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Some quick thoughts on Infrastructure and the Circular Economy

Here is a quick and personal SWOT assessment of where the circular economy approach sits in infrastructure delivery right now:

Strength Weakness
  • Readily builds on pre-existing LEAN and materials efficiency work
  • Wow! Factor and lots of momentum for implementation
  • Unifying concept that can align all aspects of people, planet, profit strategies
  • Driver for programme-level visibility and connectivity between operators
  • Can be challenging to articulate CE concept – too ‘woolly’?
  • Infrastructure-specific cost benefit models are still emerging
  • Still lacking an effective programme or corporate-level measurement for circularity
  • Lifecycle is too long for meaningful end-of-life planning (cf. modular)?
Opportunity Threat
  • Integration with BIM and WLC
  • Alignment with Natural Capital  and Net Positive Impact approaches
  • Catalyst for new procurement and purchasing models
  • Drives modular design and asset tracking
  • Basic infrastructure pathways are long-lived and can be readily re-purposed
  • Statutory design guidelines are sometimes inflexible and procurement rules can inhibit innovation
  • Corporate inertia and risk appetite prevent pilot scaling
  • Initial transaction costs can be high as supply loops are worked through
  • Current commercial models sometimes backed by vested interests and established down-cycling pathways

I set these points out as a starting point because infrastructure operators are taking the circular economy seriously – addressing the weaknesses and working through the threats to turn them into opportunities, why?

  • insulation against local scarcity
  • commodity price fluctuations
  • logistical pinch points
  • opportunities for shared materials hubs
  • phased and aligned programme schedules
  • collaboration on skilled resources, especially for critical plant and equipment

What is the evidence that they are doing so?  Working with AECOM, Highways England has developed a circular economy action plan and is demonstrating its value with the A14 Pathfinder project. National Grid, a founding partner of the Ellen MacArthur Foundation, has piloted its approach on a significant asset class: closing the loop on overhead lines – and the company is now refreshing its strategy, with new targets and performance metrics. Network Rail’s aggregate hubs – ten materials banks across the UK – are long established and their value to that organisation’s national supply chain is significant. And it‘s not just power and transport infrastructure, water companies are doing a lot too. For example, Yorkshire Water is deploying its Esholt waste water treatment works as a circular economy ‘hub’ and is making significant savings on re-use of old filter media and energy self-sufficiency.

Last month was a significant anniversary for AECOM and the circular economy – our 18th session marked the third anniversary of the Major Infrastructure – Resource Optimisation Group (or MI-ROG), which we first convened in September 2013. Bringing together Highways England, National Grid, Network Rail, International Synergies and AECOM as founding members, MI-ROG established a mission to share best practice and collaborate across programmes and projects, sharing resource strategies for sustainable infrastructure delivery.

Recently, MI-ROG has focussed on procurement as a catalyst for integrating circular economy principles into the feasibility, design, maintenance and decommissioning of key infrastructure. This has resulted in the publication of the thought piece attached here, which now represents the collective thinking of EDF Energy, the Environment Agency, Heathrow Airport, Highways England, National Grid, Network Rail and Tideway, among others.

I think the white paper is significant because integrating circular economy thinking in procurement can be a significant driver for addressing very real resource constraints and price fluctuations hitting infrastructure operators and investors as they strive to deliver on a significant investment pipeline.

Why do I think this? Simply because the sums of money spent on major infrastructure are so large and the materials requirements so vast that if you start to get it right with serious infrastructure procurement then there is a significant knock-on effect into the wider market with these major buyers driving the shift through their supply chains.

So the paper sets out likely questions and themes for future prequalifying and tendering with respect to retaining components and materials at their highest value for the longest possible time over the life of infrastructure assets. I think these sample questions give an indication of how the major infrastructure operators will encourage a circular economy model through their major tier 1, 2 and 3 contractors and suppliers in the coming months and years – well worth reading and integrating into work winning processes and innovation programmes.

Indeed, circular economy approaches are good friends of construction modularisation, BIM, comprehensive digital asset inventory and recovery and the transition to service based infrastructure delivery. With all these shifts underway in how major infrastructure projects are delivered, a circular economy approach makes for a strong unifying theme in delivering sustainable legacies.

What next you ask? Well, look out for further thinking from MI-ROG on what aspects of major infrastructure assets are actually recoverable and integrating that knowledge into procurement, design and decommissioning efforts. We will also start looking at what performance metrics work best for tracking implementation of a circular economy strategy and its impact on resource intensity across infrastructure operators.

White paper host page

Embedding circular economy into procurement MI-ROG white paper October 2016

Robert Spencer is Director of Sustainability, Environment (EMEA) at AECOM and founder abd chair of the Major Infrastructure–Resources Optimisation Group (MI-ROG)