Ep.57 Circular economy: a future by design not disaster

Maria Rampa: Hi, I’m Maria Rampa and welcome to this episode of Engineering Reimagined.

There is a lot of talk at the moment about circular economy being a significant enabler of a sustainable future, advocating a shift away from our traditional linear approach of ‘take, make, dispose’ to a circular one of ‘design out, retain, regenerate’.

In this episode of Engineering Reimagined Aurecon’s Circular Economy Leader, Jodie Bricout, talks to the CEO of ReLondon, Wayne Hubbard, and the Co-Founder and Managing Director of XFrame, Carsten Dethlefsen, about what they are doing, in different ways, to accelerate the adoption of a circular economy.

This interview was recorded in Brisbane following Jodie, Wayne and Carsten speaking at a Committee for Economic Development Australia event entitled: Lessons from London: Building Queensland’s Circular Economy.

Firstly, let’s hear from Wayne, whose mission it is to transform the way we create, consume and dispose of ‘stuff’, drastically reducing our CO₂ emissions and protecting our future. He says that our current approach will lead to catastrophic climate disaster unless we choose a different path, by design.

Let’s hear what he has to say!

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Jodie Bricout & Wayne Hubbard

Jodie Bricout: Wayne, thank you so much for coming to our beautiful country and spending your first couple of days here in Queensland. You've been working quite a time on circular economy in London. Why is it so important to London?

Wayne Hubbard: It's important because our theory of change is around the impact that we can have on climate and in the UK and I think elsewhere, there's a lot of focus on net zero, which is around reducing our carbon emissions associated with things that are within the boundary of our city, region or country. But we're interested in the emissions that are associated with the stuff that we consume. So if you allocate the extraction, production, transport, use and disposal of stuff to the end user, and mostly they live in cities, the consumer, the citizen who lives in the cities, then our emissions are something like two thirds bigger than those inbound territorial emissions. And the only way we can abate those emissions, because they're associated with materials that are hard to abate, like food or cement production or steel production is through behaviour change. And really the only way we can get that behaviour change is through system change. And that's why the circular economy is such a powerful way of addressing those emissions. And those emissions account for 45 per cent of global emissions.

Jodie Bricout: That's amazing because often people don't really make the connection between circular economy and material questions, and maybe they think about the circular economy as a waste management issue and don't necessarily link it to those emissions, because waste management is only like 5 to 8 per cent of a carbon budget. So circular economy is important not just around waste material, but for the carbon side of things as well. What do we do next? How do we actually achieve a circular economy?

Wayne Hubbard: I think there's a lot that we can do in cities. More than 50 per cent of the global population live in cities, and I think that's going to grow to something like 80 per cent. So cities are where it happens. Cities are the engine room of the circular economy. So we can certainly do a lot in cities, but it also needs action at a national level. It needs for circular economy policy to be integrated across government so all departments understand the implications, not just the environment department or the local government department, but also the Treasury, the whole government apparatus. And then cities working together collaboratively can make a real difference in the way that they support businesses and therefore, in the opportunities to engage in the circular economy that citizens have. And we started to think about how we can move into the neighbourhood level. So the sub regional or the sub city level and really talk to citizens within their own neighbourhood.

Jodie Bricout: So it’s almost like a decentralisation of engagement around this.

Wayne Hubbard: Yeah, because if you can build a circular economy neighbourhood around a main shopping street and its environs, you can fill that street with circular economy businesses like repair cafes or libraries of things or unpackaged shops. And you can engage citizens through schools, through civil society, and you can build champions and give them tools to engage their peers. You can really have a great impact. In London, for example, there are 9 million people who live in the city, but there are 600 neighbourhoods and 90 per cent of Londoners live within 10 minutes of those 600 neighbourhoods. So if you can deal with those 600 neighbourhoods rather than 9 million individuals, you crack 90 per cent of the problem.

Jodie Bricout: So we've talked a lot about consumers and citizens. How do businesses fit into this?

Wayne Hubbard: So it's businesses that are going to have to offer circular models to citizens to swap their consumption heavy habits for more user habits. We want to see that shift from consumer to user. And the only way we can do that is by supporting new businesses or supporting linear businesses who transition to more circular economy business models in London, we've supported over 400 businesses through just business support, not sustainability advice per se, but just business support. And we also offer businesses access to finance at market rates through venture capital or through development capital, so that we can engage them on a journey from startup to maturity.

Jodie Bricout: And what are those circular business models that you support?

Wayne Hubbard: So we have five circular business models which are essentially about designing out waste or using recyclable input into your manufacturing process, making things recyclable, designing things for durability, servitisation or product as a service, leasing or renting and the sharing economy. So utilising underutilised capacity. And a lot of this is enabled by tech and by the smartphone and peer to peer sharing.

Jodie Bricout: So you here with me in Brisbane - I'm not sure if you've heard, but it's going to be a little event here soon called the Olympics. There'll be a lot of developing infrastructure for this event. Obviously, it's not all about the Olympics, but it's a catalyst for change. How does circular economy impact the infrastructure, the planning of a community as well?

Wayne Hubbard: We had the 2012 Olympics in London and I think for us that development was a real great case study in how to apply circular economy thinking to a masterplan area. I'm not even sure at that time we were thinking about circular economy as a thing. But in retrospect, the, principles that they applied to the development and disassembly of the venues in that area were very circular. So, for example, the stadium was designed to have a legacy use that was smaller than its Olympic operation phase. A lot of the venues were either designed to be completely disassembled or reduced in size into legacy phase. Legacy was planned throughout the development. All of the infrastructure that wasn't hard infrastructure was designed to be removable and reusable. So a lot of those kind of principles were applied to the development. And I think by and large it was a success. And the Queen Elizabeth Park, as it's called now, is just a beautiful area to be to be part of. And it's run by a development corporation of the mayor. And they do a great job in championing sustainable design in construction.

Jodie Bricout: So shifting the construction industry and what our cities look like must be quite a complicated thing to do. How's London attacking it?

Wayne Hubbard: We developed a circular economy route map back in 2017. As part of that process, we engage stakeholders in five focus areas and one of those focus areas was built environment. So we had stakeholders around the table from government and from industry. And one of the things we agreed was that the London Plan needed to have specific circular economy policies within it. The London Plan is our strategic land use planning document, and that led to the development of the Circular Economy Statement requirement and Circular Economy Guidance so that now every strategic development in London, which are the biggest developments, must be accompanied by a Circular Economy Statement which sets out why the development is needed, what measures you're going to put in place to reduce the impact, including things like buildings as materials bank, designing in layers, all that kind of stuff. And then once the development is built, an assessment of how you did, did you reach your targets? What were the Bill of Materials? What lessons we can learn. So we'll have a case study of approaches to the circular economy at the biggest scale. So far there's been 200 plus such applications. The next stage for us is twofold, one to see if we need to tweak the London Plan policies and hopefully they'll be an opportunity to do that at some stage. But what we can do right now is work with local government to see if we can take those circular economy statements and apply it to more local developments. And we're doing that through something we call the Circular Buildings Coalition. We haven't got funding for that. We're crowdsourcing funding. So that's our immediate problem. But we're hoping to put together a coalition of funders to allow us to take this to the next stage and then develop specific guidance that is appropriate for a more local level.

Jodie Bricout: So we've also met with quite a few different organisations here in Australia already. Would you say that we need a Re-Brisbane and a Re-Melbourne and a Re-Sydney?

Wayne Hubbard: Well, certainly the functions that we carry out are definitely interchangeable to other city locations. So we offer support, in our context it’s dense urban recycling support, but support to local authorities to help them to improve their recycling rate, which is very ‘wastey’. But we also offer support to businesses and I think there's an area that we could expand on globally, which is identifying circular economy businesses, businesses who fit into those five business models, and then providing them with support to improve their chances of making their business successful and scalable. We've done such support for over 400 businesses now, and there are some really good case studies on our website of successful businesses who have raised capital on the back of our support. And we hope that some of those businesses will start to scale up and partner with global corporates. And then you have global circular economy business models. So if all cities are doing that with their own entrepreneurial talent and their own startup talent. Just think of what that could mean in terms of an explosion of circular economy thinking and practice.

Jodie Bricout: Behaviour change is so much easier where we've got something convenient and easy and good to go towards as well isn't it?

Wayne Hubbard: I would say that without that kind of plethora of circular economy business choice, then it's going to be almost impossible to get people to make the decisions that they need to take in order to reduce their consumption emissions from materials. And that's the crucial aspect here, because without that, we're not going to hit our climate change targets.

Jodie Bricout: So why do we really need to be doing this, Wayne?

Wayne Hubbard: Well it goes back to that point I was making about the climate change implications of this. You can only address 55 per cent of the world's carbon emissions through switching to more renewable sources of energy. The other 45 per cent can only be addressed through reducing your consumption-based emissions related to materials. So, if we don't address that 45 per cent, then we'll hit a point where we'll have catastrophic climate change and then things will change. So the life we live now is going to be different in the future. And it's going to be different by design or by disaster. And I choose design every time because then we're in control and we can make our support for more circular business models and a circular economy, we can design that and that can be a better way of living life. Freeing us from the burden of ownership. Freeing us from the troubles that the linear economy presents.

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Maria Rampa: I think we’d all agree with Wayne about choosing to have more control over our future – by design!

Next, let’s hear from Carsten, whose circular construction technology platform, XFrame, addresses real-world challenges through reducing embodied carbon and waste associated with construction.

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Jodie Bricout & Carsten Dethlefsen

Jodie Bricout: Carsten thanks very much for joining Wayne and I onstage with CEDA. I was really proud to be able to bring you to speak with Wayne Hubbard, CEO of ReLondon, who is a global leader in the circular economy, because I like to think that you are a global leader in the circular economy living right here in Australia. So, can you tell us about how XFrame, your system, actually works within a circular economy framework?

Carsten Dethlefsen: We consider ourselves to be a circular construction technology. And by that, what we mean is taking a design and turning it into a kit of parts that allows the entire building system to be reconfigured, pulled apart, every building layer and repurposed for a future use, whether it's in the same location or a different location. And we achieve that through an automated manufacturing process and really linking in strongly to local materials, local suppliers, local manufacturing capabilities.

Jodie Bricout: So it's almost like a Meccano set. Let's break it down a little bit. So we've got design for disassembly. How is that useful in your business model?

Carsten Dethlefsen: The design for disassembly is the critical component of XFrame and we like to call it, design for now, build for later. it's taking any custom design, making it modular, meaning that the custom elements of that build can be repurposed, but the majority of the build is modular. And so what that means is that a vast majority of your structure is modular. Even though it might appear as a completely custom design.

Jodie Bricout: So it's actually designed so that can be reused once, twice, three times in the future, maybe more. Are you already seeing organisations use it multiple times or is this just designing for the future, and it may or may not happen?

Carsten Dethlefsen: No, we've got real world applications of that. We've done internal tests where we've pulled apart and put a frame together. We've got up to 13 times on that we’ve proved the point, let's park that one. What we're now seeing, which is a really pleasing aspect for us, is tenants taking their fit-out with them which is a completely different mindset where, there's a built in XFrame, they'll pack it down, take it with them, rebuild it in a new location. And then we're easily able to provide top-up parts to finish off whatever that build now looks like in its new location. All through knowing exactly the individual components that went into the original build.

Jodie Bricout: And what would usually happen when a tenant had to move spaces?

Carsten Dethlefsen: Yeah, bring in the mini skip basically. Rip everything out and put it in the bin and someone else's problem to start again.

Jodie Bricout: So that costs real money as well, right? That costs a tenant money. Then they go to buy everything again. So your solution is saving them not only the environmental footprint…

Carsten Dethlefsen: But the cost, yeah, absolutely. And because it's a modular system, you've also got the benefits of preassembly offsite. So you're reducing the construction risk, but also speed of install onsite. we're up to 30 per cent quicker than a traditional building methodology. So the knock on effect to our clients is enormous through being able to open up their facilities earlier.

Jodie Bricout: So your solution is working now. It's a real circular economy solution. It's not just on the research tables, it's in offices. Tell us about the fit out that you've done for ANZ in Lismore that also demonstrates how it can work for climate resilience.

Carsten Dethlefsen: We are well and truly out in the market. It's not a research project, as you said. But having said that, we would deliver retail stores for ANZ across the country and one of the challenges they had was with their Lismore store that had flooded three times in the last five years. What they were seeking was a fit out that was more flood resilient. And what we were able to demonstrate there was not compromising or changing their design in any way. All we did was substitute the materials from what we were ordinarily using in a normal store compared to what we did in Lismore. So we substituted out structural grade plywood for marine grade plywood, but exactly the same manufacturing process, assembly, install. And none of that changed. And what we delivered there is a store that if it does flood, we're able to pull our linings off, pull the insulation out, which is a recycled plastic, let it dry, put it back in again, put the panels back on and the store can be up and running in a fraction of the time compared to the previous scenario where it was literally come in and demolish the fit out and start again.

Jodie Bricout: What advice do you have for other circular business models that might be emerging in Australia?

Carsten Dethlefsen: I think there's enormous appetite out there. We're seeing a lot of interest come from the corporate level, driving the need for circular approaches for some solutions that have really strong ESG credentials. The shift towards moving away from traditional construction techniques is taking a little bit longer. But I think the more of these innovative solutions we've got, the more of a compelling use case it becomes.

Jodie Bricout: We've talked about waste material use, basically you’re designing out waste all across the supply chain, which is pretty exciting. How about carbon? Does your product have carbon benefits as well?

Carsten Dethlefsen: Yeah, absolutely. Because we know exactly the components that go into a build. It's a highly engineered system, so we know right down to the last washer what goes into it. It means that we can very accurately model what those materials have in terms of carbon benefits. The main material we use is an FSC-certified structural grade plywood, which has very strong carbon sequestering credentials. So we're able to very accurately model what the carbon footprint of that building is, but also run a lot of concept design changes to see what that end effect is for our clients on what the materials actually choose to put into the build.

Jodie Bricout: So you can actually optimise and decrease the carbon impact of the building.

Carsten Dethlefsen: Yeah, absolutely. And even when we go to a concept design, we can run different scenarios that optimise the layout of materials that minimise the waste at the same time. So it becomes a really efficient way of building.

Jodie Bricout: So circular economy is not some crazy thing of the future. It's happening now.

Carsten Dethlefsen: Absolutely not. It's here. It's a real thing. There's a lot of interest in it, and I think it's certainly part of a very strong part of the future of construction.

Jodie Bricout: How can your system help with the legacy aspirations of the upcoming Olympics here where we are trying to actively design for disassembly and reuse and legacy?

Carsten Dethlefsen: We believe we've got a system that's capable of being deployed in many different applications. Think temporary ticket booths, hoarding, temporary stands, whatever it might be. The benefit is the modularity behind it means that when they're disassembled we can redeploy them into office fit outs, for example, because we know exactly the components required to deliver a different build.

Jodie Bricout: So ticket booths don't need to be reused as ticket booths.

Carsten Dethlefsen: No, we can turn that into whatever it needs to be. The other benefit we've got is that that modularity doesn't need to mean square boxes. It can be completely architecturally designed but pulled apart and reused down to the individual components in a completely different setting afterwards. It's a full flexibility in the design, but complete modularity and reusability.

Jodie Bricout: Excellent. Thanks very much for being with us.

Carsten Dethlefsen: Thank you.

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Maria Rampa: Thanks to Jodie, Wayne and Carsten for that insightful discussion! The question now remains – what are you going to do to adopt a more circular approach into your working and personal life? We’d love to hear your ideas, so please leave a comment wherever you listen to this podcast, or on Aurecon’s posts about this episode on social media.

Until next time, thanks for listening!