Review of ecosystem services in a bio-based circular economy and governance mechanisms

This paper reviews the literature relating to a type of local bio-based circular economy (BCE) where food waste (FW) is effectively recycled to advanced bio-refineries to produce multiple ecosystem services (ES) including energy, biofertilizer and other value-added products and services. The biofertilizer is applied within urban and peri-urban farms to close the bioresource loop. Such BCE concept has been proposed in several EU countries with varying degree of success in long-term operations. We systematically review the ES of BCE and identify the ES, which are not properly compensated by the market. On this basis, we further review the potential regulatory and supporting mechanisms, which could incentivize the successful implementation of BCE and overcome the market/policy failures. We find that single regulatory instrument at the government and authority level could be compromised by poor governance and practices at other levels, and therefore may not reach its full potential. Instead, we propose a multi-level regulatory and supporting system, which combines the strengths of top-down and bottom-up governances and motivates the self-governance of industry and citizens. We conclude by highlighting a need for multi-level governance research supporting urban sustainable transitions, with a focus on constructing ‘policy portfolios’ from a systems perspective to better engage government, firms, citizens and other stakeholders.