A plasticity theory is introduced which starts with a dilatancy rule and a function of plastic strain rates which represents the energy dissipated during plastic deformation. Yield surfaces and flow rules are then derived using energy conservation and the theory of envelopes. This method allows valid plasticity theories to be derived for frictional materials, but gives results for non-frictional materials which are identical to those of the classical theories. A dissipation function which includes deformation by granule rearrangement and granule distortion is presented and used to obtain a range of yield surfaces and flow rules, which are similar to those used in the critical state theory of soil mechanics. The microstructural features which may control the governing parameters of the dissipation functions are discussed.