Is renting rather than buying always better for the climate?

This article is part of a series of publications on the topic of the circular economy, including an initial article on the scope of this concept as well asa third one on the topic of reparations.

There are tensions between the circular economy and climate action. We must therefore define the conditions under which co-benefits can be generated. This is the case with renting. To explore this, we’ll use the raclette machine as our case study. It brightens up many winter evenings, but the rest of the time, it takes up space in our cupboards. Wouldn’t it be better to rent it?

Factors to Consider When Comparing Buying and Renting

The carbon emissions associated with renting are as follows:

• The device is manufactured and then delivered to the store.
• Next, the user makes two trips to the store (one to pick up the product, the other to return it).
• In the meantime, the product consumed electricity while it was in use.
• This cycle is repeated as many times as the product is rented. For the purposes of our study, we assume that the device is rented 130 times over its lifetime.
• Once the product is no longer in good condition, it can be thrown away, recycled, or donated or sold if it is still in working order.

Emissions from renting will be compared to those from buying a new vehicle.

The life cycle of a purchased product is as follows:

• Emissions from manufacturing and end-of-life are similar to those considered for a leased product.
• Logistically, the consumer only needs to make one round trip to complete the purchase.
• Overall, the product is used less frequently than a rented product.

Let's compare the costs of buying versus renting a raclette machine from the user's perspective in two scenarios:

• He uses the device only once in his life
• The typical scenario after a purchase: the customer uses the raclette machine 55 times^[1].

To begin with, let's consider the case where you drive to buy or rent the device (about 10 km one way).

In the standard scenario of 55 uses of the device, if renting does indeed reduce the environmental impact of manufacturing by more than half and, at the same time, limit the extraction of new resources on an equivalent scale, the impact generated by car travel makes renting detrimental from a carbon perspective. Here we encounter the first conflict between the circular economy and climate action.

Given this observation, the challenge is to identify the conditions under which renting—in addition to being a resource-saving option—becomes beneficial for the climate.

We have just examined the standard case of 55 uses over the lifetime of a purchase. But if the device is used less frequently, the per-use manufacturing emissions are higher and may exceed the emissions associated with car trips taken while renting the device. Therefore, if the device is used fewer than three times over its entire lifespan, renting it generates fewer emissions than buying it.

As for the distance below which a car trip (whether gasoline-powered or electric) remains cost-effective from a carbon footprint perspective for 55 rental units, the distance must be less than 400 meters; this seems unrealistic in typical car use.

At this stage, we have made the following observations: When the transportation associated with the rental is by car, it has a negative impact on the climate, unless the vehicle purchased is used only once or twice over its lifetime.

Let's now consider another use case: a store where you can pick up a raclette machine that is accessible by diesel-powered buses (5 km one way).

Renting remains less cost-effective than buying if the vehicle is used 55 times over its lifetime. However, if the number of uses is less than 7 (about 1 use per year), renting a diesel bus becomes a viable option from a carbon footprint perspective.

Let's consider one final use case in which transportation is by electric bike.

In the case of bicycles, renting makes sense regardless of how many times you use them after purchase because transportation emissions are very low. The conclusion is The same applies to the subway and tram.

Conclusion

For renting to be beneficial for the climate and resources, it is essential to reduce travel-related emissions and/or focus on very specific needs.

Proximity to low-carbon transportation infrastructure is a key driver for companies offering rental services, but often these businesses are located in commercial areas that are difficult to access without a car. Urban redevelopment aimed at supporting the ecological transition could address this issue in the long term.

In the meantime, avoid travel by having rented equipment delivered, or set up self-service lockers near residents’ homes to share items (similar to what “Les Biens en communs” does)^[2]) may be solutions.

In addition to the logistical challenges, there is also the economic equation. In a world where buying new products manufactured elsewhere is often cheaper, the government has a duty to support local jobs in the rental sector and promote the environmental benefits.

Carbone 4 is working on the circular economy through a cross-functional group focused on upstream issues, leveraging its expertise Industry, and downstream with the expertise Luxury & Retail, particularly in connection with alternative distribution models.

If you have any questions or requests regarding the circular economy, please feel free to contact us here.