Incentives aim at addressing market failures that prevent or delay the transition towards circular products, services and solutions. They play an instrumental role in pricing negative externalities, steering markets towards sustainability and driving behavioural changes. Incentives have the ability to create value, de-risk investments and improve the competitiveness of value chains that bring net-environmental benefits when compared with linear economies. They also yield benefits to the economy and society.

This report provides a list of incentives for regional and local authorities that can help to stimulate the transition to a CE. First, the barriers to a CE are given; these are why CE has not transitioned faster. Some barriers include a lack of awareness, relevant skills and perceived low return on CE investments. Secondly, a list of financial and non-financial incentives is given. The report provides an indicative list of incentives that can be implemented at Member State, regional or local level. The report also provides information on where incentives have been implemented and it contains some feedback on the functioning of these incentives, provided by the expert group members. The proposed incentives can support in addressing market failures, advancing the transition to a CE and facilitate the implementation and uptake of Circular Systemic Solutions at regional/local level.