As the Netherlands races to meet its climate and circular economy goals, it must make significant strides in a heavily polluting industry—construction—by meeting future demand for housing primarily through timber. This is according to a new report by a Community of Practice (CoP) named Building with Wood (Houtbouw). The report details a value chain roadmap of how timber construction may develop in the Netherlands, illustrating enablers for a ‘Timber Revolution’ and barriers to realising this ideal.
Construction is often overlooked in its contribution to climate change, being less obvious than air travel and less relatable than food. Nonetheless, the Dutch construction sector accounts for half of the country’s resource use and a staggering 35% of its CO2 emissions—primarily owing to its use of emissions-intensive materials like cement, concrete and steel. While traditional construction materials pose a problem, bio-based alternatives—like timber—present a promising solution. Tree growth absorbs CO2 from the atmosphere and locks it into place, and timber allows for modular, prefabricated construction, slashed costs and significantly speedier construction processes.
The CoP, in collaboration with ABN AMRO and Invest-NL, has identified two crucial enablers for timber’s successful uptake in the Netherlands, and four potential pathways the industry could follow on the journey to 2030. The paper elaborates on barriers, as well as means to surpass these barriers in building a clean, sustainable and safe future.
From the research, two trends emerged that highlight how timber-use can be revolutionised: legislation and industrialisation. The future success of timber will be made or broken by its pricing, ultimately driven by developments in policy and law. The Dutch policy MilieuPrestatie Gebouwen, which measures the sustainability of materials used for a building, will likely ignite a shift in the materials prioritised by architects and contractors. Similarly, the Dutch CO2 tax and EU Emissions Trading Scheme prices are expected to grow, hiking up the price of emissions-intensive materials like reinforced concrete by up to 33%—and concurrently driving down the cost of sustainable alternatives. Similarly, a professionalisation and industrialisation of the sector, resulting in faster project delivery and costs slashed by 30%, are crucial for timber’s successful upscaling.
The paper highlights four scenarios we can embark upon over the next ten years: Timber Revolution, Timber Evolution, Timber Disappointment, and Business as Usual. In the ideal scenario—Revolution—80% of the demand for new housing will be met by timber, and the industry boom will create thousands of new jobs throughout the country. The other options aren’t so attractive: while Evolution will see large-scale investments in bio-based materials and up to 30% timber use, Disappointment and Business as Usual scenarios fall short, resulting in sluggish development and poor investments in the sector.
Why might we continue down the latter two paths? Timber is currently more expensive than traditional building materials and a lack of long-term insight on the part of investors and financiers could result in a fragmented, small-scale industry carrying forward. The impact of covid-19 also has a role to play in timber’s potential triumph (or lack thereof): efforts to ‘build back’ including regulatory rollbacks and weakened climate legislation, as well as failure to stimulate price incentives for sustainable construction, might hinder timber’s uptake as a viable alternative material.
The good news: currently, there is more than enough growth to meet Dutch housing demand, and timber’s popularity is gaining momentum across the continent. For the Timber Revolution to become a reality—and for Business as Usual to fall by the wayside—it is necessary for investors to analyse opportunities and returns in the long-term, and recognise the inevitable truth: the future of construction lies in the forest, not the factory.
Circle Economy is delighted to announce the completion of the Circle Region Scan process in Kongsvinger, where we worked together with our partner Circular Norway to identify key opportunities for circularity in the Kongsvinger region.
The scan focused on the built environment value chain and, thanks to the enthusiasm and dedication of local public and private stakeholders, we were able to successfully set up exciting pilot projects.
Some key learnings:
Find out more about the pilots, our learnings and the process we followed in the Phase 3 & 4 report below.
Residual resources, such as food processing surplus streams—now often categorised as ‘waste’—can be reused at their highest potential value if fair pricing can be ensured, finds the latest report of the Coalition Circular Accounting. In their Valorising Residual Resources report, they elaborate on the financial, accounting and legal aspects of valorising food waste and the organisational challenges of being circular in a linear world.
Annually, 88 million tonnes of food is wasted in the European Union alone. An estimated third of that waste occurs before food items even hit the shelves. In some food categories, waste is particularly hard to avoid because of a lack of knowledge, logistical challenges or expiration dates. But in a time when climate change and hunger threaten millions of livelihoods around the world, minimising food waste is a must, resulting in higher food security and a reduced industry footprint.
A current go-to solution for many food manufacturers is to downcycle and sell waste streams as animal feed. But when these resources are of premium quality and fit for human consumption, this is a massive loss. To ensure efficient resource use, the circular economy aims to maintain the highest possible value of resources for as long as possible. But producers need a stronger incentive to valorise all their waste streams—an incentive the linear economic system does not provide.
The Coalition Circular Accounting (CCA), led by the Royal Netherlands Institute of Chartered Accountants (NBA) and Circle Economy, has identified opportunities to salvage and valorise residual resource streams before they are turned into input for the production of animal feed or waste. Using biscuit dough as an example, the coalition teamed up with cooperative IntelligentFood to explore the challenges they are facing and identify promising pathways for circular ways of working that can be applied to a multitude of other types of residual streams.
IntelligentFood is organised as a cooperative that receives residual biscuit dough from Europastry—a leader in the frozen bakery dough sector—and joins forces with value chain partners to add value and create new products. Members can contribute either as an employee, as an organisation, in cash or in-kind. All members that have contributed value share in the profits, following a distribution key.
The CCA has found that the cooperative governance structure of IntelligentFood offers great incentives for partners to collaborate, create value and share risks. As a cooperative, IntelligentFood does not own production facilities, nor employs chefs or has any logistical capacities. Their primary role is to develop new food concepts that use residual food streams and connect different external parties—from resource input to final product sales—on its platform. They take on the role of a Circular Value Chain Director, connecting and redirecting resources between stakeholders, processes and industries to ensure their highest potential and value.
The CCA once again confirmed that what gets valued, gets managed. The business case proved that residual resources should also have financial value. However, determining a fair price for these resources has sparked a debate about valuation theory versus market value. Moreover, the report provides potential options for accounting for the residual resources, based on a situation where profit margins after sales of the final product constitute the value of the resources used.
Lastly, it becomes clear from the research that our current accounting models do not incorporate impact. Currently, accounting models and investors focus too much on profit and do not take environmental or societal aspects into account.
The Coalition Circular Accounting will tackle this topic in their next case study. Together with Impact Institute, they will investigate how accounting can standardise impact assessment in order to better reflect the environmental and societal impact. This report is scheduled to appear in the first quarter of 2021.
The Royal Netherlands Institute of Chartered Accountants (NBA) and Circle Economy founded the Coalition Circular Accounting to identify accounting related challenges in the circular economy. Together they create solutions and best practices to overcome these barriers. The coalition includes experts and scientists in the field of finance, accounting and law from: Invest-NL, ABN-AMRO, Rabobank, KPMG, Allen & Overy, Sustainable Finance Lab, Impact Economy Foundation and scientists associated with Nyenrode Business University and Avans University of Applied Sciences.
The coalition has brought together experts to discuss and work out three specific, existing circular business models with a valuation or reporting issue. These cases are chosen to cover a diverse range of challenges. The presented findings and solutions are generalised to be applicable to other cases elsewhere and made freely available in the form of whitepapers.
An increasing number of businesses market themselves and their products as being sustainable and circular. Yet, whether new business models actually deliver resource savings and sufficiently consider other aspects such as social equity remains an open question.
A new report by Circle Economy, the European Environmental Bureau and the Fair-Trade Advocacy Office launches a debate on what constitutes truly sustainable business models. The report identifies blind spots in the European textile and electronics sectors, helping policymakers and business leaders understand how they can address the manifold challenges of the post COVID-19 economy.
Jean-Pierre Schweitzer, Policy Officer for the Circular Economy at the European Environmental Bureau (EEB), said:
There is no doubt we need more circular businesses like repairing, reusing and product as a service. Yet in a world where inequality is soaring, we cannot neglect other key aspects of sustainability like human rights and social justice. Policy makers and entrepreneurs urgently need to connect the dots on these topics to reduce the exploitation of natural resources as well as individuals and communities.
Sergi Corbalán, Executive Director of the Fair Trade Advocacy Office, said:
“Free trade approaches to the circular economy have many blind spots. Rather than turning a blind eye on them, let us work together to promote business models and supply chains that are both circular and fair”.
Natalia Papu, Research Analyst at Circle Economy, said:
"In their plans to build back better after the COVID-19 pandemic, governments and businesses need to address many challenges, ranging from growing inequalities to the climate breakdown. Once its blindspots are addressed, the circular economy offers an opportunity for decision makers to strengthen justice and fairness for all."
Recommendations include:
The report was launched at an online event hosted by FTAO and the EEB, as well as Young Enterprise Europe, The Club of Rome, and the European Circular Economy Stakeholder Platform. This event is part of the European Circular Economy Stakeholder Platform’s series of #CircularTalks.
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Time to walk the talk of building back better. It's been a year since the covid-19 pandemic began to shake up life as we know it. Many of us have come to realise that the impacts of the virus aren't going to disappear anytime soon. The need to boost our resilience to future shocks has never been more salient. But while talks about the need to build back better have dominated public debate, many concrete long-term actions are yet to materialise. It's time to walk the talk.
That is why Circle Economy invites circular economy enthusiasts and experts to share and discuss practical examples of how circularity can support resilience in times of unforeseeable change.
Together, we will crowdsource a digital collection of case studies and ideas, and discuss selected examples from this collection during an expert dialogue on 17 December 2020.
Boosting resilience in the circular economy. Our latest research highlights the resilience-building potential of the circular economy. Particularly three circular economy strategies—decentralisation, resource efficiency and transferable skills—can contribute to the resilience of nature, economies and communities but also carry risks.
The question that we ask ourselves now is: how can we realise this potential in practice?
From theory to action. Circle Economy invites you to jointly explore answers to this question in two steps:
We will crowdsource a digital collection of case studies and ideas that demonstrate how the circular economy can or is already helping to build resilience.
Please add your circular economy case studies and ideas related to the hotspots: decentralisation, shared resources and transferable skills to our digital collection (Password: Resilience2020).
Please add your name and contact details to your case studies if you'd like to be contacted to reflect on your contribution during the expert dialogue on 17 December 2020.
On 17 December 2020 from 3 - 4.30 PM (CET), we explore the viability of selected cases from our crowdsourced digital collection during an expert dialogue.
We are excited to be joined by experts My Selleberg (Researcher at Stockholm Resilience Centre), David Jácome Polit (Chief Resilience Officer, Quito, Ecuador), Natalia Papu (Research Analyst at Circle Economy) and Esther Goodwin Brown (Partnerships Manager and Strategist at Circle Economy).
After the dialogue, we will share a summary of the insights and learnings we gained during the session. This summary will provide businesses, governments and communities with anchor points for strengthening resilience through circular economy and for walking the talk of building back better.
Since 2012 Circle Economy supports businesses and governments in their circular journey by creating and sharing knowledge and building practical tools. In our effort to collect and share knowledge and inspiration about the circular economy to all we launched the Knowledge Hub in 2018. By digitising knowledge, opening up access, and encouraging co-creation, we have been able to break down information silos and fuel cross-industry collaboration and innovation.
Over the last years, however, we noticed a growing need for circular frontrunners to connect, collaborate on common barriers and have access to tangible circularity tools, frameworks and metrics. That is why we have now set out to create a circular economy community. A community that goes further than providing knowledge and inspiration, but that enables people to connect, discuss, collaborate and find tailored, industry-specific knowledge and tools.
But… in order to build a community for the people, we need your help! Please take a look at the features we have highlighted for you and tell us what you need to kickstart your circular journey.
The circular economy has the potential to change the world, and we believe the time to bring the concept to the kitchen table – so that everyone, from entrepreneurs to big brands, can play a role in making it a reality – is now.
→ Explore our community beta-environment here
You are about to enter the beta-version of our community environment. We aim to offer several community features that allow you to act, learn, connect and collaborate to accelerate the circular economy. Take a sneak peek at the features that we are planning to build, tell us what you think and what you would like to see in our community environment.
As part of the Thriving Cities Initiative, we are helping cities to Downscale the Doughnut and understand how they can thrive within social and planetary boundaries. But you might wonder: How can I apply Doughnut thinking to my city?
We are excited to share the City Portrait canvas; an interactive tool to help bring Doughnut thinking into the hands of urban changemakers.
Together with DEAL, and C40, and four pioneering cities around the world, we have developed this interactive workshop tool to guide the design of city strategies and initiatives in a holistic way; to support a green and just recovery from current crises.
A landmark report published today by Zero Waste Scotland and Circle Economy reveals that Scotland's labour market is in a strong position to benefit from the circular economy transition. While more than 200,000 jobs (8.1%) already contribute to the circular economy, further investments can help the country address existing social inequalities by redistributing job opportunities, creating sustainable jobs and providing more widespread access to essential goods and services.
As Scotland's decision-makers plan the country's economic recovery from the covid-19 pandemic, the report identifies a wide-ranging mix of new circular roles and skills needed to help Scotland Build Back Better by forging a truly national circular economy. It sets out a vision of the future of work in three priority areas – construction, the bioeconomy and capital equipment, such as decommissioning energy infrastructure from oil rigs to wind turbines.
The skills pathways identified in this report demonstrate, there is a strong need for digital skills development, particularly in the construction sector. This can maximise the potential of technologies to improve communication, collaboration and material efficiency, all central to the circular economy. Maximising the promising future of the bioeconomy will require work to raise awareness of the significant business and job opportunities it brings to turn waste streams into value and make this emerging sector a mainstream career choice for graduates. Meanwhile there is a valuable window of opportunity to grasp the varied redeployment options which decommissioning of oil rigs and wind turbines in Scotland’s energy sector presents.
The report, entitled 'The Future of Work: Baseline Employment Analysis and Skills Pathways for the Circular Economy in Scotland', has been launched alongside Circle Economy's Circular Jobs Monitor. This online tool that gathers, displays, and keeps track of the number and range of jobs that are part of the circular economy across the world.
It shows that with 8.1% of jobs being related to circularity, Scotland is on par with other countries where assessments have been conducted, such as the Netherlands (8.6%) and Belgium (7.5%).
As a first broad assessment of circular jobs and skills in Scotland, this report serves as a basis for future efforts to build on. These efforts will include the production of a competence framework, the enhancement of data collection and analysis, the support of innovative forms of learning and knowledge exchange, investment to support the creation of circular jobs and the promotion of the circular economy as a career destination.
Keep up to date with our work: https://www.circle-economy.com/circular-jobs-initiative
Sign up for updates: https://www.circle-economy.com/circular-jobs-initiative/contact
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