On 7 April 2022, a panel of experts discussed the challenges and opportunities for transitioning to a circular economy in Australia.
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The Committee for Economic Development Australia (CEDA) hosted the event ‘Why a Circular Economy Makes Good Cents’ on Thursday 7 April 2022 in partnership with the Circular Economy Business Innovation Centre. The event featured a panel of industry leaders and experts including Sustainability Victoria’s Director of Strategic Foresight and Research, Kate Dundas.
A panel of experts discussed the challenges and opportunities for transitioning to a circular economy in Australia and we heard directly from Returnr, an organisation that has already made the leap in running a truly circular business operation.
Panel moderator Lindsey Brown, Australian Water Market Leader at GHD opened the session with this key question: what is the circular economy and why are we talking about it?
Lindsey shared some insights from The Ellen McArthur Foundation definition that the circular economy is based on three principles, driven by design:
She explained that the circular economy is underpinned by a transition to renewable energy and materials and decouples economic activity from the consumption of finite resources. It is a resilient system that is good for business, people and the environment.
Circular economy thinking is a good idea, but how we actually achieve this was at the heart of the 60-minute discussion. Two main themes emerging in this space are:
Roch Cheroux spoke about a report Sydney Water recently released titled: ‘Unlocking the Circular Economy in Western Parkland City’ The report was a collaboration with Sydney Water and NSW Circular where over 60 stakeholders across various industries were involved. Roch explained the key components of that report which include the management of water and waste plus the benefits to the surrounding local community.
View Roch’s LinkedIn profile and Sydney Water’s website.
Veena spoke about transforming waste streams and challenged the myth that waste resources are not fit for high quality production. She explained if we’re going to bring circular economy to life, we have to be able to use valuable waste resources in re-manufacturing all kinds of products. She urged us to focus on designing ‘fit for purpose’ and ‘engineered to last’ mentalities and supporting recycling at end of life.[
View Veena’s LinkedIn Profile.
Jamie Forsyth is the founder and CEO of Returnr, a company dedicated to removing single-use packaging from the hospitality industry. Returnr targets high value, environmentally problematic, single-use packaging with an emphasis on transparency. Jamie rephrased the question of today’s event to when can a circular economy make good sense and what conditions you can look for in a circular scheme that is financially viable.
View Jamie’s LinkedIn profile and Returnr’s website.
Tony spoke about the importance of ecological transformations and emphasised the need to act now and make changes whilst leveraging the technology that already exists. He outlined Australia’s current waste generation statistics and the need to extract value from this resource. Tony concluded that the missing link is willpower and determination to really enable these urgent ecological transformations and a transition to circular.
View Tony’s LinkedIn profile and Veolia’s website.
Kate shared a Victorian perspective on this issue touching on the Victorian Government’s circular economy plan, Recycling Victoria: A New Economy, how this will evolve in the long term and how government can play a supporting role to industry. Kate rounded out the discussion by stating the circularity might be new, but all evidence tells us it’s here to stay and will be big; so, the opportunity to capitalise on product or service differentiation is now.
View Kate’s LinkedIn profile and Sustainability Victoria’s website.
Sustainability Victoria Presentation
Why a Circular Economy Makes good CentsHeld on 7 April, 2022
Lindsey BrownAustralian Water Market Leader at GHDModerator
Gabriela D’SouzaSenior Economist at CEDA Committee for Economic Development of AustraliaMC
Roch CherouxManaging Director at Sydney WaterSpeaker
Jamie ForsythDirector at ReturnrSpeaker
Tony Grebenshikoff Vice President Business Australia and New Zealand at VeoliaSpeaker
Kate DundasDirector Strategic Foresight and Research at Sustainability VictoriaSpeaker
Professor Veena SahajwallaScientia Professor, 2022 NSW Australian of the Year at The University of New South WalesSpeaker
Good afternoon everyone, and welcome to this livestream event, Why a Circular Economy Makes good Cents. By way of introduction, my name is Gabriela D’Souza, and I’m a Senior Economist for the Committee for Economic Development of Australia, and it is my great pleasure to be your host for this livestream.
I’d also like to begin by acknowledging the traditional owners of the lands on which we meet – where I am in Hawthorn is the Wurundjeri Woi-wurrung people – and pay my respects to Elders past and present.
I’d like to firstly welcome all of the excellent participants to this livestream today, but we’d also like to especially thank GHD for hosting this livestream today. Just a note to all of our viewers that are coming in at the moment, that you can follow CEDA on Twitter @ceda_news and if you want to join into this conversation via social media you can do that using the hashtag #CircularEconomy. We’d also like to invite you to participate via the pigeon hole app, and you can see those details on your screen right now. The URL is ceda.pigeonhold.at and the password is CIRCULAR. On pigeon hole you can enter your own questions or view and vote on the questions of others via the app.
Would also like to again acknowledge that GHD are supporting this event, and without any further ado I’d like to introduce and invite Lindsey Brown from GHD to make their opening comments and to introduce the rest of our participants as well. Over to you Lindsey.
Thanks Gabriela. Really appreciate the introduction. Hello everyone and welcome. My name’s Lindsey Brown. I’m the Australian Market Leader for Water for GHD. I’d also like to take a moment to pay my respects to the traditional owners of the land that I’m calling from, the Wurundjeri people of the Kulin nation here in Melbourne, and pay respects to their Elders past and present.
We have an incredible line up of speakers today who I’m going to introduce very quickly for you now. We’ve got Roch Cheroux, the Managing Director of Sydney Water, Professor Veena Sahajwalla, the Scientia Professor and 2022 New South Wales Australian of the Year from the University of New South Wales. We’ve got Jamie Forsyth, the Director of Returnr. Richard Kirkman unfortunately lost his voice and is an apology, so we have Tony Grebenshikoff, the Vice President of Business Development joining us from Veolia. Welcome. And Kate Dundas, Director of Strategic Foresight and Research from Sustainability Victoria. Welcome to all our panellists.
This event is actually a direct hit from my area of personal and professional expertise, which is one of the reasons I’m so thrilled to be hosting. My sustainability journey has always been around the role of business in environmental, sustainable governance, ESG. Although we didn’t really call it that back then. Corporate social responsibility in CSIRO was really in vogue when I was first studying and getting involved in these issues, right back from my undergrad in public policy and human rights, and then through my Masters of corporate sustainability that focused on sustainability decision making in the urban water sector, which is one of the reasons why I love the water sector, the ultimate triple bottom line industry in my view. I’m so excited to see it here represented amongst so many other important industries.
So before we get started, I think it’s worth asking the question what is circular economy and why are we talking about it? Maybe that seems like a silly thing to say to a bunch of people who are obviously interested enough to get on to this call, but I think it’s worth touching on. Although our speakers may offer their own definitions, I’ll often you the one from the Ellen MacArthur Foundation, which is around circular economy being based on three principles and driven by design, to eliminate waste and pollution, circulate products and materials at their highest value, and regenerate nature. It’s really around driving those triple bottom line outcomes through a systems thinking approach in the way that we approach design of our world.
It has a history in the waste sector, obviously driven by some finite land limitations and the risks of disposal that we learn through environmental sensitivity, and stewardship programs really led the way for some of these things early, which you’ll hear about potentially from Kate, and that cradle to grave focus on closed loop systems. We’ve seen it emerge in built environments where we’ve seen an increase of use of recycled and repurposed products, which I think Veena and Veolia have some interesting comments about. The water industry obviously as I mentioned, very close to my own heart, finding new inputs to existing systems that eliminate waste and reduce environment damage, even if those sources aren’t necessarily directly from within the water sector, including food waste. Obviously you can’t think of a more circular system than water, and I’m sure Roch will have some interesting perspectives on that.
Then of course we’re seeing the emergence of new products, services and technologies that Tony and Jamie can talk to us about as well. So there’s really a richness of perspectives on this panel, touching all parts of the circular economy. And from where we sit there’s a lot of general agreement that circular economy thinking is a good idea, but how we’re going to do it is a fundamental question and at scale and within the limits of a business case, shareholders, regulators, or others, and this is really at the heart of the question that we’re asking today.
At GHD we grapple with this within our own business and with our clients of course, and we’ve seen two really important themes that have emerged, and I’d encourage you to look for these in the chats that we’re going to hear today. The first is the importance of taking small steps while keeping an eye on the big picture, things like pilots, local and regional action. We’ve seen things with projects we’ve worked on. Transport New South Wales railway station accessibility program called the Transport Access Program, looking for reuse and repurposing materials on site. Barwon Water and their positioning as a driver of regional prosperity in the Regional Organics Network. The second is new partnerships and powerful collaborations, and we see this as a really important step in moving things forward, breaking down organisational barriers, really looking more holistically at our systems. The recent partnership announced by Sydney Water and Veolia, two of our panellists today will I’m sure touch on that.
So, really excited to get in to this topic. Hopefully this whets your appetite on what’s about to come. With that, I’ll welcome our first speaker. Roch, please take us away.
Thanks Lindsey. Good afternoon everyone. Let me also acknowledge the traditional custodians of the land and water that we are all sitting or standing on today. I’m on Dharug lands and I want to pay my respect to their Elders past and present.
So, Lindsey, I’m sorry. I know it’s all about circular economy in general, but I wanted to focus on Western Sydney, because there is a lot of very exciting things happening in Western Sydney, and things that Sydney Water is obviously involved in. So, about just two weeks ago now, I had the privilege of attending Parliament House with the Minister for Western Sydney to launch a white paper that is called Unlocking the Circular Economy in the Western Parkland City. This white paper actually was developed by Sydney Water with a number of partners, and obviously the main partner was NSW Circular, but we had also 60 stakeholders from very different directions in Government, business, industry, research and other sectors. In insist on that, because this is really important, that we have as many parties involved as possible.
So, in this white paper we proposed six recommendations that will really help activate the local circular economy in Western Sydney to make it really concrete. The six recommendations are quite diverse, and they range from setting targets and policy, obviously creating the necessary processing and systems and the incentives that we need to have in place. But really what they propose to do is to do things differently, and especially to do things differently with water and organic waste. So, this is a sort of framework document that we propose for Western Sydney, a framework that will help every industry to move into a circular economy and to implement it for real.
In partner to that we are also working on a very, very concrete investment. So, our next big investment in this region is an advanced water recycling centre that will be situated at Kemps Creek which is not very far from here, near the Western Sydney Airport. So, it’s called an advanced water recycling centre, but actually it’s much more than this. It’s more a circular economy hub, and that will generate value from the water, energy waste and agricultural nexus. So, it’s a very ambitious project. This centre is one of our largest investments in terms of water resilience in the last ten years, and to date our largest investment in terms of circular economy enabling infrastructure. Full capacity it will treat 100 million litres of waste water every day. So, a significant one. It will receive not only water from the area, but also organic waste, and we’ll turn this into water, energy and biosolids that can be used as fertiliser.
Talking about cents, the UTS team has started to do some work for us and quantify some benefits. I'll give you some numbers, high level, because the work is still ongoing. But sort of headline number, every million dollars that is spent on turning food waste into energy, we generate something like $2.7 million worth of value right across the economy. So, that’s a return of about more than 200 percent, which I think is quite compelling to anyone listening today and to anyone in general. So, where it’s coming from, a number of different things. If you think about Western Sydney, about 1.5 million people more will be living west of Parramatta by 2036. That’s about 150,000 tonnes of residential food waste and about 70,000 tonnes of commercial food waste every year. Just for scale, all this food waste is equivalent to about 36,000 African elephants. Just to give you an idea, 36,000 elephants. It’s big. It’s really big. When you think about all this massive amount of waste that is diverted out of landfill, this is a really great thing to produce something valuable out of this waste.
So, food capacity. This centre will be able to produce biosolids as I said in addition to water and energy, and simply the biosolids that will be used as fertilisers, I’ve got a value of something like $2.8 million every year. So, again, generating a valuable product from waste. I said that the centre will produce water, and when you think about there is an agreed precinct that is being developed next to the airport, it’s again thinking about circular economy, and absolutely fantastic opportunity.
Very quickly going to talk about carbon emissions. In water treatment we use a magical process that is called anaerobic digestion, and from this digestion we actually produce biogas methane, and this methane will also be produced at the advanced water recycling centre, and that will reduce emissions from Western Parkland City by something like 19,000 tonnes every year, which is equivalent to about 1,200 people. This biogas will be able to generate enough electricity to power between 10 and 20,000 homes. So, if you think about the centre, which is really a circular economy hub, it’s going to generate energy, it’s going to generate biosolids, fertiliser, it’s going to generate water, and it’s going to do it in a very, very economic way.
So, I’m just going to stop here. There is a lot more that I could say about this fantastic investment that we’re doing in Western Sydney.
Thanks Roch. Fantastic. I’m sure there will be loads of questions in pigeon hole to bring to your attention shortly. Great to hear those really measurable benefits you were able to share with us. Next we’re going to hear from Veena. Veena, would you like to open your mic thanks.
Professor Veena Sahajwalla:
Thanks very much Lindsey, and thanks Roch. It’s a perfect segue into the kinds of things that I want to share with everyone what we do at Smart Centre at UNSW. The whole essence of what we’re talking about here is really valuing these resources, which we of course label as waste, but if we’re going to bring circular economy to life, we have to be able to use it in re-manufacturing all kinds of products. When we talk about re-manufacturing, of course typically people assume well if you’re using waste, then it must be lower quality. It can’t be engineered to be high quality products, and this is exactly where I want to be able to kind of really show through some tangible examples that we’ve actually challenged that kind of myth that waste resources are not fit for high quality production. In fact it’s quite the opposite. When you look at the kinds of things that we’ve done, whether it is using waste glass, textiles, electronic waste, tyres and plastics, all of these products that are there in our economy, we know very well that we have to find a way to bring circularity to life, but to do it in a way that is fit for purpose.
It’s not as if everything is a simple water bottle that you can just kind of put it back into a PET bottle recycling plant and go right, the job is done now. But we’ve got to actually challenge the norm that says well there are so many other complex materials, even in the kind of ecosystem of plastics. You think about all the plastics that are highly engineered, and ironically some of these are classified as non-recyclables. You look at the sort of whole category of plastics that is called category 7, the other, as sometimes we read labels on it. What we’ve actually shown there is we can indeed not only convert them into plastic filaments, but we can actually do that at the right scale, do that so that in our micro-factories we can manufacture products that are fit for and are engineered to deliver the kinds of quality outputs.
Let me hold up a couple of little examples, and we start first with this. Now, I’m talking about kind of 3D printing, and these are examples of clamps that you can put into construction and various applications. A hundred percent recycled plastics, done in a micro-factory where you could take those plastics, convert them into filaments, feed them into 3D printers, and you can produce products that can be engineered and they can be customised for a whole range of different applications. So, we think about all kinds of things, whether it’s the examples that Roch’s been talking about, what’s going to happen in Western Sydney, all the manufacturing that’s going to happen there, the rebuild, and people living in that area. So, it’s about industries, people having all of those basic things in life. So, yes, industries might want this simple example of clamp fittings that we’ve manufactured for an industry partner who’s using in construction projects.
But you might say that’s all well and good. That’s plastics. That’s high quality production. Where do people come into all of this? Let me hold up another example. So here’s an example of a green ceramic tile that we’ve been producing in a micro-factory. Now this contains waste glass and waste textiles. The reason why I bring that up is it’s got actually such an important point to take into account. Think about all those builds and rebuilds that are going to happen, whether it’s in Western Sydney or indeed sadly a lot of flood affected areas in our state, and how are we going to access those tiles, those fundamental tiles? I mean if we’re relying on supply chains where products are going to come in to the country, we know COVID has if anything taught us we need to build sovereign capability, we need to show remanufacturing happening right here. So, a lot of these green ceramic tiles that we are making locally in our micro-factories with regional factory settings is all possible. Again, the reason why I make that point is that if we are to be centralised and if we are to have all of these production capacities, whether it’s in Western Sydney or some other regional communities who are setting up micro-factories in different parts of the state, we know that we can access resources. We can access waste textiles, waste glass. But can we actually engineer them to produce these high quality green ceramics?
So these are the kinds of things I guess we have to challenge ourselves and ask whether it is actually possible to achieve those engineered outcomes. The short answer is yes. We know very well that this is only the absolute tip of that iceberg. We’ve got a whole range of materials. Start to think about electrification. Everything that we talk about has to ultimately give us those goals of how we’re going to decarbonise. So, now we start to talk about all the things that Roch was mentioning. Energy. How are we going to have our storage devices? So, that then brings us into that notion that we’ve got to make all these kinds of products, energy storage, batteries and so on, and bring them to life by using our feedstock of highly valuable materials in our electronic devices.
So, I want to give everyone a bit of a flavour that it is all possible, it’s all happening right here in Australia. Thanks Lindsey.
Thanks Veena. What a great optimistic note to end on. I love how you’ve introduced the wording of remanufacturing into our conversation today. I think that’s going to be a great discussion point for later, and also this sense of securing our supply chains through increasing our sovereign capability. Some great ideas in there for us to chat some more about as we continue.
Next we’re going to hear from Jamie. Jamie, I’ve sure you’ve got some reflections on this, particularly around manufacturing. Please share.
My sustainability journey stated in 2008 when I co-founded KeepCup, and I’ve sort of been asked on today I think probably because during that journey where I’ve now started a business called Returnr, I’m pretty sure that I’ve made every mistake there is twice. So, hopefully I can supply you with some learnings. Just a bit of brief background. Returnr designs and manufactures reusable products and re-used systems. We have ready to go solutions for workplaces, public and private re-use schemes across food service, grocery and personal care.
Now, today I was briefed to sort of answer a question which was posed by the crew at CEDA, which Josh if you could pop up the slide, the question was why a circular economy makes good cents? Now, I’d probably start by trying to rephrase that question, because in all circumstances it doesn’t make cents, and I think probably what will be more helpful for the viewers is to try and understand when can a circular economy make good cents, and what conditions should you look for in a circular scheme that is basically financially viable.
Now, there are significant challenges to meet, both supply side, and at the same time consumer needs have to be met, which inevitably creates enormous trade-offs that you’ve got to navigate. Many enter this space kind of thinking that creating positive environmental outcomes will be enough, but I’d encourage you to think about the environmental action as basically the minimum buy in to play, and that you need to ensure that you have a strong value proposition that supports your environmental action. As an example, at Returnr we design products to create amazing user experiences. It should obviously meet technical needs, safety, ease of cleaning, insulation, venting, stacking, etcetera, the whole time looking beautiful, which means that the positive environmental outcomes are the primary mission of the business but the surrogate outcome of the user experience.
So, when we are looking at reusable things, for clarity, Returnr considers something circular when an item is re-used or recycled in a way that replaced itself. So, a simple test for us is where the supply matches the demand. So, as an example, if it was going to be a bottle, then what we would be aiming to do as each bottle is used is replace with another bottle, not some other sort of downcycled product.
Looking at the slide, you can sort of see that Returnr, where we go for for financial viability, we target high value, environmentally problematic single use packaging. I slipped in a quick example there. There is a single use coffee bag to hold beans, 250 grams. Basically that product is landfill. So, it clearly is very difficult to recycle. It’s often lined poly, metals, etcetera, zip lock at the top, and a single vent which makes the mixed materials very difficult to recycle. It has a technical feature which is required for it to work. We always love products that have that, because often in a reusable you can add more value to the user by improving on that feature, which is often made cheaply because it’s single use.
Then the final thing, probably the most important thing, is we love a high cost. So, that bag that’s there would be costing a small coffee roaster around about $1.00 per unit. Now, the important thing about that is when you are considering creating reusables within your system, is that every time you replace that or re-use something, that value pops out every time, and that value can be shared amongst the stakeholders. Returnr might take some of that money. The customer might get some of those savings. The supplier might save on the packaging. You can string it together a range of different ways. The higher the value, the easier it is to basically make the whole system hum.
We obviously always try and deliver a better user experience. So, you can see in the example there we’ve got the stainless steel canister. It’s a beautiful object. We love direct relationship with customers. This is something that can be created when you do create a re-use scheme. The service, if you can get some traction around something, is likely to be sticky. People are going to come back to you. It’s definitely a point of difference within your system.
The other sort of thing that we look for often is what we call a short or closed logistics chain. So, I always joke that the dark art of all re-use schemes is the return logistics. The businesses that nail that part of it will probably win the market in my view. So, a short, closed logistic chain would be someone like let’s say a meal kit business or a delivery system where you actually control the logistics. So, for every delivery it can double down as a pick up, or you create a system where the user is basically driving that return logistics. You could think about a KeepCup, where the customer takes responsibility, or you could think about maybe a system that might work with a hairdressing salon, a place where a customer always returns to on a regular basis where a system can be implemented where they can actually physically return the goods themselves.
Other areas that we love to target with packaging is where the customer is lobbying hard for a solution. You kind of do see that with meal kit type businesses, where there is certainly a group out there that will not buy from those businesses just due to the sheer level of packaging involved, and it not meeting their values. Then we also love a place where Government legislation is moving in. We see this more overseas than we do here in Australia unfortunately, but I can cite as an example a product that is interesting for us, which is a gelato tub, a one litre. It's made of polystyrene. That’s been banned in a number of states. Not Victoria unfortunately. It is actually quite an expensive single use piece of packaging, so that would certainly be a target for us.
I’ll finish up there, because I’ve only got five minutes. But hopefully peppermill me with some questions at the end, and if you don’t get any answers, feel free to connect with me on LinkedIn and direct message me.
Thanks Jamie. Appreciate those reflections, and great to have such transparency around the conditions that you see in the market that are creating opportunity. I love that theme of environmental outcome being a surrogate outcome of a great user experience. I’m sure we’ll have a lot to talk about around that. Next up we are going to hear from Tony. Tony, looking forward to your reflections on behalf of Veolia.
So, good afternoon everybody, and firstly, look, apologise on Richard’s behalf. We do know that he’s lost his voice. But the great thing about Veolia, we have one voice for our purpose. And, what is that purpose? We work across the waste, the water and the energy markets, but primarily around the waste today, I’d like to talk to you about Australia generates 74 million tonne of waste per annum. That’s a significant portion of waste, and we are a big player across what we do, and very much driving the ecological transformation. What does that mean? We are deeply looking into the habits of individuals, economies, businesses, companies, and the way the communities interact, because those interactions and habits is what creates ecosystems and how they then flourish and not flourish. So, we’re really understanding all those elements, and therefore we get it, that once you have that clarity of interactions, you can then step into that value chain and make a difference.
Some 30 years ago, the first climate summit, there was lots of conversations about the circular economy, and interestingly 30 years on we are still talking and we’re failing to act as a community and as a global entity living on this planet. There is no plan B for our planet, and we strongly believe we need to act now and start making those changes. So, what I’ve heard from Roch mention about the greener Western Sydney, that is so encouraging for us, to be able to integrate those types of systems and strategies and infrastructure that drive change. But fundamentally we have a view that we don’t need new technology. You hear this often, that we’ve got to wait for new technologies to emerge before we can start the circular economy.
When I mention 74 million tonne of waste generated, almost 20 plus million of that is construction waste, which has a high recovery and circular economy story. The biggest challenge though, we have over 27 million tonne of waste still going to landfill across Australia. Fourteen million of that has an organic product. Roch’s talked about how do we extract that value and get the energy and consumption out of it. So, we don’t need the technology. We have the facilities around the Australian footprint today across all the various industry players.
I’ll give you an example. Household waste. What we all deal with and have a touchpoint every day. So, we collect and buy products from supermarkets. We bring that to our homes, we unpack, and then what’s not needed we discard it, and typically the value to there is at that point. What if we change the focus and the mindset? Those manufacturers of those various products would potentially pay a few cents to discard that waste. Because at the moment, the way the system works is the local government have a rebate or a rate that they collect from each of us who then pay for companies like mine to collect and dispose of that waste. People don’t have a sense of belonging to it. When Veena was mentioning everything has a resource, everything has value, so how do we recreate that value in people’s minds? That’s what ecological transformation is. It’s what is the thinking behind those interactions, and how do we as a mum and dad, as a family of five, make sure that the big brands, the Coca-Colas, the Arnott’s and all these various companies have an association with the products they’re manufacturing, and they actually pay for the disposal? Then they’ll start to shift their thinking from disposal to circular, because they want to cut out those costs.
So, there’s a big shift. I don’t think we need the technology. We’re always emerging and our technology is refreshing every ten years or so. But I think the number one missing step is willpower, is the determination to really see this through, and how we as an enterprise, as communities, as customers, as stakeholders of each other’s group can integrate and really set those policy settings. What’s encouraging is there’s some new policy settings out there around FOGO, taking organics out of landfill. That’s encouraging, and we want to see things like that move forward. But for us, I think we have the money. We have the capital. Money is cheap at the moment to build and refresh infrastructure. We have the policy settings. Fundamentally I’d love to challenge all our listeners, is what are you doing to change a few habits tomorrow to commence this circular economy journey? If we all start one or two habits a day, by the end of the year we’ll have 700 habits that have shifted and changed and we’ll start seeing the benefits of a circular economy.
So, in summary, does a circular economy make cents? I would say we need a few cents and a bit of willpower and circular economy will commence and thrive. Thank you.
Thanks Tony for those reflections, and excellent challenge you’ve posed to our whole audience today. Interesting to see willpower as the last important ingredient we need in getting a circular economy going. Great to have some follow up questions about that in pigeon hole.
We are going to round out our presenter comments with Kate from Sustainability Victoria. Welcome Kate.
Hi. Thank you. Thanks for having me. I’m coming to you also from the lands of the Wurundjeri people, and I want to acknowledge that we live and work on the land of the world’s oldest and most sustainable culture, and we have a lot to learn.
I’m going to talk quite generally about the circular economy and what it is, and then talk to some of the things that the Victorian Government is doing. So, the linear economy, what the circular economy is not, is based on a take, make and waste model, and it’s obvious that this is problematic for our environment. The whole system operates to convert our natural resources into financial resources, and degrading the living systems that we all depend on, and we can see the result of that playing out now.
The economic side of this linear economy doesn’t really make sense either. Manufacturing things and products embeds them with value. We turn ore into metals that enable us to have smartphones and cars. We harvest oil or natural fibres to create our favourite pair of jeans. So, if a part breaks, does that mean the rest of the product is now useless? Does a broken screen mean that the metal in our phone is now worthless? If we throw stuff away simply to replace it with something new, we’re throwing away that value and we’re throwing away opportunity. I just love the work that Veena is doing to deal with some of that.
In Australia we’re right at the beginning of a transition towards a circular economy, meaning it’s prime time for businesses to get on board and start innovating by rethinking business models and the products and services that they offer to be more circular, and we’ve just heard about that too. The opportunity to capitalise on product or service differentiation is now. Our current economic system is set up to support that linear way of dealing with our resources, which hides a lot of the cost of externalities. The linear economy increases exposure to risks, such as notably higher resource prices and supply disruptions – again, we’re seeing that now – and rising volumes of waste and pollution. An increase in emissions, a lack of action on accelerated climate change carry an incredible health cost. We’ve just found out that plastics have been found in human blood.
The circular economic system enables savings and economic opportunity to the sound of billions, and research indicates an annual net material cost saving of up to 630 billion US dollars, and that’s for the European Union alone. A user centric economy, which we’ve also just heard about, will lead to increased rates of innovation, employment and capital productivity which are all, as we know, important multipliers to economic benefits.
The circular economy is not just about the waste sector. It’s about total economic reform, about how we design, how we use, how we think about the materials and products that we interact with. It’s also not a dedicated decarbonisation approach. A circular economy does not specifically target a reduction in emissions, but emissions and materials are two sides of the same coin, and we can’t have one without the other.
So, what are we doing about it in Government? Sustainability Victoria’s purpose is to accelerate Victoria’s transition to a circular climate resilient clean economy. We’re not the regulator or the policy makers, and I know some of the laws get in the way of what we’re trying to do. At Sustainability Victoria we see ourselves as market enablers, and we action on this purpose through three focus areas. Investments and innovation, behaviour change and community action. Outside of SV there’s a whole suite of reforms happening across the Victorian Government, and key to those is Recycling Victoria, a ten year $500 million action plan to transform our recycling sector which is waste and cut jobs. A few examples of what we’re doing is investing in a new waste data system to expand our waste data, what we collect, how we collect it, when we collect it, how we analyse it, and this will be enabled through the new Circular Economy Act, which will enable greater data collection powers. We’re experts in behaviour change and embed behavioural insights and social research into our campaigns, programs and projects, and we provide hundreds of millions of dollars in grants across industry, research and development and community groups to accelerate the transition to a circular economy.
Another example of a program that might be interesting to some of the listeners here is the Circular Economy Business Innovation Centre. Lindsey, you mentioned how important partnerships and powerful collaborations are, and that’s what we’re trying to do at CEBIC, CEBIC.vic.gov.au. It exists to support businesses to innovate and identify and implement circular economy opportunities and business models. So, if anyone out there has got an idea, you can call us and get one to one advice with a CEBIC representative. You can come along to some events, and we also have funding, so you can apply for some cash to get what you’re trying to do up and running.
If you want to find out more, please visit our website, or again you can reach out to me on LinkedIn as well.
Thanks Kate. Some incredible opportunities there for people, and great to see putting some investment towards really building some of these new solutions. I loved the idea of throwing away value as a way of changing our mindset, and maybe something that will fuel some of Tony’s willpower discussion.
We’re now going to open to the Q&A. There’s been a bit of activity in pigeon hole, which I’m very excited to get to. I’ll just remind you that is the way to access pigeon hole. Please post your question or vote on other questions that you would like to see the answers to. But for the moment, I am going to exercise my privileges as panel moderator and ask my own question of the panel. This is for all of our panellists. Last week the European Commission presented a package of green deal proposals to boost circular economy through product lifecycle measures and textiles, market boosting for recycled construction products, consumer information, protection against green washing etcetera. Imagine for a moment this panel was going to craft an Australian green deal to support a more circular economy. What measure would you recommend we consider and why?
Not all at once.
I was going to say Lindsey, for me I mean the answer’s kind of obvious. There is so much happening in our economy in terms of rebuilding, manufacturing, local capacity building. I mean we do have the capacity right now to be able to say that if we could instigate I guess something that says you must have 50 percent recycled content, or 30 percent, or whatever the case might be, but if the option is there. I mean many a time the option is there, and I guess we sometimes do get a bit lazy, because we continue with business as usual. My point is if the options are there, if technologies are there, and if you can kind of straight away go here’s an option. I either send my waste to landfill or I support the rebuild activities in Australia by using more recycled content. I mean if we can do that straight away, I think to me any green deal is going to make sense economically, environmentally as well as socially.
Because I guess when we talk about ESG, the social benefits of doing something like that and boosting jobs in the region and enabling that to happen with the power that we hold in our own hands – because remember we’re not just people who generate waste. We’re also consumers. Whether we’re building Western Sydney Airports as large infrastructure projects or whether we’re doing rebuilds, we’re consumers. At the core of it as individuals, whether professionally or personally, we can make those choices ourselves. So, I think we’re all part of that circularity and the way of thinking, so I think we need to all play our part. So, I’d probably say you need to bring both economy as well as I guess the willpower – I guess Tony was talking about – but I guess that commitment from our business leaders to make that happen.
Some commitment through targets and objectives. Roch, I know you’re keen to weigh in next.
Yes. I think what Veena is saying is absolutely right. But first of all really for Governments to set policies and targets, and that’s not something that we currently have. There is also I guess to facilitate different industries to work together. We know that if there’s no structure around the different industries, it will be difficult. It will be difficult for example the construction industry to have access to the agriculture industry or to have access to the manufacturing industry or to have access to the water industry. Because industries are quite different and they’re not operating in the same space.
One of the recommendations that we proposed in our white paper was to create a one stop shop, where you can have actually the sort of exchange place between industries, where the construction industry can come and say well actually, I’ve got this amount of soil of this quality. Is anyone interested? I’ve got the material coming from the deconstruction of this old factory which has got this percentage of aluminium, steel, etcetera. Is someone interested? Having this one stop shop and the ability to have the exchange between the different industries would be a great way to boost the circular economy and to make it real.
Fabulous. Some great insights there from our panellists. I’ll give anybody else who wants to weight in one more minute, and then we’ll move on. Yes?
I’d say Lindsey that an easy solution is basically just to levy single use waste with some type of tax at the supply side right up front, right built in to everything else, and then the big users will effectively – it will shift the way in which they consider the waste and will level the playing fields for everyone in terms of bringing in reusables or using recycled material in other products.
Great. And, Kate, I can see you were keen to weight in as well. Your contribution to our green deal?
So, I would have a complete rethink of our design industry and make sure that we’re designing for disassembly and designing things well for a circular economy, and then the other thing would be to get rid of GDP and think differently about targets and measures and what it is that we’re actually measuring, and measure the circular economy and our transition towards that.
Tony, anything from you to round out our panel?
I think we’re all saying the same thing. So, as my point before, a few cents upfront by the big manufacturers and developers will then drive not a voluntary process but a legislated process. If we have that commitment upfront, then all of the parties here could ensure that we avoid going to landfill and avoid having a linear economy as mentioned, and it becomes circular by its own rights. Because that will motivate all people to work together to create those loops at all levels of the hierarchy.
Great. All right. Well, it sounds like we’ve got the bones of a fantastic proposition. I hope the right people are listening. I’m going to get to some of the questions in pigeon hole, and there are a couple right at the top there. One is from Cherie around the responsibility of Australia and New Zealand in addressing their own domestic plastic waste rather than shipping overseas. Just a question to those on the panel who may have thoughts about this. Are we seeing more of that I guess taking of responsibility for those types of waste products? And, I guess a related question from Harriet was are we actually seeing a reduction of waste rather than moving to recycling? Are we really taking measures to reduce the use, particularly of PET, rather than just recycling it? So, really this is a question about our waste balance and what are we doing with it?
I can start on that if you like. We had targets to reduce individual waste. We had the China sword ban, so we are unable now to ship materials overseas, and the plastic bans are coming up soon. So, there’s been a hell of a lot of investment into the recycling sector and into manufacturing and remanufacturing materials onshore. So, there’s certainly a massive change in the sector, and yes, it’s not quite as fast as we need it to be, but there’s definitely improvements being made.
Great. Anyone else?
Look, I could probably just add. Around plastics in particular, on the east coast there’s about 2.3 million tonne of plastic generated that goes through waste facilities and the likes, and the export bans are clear and they’re preventing mixed plastics and then eventually single polymer plastics unprocessed from leaving our shores. So, the problem will remain on our shores, and what we’re seeing is a significant approved and planned approval for infrastructure that will help process that to single polymers and flaking and washing. So, then what we’re hearing and having lots of conversations is the offtake market who are remanufacturing products are starting to define the specifications they need. Because companies like ours received your yellow bin with lots of mixed rubbish and plastics and recyclables. We try and separate it again after it’s been contaminated or mixed, and then we’re trying to make a specification.
So, we’re at that point where I think those specifications become clear, and then we can have an open competitive market where we create those recycled products for re-use in the Australian market.
I was actually just going to add to the point that ultimately we’ve talked about creating markets, but the markets are already here. I mean we just have to be able to find a way to bring in more of that remanufacturing happening on shore. So, whether it is about use of high quality plastics, I mean the kinds of examples I was giving earlier – so it’s not just your infrastructure that you need in the consumer space around PET and those kinds of everyday items, but I mean quite often we don’t see high quality plastic waste that’s coming for example from our electronics sector. I mean here we are working from home. There’s a whole lot of high quality plastics in our printers and toner cartridges and what have you. What you want to do is you want to put that back into remanufacturing, and therefore the example I was giving earlier about putting it into 3D printing, automatically means you’ve created that economy that is putting it into higher and higher order and value that you can get out of those.
So, it’s about connecting the dots between the material, taking that material and bringing it into the hands of remanufacturers in the shortest possible distance without that cross-contamination. I think Tony you mentioned about cross-contamination. I mean the best thing you can do for your materials is treat it like any other mined resource. I mean you mine a resource, you value that resource, you understand its quality, and when you understand its quality you can direct it to appropriate production opportunities. And, let’s face it. That’s really what we’re talking about here. Whether you’re making steel or a high quality plastic, you have to understand that feedstock, and is it fit for what kind of production, because you need to know the end market, and the engineering that gets you that end market quality. I think to me that’s the language we need to start talking. Taking it away from the fact that it’s just something that needs to be so separated. I get that. That’s important. But I think we need to be talking also about the more sophisticated end market which is where values are.
I’m happy to report that many of our industry partners who work with us are actually already ahead of the curve, putting in a lot of these kinds of products that are made from recycled content into various projects. So, I think we’re already seeing that happening.
I’m going to have to run us out the last question, if you can believe it. We’re already there. I knew this time would speed by, and it definitely has. So, I’m going to kind of mix a few questions together, including one of my own, so hopefully you’ll indulge me, and maybe Jamie, we’ll start with you first. But I mean a lot of the themes that have come out today are around looking for more action, we need targets, we need investment, we need legislative change and regulatory change. Obviously those things all take time, and there’s definitely comments in the chat around the effect that we don’t have time. We’ve been kind of going slowly and incrementally as we’ve been going, but isn’t it time for drastic change? If we can’t afford to wait, what can we do?
Well, I think Government legislation would be – I’ve seen it shift markets overseas, which we deal with quite regularly, and really shift the needle. But it takes a population that is going to push for those things. When you talked about the waste just before, in my view we should be responsible for the waste we create as a country, and it’s unethical for us to send it offshore. I’ve seen where that waste ends up often, and as far as I’m concerned, it should be a crime basically, that we would send it off to some third world country and have sorted through on the shores of some river.
So, I’d like to see government basically step up. They’re the ones who can probably make some big changes, because when they move, big business has to move, and big business has got the money and the muscle to push things through very quickly.
I think that’s true about the Government. Government regulation an quickly shift things, but it needs public support. Everybody that’s in here is an individual making decisions and an individual with purchasing power and political power, so it’s up to every individual and every Government to make better decisions.
Got to love an election year for that, right Kate?
You can tell that viewer that I have given myself a lot of grey hair trying to make change quick, and I’m sure many of the other panellists here have as well.
Yes. Absolutely. Roch?
I think the combination of policy and targets and regulation and the willingness, the goodwill from everyone to participate, they are the key ingredients to make it work. But I think it’s very clear it’s not tomorrow. It’s now. And, every investment that we’re doing today, whether it’s corporate, whether it’s personal, we have to think about what we’re doing, because I think time is running out and there’s no return. At some point there’s no return. So, definitely something that we have to do now, and if we don’t get the regulation in place, if we don’t get the policies and the targets set by Governments, nothing prevents us to do something still, and that’s what we should be doing.
Back to your point Tony around no plan B for our planet, is it time for radical action?
Well, I think we need the policy settings. We’ve talked about that. But back to willpower. I mean in your own experiences, we’ve all got these journeys and paths we’ve been on, but you think about change in your life, when it happened. The thing just before change was you were fully aware of the situation, and before you become aware, you need to get the attention of people around you, what is actually going on. And, I think we are getting the attention of the communities, of the big companies and the likes. It’s like a ten year old at school. If they’re not paying attention in class, they miss the whole learning. We as a community, are we paying attention? I think we are, and there’s still a lot of opportunity. There’s surveys recently I’ve read where only four percent of the populated survey individuals knew what the benefits of circular economy are, but once explained to them, it went up to 60 percent. So, there’s a big gap.
So, I think we need to get the attention, make people aware, introduce those changes of habits at home. It starts at home. Then you take those habits to your business, and those businesses start to change the whole system. So, I think there’s as willpower piece, but there is also a policy setting, and I think we have the capital now and we have the desire. It’s each and every one of us making a few changes a day, and we’ll start to see this shift.
I think the other important point in all of this is that positivity around inspiration, where people who are the leaders in the space have also perhaps a role to play in inspiring the others to come on board. I think to me that inspiration, who are willing to be out there and play that role of inspiration by sharing their stories – I mean we’ve got examples of green ceramic tiles going into places like Sydney Olympic Park. And, those are small examples, but I think to me if we hadn’t had that opportunity, we wouldn’t have had the opportunity to get these actions happening. So, I think to me it’s about action. We’ve talked about that. It’s about inspiration. I think all of this is all of us as human beings wanting to share our stories, and I think to me, the power of inspiration cannot be undervalued, so I’d probably say to me that’s an important piece as well. As human beings we want to hang on to hope, and so I know as much as there’s a lot of talk around doom and gloom and all that, but great examples of lovely things people are doing across the world, and I think we want to probably share more of that.
Well, I can’t think of a better way to close than that Veena. I think you have all doled out that inspiration in spades, and the way that you’ve also generously shared your stories and the journeys that you’ve been on towards taking those small steps that lead to big changes, being open to piloting and testing, to new types of partnerships, all the things that we talked about at the very start. I think you’ve really given our whole audience a lot to think about, not just in terms of the big picture things that need to change, but also the small picture things that we individually can do and the hope that we can bring to the discussion by the small actions that we can take that really do add up.
So, thank you so much for being along today and being on our panel. On behalf of GHD, again I just want to thank you all, and I’ll hand over to Gabriela to close.
Thanks everyone. I have the rather unenviable task of trying to make some closing remarks, because I just enjoyed so much of that conversation. I thought there were so many cool themes around it. And, really liked Lindsey’s introduction around clarifying what the circular economy was, and looking at how our speakers have tried to effect that change in their own workplaces. From Roch we heard about the focus of Sydney Water on Western Sydney with some really impressive and concrete numbers about what’s really at stake. I particularly liked the conversation to elephants. I thought that was quite good. Then from Veena it was great to see some of the practical examples of how some of that is being incorporated into one of our biggest waste industries, which is in construction.
From Jamie it was great to hear some of the strong value propositions that are in play here, and as an economist, thinking about how we actually tax carbon and how we actually tax the things that aren’t good for the environment, for the economy, so really appreciated that perspective. Obviously the legislative framework has been a bit lacking in that area, but hopefully over the next couple of decades as we get closer to a net carbon by 2050 framework that will improve.
It was really great to hear from Tony as well about some of the philosophy around waste, water and energy and the real urgency around water, water and energy being Veolia’s focus, and the real urgency around failing to act and the fact that there is no plan B. Also just noting that we don’t need new tech. We do have all the tech that we need to be able to make these changes now.
So that’s my very quick round up of what’s happened today. Again, I would like to sincerely thank all of our participants for their contributions. I’d also like to thank GHD, our livestream sponsor today. Your support definitely allows us to continue to have these important conversations as we move on to an election, but also as we move on to a future where we can decarbonise effectively and can reduce waste.
Now, I’d like to also thank the audience for their participation in the discussion. This discussion has been recorded, and will soon be immediately available via your livestream link and on the CEDA website next week for you to share with your colleagues and your network.
I believe that’s now time, so thank you again for joining us, and with that I will close today’s proceedings. Thank you very much.
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