Closing construction’s circularity gap – Patrick Moloney

 

Patrick Moloney, Director for Strategic Sustainability Consulting, Ramboll, speaks with Robbie Cousins about what needs to be done to embed circularity into construction projects.

 

The European Green Deal is a package of policy initiatives designed to set the EU on the path to a green transition with the ultimate goal of reaching climate neutrality by 2050. It supports the transformation of the EU into a fair and prosperous society with a modern and competitive economy. The Green Deal comes with several acronym-friendly directives and regulations, some of which are set below.

Circularity Gap Report 2024

The recently published ‘Circularity Gap Report for 2024’ by NGO the Circle Economy Foundation and Deloitte states: ‘In just the past six years alone, the world has consumed over half a trillion tonnes of materials – nearly as much as the entirety of the 20th century.’ The report contends that driving change across food, built environment and manufacturing sectors could slash by one third the amount of raw materials needed from nature. Under buildings and infrastructure, it states the four key policies to do this would be:

– Optimising the use of existing structures

– Using secondary materials rather than virgin materials

– Adopting energy efficiency measures, and

– Prioritising circular approaches such as modular construction and materials such as renewable wood over steel.

Succeeding in the circular economy

Patrick Moloney, Director for Strategic Sustainability Consulting, Ramboll, is director of a division that sits across Ramboll’s global operational divisions, providing a strategic overview for the multifaceted areas of the built environment and resource provision, be that roads, bridges, water, buildings, energy, etc. He also heads up Ramboll’s virtual network around circularity globally.

He was in Dublin for the Irish Green Building Council’s (IGBC’s) Build Green Now conference 2024  to give a presentation titled ‘Succeeding in the Circular Economy’, in which he highlighted the importance of contractors moving away from seeing circularity as a waste management issue and to look at it through the prism of materials economics where it brings value to their projects and businesses.

Patrick Moloney explains: “It is imperative that the built environment and other sectors transition to a circular economy to address our planet’s greatest challenges, such as resource scarcity, climate change, and biodiversity loss.

“We have a gap, a huge materials gap. 90% of material inputs into our economies are virgin materials. This is a critical gap that needs to be closed and there are a range of actions that can be taken to do this.”

Defining circularity

patrick Moloney says the first of these actions is actually defining circularity in a built environment context.

“I always start with a definition or lack of a clear definition of circularity. Definitions of circular economy are vague and abstract as it can mean different things in different sectors. I believe that each business, enterprise and product needs its own unique definition and a specific matrix that can track materials and thus close the gap and stakeholder collaboration is vital to achieving this.

“Looking at the built environment, from investor to developer to contractor to manufacturer, the demands of each, albeit with the same goal, differ. But, all parties need to collaborate to ensure a successful transition with respect to the entire value chain. And innovation will be critical, as we need to rethink how we use materials or the choices that we make.”

For the purposes of having an overarching definition, Patrick Moloney believes the two-sentence EU definition of a circular economy sums it up best in general terms: ‘A circular economy is an economic system whereby the value of products, materials and other resources in the economy is maintained for as long as possible; Enhancing their efficient use in production and consumption, thereby reducing the environmental impact of their use, minimising waste and the release of hazardous substances at all stages of their life cycle’.

Patrick Moloney explains: “This definition places a value on products, materials and resources and aims to maintain this value for as long as possible. Waste is only mentioned in the second sentence. So understanding that keeping something useful and in the loop for as long as possible is fundamental.”

Ramboll’s Six Key Principles of Circular Economy Applied to The Built Environment

Moloney adds that Ramboll, when looking at the built environment, has six fundamental principles that would guide the establishment of a circular economy:

1. Design out waste – Utilise reusable, recyclable and sustainable materials for building design to reduce waste. Modular construction, material passports and design for deconstruction methods should be emphasised for easy deconstruction and material recovery.
2. Prolong/extend lifetime – Prioritising and utilising existing buildings through adaptive reuse. Construct new buildings with durable materials, adaptable and flexible designs to facilitate future modifications or use cases, extending their useful life and reducing the need for demolition and reconstruction.
3. Use waste as a resource – Perform pre-redevelopment audits and implement construction waste management plans that prioritise the reuse, repurposing and proper recycling of debris, such as using crushed concrete for sub-base materials.
4. Facilitate regeneration – Design buildings that not only reduce environmental impact but actively improve it, such as integrating rainwater harvesting systems to replenish local aquifers and using materials sourced from certified regenerative farms that enhance soil health.
5. Operate in systems – Encourage collaboration across the construction industry to share sustainable practices and technologies, aiming for a systemic approach to resource efficiency and waste reduction. Leverage digital twins and big data to match decommissioning and deconstruction activities with nearby construction demands.
6. Capture and share value – Demonstrate tangible business value. Distribute the economic benefits of a circular value chain fairly, ensuring all actors reap the economic and financial benefits.

The Circularity Value Proposition

For circularity to work at a project level, he says that contractors need to fully understand investors’ and clients’ requirements as well as manufacturers’ needs and capacities to meet the project’s requirements.

“Contractors first have to understand how funding flows from the top down and then what is required to bring the right materials up through the supply chain.

“We can’t be just doing this for the greater good of the planet. It must have a tangible value for every stakeholder. One company in the supply chain should not suffer because another demands that their particular goal be achieved. Success is incumbent on all stakeholders having synergy and understanding each other’s requirements.”

Patrick Moloney refers to the directives and regulations outlined at the beginning of this article that are being transposed into law across the EU at the moment,

“It is essential that company directors fully understand their CSRD requirements and the implications of other directives and regulations being transposed into law at this time. For instance. ESRS E5 (Resource use and circular economy) requires companies to provide a detailed overview, including impact analysis and risks and opportunities assessment, management criteria, implemented strategies, sustainability goals, and specific information on material flows, incoming and outgoing, including waste management. Companies also need to have effective plans in place to leverage existing sustainability efforts and find ways to get value from them.”

He adds that under the CSRD, chief financial officers will be responsible for signing off on their company’s CSRD reports, which will be subject to the same level of audit scrutiny as company accounts.

“From the outside looking in, I sense that the Irish business community has yet to grasp how quickly CSRD reporting is coming down the line and what the new regulations mean for their clients and supply chain relationships.

“Energy provision is fundamental to the security of society. Rare minerals and metals are central to our energy infrastructure, and materials such as copper, nickel and cobalt are all dwindling resources. Meanwhile, construction has the biggest footprint in terms of carbon emissions and materials consumption. It is imperative that it embraces circular thinking and action.”

Moving away from a waste management mindset

Patrick Moloney adds: “The CSRD presents an opportunity for business owners to better understand the impact of their operations on the environment and to take measures to gain a competitive advantage in what will be a changed marketplace.

“I think within the construction stakeholder chain, there is a huge disconnect about circularity, and systems need to be put in place to make circularity work for everyone. Currently, unused materials are generally viewed as waste and not a resource. Materials can be weighed. They have a tangible value. So contractors need to figure out ways to reduce them as an input or give them value as an output.”

He continues: “Companies are being forced to rethink and be transparent about what they do with materials that come into their businesses. The quicker this is recognised, the quicker they can move to a position where they could gain a competitive advantage in the marketplace.”

Early stakeholder involvement

Patrick Moloney adds that all stakeholders need to be involved and have input from the earliest point of a project for circularity to work, as each should have specific expertise in how they can bring circular value to the project.

“If you are responding to a tender that is 90% price-driven, it is fair to say from a sustainability perspective, you are limited in what you can do. All the parts of the value chain have a level of ignorance that can affect those below them. Those further down the chain who aspire to be great are impacted because those above them lack understanding of what they do and can bring to the project. The reverse is the same, whereby if investors or clients have specific sustainability asks, they need to convey these and know they are understood. Everyone should be able to educate and maybe inspire others about what can be achieved and what value is to be gained from their input.”

Next steps

For circularity to work at a project level, it needs to be addressed at a sectoral level by cross-sector bodies.

Patrick Moloney explains: “It cannot be stressed enough how important it is for representative bodies such as the IGBC to bring industry stakeholders together to work out the logistics of closing the circularity gap. Value chain actors need to discuss the issues to identify and understand the pressure points. Solutions won’t be achieved unless all actors are heard.

“Ultimately, circularity needs to bring value to everyone. We need to move from a point where a product or material is defined as being ‘recyclable’ to where it is actually going to be ‘recycled’. It doesn’t work otherwise. The process has to be value-driven at the end of the day. Construction is a money-driven business. The heart can be the right place, but if there isn’t a value proposition or business case to move forward in a certain direction, companies won’t move unless there is regulation to push them. So, there is a need for a stick and carrot combination.

“The stick is the regulation that forces companies to act. The carrot is that there is value to be gained from embracing circularity or materials economics. When we talk about sustainability, we rarely talk about the value of it. We speak in terms of emissions reductions. There has to be value in setting science-based targets. If the consequence of inaction is losing tenders, then that in itself must bring value. But as the gap closes, new value propositions will emerge.

“The transition to circular economy needs to be both economically and financially viable, and we need to be able to articulate the value proposition. It is inevitable that we will find solutions. Change will inevitably happen, and those companies that embrace circular economics at the earliest stage will benefit most from it,” Patrick Moloney concludes.

The Irish Green Building Council runs a quarterly ESG Community of Practice for its members to share experiences and build knowledge.

The next session will be on CSRD Reporting in Dublin on Wednesday, 11 September. For more details, contact memberservices@igbc.ie