Introduction

Increased electrification of society, combined with greater use of renewable energy sources, is seen as a central strategy to address climate change. Electrification takes place in many different areas. However, it is particularly important to have a decreased use of fossil fuels in the transport sector. There are already several countries that have adopted strategies for the electrification of the transport sector (e.g., Sweden has developed an electrification strategy [1]). This development is also expected for many industries, for instance, current efforts to replace coal and coke in steel production with hydrogen produced by renewables [2, 3]. Electrification in combination with growing economies has led to increasing electricity needs, with demand predicted to rise even further in the future [4]. Increased electricity needs combined with more use of intermittent and renewable energy sources, will increase the pressure on electric grids [5]. The electricity grids of today, however, are not sufficiently equipped to support the renewable and sustainable energy system of the future. Many see “smart grids” as the solution to these problems [5]. With smart grids renewable energy sources can be easier integrated into the electricity grid and it is possible to further improve the reliability and resilience of the grid. In addition, smart grids can make it easier to use electric vehicles as well as other forms of distributed energy generation and storage. But the smart grid as such does not yet exist [6], even though parts of current grids might be regarded as “smart” [7].

Currently, there is no exact definition of smart grids, but there are many different ideas, visions or imaginaries of what a (future) more intelligent grid could entail [8,9,10,11]. According to The International Energy Agency (IEA), a smart grid is “an electricity network that uses digital and other advanced technologies to monitor and manage the transport of electricity from all generation sources to meet the varying electricity demands of end-users” [12, p. 6]. Smart grids are seen to coordinate the needs and capabilities of all actors in an energy system to enable smooth operation, while also minimizing costs and environmental impacts and increasing flexibility and reliability [13]. Further, smart grids are considered an alternative to extending or reinforcing physical infrastructure, which is costly and disruptive, in a situation with a foreseen increased use of renewable energy resources and ever-increasing electricity demand [14]. There are still many questions about how smart grids might develop in the future [6]. One issue concerns scale, as the future of the electricity landscape includes different kinds of visions, such as a global super grid, regional grids, decentralised systems in a smart grid, or self-sufficient off-grid systems [15]. Another question for the future concerns the role of electric vehicles (EVs) in smart grids [16, 17]. EVs can support the smart grid by offering an option for load balancing, but EVs can also cause problems for grids. Most notably, some countries may not have enough electricity available in local grids to support a rapid transition to EVs [18].

Smart grids can be described as an evolving set of technologies. There are no fixed elements that define a smart grid. Furthermore, these technologies are used to varying extents depending on where in the world and in which contexts they are being used and developed. Some technologies are already in use, whereas others are still being developed A smart grid is not only built on technology, however, as new actors, support structures, institutions, or regulations will be needed to realise the visions [19]. Additionally, the user in the smart grid is faced with new demands and opportunities [20, 21]; this also applies to prosumers more generally (see e.g. [22, 23]).

While smart grids may support climate change objectives and provide environmental benefits through load balancing and storage, promoting energy efficiency, and integrating renewables [24, 25], there is considerable uncertainty related to their sustainability in a broader sense. There is a diverse range of perspectives and concepts surrounding the concept of smart grids. To be sustainable, a smart grid must incorporate the three pillars of sustainability. This encompasses environmental aspects such as climate change and material use, as well as social and economic considerations. Previous research on smart grids has predominantly focused on energy and climate impacts, as well as social and economic factors. When it comes to energy and climate change, a lot of studies investigate how smart grids can contribute to integrating renewable energy sources into the grid and thus reduce carbon emissions so that one can achieve an energy system that is more resilient and environmentally friendly (e.g. [24, 26]). Social and legal sustainability aspects connected to smart grid use are receiving increasing attention in research, focusing on issues such as consumer vulnerability [27], how current legal frameworks do not promote the flexibility required in smart grids [28], and issues related to (mis)use of consumer data by market actors [29, 30], including issues such as privacy of consumer data, data security, user control and acceptance, and distribution of the benefits of smart grids. There is recently more interest in also considering the material implications and resource utilisation of smart grids, or in other words: the circular economy (CE) implications of the smart grid. However, so far, less research has been conducted on issues regarding CE, for instance, resource use required for the smart grid transition. This is why this research focuses on how CE principles can be integrated into the development and maintenance of smart grids, a topic that is underexplored in academic research.

Nowadays, issues related to resources are usually discussed under the umbrella term of CE. There are many different definitions and understandings of CE in the research [31], but essentially the CE aims to achieve a gradual decoupling of economic growth from the consumption of finite resources and to design waste out of the system [32]. It also stresses the economic gains associated with resource savings [33]. A company may develop five strategies – or a combination of strategies – to develop circular solutions [34]: they can narrow (use less material and energy), slow (use products and components for longer), close (use the material again, i.e., recycling), regenerate (use non-toxic material and renewable energy), and inform (use information technology to pursue circularity) the resource and energy flows that are associated with their business activities.

The move to a CE requires a strong shift in the market. While there are signs that some industry sectors may be on the edge of such a “disruption” [35] there is very little research on the implications for electric grids. A key concern is that the climate change transition requires resources, for instance, minerals for EVs and batteries for storing electricity, and thus such research is needed. Several new reports question if we even have enough resources for the necessary climate transition [36, 37]. This raises the importance of enhanced recycling practices to secure more resources through recycling. Another option is to use grid components that last longer – i.e., are more durable – and maintain them properly to prolong their lifetime. However, current rules regulating grids and other factors can be a barrier to such solutions [38, 39]. For instance, many grid companies replace grid parts after a given number of years, which disincentives investment in more expensive, durable grid components.

This study aims to explore how much CE principles are integrated within the context of smart grids, specifically in a Swedish context.

For this aim, the following research questions were defined:

  1. 1.

    How have CE implications of smart grids been investigated and covered in previous research and other relevant literature?

  2. 2.

    How are CE principles being implemented in the smart grid industry, and what challenges and opportunities can be identified regarding the implementation of CE strategies?

  3. 3.

    What are the main barriers and enablers that influence how CE principles are integrated into the development and maintenance of smart grids in Sweden?

The paper has the following structure: Sect. 2 describes the methods employed, the material used and the data analysis. Next, the nexus between smart grids and CE perspectives is explored, building on a literature review. After that, the results of the semi-structured interviews are accounted for, followed by the discussion and conclusions.

Research Design, Methods, and Material

The study consists of a literature review and an interview study based on semi-structured interviews. It follows a qualitative research approach, as this was deemed most suitable to capture the different actors’ perceptions, while also capturing the relevant aspects in the literature review and thematic analysis [40]. A qualitative, exploratory research approach is also appropriate when exploring a new phenomenon, where there is limited research.

The literature review aimed to examine the current state of research on the integration of CE principles within the context of smart grids. Interviews with different stakeholders in the smart grid field were conducted to understand their views and perceptions on the CE and to evaluate if CE-related issues are a priority for stakeholders. Through the interviews, it was possible to investigate and understand how current rules and regulations may support or hinder circular solutions for these stakeholders, and the extent to which CE and resource issues are discussed among different stakeholders working with smart grids.

The focus of this study is Sweden, although it is important to consider the influence of EU policy and global developments on Sweden’s electricity system, as the EU rules establish a lot of the legal framework for energy markets in EU member states.

Figure 1 shows in a flowchart an overview of the applied methods. The next two sections describe in more detail the literature study, actor mapping, the semi-structured interviews as well as the data analysis.

Fig. 1
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Overview of applied methods

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Literature Review

In this study, a literature review was conducted to explore the connection between sustainability, specifically circular economy and smart grids in current research [41, 42]. The search is summarised in Table 1. Many articles review the future challenges in smart grids (e.g., [43, 44]) but very few discuss resource constraints. Our literature only found a few articles of relevance. The search was therefore widened also to include literature on CE business models, studies that account for resources required for technologies in smart grids, and some studies on specific technologies, including batteries and EVs. The searches were conducted in Scopus, Google Scholar and Google. Many of these studies do not make direct links between smart grids and CE aspects, strengthening the case for more empirical investigations.

Table 1 Overview of the literature search
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Actor Mapping, Semi-Structured Interviews, and Data Analysis

To identify the key actors involved in discussions and work related to smart grids in Sweden, an actor mapping was conducted. The actor mapping began with desktop research, which included a Google search for relevant reports published in Sweden on smart grids, also using the snowball method. This search was carried out in the summer and autumn of 2021 and was updated in the autumn of 2022. Based on the results of this initial search, the various actors working on smart grids in Sweden were identified, categorised, and recorded in an Excel document.

Figure 2 shows an overview of different stakeholders working in one way or another with smart grids in Sweden. The actors comprise a wide range of stakeholders, including various governmental actors at the national, regional, and local levels (e.g., SOU, energy agency, EI, and regional actors such as Region Skåne), consultancy firms (e.g., Profu, Ramböll, Sweco, DVN GL, Thema), industry or trade organisations (e.g., Swedish CleanTech, Power Circle), technology providers/original equipment manufacturers (OEMs) (e.g., ABB, Schneider Electronics, KL Industry, AB, Siemens, Caverion, Afry), the energy industry (Vattenfall, Skellefteå Kraft, Kraftringen, Ellevio, E.ON), research institutions and universities (e.g., RISE, IVL), and various demonstration projects. The actor mapping was exhaustive, but there are potentially other stakeholders present in Sweden who are relevant to the development of smart grids.

Fig. 2
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Overview of different stakeholders involved in work with Smart Grids in Sweden

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Semi-structured interviews were chosen since they allow for probing, using open-ended questions where participants are allowed to give their personal views on different topics [45, 46] They are ideal for examining uncharted territory with unknown issues (ibid). This is useful since this study aims to fill knowledge gaps about issues that have been scarcely studied.

Purposeful sampling has been chosen, which is common in qualitative research [40, 47]. In conducting the sampling so that a variety of positions concerning a research topic are represented, differences in experiences may be highlighted [48]. Theoretical saturation could be reached with the number of interviewees [40]. The interviewees were found through actor mapping.

An interview guide was designed with questions related to smart grids, with a particular focus on resource and material use aspects. Different stakeholders with insight into the smart grid field were regarded as a suitable interview group to seek knowledge about smart grid resources and material use issues that are not present in the current academic literature. The focus was thereby mainly on knowledge brokers and intermediaries in the development of the smart grid.

A total of 19 semi-structured interviews were conducted with six different stakeholder categories, as these were identified as important knowledge brokers and intermediary actors for smart grid development in Sweden, as presented below.

  • Technology providers/original equipment manufacturers (OEMs) are at the forefront of smart grid technology development. It was therefore deemed key to investigate their understanding of different sustainability issues in connection to the technologies they are developing.

  • Government agencies/public bodies are important in creating the societal conditions that allow for increased smart grid employment, and they work strategically in implementing smart grid technologies.

  • Consultancy firms hold much knowledge since they are often employed by governmental actors or companies to draft reports on the future electricity system.

  • Research institutes/researchers, including consultancy firms, have expertise covering many aspects of smart grid systems, from technology development to implementation and assessment.

  • Energy organisations can host a wide range of actors and therefore have a special insight into energy issues.

  • Network operators/ energy companies are practically concerned with implementing smart grid technologies, e.g., installing smart meters.

The stakeholders selected in this study play a crucial role when it comes to the development of the smart grid in Sweden. They can be defined as knowledge brokers and intermediaries in the field of smart grids. [49,50,51,52] The selected stakeholders act as knowledge brokers and intermediaries as they for instance facilitate the transfer and exchange of information and expertise about smart grid technologies, Circular Economy (CE) or even their integration. All of them contribute when it comes to shaping technologies and practices regarding smart grid developments or maintenance. In their work, they are also able to show the need for new actors, support structures, institutions, and regulations or changed roles and responsibilities of users and prosumers.

The interviews were conducted on Microsoft Teams. The interviewees all gave their consent to be recorded. All the interviews were transcribed and analysed with the help of the computer-assisted qualitative data analysis software NVivo with inductive coding. The interviewees were promised anonymity and therefore the quotations do not include any names.

The Nexus between Smart Grid and Circular Economy (CE) Perspectives

Based on our literature review, this section applies different perspectives to discuss the integration of CE aspects for smart grids. Firstly, the general relationship between CE and climate and energy issues is examined. Then the resource challenges of smart grid and climate technology, and the potential measures smart grid suppliers could use for supplying CE solutions are discussed.

Circular Economy and Climate and Energy Policy: Synergies and Conflicts

There are several potential positive synergies between the CE and climate objectives [53, 54]. By keeping buildings, infrastructure, and products in use for longer (longer life spans), there are great opportunities to save not only resources but also to cut greenhouse gas (GHG) emissions, as such emissions emerge in various parts of the production chain when producing new materials and products. Furthermore, it is possible to increase the reuse and recycling of products and materials and thus create opportunities to reduce GHG emissions for many materials.

There may also be some trade-offs. In some cases, replacing products and infrastructure with more energy-efficient alternatives can lead to higher GHG emissions, even if resources are saved, since there is a delay in the introduction of more energy-efficient products and infrastructure (e.g., [55, 56]). As products become more energy-efficient, there is however less trade-off between keeping a product in use for longer vs. replacing it with a newer, more energy-efficient product, since many technologies cannot be made much more energy-efficient [57].

Due to the complexities involved, it is crucial to adopt a “systems perspective” when looking at alternatives, for example when looking at issues such as climate change, resource use, and toxicity in an integrated assessment [58].

Circular Economy and the Smart Grid

The importance of analysing how smart grids can integrate with CE issues is increasingly important. A key concern is that the climate change transition requires resources, including minerals for EVs and batteries for storing electricity, as well as for renewables such as solar PVs and wind power. Several recent reports have looked at the potential resource needs for the transition [35, 37, 58]. Copper, graphite, rare earth elements, nickel, cobalt, and lithium are some of the resources where a strong demand increase is expected. Prices are expected to rise in the future, which could have major impacts on the level of grid investment [36]. Some reports question whether we even have enough resources for the necessary transition [37]. However, there is of course great uncertainty related to which resources will be needed, as there is scope to innovate and replace some minerals with alternatives.

A recent analysis from the IEA states:

“Electricity grid operators should embrace the achievement of the United Nations Sustainable Development Goals by reducing the use of raw materials, adopting alternative sustainable materials in grid components, implementing circular solutions for dismantled grid assets (such as recycling and reusing equipment) and protecting biodiversity. These measures can reduce life cycle environmental footprints and increase safety, especially when critical mineral resources, notably for copper, may become scarce and geographically concentrated.” [59]

The Swedish Energy Agency stresses that access to resources is one crucial component of a sustainable smart grid, and that the development of the smart grid can reduce the size—and associated environmental impacts—of some current practices (e.g., reduction of fossil fuel extraction), and instead increase other practices and their impacts (e g., mining of minerals for climate-friendly technologies and smart grid solutions) [60]. In line with the previously mentioned reports, the Swedish Energy Agency stresses that some new technologies will require minerals. It also emphasises the need to develop logistic systems for new energy carriers, especially batteries and hydrogen as this is seen as a key enabler for the decarbonisation of heavy industries. Furthermore, the report highlights that more grid infrastructure also puts pressure on nature. What is needed, according to the report, is a system perspective based on life cycle thinking, when smart grid solutions are adopted.

A study by Kis et al., [61] reviewed the material use associated with electricity generation technologies, although the study does not directly analyse what kinds of resources are critical or scarce.

Mattsson et al., [62], stress that the implications of future grids include both local and global impacts, and that some technologies have the largest impacts in the extraction and production phases but limited impact in the use phase if run on renewables (e.g., batteries), whereas others may also have impacts in the use phases (e.g., wind power). They also highlight that we know more about the environmental impacts of some technologies and solutions than others. As some metals and minerals may be hard to obtain in the future, technologically advanced nations should also be able to develop solutions such as wind power and EV technology without some of these minerals [63].

The production of batteries for EVs is associated with a large amount of environmental impact [64]. While there is uncertainty regarding future technologies and energy needs [65], resource scarcity is a possibility. Businesses can partly address such problems by recycling or increasing the product lifetimes of batteries (e.g., [66], but we need a more general CE strategy for EVs [67]. The EU has policies in place to re-use and prolong the lifetimes of used EV batteries (e.g., by using them in an electric grid),Footnote 1 but it is possible that recycling is more beneficial than longer life in the near future, if the battery technology advances rapidly. However, there are uncertainties regarding the electrification of transport, where material needs not only include EVs but also charging infrastructure (cf. [68]).

A recent study of long-life high voltage motors – stationary motors with industrial uses, that often run up to 24 h a day – found that extending the lifetime by strategies such as repair only makes sense if the energy efficiency is not reduced in the process; the intense use of the battery means that resource gains due to longer lifetimes cannot compensate for climate-related impacts due to decreased energy efficiency performance [69].

Different scenarios are possible for wind power and solar PVs, ranging from a best-case scenario that assumes material intensity improvements that reduce demand for resources, to a worst-case scenario which implies a need for much more mined resources [70]. There is currently a lot of research and experimentation looking at recycling these technologies, but changes in technology and the costs of materials mean that the future recycling pathways are uncertain.

While there is limited research on the relationship between the smart grid and CE, some energy companies have started to discuss the implications. Looking at the comprehensive vision made by any company, only one could be found, developed by ENEL [71]. The document stresses: The need to look at which raw materials to use and collaborate with actors in the value chain; research the potential for phase-out of critical raw materials, and materials with negative social impacts in supply chains; the extension of the service life of grid components like batteries; re-use, remanufacturing, or recycling of old grid components; consider dismantling and recycling of components already when designing a facility; test new solutions like applying used batteries from electric vehicles as storage solutions in grids; develop new storage solutions that require less material (e g geothermal storage); increasing the content of recycled material in components like smart meters.

Deloitte [72] has analysed how data centres can be more circular, focusing on solutions like prolonging the life of components, recycling more components, and adopting modular design to be able to switch components without having to replace larger systems.

Circular Components and Business Models

Following the concepts in [34], there are five key circular business model (BM) approaches that can improve the resource and energy flows associated with business activities: companies can narrow (use less material and energy), slow (use products and components longer), close (use the material again, i.e., recycling), regenerate (use non-toxic material and renewable energy), and inform (use information technology to pursue circularity).

Regarding the first strategy, there is a natural driver towards using fewer materials and energy-intensive solutions, not only for grid components but also for technologies that use an increasing amount of electricity, such as data centres [73, 74]. These efficiency gains are however offset by increased use and storage of data. The mining of cryptocurrencies also accounts for a large amount of energy use [75].

The second strategy, slow, implies a situation where grid components can be used for longer to save resources. When companies sell grid components, they have limited incentives to increase lifetime, as they earn money by selling components. Some OEMs of grid components have however shown some interest in leasing out grid equipment to distribution system operators (DSOs) [39]. This would provide stronger incentives to design durable components, as money is not made on the sale but through monthly payments. This means there are incentives to make durable products that have long lifespans and require limited maintenance. However, there currently seem to be some regulatory barriers that hinder investments in smart grids generally, which acts as a barrier for leasing solutions. A first concern is that current rules regulating grids often support investments in capital-intensive goods (CAPEX) rather than operational spending on maintenance and flexibility (OPEX). Thus, it means that DSOs prefer to invest in grid infrastructure, not in maintenance and grid flexibility. This is a general barrier for smart grid solutions (see also [38]). It can also be a barrier preventing investment in long-life grid components, or leasing of grid components from OEMs that design and sell durable components [39]. An option would be to move towards regulatory frameworks that support a TOTEX (Capital Expenditure + Operational Expenditure) model [76]. The Swedish Energy Markets Inspectorate [77] has proposed changes to Swedish rules to support such developments. The aim is to make it possible to introduce incentives in the regulatory model that steer towards solutions other than traditional network investments when these are more cost-effective in the long run. The proposed rules will benefit flexibility services use, provided they are more cost-effective than traditional network investments.

A third strategy for businesses is a BM related to closing loops (using materials again, i.e., recycling). There, one can assume that there is a natural driver to recycle metals and other valuable materials in grid components, whereas there is less recycling of rare earth elements, but there seem to be no studies on this specifically for smart grids. There are already see examples of how some companies are increasing the recycled content of components like smart meters [71], whereas several large IT companies have increased the reuse and recycling of components [72].

A fourth strategy is to regenerate BMs (e.g., use of non-toxic and biobased materials). In the case of material choices, there are several EU regulations on restricted chemicals, as well as rules on conflict minerals, which provide an impetus for change. One can also assume there are additional drivers, as smart meter OEMs have started to launch models made with recycled plastics [78], or have started responsible sourcing practices and committing to more recycled materials [79].

Views on Circular Economy in the Smart Grid

This section accounts for how the interviewees define smart grids, whether CE principles are considered in the smart grid and how CE can be enabled in a smart grid, the material and resource demands there are for the smart grid, and how CE can be integrated into a smart grid.

What is the Smart Grid and how will the Grid Develop?

The interview respondents were asked to provide their definitions of the “smart grid” term. Many of the interviewees stated they found the concept unclear or simply difficult to define but provided a definition anyway. Two were more critical. One interviewee highlighted that it is more of a marketing concept, with companies attempting to fit a wide range of technologies under the umbrella of “smart” to promote them (IP_6, intergovernmental agency). The other critical interviewee did not agree with the term at all and wanted instead to refer to “flexibility” in the grid (IP_8 regional council). One interviewee (IP_19 consultant) stated, “There has been a lot of [talk about] flexibility, which has been the buzzword. So, we're actually talking about the same thing. Then we talk about the part of smart electricity grids where new technology can be used to involve customers in a new way, but then it is flexibility and flexibility markets, and then there is…this new buzzword is electrification …”.

Most interviewees said that what a smart grid means to them is the use of advanced technology and connectivity to improve the efficiency, reliability, and flexibility of today’s electricity grid. Many interviewees also referred to the importance of increased integration of distributed energy resources, such as solar panels. Additionally, many interviewees talked about a future with increased use of electric vehicles, and the use of smart meters to gain real-time visibility and detailed information on energy usage. Furthermore, some mentioned a focus on increased customer engagement and participation in the management of the grid, as well as a shift towards more cost-effective and sustainable energy systems.

Using flexibility means optimizing the use of existing resources and infrastructure, rather than simply expanding it. For many, this is however just an additional or temporary help, and the interviewees thought that the grid needs to be physically expanded too.

One of the main differences in the definitions provided was the specific technologies and solutions that could be used for a smart grid. Some respondents mentioned the use of data analysis and automation, while others focused on two-way communication, digitalisation and communication, system-wide coordination, and customer engagement. Another difference is the perspective or purpose of smart grids. Some define the smart grid as a tool for safety and availability, some stress improved customer satisfaction, or the importance of running the existing grid more efficiently, while still keeping it safe.

Often smart grids are associated with more decentralised systems (see e.g. [15]). Regarding the future of the grid, the interviewees agreed that there will be more decentralisation, but it will not work without centralised electricity production in place.

Resource and Circular Economy Considerations in the Smart Grid

The interviews revealed that CE and resource issues have not been extensively discussed in the context of smart grids, or the energy sector more broadly. However, there appears to be a shift in this regard. Overall, the interviewees said it would be important to also take resource and material use into consideration but not all have worked with this in practice or thought about it much before.

Interviewees from national governmental agencies and an intergovernmental organisation all stated that in general, the focus has been rather on energy efficiency. This is also evidenced by EU product legislation, which has mainly regulated the energy performance of products. However, increasing the energy efficiency of products may often require the use of materials that have negative climate impacts, highlighting the need for greater consideration of the materials used in products. The respondents however also said that they had internal discussions about resource issues and started to include these issues more often in their work when for instance writing reports. The respondents further said they believed that considering CE and resource use would be more important in the future. (IP_12 governmental agency, IP_4 governmental agency, IP_6, intergovernmental agency).

“This whole thing about resource efficiency and circular economy, it will become much more important with… not only that you must rent the product itself, but you think about the life cycle when it comes to… and flows, within the industry. And for example, you build up circular currents and take care of the waste and the heat that comes out, for example, server halls… a lot of excess heat, maybe you can use it in a fish farm or a greenhouse nearby.” (IP_12 governmental agency).

To give some concrete examples, one interviewee from a governmental agency said that they have recently placed a greater emphasis on resources in advice in the national “Electrification Strategy” that formerly focused on energy efficiency but now also includes a section on resource use (IP_4 governmental agency). The interviewee from the intergovernmental agency stated that they just started to consider resource aspects within their organisation. Related to that, one of the tasks the interviewee had, was to work on a report about critical minerals, which estimates mineral demands under different energy scenarios. The interviewee said that there is a new awareness of circularity and resource issues, but the organisation has so far not proposed any concrete solutions regarding resource needs and the transition to for instance renewable energy (IP_6 intergovernmental agency).

Enabling Circular Economy in Smart Grids

This section describes the opportunities and challenges the interviewees saw in enabling a circular economy in the smart grid, for instance through more efficient material and resource use for the grid infrastructure or certain technologies, or through different business models such as leasing or renting of equipment.

Efficient Material and Resource use in the Smart Grid: the Physical Grid Infrastructure and the Need for Extra Components?

When it comes to CE, the question that arises is how resource and material-demanding or efficient will a potential smart grid be. Overall, the interviewees thought that smart grids would also be more resource-efficient than traditional grids, but it was not always clear-cut that it would be like that. Creating a smart grid means also that there is a need for new physical components, for instance, control and regulation systems, batteries, and home appliances.

“Constructing an electric grid [means using] iron, copper, and aluminium. Electronics demand other rarer metals, batteries and other things… In that way [smart grids] have an impact, but the benefit is bigger – without having calculated or being able to verify it in any other way than my personal estimation.” (IP_1 energy company).

One big change in the transition to smart grids will most likely be big software changes. This change would not necessarily mean replacing the current grid infrastructure, but instead, it means adding components to the existing grid infrastructure, such as digital measuring equipment. The biggest resource demands will most likely be during the implementation of various smart grid technologies which will then decrease over time once they are standardised and incorporated in the system. Thus, it is crucial to consider resource use, especially the planning and implementation phase of smart grid technologies to be able to optimise resource use and minimise any negative impacts (IP_1 energy company, IP_7 energy company, IP_16 research institute).

Some of the interviewees discussed what influence grid owners can have on resource use simply by choosing certain technologies. However, some stressed that all technologies will have trade-offs. One example that was mentioned is that batteries are rather mineral-intensive. One solution that was suggested was that one could also use hydropower to store electricity instead of batteries (IP_6 Intergovernmental Agency).

Several interviewees emphasised the potential of smart grids to enhance resource efficiency within the electricity system and gave different examples:

  • –Smart grids provide flexibility and “shave” peaks in demand. This can help to mitigate the need for the construction of additional grid infrastructure, thereby reducing material needs and costs and potentially contributing to a more sustainable electricity system (IP_4 governmental agency, IP_15 governmental agency, IP_2 research institute, IP_13 consultant, IP_1 governmental agency, IP_7 energy company).

“Cables are dimensioned after the busiest times of the year, so they are not actually “full” most of the time” (IP_7 energy company).

Flexibility markets, which involve the use of smart grids to connect more customers to the grid and manage demand, are already being utilised by network operators to address capacity constraints. However, these markets are currently limited to larger customers. (IP_7 energy company). There is potential for these markets to be expanded to include smaller customers, such as households, using aggregators. This would be good as they are seen as being able to be flexible compared to industries that would need to maybe stop operations. Regulatory changes may be necessary, however, to incentivise network companies to invest in virtual grids rather than traditional infrastructure (IP_7 energy company, IP_8 regional council).

  • It would be possible to use vehicle charging points for load balancing. This could be done by coordinating charging times with periods of lower household energy use. One of the respondents (IP_9 research institute) highlighted here the potential for the extensive adoption of vehicle-to-grid (V2G) and vehicle-to-home (V2H) systems in the future to further optimise resource use and improve the performance of smart grids. These strategies for instance could help to make sure that existing resources are used more effectively and efficiently when implementing smart grid technologies which would then help minimize the need for additional materials and infrastructure. “Electric vehicles are essentially batteries on wheels […]. The reality is that the car stands still most of the time.” (IP_9 research institute). There are already existing brands that produce batteries which can be discharged to provide electricity to the grid, but one interviewee (IP_9 research institute) was a bit concerned that there might be no or little willingness of electric vehicle (EV) manufacturers to replace batteries that have only been used for a short period.

  • When it comes to smart meters, one suggestion was also that maybe it would be possible to install smart meters for a neighbourhood and not for each household (IP_6 intergovernmental agency). The number of needed resources will also depend on the level of flexibility that can be achieved.

  • One interviewee said instead of adding more equipment to develop the smart grid, it would simply be possible to instead focus on keeping the system simple (IP_9 research institute). The example the interviewee presents is that simply a smart meter combined with a smartphone app could be enough to make a building more energy efficient. The needed resources for developing smart grids can be quite different and are dependent on the level of flexibility achieved within the system. Digitalising and connecting many home appliances probably will mean using more resources as more components and equipment are needed. Another solution here would be to achieve a smart grid with for instance disconnecting entire households from the grid during peak demand. This highlights that it is important to carefully consider the various resource implications of different approaches when it comes to developing and implementing smart grids.

Despite the potential for smart grids to improve resource efficiency and prolong the lifespan of grid components, several interviewees still thought that new infrastructure would be required in the coming years to replace ageing components and accommodate increased electricity demand (IP_4 governmental agency, IP_7 energy company, IP_3 OEM, IP_8 regional council). One interviewee (IP_4 governmental agency) suggested thereby that further investigation through scenario analysis may be necessary to fully understand the potential impacts.

It is crucial to take into consideration how to best optimise resource use which helps to minimise negative impacts (IP_1 governmental agency, IP_6 intergovernmental agency, IP_9 research institute). Overall, it is not always obvious what the best solution is, and one simply has to choose which is best in a specific context. One example, showing the complexity of the issue, is energy communities. These are often viewed positively creating a decentralised and more sustainable energy system where renewable energies are promoted and a GHG reduction is achieved. Two interviewees took up energy communities as examples of solutions that may increase material and resource use (IP_1 energy company, IP_9 research institute) and thus questioned their positive impact on a sustainable energy system. They argued that energy communities can be resource-intensive when one takes a material perspective. What is needed is basically parallel cables which impacts the resource use negatively. They acknowledge that energy communities can be more efficient from a pure energy perspective as they allow households to share surplus electricity, rather than sending it back to the grid. Another interviewee also highlighted the potential of energy communities regarding the reduction of peak electricity demand as households can share electricity (IP_12 governmental agency).

Looking at all these reflections by the interviewees it becomes apparent that it is important to consider both, energy efficiency as well as material implications, of the implementation of a smart grid. These considerations highlight the importance of considering both material resources and energy efficiency in the implementation of smart grids, all with different trade-offs and resource impacts.

Smart Grid Technologies, Components and Equipment: the Importance of Assessment, Prolonging the Lifespan and Maintenance

Having a smart grid will mean in one way or another, that we need more equipment, components, and technologies. The important question is then how these will be designed as well as how long they will be used. Are equipment and components for the smart grid shared, maintained, and prolonged? Regarding maintenance, rules and regulations strongly affect the use of components, equipment, and technologies. Interestingly, the interviewees had different views on these issues which shall be presented below.

Additional components or equipment, for instance, smart meters, are needed for the implementation of smart grids, it is important to consider the environmental impacts of these technologies overall. Some of the interviewees are working with different components or equipment needed for the smart grid and they shared their experiences. One respondent (IP_10 energy company) said that his company always conducts life cycle assessments (LCAs) on their smart meters. They do consider resource use as they are responsible for quite a large number of meters (900,000). The respondent said that their priority for the new meters has been to design them with a lifespan of 15–20 years to minimise resource use and waste. Moreover, another respondent (IP_3 OEM), whose company also manufactures smart meters, stated that LCAs are conducted on their most popular products and that they are investigating ways to make material use more sustainable. They are considering the environmental impacts of their products more as they notice an increased public interest and there is also stricter legislation. The smart meters they produce have a lifespan of 12 years, however, the responsibility for recycling or decommissioning them falls not to them but to the utility companies and is highly dependent on market conditions. However, in contrast, one interviewee from an energy company stated that he/she is not aware of LCAs being conducted within their company and had not heard discussions about or thought about resource implications when replacing components of certain technologies more frequently (IP_7 energy company). Similarly, a consultant said that so far, they had never investigated resource demands from any smart technologies but at the same time recognised that this may become a relevant topic in the future (IP_13 consultant).

Other interviewees shared the opinion that smart meters and other technologies used in smart grids generally have longer lifespans than other technologies (e.g. IP_12 governmental agency, IP_10 energy company). There was however another interviewee (IP_16 research institute) who gave the example of an advanced smart meter that was replaced simply because they did not have the required HAN-port. This example highlights how product demands can (negatively) impact resource use. Thus, there are risks grid components are exchanged due to technological advancements or because they are outdated. Overall, interviewees expressed a wish to extend the lifespans of smart meters (and other technologies) and minimise resource use, however, the strict requirements for a certain functionality can be a challenge in this regard.

The interviewees said that sometimes grid components were exchanged before the end of their technical lifetimes when the existing rules and regulations provided economic incentives to replace them. However, it is a complex situation with ever-changing rules and regulations where different grid components have different economic write-off periods. Furthermore, it varies for different components, to give an example, components with a long lifetime are sometimes kept their entire life, whereas others, which are easier to exchange, might be replaced even though they would still be fully functioning. Many of the interviewees also stated that it is problematic to set the “optimal” rules that also incentivize early replacement of components to protect grid investments to make sure grid safety and functionality are protected.

One of the interviewees working with the supply of buildings and electric components stated that it is a problem that many of the DSOs usually choose the lowest price when they purchase grid components. Additionally, the respondent argued that the DSOs do not maintain them as often as recommended by the OEM. This could lead to a “vicious circle”. A vicious circle where the DSO to begin with do not aim for high-quality and durable components, and then these are not (well) maintained. Furthermore, the focus on price and low-quality products might lead to early product replacements. The respondents stated that it is difficult to provide long-term commercial guarantees for their products because the lifetime of the products highly depends on how they are used and maintained. Another interviewee from an OEM who supplies smart meters said that leasing solutions for smart meters could be interesting for them, even though customers have not yet brought up the issue. Leasing as a circular business model will be discussed in the next section.

Maintenance might become increasingly important for the smart grids since more and more digital components will be used such as sensors which might need to be maintained as well as replaced more frequently. Existing rules and regulations do however not provide sufficient incentives to prioritise maintenance. Some interviewees highlighted that there are already better systems for monitoring the maintenance status (IP_14 OEM, IP_7 energy company). One interviewee (IP_14 OEM) said that they usually ask their DSO customers to conduct regular maintenance, however also noted that maintenance is still limited.

Circular Business Models: Sharing, Reusing, Leasing, Renting and Second Life?

To better integrate CE principles in the development and implementation of the smart grid, it would be possible to work with different circular business models for smart grids, for instance, leasing, renting or reusing grid components or technology. This means that companies that sell high-quality equipment to the power grid could for instance lease or rent equipment for several years instead of selling and then they could also be in charge of maintaining the equipment themselves to ensure long service life. Also, certain components or technology could be reused or re-purposed. Different business models were discussed with the interviewees.

In general, the interviewees were not familiar with the idea of leasing or renting technology to increase circularity. However, some respondents thought of examples of leasing and renting grid equipment during the interviews that are already taking place:

  1. (1)

    Network operators do rent batteries to address peak demand during short periods as support until grid infrastructure is strengthened. This is done because regulations do not allow grid operators to own batteries, thus they must rely on this solution. When batteries become cheaper, the rental of batteries could become an important business model (IP_8 regional council, IP_10 energy company).

  2. (2)

    Another example of a circular business model is a pilot project in Gothenburg where old bus batteries are reused and repurposed for apartment buildings to store electricity from their PVs. The car industry has rather strict rules on how long batteries can be used so the batteries are usually still suitable for energy storage (IP_9 research institute and IP_12 governmental agency).

  3. (3)

    There are two other examples where leasing and renting are used. In Sweden, there are for instance cases where roof space is rented for solar panel installations. It is also common to lease EVs. (IP_12 governmental agency).

Other ideas of leasing and renting were discussed by the interviewees. One interviewee (IP_12 governmental agency) said for instance that s/he thinks that leasing energy storage or flexibility could become more common in the future. It was however noted by the interviewee that when flexibility is offered as a service, that would mean uncertainties as third-party financing might be challenging. This refers to the sources of revenue frequency regulations, flexibility markets or working with spot prices. Further, it would be rather difficult to predict how profitable it would be to offer flexibility as a service. It would also potentially vary according to weather conditions.

A concern that was discussed was that there could be problems for service providers in the grid industry since for instance network operators have their spare equipment as malfunctions could occur. It would be difficult for another actor to provide the right spare parts since network operators commonly use different products. This would mean that such a service provider would need to have multiple models of a certain component. A potential solution would be for network operators to use the same components (IP_14 OEM).

The interviewees who work for network operators said that the existing rules and regulations favour capital investments, which in turn means they prefer owning equipment rather than leasing it. It is possible with the current regulations to treat renting costs as capital investments, but in practice, this is a complicated process that involves additional administrative expenses for the company (IP_1 energy company, IP_7 energy company). One interviewee (IP_10 energy company) did not believe current regulations would hinder new business models, as leased/rented equipment can be treated as capital but did not see any economic advantage in leasing or renting.

An issue overall regarding costs and price that was highlighted is that product price, which leads to grid owners often purchasing the cheapest components, currently dominates all other considerations in procurement processes, which is not beneficial for the support of sustainable solutions in general. (IP_13 consultancy company).

Summary of the Stakeholder Views on Circular Economy in the Smart Grid

Table 2 gives an overview of the key messages of the stakeholder views on the circular economy and the development and maintenance of smart grids.

Table 2 Summary of the stakeholder views on circular economy in the smart grid
Full size table

Discussion

In this study, a comprehensive literature review was conducted combined with semi-structured interviews of key intermediaries involved in the SG development in Sweden. The study aimed to explore the nexus for sustainability between CE principles and smart grids.

Integration of CE Principles and the Smart Grids in Previous Research and the Smart Grid Industry (Research questions 1 and 2)

The integration of CE principles into smart grid systems is a discussion that is still in its infancy, and the literature review showed that research on the topic is still limited. This is a new area of research and thus this study adds to the field of CE and smart grid research, showing the chance for new and significant insights and advancements.

Different technologies, for instance, EVs and renewable energy sources such as solar panels or wind power, are important to consider in the discussion about integrating CE principles into smart grid developments, due to the expected resource use (e.g. [36, 37, 80]). For instance, the production of batteries has been identified to have significant environmental impacts [64].

The literature review found that only one energy company has developed a more elaborate vision for CE in their sector [71]. None of the interviewees indicated that they had such elaborate discussions on this topic, showing that CE issues are not yet part of the core sustainability discussions in the sector. However, the interviewees confirmed that the issue is increasingly discussed in the industry, but the interviews also indicate that the discussions are taking place at different levels of “maturity” as some organizations engage in them quite extensively, while others do so less frequently, and others have yet to incorporate these issues into their discussions. There are also examples of CE aspects having influenced product design in some companies but not in others. Further, some interviewees noticed a recent shift in this regard, with some organisations placing a greater emphasis on resource use discussion even including it in reports at governmental and intergovernmental agencies.

The literature indicates that there is great uncertainty regarding the future resource need, as this depends on future technological developments, e.g. the potential to replace scarce materials with substitute materials [62, 63, 70]. The interviewees also expressed different opinions on this, e.g. by stating that the smart grid will have a lot of potential for resource savings or showing concerns about resource needs. Energy communities are often seen to contribute to smart grid developments by facilitating decentralized energy production as well as sharing, enhancing grid resilience and (energy) efficiency [81]. Interestingly, one opinion was that the emergence of energy communities may increase resource use as it requires much more infrastructure like cables. Thus, there may be conflicting objectives within future smart grid developments, which policymakers and other actors should pay attention to. When it comes to the development and implementation of sustainable, circular and smart grid solutions, it is crucial to include life cycle thinking and a systems perspective [60]. What this means, is to consider the full life cycle of a product or system, from raw materials extraction to disposal and this can help to identify the most sustainable options. Understanding the implications of different technologies and solutions as well as including both local and global impacts, makes it possible to take more informed decisions regarding the adoption of smart grid technologies.

Various CE strategies have also been discussed in the interviews as recycling, extended lifespan, resource-efficient design or new business models like leasing and renting, in the development and maintenance of smart grids in Sweden. Some ways to integrate CE principles into the development of smart grids to achieve a more sustainable grid would be for instance recycling of components, use of biobased plastics, switching to different materials, and the adoption of long-life components; the latter can be supported by business models like leasing. The interviewees brought up these issues, but there were diverging views on the need for, and profitability of, leasing solutions. The interviews confirmed that sometimes grid components are decommissioned before the end of their technical lifetime, and a general conclusion is that both the laws and the accounting practices are complicated. Further, there are some indications that the preference for low cost of components when grids are procured can lead to a vicious cycle: there is little interest in maintenance or business models that reward the durability of components.

Barriers and Enablers Affecting CE Principle Integration in Smart Grid Development and Maintenance (Research question 3)

The barriers to a “circular” smart grid found in the literature include for instance regulatory frameworks, network maintenance, financing and cost considerations [38], and the wish of DSOs to rent grid components seems to (still) be rather limited [39].

The current regulatory framework for investments in the electricity grid supports companies to make traditional investment decisions that are capital-intensive investments. This makes it less attractive to invest in smart grid solutions, additionally, the maintenance of network infrastructure poses challenges, and so does the financing of new technologies and solutions.

The interviewees stated that the current legal rules can lead to grid parts being replaced before their technical lifetime has come to an end. They further confirmed that many DSOs do not commit as many resources to the maintenance of grid components as is desirable. However, there are likely to be great differences depending on the kind of grid components – e.g., concrete houses tend to be used until they are too old, whereas other grid components may be replaced early – but that may also depend on DSOs.

Smart grids have the potential to support CE solutions in the energy sector by maintaining and intensifying the use of physical grid infrastructure, as well as using digital technologies to facilitate the sharing and reuse of resources. New business models, for instance, leasing or renting of certain components, equipment or technology could also play a bigger role in the future. However, currently, regulatory barriers and a lack of economic incentives are hindering the widespread adoption of circular business models in the sector, such as leasing and maintenance models. The interviews also revealed a “mindset” issue, as few stakeholders have considered leasing options. Furthermore, the lack of standardisation of grid components among manufacturers implies a lack of flexibility when it comes to choosing flexible contracts, as well as leasing and maintenance suppliers. The current focus on “lowest cost” was seen by several interviewees as a barrier to sustainable solutions in general.

In Synthesis: Towards a Smart, Circular Grid

The interviewees pointed to how smart grids can support resource efficiency. Better balancing of grids means that fewer cables need to be built. And even if more resources are required for batteries etc., overall, it is likely that climate and energy benefits outweigh the extra resources needed. However, some interviewees also stressed that this will be dependent on technological developments, and on what kind of technologies we choose to make use of. One example is that storing energy through hydropower solutions could be an alternative to battery storage, which will greatly influence which resources and minerals are employed for different storage solutions.

A key problem is that large industrial transitions take time, and researchers have identified this as a problem for CE, as the immediate need to reduce resource use will be difficult in large systems that change slowly [82]. Turning grids into smart grids is complex and adding CE dimensions adds to this complexity. While some industrial sectors may be on the brink of a “CE transition” [35], it is likely that the energy sector is not at the forefront as the focus has been on energy efficiency, energy security and integration of renewable energy.

This study shows that CE principles with smart grid technologies bring new opportunities to make the energy system sustainable to create a resilient and circular energy future.

Practical Recommendations

Some practical recommendations to encourage CE principles to be integrated into the development and maintenance of smart grids shall be presented here to encourage that circular practices become more established.

A first recommendation for all stakeholders would be to consider the entire lifecycle of components used for smart grids and resource use in general.

Further, all involved stakeholders should be open to exploring different and innovative business models such as component leasing or renting. In relation to this, policymakers should review current rules to ensure laws do not act as a barrier for smart grid developments and CE solutions. For instance, the regulatory framework should support a TOTEX model.

Increased education and awareness among all stakeholders involved could help to create a deeper understanding of the issues and in turn, generate more commitment. One can see how international organisations like the IEA [36], and national agencies e.g. [60] have started to research these issues. It is therefore recommended that such efforts shall be continued.

Limitations and Future Research

This study used semi-structured interviews to explore current knowledge among practitioners on the integration of CE issues in smart grids. It is probably the first study of its kind. The interviewees are experts in the field, but of course, only represent a limited number of people. It would be interesting to follow this up with a quantitative approach and do an industry survey to involve a large number of participants. This could increase the generalizability of the findings.

Furthermore, the study focused on the Swedish context. Even though Sweden has many EU rules related to energy markets, the findings might not be directly applicable or reflective of the challenges and opportunities in other countries (even European ones), regulatory contexts, resource availability, and environmental priorities. Thus, there is a need for similar studies in other countries, and country comparisons.

An additional recommendation for further research would be to do an analysis specifically focused on policy and regulations and to investigate how current and potential future policy and regulatory frameworks can enable or hinder the adoption of Circular Economy principles in smart grid development and maintenance.

However, due to the novelty of the research, there is in general a need for more and different empirical investigations to strengthen the links between CE principles and the smart grid.

Conclusions

The study aimed to provide an understanding of the different challenges as well as opportunities to integrate CE principles in smart grids to achieve a more sustainable and resilient energy system. This integration is particularly important since resource efficiency in the energy sector should be emphasized considering the growing environmental and resource challenges.

The research on circularity in the smart grid is still in its infancy and this study contributes to filling this research gap. Additionally, this study has aimed to provide insights not only to researchers but also to policymakers and industry practitioners.

Integrating CE principles into the development of smart grids offers both opportunities and challenges. The findings of the study highlight how important it is to integrate CE principles into smart grid development, implementation and maintenance, to support sustainable use of resources, in light of global resource limitations and environmental concerns. It is important to consider the potential material impacts of different technologies and components, as this can inform decision-making and help to optimise resource use in the transition to low-carbon energy systems. In the planning and design phase of any kind of grid development, it would be good to incorporate CE principles.

The interviews conducted indicate that the issue is increasingly discussed among key stakeholders, but that knowledge is limited, and resource issues are not a key focus, with limited impact yet on emerging technologies and business models. Thus, more research is needed to increase our understanding of the resource implications related to future smart grid development. Policymakers should also pay more attention to these issues since current rules and regulations as well as maintenance practices influence whether and how frequently grid components are replaced. A longer use could be encouraged. Thus, the sooner we start to assess these issues the better, to design a proper policy framework for future grid developments. Policy actions are needed to deal with these challenges and opportunities. Grids can play an important role when it comes to promoting energy as well as resource efficiency – it is possible to combine these two aspects and realise a circular and smart grid.