Advancing circular logistics solutions in cities

Expected outcome

Projects are expected to contribute to all the following outcomes: Accelerated transition towards circular economy in the freight transport sector and throughout the urban logistics value chain, contributing to the objectives of the Climate-neutral and Smart Cities Mission and the EU Circular Cities and Regions Initiative (CCRI); Increased adoption by logistics operators of new and tested circular systemic logistics solutions, including modular loading units and reusable transport packaging systems tailored for urban delivery settings; Improved integration of reverse logistics into urban logistics models to enable higher reuse and recycling rates; Optimised resource utilisation in urban logistics through innovative circular economy approaches, leading to significant reductions in material consumption and carbon footprint; Enhanced cooperation among urban stakeholders, including local authorities, logistics providers, retailers, and consumers, fostering circular business models and enhancing consumer acceptance.

Scope

The rapid growth of e-commerce and urban logistics has led to an increase in packaging waste, inefficiencies in freight transport, and rising environmental impacts. Current urban logistics systems often rely on disposable packaging and fragmented transport operations, resulting in significant material waste, resource inefficiency and carbon emissions. Addressing these challenges requires innovative circular economy approaches, promoting systemic, innovative, circular and scalable solutions for reducing waste generation, in line with the revised EU Packaging and Packaging Waste Regulation (PPWR) , and improving resource efficiency in business-to-business and business-to-consumer logistics. Building on previously funded projects’ outcomes and leveraging potential complementarities with existing regional circularity hubs and other initiatives (e.g. the CCRI and its related projects , as well as the Driving Urban Transition Partnership (DUT) ), proposals should address all the following actions: Design and develop solutions for innovative, modular, reusable, and recyclable packaging and loading units. The proposed solutions should reduce single-use packaging in urban freight transport and demonstrate the benefits of their use in urban logistics processes, while considering the impact of packaging waste regulations on logistics and delivery models in urban areas. Develop and test digital tools and systems for tracking and optimising the use of the loading units as well as for secure and efficient stowage, transport, and handling, by integrating technologies such as Internet of Things, edge computing, Artificial Intelligence and data-driven collaboration platforms (e.g. data spaces), considering technological sovereignty and energy-efficiency. Engage urban and local stakeholders, including local authorities, logistics operators, retailers and citizens, in co-designing innovative solutions to implement reusable and recyclable packaging and use parcel lockers and micro-hubs (pick-up points) for returning new items and collecting used items (for the purpose of repair, reuse, remanufacture, repurpose or recycling), thus promoting the transition to circular urban logistics in various product value chains. Demonstrate the proposed solutions in real-world pilots in at least two different urban environments, each pilot covering two different types of goods or more (e.g. textile apparel, consumer electronics), in cooperation with logistics service providers, cities, and e-commerce value chain actors. Pilots should also consider reverse logistics systems, and innovative return and reuse schemes. Explore and evaluate environmental, social, and economic (e.g. need for new business models and incentive schemes) impacts of circular economy approaches and specifically the potential of reverse logistics systems to enable circular flows of materials, reduce greenhouse gas and pollutant emissions, and support reuse schemes.

What this means for cities and regions

Cities with logistics operators and retailers, linked to the Climate-Neutral Cities Mission and the Circular Cities and Regions Initiative. Topic budget €22.5 million; 3 grants expected; around €7.5 million per project. Opens 9 February 2027; closes 7 October 2027. Satellite positioning tracks reusable assets and optimises delivery and return routes, the data backbone of any reverse-logistics scheme.