• Jana Vrzel

The Circular Economy Basics Series - The Biological Cycle

The Biological Cycle of the Circular Economy Butterfly Diagram (own illustration)

The circular economy system diagram, also known as the Butterfly Diagram, illustrates the continuous flow of materials in the circular economy. It consists of two main cycles – the technical cycle and the biological cycle. In the technical cycle, products are kept in circulation in the economy through reuse, repair, remanufacturing, and recycling. This way, materials are kept in use and do not become waste. In the biological cycle, biodegradable materials are returned to the Earth and decomposed through processes such as composting and anaerobic digestion. This allows the land to regenerate the nutrients, which can then be used to create new biodegradable materials, thus, ensuring the continuation of the cycle.

The diagram above highlights the left side of the Butterfly Diagram, which represents the biological cycle, the focus of this article. The biological cycle involves materials capable of biodegrading and safely returning to the Earth. It describes processes where nutrients are returned to the soil and help regenerate nature.

The following outlines the key concepts of the biological cycle:

1. Regeneration

Regenerative thinking is at the heart of the circular economy. The purpose is to build natural capital rather than deplete the already limited resources present on Earth. Sustainable and regenerative farming practices allow nature to restore the soil and increase biodiversity. A circular food system, for instance, returns biological materials to the earth rather than wasting them. Our efforts should not only be simply towards causing less harm to the environment but increasingly towards how we can restore and maintain it.

2. Farming

Current agricultural practices have a large impact on the environment, being a leading contributor to greenhouse gas emissions, water consumption, and nitrate and ammonia pollution. Sustainable agriculture is, therefore, a vital element of a circular economy, as it focuses on achieving increased sustainability by keeping resources and materials in use for as long as possible. Circularising agriculture is based on minimizing demands for external inputs, closing nutrient loops, and reducing the environmental impact from discharges and runoff.

An example of circular farming is the integration of mixed crop-livestock and organic farming, agroforestry and water recycling, and wastewater reuse. The key to reducing CO2 emissions lies in using natural resources more efficiently and significantly reducing the use of new inputs. Once the cultivated food is harvested and consumed, the nutrients retained in organic waste streams can be collected and returned to the soil via processes such as composting and anaerobic digestion. If nutrients are not returned, the soil becomes depleted, meaning farmers are forced to rely increasingly on chemical fertilizers to keep farmland productive.

3. Cascades

Cascading maximizes resource effectiveness by using biomass in products that create the most economic value over multiple lifetimes. This approach to production and consumption incorporates the idea that energy recovery should be a last resort and only employed after all higher-value approaches to retaining products and services have been exhausted. When products or materials can no longer be reused (cascaded), they move towards the outer loops of the biological cycle where they are returned to the soil.

An example of cascading can be found in wood production and processing. The process begins with the harvesting of the raw material. This should be done in certified production forests in order to leave the Earth’s vital natural forests largely untouched. After the harvesting, the wood is processed, creating sawdust as a by-product. This sawdust can be used, for instance, for on-site incineration to fuel the wood drying process of board production. After the wood has been used by consumers and reaches the end of its lifetime, it must be sorted for further use in e.i. incineration for the production of renewable energy or the production of paper. Finally, just like in nature, the wood comes full circle as the ashes and CO2 generated by the incineration are captured by and support the growth of new trees. This example illustrates how cascading seeks to retain the maximum value possible from wood throughout its lifecycle – value that would otherwise be lost.

4. Composing and anaerobic digestion

Composting and anaerobic digestion are natural processes that have been happening on Earth since its beginning. Their products have been used for fertilizing crops for many decades. Both methods are sustainable and great energy savers. The main difference between composting and anaerobic digestion is oxygen. Aerobic processes utilise air and anaerobic ones do not.

Composting is an aerobic process, which means it requires oxygen. Under the layers of biodegradable waste, organisms naturally oxidize the organic matter. This process transforms the waste into nutrient-rich fertilizer. Its only disadvantage is that the oxygen also releases carbon dioxide into the atmosphere. Nonetheless, composting is an eco-friendly practice as it is a clean source of recycling.

Anaerobic digestion is a process by which microorganisms break down biodegradable materials without using oxygen. This process is much slower but more useful, as the process itself produces methane, which is a key component of biogas. Biogas is valuable today to fuel vehicles, heat houses and generate electricity. Furthermore, biogas is a renewable as well as a clean source of energy. Gas generated through biodigestion is non-polluting, meaning that it reduces greenhouse emissions. Driving a biogas car instead of a combustion engine car reduces one’s carbon footprint by 17.5% per year.

5. Extraction of biochemical feedstock

Feedstock refers to "any renewable, biological material that can be used directly as a fuel, or converted to another form of fuel or energy product". It is most often used to support large-scale chemical reactions, which are usually organic substances. When referring to both post-harvest and post-consumer biological materials as feedstock, the process uses biorefineries to produce low-volume but high-value chemical products. Some examples of feedstock include crude oil, which is used to produce gasoline; corn, which is used to produce ethanol; and soybean oil, which is used to produce biofuel.

Companies applying processes of the biological cycle


This innovative company uses fruit leftovers to produce durable and animal-friendly leather-like material. By transforming fruit waste into value, Fruitleather Rotterdam wants to raise awareness towards fighting food waste. The collected fruit waste is transformed into a purre, followed by fiber extraction and a drying process. Once the material has been produced it is sold to product designers.

Nam Mushrooms

Nam Mushrooms is a Portuguese business solution to tackle coffee waste in Lisbon. The company collects the ground coffee waste from local cafes and restaurants and grows fresh and organic oyster mushrooms with it. The company then sells back the mushrooms to the local restaurants and community. Additionally, the company directs the production waste generated by mushroom cultivation to local farmers as an organic and nutritional way to grow fruits and vegetables. The company also offers Home Grow kits for people interested in growing fresh produce themselves.