Circular Procurement and the Built Environment

How can we reduce our material consumption and generate less waste? This is an important question being addressed by legislators around the world. The European Union (the “EU”) leads the way with its ambitious goal to transform the EU into a sustainable, low-carbon, resource-efficient and competitive economy. 

To achieve this goal the European Commission presented the European Green Deal in December 2019, which sets out a plan for the transition to a circular economy in order to preserve a liveable earth with sufficient, food, water and wealth for future generations (Closing the loop – An EU action plan for the Circular Economy). Following a series of dialogues with key industry sectors, the European Commission recently published an announcement in April 2024 in which it points out that strategic procurement can be an important tool to create markets for net-zero, circular and clean technologies and business solution by rewarding companies that invest in innovative and sustainable technologies and production (The Clean Transition Dialogues).  

The recently published Procurement Strategy Circular Viaducts and Bridges provides insight on how strategic procurement can be applied in relation to the built environment to facilitate circularity within the market. We will briefly discuss this strategy and identify general principles that can be used as inspiration when procuring construction and renovation works. 

Procurement Strategy Circular Viaducts and Bridges

Buyer Group Circular Viaducts and Bridges, an organisation consisting of the Dutch government and other public authorities, has recently published the Procurement Strategy Circular Viaducts and Bridges, a strategy aimed at supporting public procurement authorities in the circular procurement of construction and renovation works of viaducts and bridges (Market Vision Circular Viaducts and Bridges, Contract Drafts Circular Viaducts and Bridges). This strategy explains that the Netherlands has a large number of bridges and viaducts owned by public / governmental and decentralised authorities that will need to be replaced or renovated in the upcoming decades. To achieve the European and Dutch goals  for circularity, the authors of the strategy note the importance of finding new and sustainable solution for the procurement of the works and services. 

Circular procurement refers to any purchasing of works or services that rewards the degree of circularity of a business or solution. A circular economy is a model of production and consumption in which the generation of waste is being avoided throughout the value chain. Materials are being reused after the end of the life cycle of a product and are kept within the economy. The circular model is different from our current linear economy in which we rely heavy on consumption and disposing of products and materials.  

What does circularity mean in relation to the built environment? There is no set way to approach circularity in the built environment. An example: the client and contractor are focused on not only the utilisation phase of a building but on the entire lifecycle of the works – from planning and design until decommissioning and afterwards. A life cycle approach can be adopted during the design phase by designing flexible and adaptive structures. The principle of circularity can be applied during the construction phase and maintenance phase by using sustainable and modular materials and focusing on proper maintenance and a reduction in the amounts of repair to ensure that the life span of the building is as long as possible. Combining these principles enables us to approach the decommissioning phase in a circular way: the relevant building can be easily refurbished instead of torn down and the building consists of different materials that can be harvested easily for the purpose of repair, reuse and/or recycling.

The Procurement Strategy Circular Viaducts and Bridges is drafted with a focus on the Netherlands and its viaducts and bridges. Nevertheless, we believe that principles can be derived from the strategy for the procurement of construction and renovation works in general and of course broader than the Netherlands only. 

1. Waste Management - It is the responsibility of the procurement authority to take a proactive role in waste management. As the authority makes the call, it must ensure that there is sufficient room for bidders and contractors to consider and determine strategies to manage waste and reuse materials. It must also consider elements outside the boundaries of the project and determine when the works will be decommissioned and how the waste en harvested materials will be reused and recycled. 
   
   
2. Award Criteria - The procurement authority must challenge bidders to show how they intend to perform the works in a circular way in their submissions and plans of approach. This can mean several things: realising a design based on reused materials supplied by the procurement authority, using sustainable and biodegradable materials, using certification and guarantees in relation to sustainability and the lifespan of materials, harvesting used materials in an optimal way at the end of their lifecycle, optimising the use of utilities and reducing repairs and maintenance works. The procurement authority awards circular measures. It is essential that the measure of circularity is objectively determined. 
   
   
3. Collaboration between Procurement Authorities - Considering the harvesting, storage and reuse of materials on a project-to-project approach might not be the best way to ensure an optimal degree of circularity. A holistic approach might be better to facilitate further reuse. Furthermore, a collaboration between multiple procurement authorities can be beneficial to seek a certain extent of standardisation of works to make reuse easier and to register lessons learned for follow-up projects.
   
   
4. Collaboration between the Procurement Authority and Contractor - Close collaboration between the procurement authority and contractor by applying a two-phase approach or early contractor involvement is the best way to adapt a life-cycle approach to contracting. Competitive procurement of such contracts (e.g. by using an innovation partnership) can be tailored to focus on quality over price, and the approach provides sufficient room to monitor and optimise the degree of circularity along the way. 
   

Looking forward

The market will play a major role in the transition to a circular economy. Implementing a circular approach to the daily activities of a company is possible, but it requires innovation which comes with costs and risks. Commercial parties are not willing to make costs and take risks if the appetite for circularity does not exist among their clients. Public authorities must therefore take a key role by enabling circularity in their purchasing procedures to allow innovative market players to emerge and thrive. The Procurement Strategy Circular Viaducts and Bridges is a prime example of how governments can drive progress on sustainability and circularity forward and can be an inspiration outside the Netherlands as well.