliance – the LIA would be happy to work with DEFRA and DESNZ on both.

Dr. Irene Mazzei, KTP Associate, Stoane Lighting

In March 2023, the Intergovernmental Panel on Climate Change (IPCC) finalised the Synthesis Report for its sixth assessment, in which data suggests that humanity is still quite far from limiting global warming to 1.5 °C – or even 2°C by 2030. Figure 2, taken from the report, shows that if no changes are made to currently implemented policies, the Greenhouse Gas emissions will keep increasing, causing global warming to reach 3.2 °C by 2100, with catastrophic effects to Earth’s ecosystems and society.

Industry produces up to a third of the net anthropogenic GHG emissions, with steel, concrete and plastic manufacturing being major contributors. The introduction of more sustainable corporate practices, such as replacing materials with more environmentally-friendly alternatives, switching to renewable energy providers and limiting or repurposing manufacturing waste, associated with the application of the principles of the circular economy, can help substantially reduce emissions deriving from industrial activities.

The lighting industry is starting to adopt several of these strategies; however, at present, positive actions are mostly driven by internal inputs in companies that want to take steps towards greener business strategies. Looking at these internal inputs, it is also possible to identify opportunities in using and promoting sustainability assessment strategies. Quantifying environmental impacts is the first step for a company to understand where the emissions come from and what to change to reduce them. From simpler assessments, such as quantifying the embodied carbon of products or their circularity (see TM65 and TM66), to more complex Life Cycle Assessments leading to Environmental Product Declarations, being able to communicate clearly and transparently the emissions associated with products is definitely an advantageous skill for a company.

However, in addition to internal initiatives, a greater “push” could be provided by external inputs coming from policymakers. In the European landscape, the last piece of the “Circular Economy and Consumers Package” puzzle was added on 22 March with the adoption of the directive on substantiation and communication of explicit environmental claims. The directive – now being discussed by the EU Parliament and Council – has the objectives of: empowering consumers with more trustworthy environmental claims on products; rewarding businesses that take genuine positive actions in improving their company’s sustainability, as opposed to those who use green claims to “greenwash” their unsustainable agendas; and establishing common rules and practices for assessing and reporting environmental information of products. Other key points of the circular economy packages include the European Commission’s ESPR proposal, the Eco-design and energy labelling working plan, and the “right to repair” directive proposal. The latter consists of a proposal recommending repair practices over total replacement of products (when practically and legally possible), especially if the costs for replacement are higher than or equal to the costs of repair.

An important requirement of the publication of environmental information as an EPD, is the application of Product Category Rules (PCRs) and/or Product Specific Rules (PSRs) to the LCA. A robust and comprehensive set of rules specific for luminaires is provided by the Program Operator PEP Ecopassport. Their lighting PSRs make sure to cover all relevant aspects of these products so that environmental impacts are evaluated in a complete and consistent way.

The progress made by the industry in the field of sustainability is undeniable, no matter if coming from internal initiatives or necessitated by incoming policies. However, some challenges still stand in the way of sustainability, some of them affecting the entire sustainability and life cycle assessment practice and not only the lighting industry. To mention just a few examples, harmonisation and data sourcing are two factors playing an important role. Using a number of different sustainability assessments – that produce results that are not comparable with each other – does not help the cause. In addition to this, using the same methodology but collecting data from different sources will also produce results that shouldn’t be compared, as stated in article 4(1), paragraph (a) of the Green Claims proposal. The introduction of rules to promote a more systematic and consistent approach within the industry – as done, for example by the PEP Ecopassport PSR initiative – will help reduce the variability of results in the future, leading to more harmonised practices and a “level playing field” for businesses in the industry using sustainability assessments.

Finally, a higher level of alignment within the industry would be beneficial to the actors asking questions and those providing the answers on sustainability matters, such as circularity. This is why it’s important to communicate transparently on what the environmental and performance objectives are and ask/provide environmental assessments of products accordingly.

In the responses from the contributors, we see we have a circular economy assessment metric, we have embodied carbon assessment methodologies, product specific rules for LCA of luminaires, business model developments to embrace circular economy opportunities, companies and organisations to assess and validate claims, industry led work on standardisation of remanufacturing processes for luminaires and so much more.

The industry is showing encouraging initiative and striding out ahead. If one looks at assessment of products for circularity as a broad catch-all there is one good methodology, TM66, we now also see narrowed focus on durability, lifetime and repairability separately within circularity. Within impact assessment we see measurement of different impacts, embodied vs whole life carbon as an example. We also see parallel, sometimes overlapping methodologies in impact assessment. With such progress in the lighting industry and built environment the challenge facing us is to hone approaches, select preferred methodologies and through groups such as the GreenLight Alliance and industry associations make proposals to policy makers on regulation that works for the industry and delivers on the objectives to deliver meaningful sustainability improvements in our industry. Encouragingly, this is happening already.