E²-Cycle: Take-back of end-of-life HVAC equipment

Currently, end-of-life equipment is often sent directly for shredding, which limits higher-value circularity options, such as reusing functional components. After shredding, complex composite products, in particular, retain only a small portion of their original value.

The E²-Cycle project is designing multi-stage value-retention networks that enable manufacturers to take back complex products and preserve the value of their components at the highest feasible level. Five partners are pooling their expertise to lay the groundwork for a circular economy for complex composite products. Key question: How can circularity reduce primary energy use?

Complex technical products contain high-value components, require significant manufacturing resources, and incorporate valuable raw materials such as rare earth elements or platinum group metals. Collecting these products at the end of their useful life specifically for reuse, reprocessing, or high-value recycling preserves much of their value-retention potential.

Against this backdrop, E²-Cycle is developing concepts for multi-stage value-retention networks that keep products, components, and materials in circulation at a high level of retained value for as long as possible. Using heating pumps as an example, the project is investigating how take-back, sorting, processing, and recycling can be designed efficiently and organized through a division of labor.

A carbon footprint analysis of a Wilo heating pump shows that electronic components account for a significant portion of production-related emissions, so the targeted collection and recovery of these components at the end of their useful life is particularly important. In practice, opportunities to improve collection rates for waste electrical and electronic equipment can further enhance this potential. E²-Cycle addresses these challenges, with the aim of making the developed solutions transferable to other applications in the plumbing, heating and HVAC industries. 

The consortium offers manufacturers and waste management service providers specific services for value-retaining circular systems:

• Analysis of material flows and value chains for complex products
• Design of circular logistics networks using optimization and simulation
• Cloud-based planning tools for network planning
• Pilot testing of take-back systems in industrial applications
• Environmental impact assessment using life cycle assessment

request CollaBoRation

»Preserving end-of-life equipment maintains the energy and value creation embedded in each component. The value of an end-of-life device remains within the circular economy when the take-back system is well designed. An effective and efficient take-back system is essential for preserving value creation.«
Charlotte Joachimsthaler, M.Sc., conducts research at Fraunhofer IML on the environmental drivers of take-back systems.

E²-Cycle lays the foundation for future industry-wide value-retention networks. Using heating pumps as an example, the project is developing and testing processes, role models, and collaboration structures for circular value creation. The approaches developed are intended to serve as a blueprint for the HVAC industry and beyond.

Networks based on a division of labor are planned from the outset to maximize value retention. Each participant performs the task for which it is best qualified. Three criteria, among others, determine the optimal value-retention stage for a component:

1. Marketability: Is there an internal or external market for the component?
2. Repairability and upgradeability: Can the component be upgraded?
3. Cost-benefit ratio: Do the benefits justify the cost?

The manufacturer provides the necessary product knowledge and relevant information for downstream processes while creating the conditions for smooth implementation.

Collecting end-of-life equipment separately and as close as possible to its point of origin increases the proportion that can be sent for high-quality processing. Collection and, when necessary, pre-sorting should be easy for handicraft enterprises and wholesalers to implement and should require minimal additional effort.

To increase logistics efficiency, waste equipment generated in decentralized locations should be consolidated at an early stage.

Recycling facilities identify and sort returned products to recover valuable or reusable components. When necessary, the products are partially disassembled. Products with reuse potential are transferred to the manufacturer for further preparation.

Disposal facilities collect products that are unsuitable for reuse, separate them by material type as far as possible, and send them for high-quality material recycling.

Taking back and preservation of end-of-life equipment, its components, and materials to a high standard requires collaboration among stakeholders throughout the value chain. The project team is investigating how to design efficient processes for take-back, reuse, and recycling. Stakeholders are invited to share their experience and discuss potential applications with the team.

• Manufacturers of complex composite products can discuss how the concepts developed could be applied to their material flows, for example, in building services or other technical product sectors.
• Research and industry partners can discuss approaches to taking back end-of-life equipment, reverse logistics, and the circular economy with us and identify joint research and development opportunities.

CONTACT US

In an industrial application, E²-Cycle is testing the take-back of end-of-life equipment in the heating pump segment. The goal is to gain insights into the potential application of the approaches developed across the plumbing, heating, and HVAC industry.

Wilo SE operates a recycling center in Dortmund and has been certified as a primary treatment facility under ElektroG. By August 31, 2026, a take-back project had collected 428 metric tons of end-of-life pumps from 736 collection points nationwide and sent them for recycling. Wilo processes resource-critical, high-value components that require specific expertise, such as permanent magnets. The recovered magnets are either reused in new pumps or recycled as material for manufacturing new magnets. Zentek coordinates collection logistics and further processing through suitable partners.

The pilot project is testing identified opportunities for optimization within the existing collection, disassembly, and recycling structure. The focus is on sorting and partially disassembling end-of-life equipment at the recycling facility.

Mathematical optimization and simulation are used to examine network scenarios and economies of scale while accounting for other companies in the plumbing, heating, and HVAC industries.

The potential extends beyond the pump market (12.5 billion euros in revenue) into the electrical and electronics industry (182 billion euros). 

Five partners in E²-Cycle are pooling expertise from research, industry, and information technology (IT).

• The Fraunhofer Institute for Material Flow and Logistics IML coordinates the project and contributes methods for reverse logistics, network optimization, and environmental assessment.
• Wilo SE provides product expertise on heating pumps and operates its own recycling center. 
• Zentek is responsible for collection logistics and material flow management and supports manufacturers in fulfilling their take-back obligations under ElektroG.
• TH Cologne evaluates environmental impacts using life cycle assessment. 
• LogProIT GmbH, a spin-off of Fraunhofer IML, develops cloud-based simulation and optimization tools based on the OTD-NET environment.

The collaboration helps preserve the value of complex components through a logistics network based on a division of labor. Each participant contributes the expertise for which it is best qualified.