Earth Day 2022 is a good time to look at the ways businesses are stepping up to the challenge of climate change. Here are three big areas that are having a significant and growing impact on reducing harmful emissions and protecting the environment. 

1. The Circular Economy Goes Mainstream

The "circular economy" is a big, structural change requiring a shift in mindset and investments. Instead of mining and harvesting, manufacturing materials into products, using the products and discarding them, in a linear way, we can keep using the same materials over and over in a more circular way. The first advantage is cost savings: used materials are almost certainly cheaper than virgin materials. The second is availability: waste materials are as available as the products we are finished using. We don't have to import them from a war zone or a politically uncomfortable trading partner. The third is innovation: waste materials can solve problems in new ways. 

Here's an example of applying the circular economy concept to tires: scrap tire material can be used in asphalt. The improved, rubberized asphalt has been found to respond better to temperature changes, producing less potholes, and to drain rainwater better than other asphalt. Both potholes and rain accumulation can be unsafe for drivers. So old tires not only can find a new use, avoiding landfill, but they can help make driving safer.

The fifth annual Circularity Gap Report, published by a group called Circle Economy, says that only 8.6% of the economy is circular, meaning more than 90% of materials extracted and used are thrown away. With rising consumption, materials use has nearly quadrupled in 50 years, according to the report. That means that over 90% of materials extracted and used represent a business opportunity: inventing new markets for them. Waste can be used to make new products, packaging, building materials, and more. 

Accenture has estimated the circular economy to be a $4.5 trillion business opportunity, with all kinds of ways to transform a problem into a resource. 

2. Renewable Energy is Growing

Renewable energy has come a long way, with prices down, job numbers up, and advancements in battery storage that now make it possible to rely on continuous energy. Engineers at Stanford University recently developed solar cells that can produce energy at night through a process involving temperature differences. A company called Re-wind is using scrap wind turbine blades in civil engineering projects, finding innovative ways to recycle them. Battery recycling is scaling fast, and US sales of plug-in electric vehicles nearly doubled between 2020 and 2021. 

With gas prices up and supply chains in turmoil, the decarbonization transition represents an economic opportunity reminiscent of a war effort: such a spike in demand can supercharge the economy. In fact, President Biden has invoked the Defense Production Act to jumpstart domestic mining of materials needed in batteries: lithium, nickel, cobalt, graphite and manganese. America needs EV charging stations, grid upgrades, recycling facilities, organic materials, meat substitutes: an endless list of new products and services for a decarbonized world. 

3. I Sing the Car Electric

A week on a small island driving a plug-in electric car past gas stations advertising $4.32 a gallon brings a pause for reflection. If energy were free, people could spend more money on food. The poverty rate would immediately decline. The island could invest in solar powered desalination plants to shore up scarce water supply. More fresh water would be good for agriculture. 

The sun and wind are free and infinite. Investing in the innovation needed to deploy these sources of energy, and hydrogen and nuclear energy, makes enormous business sense. It also makes a lot of sense from the national security perspective of energy independence. What is difficult is shifting investments and government support from the entrenched fossil fuel industry into renewable energy infrastructure. Change doesn't come easily, even when it makes this much sense.

Since renewable energy, electric vehicles, circular economy, and other sustainability measures make such good business sense, investors are piling in for the money. Environmental, social and governance (ESG) funds continued to draw record investments. "U.S. sustainable funds netted nearly $70 billion for the year, a 35% increase over 2020's high-water mark," reported Morningstar. 

Earth Day is in its 52nd year. It started at a time of rising consciousness about the evils of pollution, and after a massive oil spill in Santa Barbara in 1969. But this year, the buzz words are "invest," "business" and "innovation." Just as waste can be transformed from problem to resource, business can change from polluter to innovator.

That is the challenge in 2022, and success is a realistic possibility.