A new report that articulates the business case for pursuing circularity in the built environment has just been released by the World Business Council for Sustainable Development and Ramboll.

Given that the construction industry is responsible for the consumption of around half of the world’s virgin resources and almost 40% of global carbon emissions and solid waste streams, adopting an approach circular and regenerative in the built environment will be essential to allow a just transition to a low carbon economy and limit the loss of biodiversity.

The report, The Business Case for Circular Buildings: Exploring Economic, Environmental and Social Value, of which Ramboll was the lead author, illustrates industry examples, highlighting benefits such as reduced costs and emissions and increased asset valuation as part of the business case for implementing circular solutions. However, he indicates that established industry approaches need to evolve in order to better quantitatively measure the benefits of circular solutions.

“The discussions at COP26 billed as ‘humanity’s last best chance to avert a climate catastrophe’ send a clear signal of the speed and scale of the response needed,” said Phil Kelly, director of climate change. sustainable solutions from Ramboll in the UK. “Creating circular approaches in the construction industry can be a game-changer in terms of impact on the planet while providing new business opportunities. With investors increasingly assessing corporate environmental, social and governance credentials and the continued development of new economic taxonomies, now is the time to introduce circular approaches, ”said Kelly.

He also said that the construction industry is still struggling to define, generate and capture the value associated with circular approaches and that a clear learning curve is required from the industry.

“We are seeing the first signs of an exciting new phase for the global construction industry – by including the value of circular solutions in the financial business case for construction projects, we can begin to quantify the economic benefits (d ‘reduced use of materials, emissions, increased asset recovery, etc.) and encourage decision-making to embrace the true value of the circular economy, ”said Roland Hunziker, Director of Sustainable Buildings and Cities at World Business Council for Sustainable Development.

Based on a review of the literature, a global survey and several case studies, the report shows emerging evidence of the economic value of circular building solutions, such as: –

  • Avoided costs associated with the acquisition of new land and landfill costs by prioritizing the use of existing building land
  • Increase in asset value by recognizing the value of residual materials and reducing deconstruction and landfill costs
  • Rental price benefit achieved through reductions in energy costs and service charges through the design of circular buildings and the use of new business models focused on services rather than products
  • Market differential and quick sales thanks to improved branding and buy-in from the local community

The report also highlights significant reductions in carbon emissions and waste generation for developments that favor circular economy approaches. It highlights added value for the economy and local communities, such as the creation of markets for local materials and local jobs, and the preservation of cultural heritage, although these benefits remain difficult to quantify.

In order to improve in particular the case of the economic value of circular buildings, the report also highlights the need for more quantitative data on the financial benefits to integrate circular economy practices in the construction sector.

Click here to download the report, The Business Case for Circular Buildings: Exploring Economic, Environmental and Social Value.

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