How the Netherlands can inspire Slovakia to embrace circular economy

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Expert opinion on Circular Economy possibilities in Slovakia

Published in Euractive in the Slovak language in 2 parts on February 25 and 26, 2019

Challenges ahead!
We and our planet are facing some major challenges today. Climate change, loss of biodiversity, “the plastic soup” and providing access to resources for our industries are just a few of them. Will it get better? The OECD Global Material Resources Outlook to 2060 projects a doubling of global primary materials use between today and 2060. The Ellen Mac Arthur Foundation stated that in 2050 there might be more plastic in our oceans than fish. Seawater rise will impact the deltas of the world (and 80% of global GDP takes place in delta’s!). 1/3 of the food we produce is wasted. To feed the world in 2050 we have to double food production.

Go Circular
A transition to a Circular Economy (CE) makes more than makes sense in these circumstances. A CE is often explained as a way to keep resources in circulation much longer. But a CE is not only keeping materials in the loop. It also about renewable energy, preservation of biodiversity, social inclusiveness and new coalitions. It is another way of designing, producing, consuming and dealing with waste. It is a system change and it is about both economy and sustainability.
My country, The Netherlands, is building a national and international circular economy programme that reaches across all sectors of society. Our government has pledged to become circular by 2050, including a 50 per cent reduction of raw materials by 2030. A seemly unreachable target. It is inspirational and I believe we will get close to that target.

• Adopting circular economy principles would bring considerable benefits to the EU, such as:
• The overall benefits amount € 1.8 trillion by 2030, double the benefits of the current development path;
• The average disposable income for EU households would increase by €3,000, or 11% higher than the business as usual development path;
• GDP would increase as much as by 11% in 2030 versus today, whereas the current development path shows 4% growth;
• Carbon dioxide emissions would be reduced by 48% in 2030, relative to today’s levels or 83% by 2050; and
• For primary materials from automotive and construction sectors, real estate land, synthetic fertilizers, pesticides, agricultural water, fuels, and non-renewable electricity, material consumption could go down 32% by 2030 and 53% by 2050, compared with today.

Best Circular Practices from the Netherlands
The Dutch have set 5 transition agendas for priority market segments: biomass and food, construction, manufacturing, plastics and consumer goods. A clear focus allows to attract a critical mass of stakeholders needed to scale-up. We listed a few examples of proven circular business models.

Signify (Philips Lighting) has adopted Circular Economy. Lighting is responsible for a large part of electricity consumption and CO2 emissions. Public Lighting, for example is very relevant for Cities all over the world. In 2014, the supply of lighting still accounted for 15% of the world’s power consumption. Signify aims to contribute to achieving the United Nations’ ambition of reducing this to 8% by 2030. The new, intelligent LED lighting, for instance, uses 80% less power. Signify s is also offering “Circular Lighting” and Light as a Service. Clients no longer invest in light bulbs and maintenance but pay only for the light. This saves both energy and materials and offers Philips new customer propositions. In discussions about street lighting for a city the topic of “safety in the streets” is addressed and when discussing lighting in a shopping mall the it also about the creation of an atmosphere that leads customer retention and increased shopping.

The Port of Rotterdam , Europe’s largest Port that is starting to “walk the talk” towards Circular Economy. In Rotterdam large scale applications can be seen like the capturing of CO2 from Industry for use in nearby green houses. Lining offer of excess heat with demand has been done by a “plug & play” heat network. There are many advanced recycling examples in the Port area for example for plastic or linked to construction and green chemistry. Chemical leasing is a business and service model that is growing. Here the chemical company supplies a substance for a specific service but retains ownership of the chemical. It brings a shift in focus from increasing sales volume of chemicals towards a mutual beneficial value added approach between client and supplier. It leads to more efficient use of chemicals, and to quality, environmental, and economic benefits. Some examples from the Rotterdam Port Area are small and inspirational (even edible!) like RotterZwam (mushrooms grown on coffee residues).

The Delta Development Group went from vision to realization of Park2020 . It is the first full service Cradle to Cradle working environment in the Netherlands. In Park 20|20 a unique level of sustainability is created together with a human centered design approach to realize the cleanest, most inspiring and productive working environment to date. It has an integrated circular vision, modular buildings, natural ventilation, cold & heat storage, water re-use and urban farming. Nowadays Delta develops in cooperation with Schiphol Airport, the Circular Valley, the circular business park that will be realized in the oncoming years.

Co-operative Agrifirm (17.000 farmers) delivers inputs for arable crop and livestock farmers. Circularity of minerals is key in agriculture. Examples: Tools for precision feeding of crops and soil, increasing yields and efficient use of raw materials, are being developed. Animal based manure delivers high value for arable crop farming. Application tools and processing has being developed. In feed industry 50% percent of raw materials originates from food and energy industry. 15% is Former Food stuff (candy bars). Processing plants are operating to produce valuable feed. So, Circular Economy shows how efficient feeding, circularity and reduced environmental impact can be unified.

In cooperation with Delft University, the collaborative platform and community NederlandCirculair! started the program CIRCO : design for creating circular business. It is a program in which companies and their product- and business developers work together on the re-design of their products, services and business models. Already about 80 Dutch companies participated. It is supported by Dutch government as a strategic game changer.

The Edge, the smartest and greenest building in the world
The Edge, designed for Deloitte, is a 40,000m² office building in Amsterdam. Sustainable technologies created a radically new working environment with the world’s highest BREEAM rating awarded to an office building. It is a comfortable and efficient building that is healthy and productive to work in and helps to attracts talent and higher employee satisfaction.
The Edge uses 70% less electricity than comparable office buildings and as a building it is energy positive.
It features amongst others a solar panel roof and facade, energy and rainwater reuse, thermal energy storage in an acquirer.
There is remote insight into the presence of people in the building (anonymous). Heating, cooling, fresh air and lighting are fully IoT (Internet of Things) integrated and Buiding Management System controlled per 200 sqft based on occupancy – with zero occupancy there is (almost) no energy use.
The Edge is not just a successful reduction in water and energy us but an example of integrating technology with new ways of designing, and news ways of working.

Small, beautiful and very pragmatic examples came from Modulo , a modular recycling center, that helps municipalities to inspire inhabitants to separate waste. Recycling Centres make the quantity of waste arisings very visible to site users, but the design flexibility that the Modulo Béton system offers can also enable Recycling Centres to demonstrate the extent of sorting opportunities and successes.

In Waste Management, The Netherlands is a global frontrunner. In the last 1,5 century we have seen a transition from a focus on public health (with emphasis on collection) to environmental protection (building in a control system and introducing technological solutions), to professionalisation and diversification after 1990 (public-private responsibilities, economic steering instruments) and in the last 10-15 years a focus on circular solutions with a value-chain approach. The landfilling of Municipal Solid Waste amounts a mere 2 %. Most fractions are recycled. For example, the recycling of plastic packaging has almost doubled in six years’ time and is now over 50%, already in 2014 we were recycling 82% of our paper and cardboard. For metals, the level is even 94%. Now the focus is on involving the behavior of households more and more to separate their waste better.

From non-recyclable fractions the energy can be recovered with state of the art installations like the one in Amsterdam from AEB. From the non-burnable fraction precious metals can be recovered in ever greater amount by companies like Inashco or the ashes can be reused as building materials.

The Waste Transformers create decentralized, nutrient and energy hubs by converting residual organic waste streams into energy, whilst recovering (on-site) the natural resources and water in the waste. In the Amsterdam area of the Westergasfabriek they empower the restaurant community to leverage their waste to power positive change using smart business models. It is a small-scale, high impact approach for organic waste.

By recycling carbon black from car tires, the Dutch start-up Black Bear is reducing the mountain of discarded car tires, currently numbering some 2 billion a year. These tires are still often burnt, thus releasing a high volume of CO2 into the atmosphere, or they end up on the rubbish dump. In Africa, they are a source of malaria because a layer of water collects in the tires, allowing mosquitos to thrive. Carbon black out of discarded tires can be used to produce new tires, paint or ink at a competitive price. During the Black Bear production process, much less CO2 is emitted, and oil and gas are released as by-products. The 10 M installation, set up with value-chain partner Kargro, Rabobank and the Energy fund of the Province of Limburg, and can treat 2 M tires a year when in full production.

Lessons for Slovakia?
The Dutch do not pretend to have all the answers. Our geography in a delta however forced us very early on to work together to keep our feet dry and to face environmental challenges. You could say that we learned the hard way and that our lessons and failures might inspire others.

Focus on waste management: a good first start but not the whole story
Waste management is a good first step towards a circular economy and it is very important to follow the waste hierarchy. The Visegrad countries are struggling to reach the EU 2020 targets for municipal solid waste (MSW). Slovakia only recycled 23% of MSW in 2016. The MSW recycling target is 55% for 2025 and 65% for 2035. It might seem tempting and relatively easy to just build incinerators and send unsorted MSW to them but besides being capital incentive, they actually might prevent the preferential recycling activities for the next 20 years. For the price of one waste incinerator you can organize a hell of a lot of collection at the source. Important here is to tackle first the large fraction of organic waste by separate collection and valorize it by means of composting and digestion.
A more circular future might even bring bio-plastics, textiles and chemicals from bio-waste.
Source separation especially makes sense for waste that has a value on the market. Paper, metals, rigid plastics to name a few. For flows like household packaging, batteries and WEEE the value of the recyclables is not high enough to finance the system. It needs a producer responsibility scheme to make it actionable.
Producer responsibilities requires professionality and responsibility in the whole value-chain. The government sets the targets and creates the boundary conditions. The producers and importers finance and manage the system ideally not as a cost factor but as an incentive to improve the system. Local government should motivate or incentivise citizens and set-up a collection system. Sorters and recyclers should make qualities according to specifications that industry can work with. Only then can industry increase the recycled content by design and create a pull factor and close the loop. Recycling targets should not be not a goal in itself if there is no market for the recyclate.

Opportunities in plastics and automotive
I see more circular opportunities for Slovakia beyond waste management like in the automotive industry and the plastic supply chain
The automotive industry represents almost 43 per cent of total industrial production, and in 2015 and 2016, Slovakia produced over a million cars. The industry is in a rapid transition and circularity is a major part of the solution. “If business as usual is no longer an option for the car industry and if it is so important for Slovakia you have to prepare for the future”. But how?
The automotive industry is a large, highly technical industry, that creates complex products with many components. Creating new material loops, for example for plastics and textiles will help.
Shifting consumer demands call for new mobility services, while tightening regulation will require collaborative innovation along the value chain. There will be a need to redefine roles and ownership, to rethink the design, production, usage, and waste phase.
A car only drives 4 to 8% of its time. Mobility as a Service and car sharing are good circular answers.

Also remanufacturing, the rebuilding of a product to specifications of the original manufactured product using a combination of reused, repaired and new parts can be part of a new positing. Imaging producing remanufactured engine parts with guarantee for half of the price? The skills set does exist in Slovakia.

Can we stimulate circular innovation?
It helps if the (national and local) government sets an ambitious goal that fits with the local dynamics (energy neutral areas, zero emission inner city centers, circular or bio based plastic valley, zero waste factories). At local level it is important to give a platform to frontrunners to inspire others. You can help circular start-up to grow and get a market by circular public procurement (20% of EU DGP!). The local government can be the facilitator that bring actors together for example in industrial areas where waste for one can be a resource to another.
Give room for experimentation and create additional dynamics by letting start-up temporarily use empty buildings. A bottom-up movement with a local hero can be very powerful. Essential is that we include circular thinking in educations: our kids are the consumers and the leaders of tomorrow!

I do think the Dutch and Slovak people can help each other to give Circular Economy momentum and create business opportunities in the wider region. We are both small countries. Maybe we will not create the biggest Industry in the market but can strive to be the most circular and the most impactful for our future generations.

Innovation is great but to be impactful we need to accelerate and scale-up.
We would love to investigate if we can set up a circular hotspot in Slovakia as well. Just “Circular Change” in Slovenia is impacting its region a Slovak Hotspot could be a circular cornerstone in central Europe accelerating business and sharing circular knowledge and innovation. It would require a transition agenda with concrete goals and action, for the automotive sector but also for other priority value chains or for cities and regions with local dynamics. It might also include a social, knowledge and investment agendas and it could lead to interventions like fostering legislation and regulations, intelligent market incentives, financing, knowledge and innovation, international cooperation – and, crucially, behavioral change.

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