Thinking in Circles Makes Billions

Embracing the idea of a circular economy could earn Welsh construction an extra £1billion by 2035. We just need to think differently. CEW Director Emma Thomas explains how.

Embracing the idea of a circular economy could earn Welsh construction an extra £1billion by 2035. We just need to think differently. CEW Director Emma Thomas explains how.

Last week, we announced that if Welsh construction embraces the ideas, principles and arguments for the circular economy, there is the potential opportunity to expand the economy by an additional £1billion per annum by 2035.  That is the same as an increase of 12.5 per cent in the turnover of the Welsh built environment sector.

The details are all contained in our report: Circular Economy Opportunity for the Built Environment.

The numbers we quote are consistent with a growing body of research that identifies the economic opportunity and the importance of the sector in delivering.  The built environment sector has a high environmental impact, retained financial value and potential for reuse. All we need to do now is convince everyone to put aside their fears, concerns about costs and to think ahead and focus on the long term value to gained.

Right now, right across the UK and not just in Wales, construction, as a process and economic sector is wasteful. We are a take what we need to make what we think we need and then dispose of it industry, because our society is too. It is a problem reflected in our whole society. This is no longer just a complaint of an older generation about how nothing lasts. It is now built into our psyche. It is why, as part of the Welsh built environment, construction consumes around 80% of raw materials. It is why, despite great work by our own CEW team and Welsh Government commitment to Towards Zero Waste, Welsh construction is still far too wasteful.

We waste so much as a direct result of linear thinking and problems early in the construction process. It's time to change. It is time to embrace the concept of the circular economy and abandon thinking in straight lines.

To achieve real savings requires a shift in mind set by clients, design teams, procurement professionals and changes on site. But, as well as saving money and minimising waste, a circular model will significantly boost construction. Commissioned by CEW, research by Amec Foster Wheeler that forms the bedrock of our report, argues that by moving away from take-make-dispose and embracing the circular economy the Welsh environment can expand by 12.5% - adding £1billion of value by 2035.

How do we do that? The first step is to look at how decisions are made from the very start and establish a new approach, one based on the principles of rethinking construction, a whole life approach – putting value ahead of price, working in integrated teams with early involvement, focussing on long term outcomes not just short term cost management.

When we think in straight lines we obsess with cost. We must move away from price and focus on value. A focus on costs does nothing except leave an expensive legacy for future generations to deal with.

The root of this solution is collaboration – something CEW has been advocating for many years. Working as integrated teams we can, together, create a stronger, sustainable and more profitable Welsh construction sector.

Thinking that far ahead is a stretch for our industry. But to secure the £1billion benefit from embracing the circular economy it is what we must do. After all, isn't it a waste of time and resource and a risk to health to devote so much of our money in managing the disposal of our wasted materials? We should avoid wasting them in the first place. We must consider how we can maximise our materials, our resources and where possible re-use them.

Delivering the economic opportunities begins with good design and good procurement. If we can convince the procurement teams of clients and their commercial colleagues in contractor firms that they can save money just by rethinking their processes, we will be half way to achieving the goals of a circular economy.  To do that, we need to persuade them to think in circles, not straight lines.