Enabling Green Manufacturing in MSMEs through Circular Economy and Energy Optimization Models

The transition to green manufacturing is pivotal for achieving sustainable industrial growth, particularly in the Micro, Small, and Medium Enterprises (MSME) sector of developing economies like India. This paper explores the integration of Circular Economy (CE) principles and energy optimization models (EOMs) as dual enablers of green manufacturing practices in MSMEs. The study adopts a mixed-methods approach, drawing insights from qualitative interviews with 50 MSME stakeholders and quantitative energy performance data from selected enterprises. The research identifies key barriers—such as technological gaps, policy ambiguity, and lack of financial incentives—and proposes an integrated CE-EOM framework that enhances resource efficiency, waste minimization, and energy sustainability. Empirical validation through case studies and simulation of energy-saving interventions demonstrates that CE and EOM implementation can result in 20–35% resource efficiency gains and up to 25% reduction in energy costs. The findings reinforce the strategic significance of green transitions for MSMEs, positioning them not only as participants but as pioneers in the sustainable industrial revolution. Policy recommendations, technological interventions, and training roadmaps are proposed to accelerate adoption at scale.