Circular economy, in particular recycling

Importance

Protecting natural resources, the economical use of raw materials and the extraction of secondary raw materials¹ from waste or residues are of great importance not only for humans and the environment, but also for the German industry, which depends on imports for a number of the raw materials it needs (see Security of supply). Substituting primary with secondary raw materials also often results in significant savings, for example in energy consumption.²

Against the background of the increasing global demand for raw materials, but also the challenges in the context of climate change, a circular economy, in which the product design itself already aims for raw material cycles that are as closed as possible, with little material loss as well as a reduction of greenhouse gas emissions and energy consumption, is becoming more and more of a focal point. In December 2024, the Federal Government adopted the National Circular Economy Strategy (NKWS) (see Section e).³

According to the Status Report on the German Circular Economy 2024, there is a comprehensive network of more than 14,337 pretreatment, treatment, sorting and processing plants for the recycling of waste in Germany, in particular for recycling, which in addition to chemical­physical, biological and mechanical processing plants also includes soil treatment plants, construction waste treatment plants, sorting and dismantling plants, and similar. However, this infrastructure is not equally well developed for all raw materials. There are gaps, especially when it comes to critical raw materials such as lithium, cobalt or rare earths. Battery recycling is also under development. The recycling industry provides jobs for around 315,000 employees in around 10,000 municipal and private enterprises and generates revenues of around € 105 billion. The gross value added amounts to about € 33 billion.⁴

Legal bases

Environmental pollution, the shortage of landfills in the 1980s and the increasing awareness that natural resources and energy sources are valuable, finite resources have triggered a modern circular economy. The aim of a modern circular economy is to ensure a sustainable use of recyclable materials through, for example, a product design that allows for recycling, durable, repair-friendly and easily recyclable products and the decoupling of waste volumes from economic output. These objectives are largely pursued by the Circular Economy Act (KrWG) based on the EU Waste Framework Directive 2008/98/EC . The Law on Promoting the Circular Economy and Safeguarding the Environmentally Sustainable Management of Waste (Circular Economy Act, KrWG) is the core regulation of waste legislation. In addition, there are requirements for the product design of certain products with regard to energy and resource efficiency within the framework of the Ecodesign Directive and, in future, the Ecodesign Regulation. Other regulations apply to specific products, such as the Electrical and Electronic Equipment Act (ElektroG) or the Packaging Act (VerpackG).
An essential element of the KrWG is the so-called five-stage waste hierarchy, which applies to waste owners and producers in the following order: 1. Prevention, 2. Preparation for reuse, 3. Recycling, 4. Other recovery – in particular energy recovery (incineration) and backfilling, 5. Disposal (landfill). In order to promote recycling and other material recovery, Section 14 of the KrWG imposes recycling quotas.

One component of German waste law is transferring product responsibility to manufacturers and distributors, who must ensure that the generation of waste is reduced from product development through production to use and that environmentally sustainable recovery or disposal is ensured. In addition, Germany banned the disposal of untreated municipal waste in landfills in 2005 in order to significantly reduce the generation of greenhouse gases that are harmful to the climate from landfills.
The EU Ecodesign Regulation⁵ entered into force on 18 July 2024 and allows for requirements regarding the design of products with regard to durability, recyclability and other resource efficiency aspects. If products falling under this regulation do not comply with these requirements, they may no longer be marketed in the EU. Under the Ecodesign Directive, there are already a number of product requirements regarding durability and repairability in place for some products where energy consumption is a concern, such as white goods and smartphones.

The Electrical andElectronic Equipment Act (ElektroG), which was last amended on 1 January 2022, and the Ordinance on the Treatment of Waste Electrical and Electronic Equipment (EAG­BehandV) provide the legal framework for implementing product responsibility for electrical equipment. The law is intended to implement the EU legal requirements of Directive 2012/19/EU on waste electrical and electronic equipment. From 2019 onwards, the Directive requires a collection rate of at least 65% of the average quantities of electrical and electronic equipment placed on the market in the previous three years.

The amendment to the Packaging Act⁶ also added further provisions with regard to packaging under the existing extended producer responsibility system. Since 1 January 2023, for example, final distributors must also offer reusable packaging alternatives when selling food for immediate consumption in disposable plastic packaging and so­called “to go” disposable beverage cups. Furthermore, certain single-use plastic beverage bottles must include a minimum amount of recycled material since 1 January 2025. The new European Packaging Regulation (Packaging and Packaging Waste Regulation, PPWR)⁷ entered into force in February 2025 and requires an amendment to the German packaging legislation by mid-2026. The PPWR also prescribes a minimum recycled material content for plastic used in packaging.

On 3 July 2019, Directive (EU) 2019/904/EU on the reduction of the impact of certain plastic products on the environment (Single-Use Plastic Directive) entered into force. The objective of this Directive is to prevent and reduce the impact of certain plastic products on the environment, in particular the marine environment, and on human health, and to promote the transition to a circular economy with innovative and sustainable business models, articles and materials and to thereby also contribute to the smooth functioning of the internal market. The Directive sets out a number of measures to reduce the consumption of certain single-use plastic products, to limit the careless dumping of these products in the environment and to improve the management of the resource “plastic”. In the context of implementing the Directive as national law, the Ban on Single-Use Plastics Regulation (EWKVerbotV)⁸ started by prohibiting the circulation of certain single-use plastic products (e.g. cutlery, plates, straws made of plastic and “to go” packaging and cups made of expanded polystyrene). Environmentally friendly alternatives already exist for these single-use plastic products. The Single-Use Plastics Labelling Regulation (EWKKennzV)⁹ stipulates that certain single-use plastic products placed on the market must have a label either on the packaging or on the product itself, which should inform consumers that the products in question contain plastic, which forms of disposal must be avoided and what environmental consequences improper disposal has. In addition, single-use beverage containers made of plastic may now only be placed on the market if their plastic closures and lids are firmly connected to the container for the entire time the product is used. The Single-Use Plastic Fund Law (EWKFondsG)¹⁰ is the final step in implementing the EU Single-Use Plastics Directive into national law. Extended producer responsibility is introduced for certain single­use plastic products (such as to-go-food containers, bags and foil packaging, beverage cups and containers, light carrier bags, wet wipes, balloons and plastic tobacco filters (filter products)). A key element is the creation and management of a single-use plastics fund.¹¹ The producers of affected single-use plastic products pay a contribution into the fund each year. The fund is used to reimburse public waste management services and other legal persons under public law entitled to receive compensation for the costs they incurred in relation to waste management and cleaning services provided to the public and to fund activities to raise awareness. These costs have so far been borne by the general public. The first contribution is due in 2025 on the basis of the quantity of products placed on the market in the calendar year 2024.

As of 1 January 2021, the regulations governing the export of plastic waste from the EU were tightened via amendments to the European Waste Shipment Regulation in order to manage the global waste stream better. It prohibits the export of hazardous plastic waste and non­hazardous plastic waste that is hard to recycle from the EU to non­OECD countries. The export of non­hazardous plastic waste that is easier to recycle from the EU to non­OECD countries is subject to further restrictions in accordance with Regulation (EC) No 1418/2007.
The Substitute Building Materials Regulation¹², as part of the General Regulation of the same name, has been setting out uniform and legally binding requirements for production, quality assurance and installation of mineral substitute building materials in technical buildings across the country in 2023. Mineral substitute building materials within the scope of the Regulation are, for example, recycled building materials based on construction and demolition waste, slag from metal production and ash from thermal processes. The Substitute Building Materials Regulation supports the objectives of a circular economy. Furthermore, it aims to increase acceptance of the use of substitute building materials.

Waste volume and waste recovery

A gross total of 399.1 million tonnes of waste were generated in Germany^13,14 in 2022, a further decline from the current peak in 2018 (417.2 million tonnes). Construction and demolition waste accounts for just over half of total gross generation (about 54.2%) with 216.2 million tonnes. Municipal waste generation amounted to 48.6 million tonnes, secondary waste (waste from waste treatment plants) to 57.1 million tonnes and other waste generation, mainly from manufacturing and trade, added up to somewhat less with about 48.6 million tonnes. Around 28.6 million tonnes of waste were generated with the extraction and treatment of mineral resources.

About 326.6 million tonnes of waste were recovered in 2022, of which 280.0 million tonnes were material and 46.6 million tonnes were energy-related.¹⁵ The recovery rate of all waste has remained stable at 82% in recent years (2022). The recovery rate measures the proportion (input) of the waste collected that undergoes a material or energy recovery process. The (input­oriented) rate of recycling, i.e. the proportion of waste recycled or processed to be reused, has remained stable at around 70% in recent years.¹⁶

The amendment to the EU Waste Framework Directive (2018) introduced a new (output­oriented) calculation method. The recycling rate is no longer based on the amount of waste sent to recovery facilities (input amount) but on the amount of material that is actually recycled (output amount, after removal of non-recyclable material). Recycling figures achieved under the new procedure are only gradually becoming available; the first calculation for 2020 assumes about 53%.

Examples of recycling and utilisation rates¹⁷

In Germany, there are several institutions that regularly report on recycling and utilisation rates and that provide data. An up-to-date collection, analysis and publication of relevant data on waste management, in particular recycling, is available from the following institutions:

• Federal Ministry for the Environment, Nature Conservation, Nuclear Safety and Consumer Protection (BMUV)
  Regularly publishes overviews of statistics on individual sectors of waste management.¹⁸ One example is the reporting to the European Commission under the WEEE Directive on waste electrical and electronic equipment. In 2022, the recycling rate for waste electrical and electronic equipment was 83.8% and the recovery rate was almost 98%. However, in 2022, only just under 32% of the average amount of waste electrical and electronic equipment placed on the market in the previous three years was actually collected. In order to increase this volume and to reach the target collection rate of 65% set by the EU since 2019, further development of the Electrical and Electronic Equipment Act is needed, for example to foster increased awareness of the population for the separate collection of electrical waste through standardised consumer information.¹⁹
• German Federal Environment Agency (UBA)
  Publishes regular reports and statistics on waste management and recycling rates for various materials, including plastics and other waste. It also carries out analyses on the development of recycling and recovery rates and makes this information publicly available.
  “With just under 70% of waste recycled and almost 12% recovered for energy purposes, Germany recovered just under 82% of the waste generated in 2022. The municipal waste recycling rate in 2022 was 68%.”²⁰
• Federal Statistical Office: Environmental statistics surveys
  The Environmental Statistics Act (UStatG) forms the legal basis for establishing official, annual statistics on waste management. For example, waste generation is differentiated by industrial sector (see references in section c) and waste electrical and electronic equipment by product category.
• Central Packaging Register (ZSVR)²¹
  Monitors and controls the packaging waste management system and reports annual recycling rates for packaging from dual systems collections.²²
  In 2023, the dual systems achieved five out of eight recycling targets, and in some cases even exceeded them. These include ferrous metals, aluminium as well as paper, cardboard, cardboard (PPK) and plastics. In total, around 5.5 million tonnes of used packaging (all material groups) from private end-use were recycled in 2023 (corresponding to an overall recycling rate of around 90%).²³ In the case of materially recovered (recycled) plastic packaging, the share increased from 42.1% to 68.9% between 2018 and 2023.²⁴
• The Federal Institute for Geosciences and Natural Resources (BGR) / German Natural Resources Agency (DERA)
  The annual BGR report on the natural resources situation in Germany provides a structured overview over utilisation rates for refined and crude steel production in Germany. In 2022, about 85% of lead, 58% of aluminium, 46% of crude steel, 40% of copper and 18 % of zinc came from the supply of recycled raw materials.
  In a recent study, DERA examined the status quo of the German metal-producing recycling industry and summarised it in an interactive map, metal-related factsheets and a short study.
• Business associations (example)
  The Federal Association of the Waste, Water and Raw Materials Resources Industries (BDE) is one of the most important associations for waste management and recycling in Germany. Together with numerous other stakeholders, it regularly publishes a summary of the state of the circular economy in Germany in the Status report on the German circular economy (2024) (see section a).
  The association Circular Economy CONSTRUCTION reports on mineral construction and demolition waste which accounts for a large share of the waste generated. The construction sector recovers around 90% of non-hazardous mineral construction and demolition waste. In 2022, 75.3 million tonnes of recycled building materials were produced by processing mineral building materials. 47.6% of these were used in road construction, 24.4% in earthworks, 8.7% for other applications (including landfill construction) and 19.3% as aggregates in asphalt and concrete production.²⁵

Future Challenges/Outlook

The EU Circular Economy Package (2018) and the second EU Circular Economy Action Plan (2020) are key overarching strategies and regulations on the path to a circular economy at EU level. The strategic objectives of the European Commission’s Action Plan are modernising and strengthening the EU’s competitiveness, empowering consumers and developing lead markets for climate-neutral and circular economy products. In addition, the share of materials that are recycled and returned to the economy in the EU is to be doubled by 2030 (in 2020 the share was 11.7%). The Circular Economy Package and the implementation of the measures outlined in the Second Circular Economy Action Plan commit Member States to a wide range of further steps to strengthen the waste hierarchy and the circular economy. Member States must, for example, take measures to encourage the re-use of products. In its policy guidelines for 2024-2029, the European Commission has announced a new legal act regarding the circular economy. The aim of the Circular Economy Act (CEA) is to decarbonise the economy as part of the transition to more sustainable production and consumption patterns in order to preserve the value of resources in the economy for longer. The CEA is also intended to help strengthen market demand for secondary raw materials and to create an internal market for waste, especially with regard to critical raw materials. According to the COM, the proposal for a CEA, announced for the end of 2026, is to comprise three pillars, which provide for amendments to a) the Waste Framework and Landfill Directives, b) the Waste Electrical and Electronic Equipment Directive and c) accompanying instruments (for example, circular business models).
In December 2024, the Federal Government adopted the National Circular Economy Strategy (NKWS), thereby creating a long-term framework to reduce primary raw material consumption and to promote the circular economy. According to estimates of the Federal Association of German Industry (BDI) and Deloitte, expanding the circular economy in Germany will result in an additional gross value added of € 12 billion per year by 2030 and an increase in employment of 177,000 jobs.²⁶
The NKWS provides a framework for ongoing strategies regarding the aspects of a circular economy, such as the German Raw Materials Strategy. The goals of the German Sustainability Strategy are supported by the NKWS. The website www.kreislaufwirtschaft-deutschland.de informs the public on all aspects of the national circular economy strategy.
Under the guiding principle of reducing the consumption of primary raw materials, the NKWS pursues three strategic objectives:

• Close material cycles
• Strengthen independence from raw material imports
• Avoid waste

The objectives of the NKWS are to be implemented through specific measures and instruments. Examples include standards for durable products, the introduction of digital product passports, quotas for using recycled plastics at EU level, further development of the right to repair for consumers or the targeted use of public procurement for the circular economy. Action is needed at both the national and EU level.
The NKWS has specified measures and instruments for fields of action that have been identified as priorities given their significant mass flows or high potential for the circular economy. Examples of priority fields of action are:

• Information and communication technology (ICT) and electrical (electronic) equipment
• Renewable energy facilities
• Construction and building sector
• Metals

Research and development (R&D) are essential pacemakers for innovation and progress in the transformation towards a circular economy and are important for all priority fields of action (so-called cross-cutting issue). A two-year dialogue process to improve the recycling of specific raw material flows made it possible to identify specific options for action. These were published in the final report of the German Natural Resources Agency (DERA) 2023 Dialogue Platform on Recycling Raw Materials.²⁷ The dialogue platform focuses on metallic raw materials and industrial minerals and identifies 94 options for action. The NKWS was able to take these into account when presenting the fields of action.

The DERA recycling atlas for metal production shows that Germany already has an efficient recycling industry for base metals such as copper, aluminium or iron/steel. As regards 17 rare earth metals or other special metals such as tin, tantalum (coltan), tungsten or platinum and lithium, however, circular economy approaches or recycling processes have so far scarcely gone beyond research and development. Although recovery would be, in part, technically possible and environmentally sensible, it is often not yet economically feasible. The aim here must be to continue to drive research and development and, above all, to ensure that new processes and technologies come onto the market. To this end, it is necessary to establish and expand appropriate collection and recycling routes and to create regulations with tax incentives for secondary raw materials, for higher legal recycling quotas and strict ecodesign guidelines as well as for the export of scrap metal to reduce the amount of imports needed.

The national implementation of the Critical Raw Material Act (CRMA) also strengthens the circular economy, as it calls, among other things, for an increase in processing and recycling capacities. The aim is to ensure the availability of critical and strategic raw materials in Europe and to reduce dependence on third countries. To this end, a quarter of the EU’s demand for strategic raw materials is to be met through recycling from 2030 onwards (see Security of supply).

Both the NKWS and the CRMA promote a sustainable use of resources and recycling technologies, with the CRMA specifically targeting the security of critical raw materials, while the NKWS promotes a comprehensive circular economy in line with the EU Commission’s Circular Economy Action Plan, with actions at the national and European level

¹ Deutscher Naturschutzring (DNR) (2023): Primary and secondary raw materials.

² German Federal Environment Agency (UBA) (2019): Material flow-based determination of the contribution of the secondary raw materials industry to protecting primary natural resources and increasing resource productivity.

³ Federal Ministry for the Environment, Nature Conservation, Nuclear Safety and Consumer Protection (BMUV) (2024): National Circular Economy Strategy for Germany. URL: https://www.kreislaufwirtschaft-deutschland.de/

⁴ Federal Association of the Waste, Water and Raw Materials Industries (BDE) (2024): Status Report on the German Circular Economy 2024.The Status Report on the Circular Economy is published every two years. Circular economy statistics also take into account the upstream and downstream value-add stages for technology and commerce.

⁵ German Federal Environment Agency (UBA) (2024): New Ecodesign Regulation for sustainable products enters into force.

⁶ Act on Implementing Requirements of the Single-Use Plastics Directive and the Waste Framework Directive in the Packaging Act and other laws of 9 June 2021.

⁷ Directive (EU) 2025/40 of the European Parliament and the Council of 22 January 2025.

⁸ Regulation prohibiting the placing on the market of certain single-use plastic products and products made of oxo-degradable plastic (EWKVerbotV) of 20 January 2021.

⁹ Regulation on the quality and labelling of certain single-use plastic products (EWKKennzV) of 24 June 2021.

¹⁰ Act on the Single-Use Plastics Fund (EWKFondsG) of 11 May 2023.

¹¹ German Federal Environment Agency (UBA) (2024): The Single-Use Plastics Fund. Which players and products are affected?

¹² Regulation on Requirements for Using Mineral Substitute Building Materials in technical buildings (ErsatzbaustoffV) of 9 July 2021

¹³ Destatis (2025): Waste management.

¹⁴ German Federal Environment Agency (UBA) (2024): Waste generation. 

¹⁵ Material recycling means any recovery process other than energy recovery and the processing into materials intended for use as a fuel or other means of energy production. In particular, material recycling includes the processing for reuse, recycling and backfilling (Section 3 (23a) KrWG). Energy recovery, on the other hand, refers to the processing of waste for thermal recovery by incineration. However, some waste is also incinerated to dispose of it.

¹⁶ Destatis (as of 3 June 2024): Short overview Waste balance 2022.

¹⁷ The recycling rate (calculated based on the weight of waste entering recycling facilities) differs from the utilisation rate (proportion of materials actually recycled and their actual use in production).

¹⁸ BMUV (2025): Statistics on individual waste management sectors. 

¹⁹ BMUV (2024): Electrical and electronic equipment.

²⁰ German Federal Environment Agency (2024): Recovery rates of the main types of waste.

²¹ Central Packaging Register (ZSVR)

²² ZSVR (2024): Figures, data, facts: Annual recycling rates in Germany. 

²³ Ibid.

²⁴ Foundation Central Packaging Register (ZSV) (2025): Press release – Packaging recycling requires correct separation of waste: Current figures, positive trends and challenges.

²⁵  Association of the German building materials industry and waste management sector (2023). Circular economy construction. Mineral construction and demolition waste.

²⁶ Federal Association of German Industry (BDI) and Deloitte (2021): Circular economy – Challenges and opportunities for Germany as an industrial location.

²⁷ German Natural Resources Agency at the Federal Institute for Geosciences and Natural Resources (DERA) (2023): Final report of the Dialogue Platform on Recycling Raw Materials (version: August 2023)