The Sharing Economy is Good for the Environment. Here’s Why.

The concept of sharing isn’t new: we’ve always shared a garden tool with a neighbor or a dress with a best friend. What’s new, though, is sharing with a much larger pool of people: complete strangers who are verified via their online presence, ratings and reviews. This is essentially the new sharing economy, which has boomed in recent years thanks to platforms that enable the trust and the transaction to share on a large scale.

A hallmark of the sharing economy is the harnessing of under-utilized physical assets such as cars, homes, and tools. Users grant each other temporary access to said asset, moving from ownership-based to time-based access and usage.

Sharing an under-utilized asset: Cars

A good example of sharing an under-utilized asset is carpooling. Carpool apps such as Blablacar (which has over 40 million members worldwide) and Waze Carpool leverage the excess capacity in a car: unused passenger seats. These apps match users that need a ride to users who are offering a ride.

Cars are under-utilized assets themselves: they tend to be used only 5% of the time. Turo and Getaround are apps that let car owners rent out their cars when not being used. Of course, traditional car-rental companies like Hertz and Enterprise, as well as newer ones like Zipcar also work on the same model of car-renting, however with Turo and Getaround, supply is generated by car owners.

Think of the environmental benefits of decreased new car production if we can rely on renting and ride-sharing instead of buying.

What about Uber and Lyft?

While ride-hailing apps were considered part of the sharing economy, they are increasingly being recognized as an on-demand service: you hail a ride, you want your food delivered, and the platform matches your request to a pool of drivers. Placing such an order does utilize a car that someone else owns or drives; but if you hadn’t ordered that ride, a trip wouldn’t have been made in the first place (and more emissions created). Although, one can argue that using ride-hailing apps is better than buying a car.

Ordering an UberPool or a Lyft Line, on the other hand, is more environmentally-friendly since that same trip is now shared between more users.

Another service where trips are shared between users? Your local public transport :)

Home-Sharing

A study suggests that carbon dioxide emissions per person decrease with household size, likely because they are not duplicating climate-impacting activities such as air-conditioning and laundry. Airbnb and VRBO can hence be a more sustainable option than hotels, more so if the home is being shared with the occupant. (A 2014 study showed that Airbnb guests use 63 percent less energy than hotel guests.)

The Sharing of Things

According to Peerby, an app that lets you borrow items from your neighbors — anything from garden and home-improvement tools to party and holiday products — 80% of the things we own are used no more than once a month. Borrowing instead of buying reduces the number of things we buy, potentially reducing our carbon footprint. These apps are good additions to traditional tool rental or party rental shops that may not carry smaller items.

In a similar vein, you can rent designer clothes instead of buying them using apps such as Rent the Runway and StyleLend (this does involve shipping, though). The garment industry is one of the biggest polluters, so this move from ownership to collaborative consumption is especially beneficial. Similarly, LeTote is a subscription model for clothes rental: for a monthly fee, you can keep your clothes for as long as you want, or choose to buy a piece.

That Second-Hand Stuff

Another flavor of collaborative consumption is the redistribution market, or the second-hand economy, where ownership of a product is transferred, rather than that product being “shared”. It is still environmentally friendlier than buying a new product when you think of the carbon footprint involved in the making, and disposal or recycling of that product.

eBay has of course been around for a while as a marketplace for used and new items alike. However, apps like Tradesy and Poshmark are more targeted online marketplaces for second-hand clothes from individual users. I had never sold a coat or a dress on eBay before, but found myself listing pieces from my closet on Tradesy, as well as buying from other users because of the ease of listing and searching alike.

Apps like Letgo, eBay’s Close5, and OfferUp enable the matching of a buyer and seller locally for used goods, but don’t enable the transaction. (Also, don’t forget about your local thrift stores for used goods.)

The sustainability of the second-hand economy isn’t easy to quantify because of various possibilities post-transaction, such as the seller using the money earned from a sale to buy a new item, thereby nullifying the environmental gains. It still is a step in the right direction, and one that can make a difference once more people join the movement.

NoMoreBoundary is an app development company based in San Diego. NoMoBo can create your next app in the sharing economy: we do app and web development, visual design and consulting. Contact us today to get started.