Circular Economy and Cost Management in Civil Engineering

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How to effectively integrate the circular economy and cost management in Civil Engineering.

October 3, 2022 Civil Bites 0 Comments

The building industry has a substantial influence on the environment. Construction and maintenance of buildings and non-building structures need natural resources and technological nutrients. The limitation of their use in building projects is one of the most significant obstacles. In light of a scant understanding of the most successful leadership patterns for sustainable building projects, one may ask whether construction businesses constitute a single dominating management style. In turn, the difficulties experienced by these businesses might be connected to how to successfully apply the Circular Economy (CE) idea and decrease the negative externalities of the construction sector.
Transformation to a sustainable building requires the participation of change agents. Based on literature analysis and questionnaire, it was discovered in this paper that it is challenging to identify a dominant leadership style in construction organisations. In addition, a road to circular economy (CE) maturity has been shown as an ongoing goal. The uniformity helps the building business effectively promote the Circular Economy (CE) notion. The study identified three stages in becoming a circular economy (CE)-matured construction company: discord, exhilaration, and harmony.

Introduction

Numerous municipal, regional, and worldwide regulations presently prioritise the collection of building and demolition debris (López Ruiz, Roca Ramón, and Gassó Domingo, 2019). Although many problems related to energy efficiency are being extensively researched in the construction industry, approaches for resolving the pollution problem are still in their infancy (Leising, Quist, and Bocken, 2018). The Circular Economy is getting growing awareness, particularly among legislative decision-makers in the European Union (EU). Its application in many industries is a clear benefit. The adoption of BIM in the building sector consists primarily of a new design philosophy in which diverse disciplines are merged in advance to determine their applicability and constructability.
A system theory’s approach is predicated on the basic premise of organisation. In a systems-based practice, the organisation is seen as an entire, purposeful system comprised of interconnected elements rather than a collection of distinct pieces to be dealt with individually. Similarly, building organisations have subsidiary processes besides their primary ones (managerial or supporting). Figure 1 depicts a model of the circular economy (CE)-oriented construction business system.

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Figure 1 Business process map in construction companies

Policy Background

National Policy

The UK Government has issued several policy and strategy papers to establish a more circular economy, with the 2018 Resources and Waste Strategy being the most important. The 2018 Resources and Waste Strategy (RWS) outlines the current Government perspective on waste management in England, including how the UK must reduce and manage waste more efficiently by maximising chances to produce value from material prevented from entering waste streams and material retrieved from waste streams. Resources and Waste Strategy (RWS) gives a helpful example of the circular Economy, which is shown on the following page:

Figure 2 Benefits of Circular Economy
Figure 2 Benefits of Circular Economy

Resources and Waste Strategy, 2018

The Resources and Waste Strategy (RWS) identifies the waste hierarchy as a crucial concept to be implemented when promoting circular economy principles as a natural consequence of the government’s goal to manage trash more effectively via a circular economy. The waste hierarchy offers a framework for dealing with rubbish effectively. It demands that as many resources as possible be recovered and reused, emphasising the need to prevent waste from developing in the first place. The waste hierarchy is necessary for more effective resource management and a circular economy. Resources and Waste Strategy (RWS) provides the following depiction of the nation’s progress toward waste management in line with the waste hierarchy.
The Resources and Waste Strategy (RWS) recognises the construction industry as a critical area where resource efficiency must be enhanced to maximise resource productivity and achieve waste production and management objectives. Resources and Waste Strategy (RWS) believes the construction industry is on the verge of a significant transformation due to the increased use of novel building materials and methods. Applying Extended Producer Responsibility (EPR) for specific building materials optimises resource use.

National Planning Policy Framework

While the most recent edition of the National Planning Policy Framework (2021) does not mention the transition to a circular economy directly, it does indicate that “planning policies and actions must also incorporate applicable international commitments and legislative requirements”. This confirms that planning policy and choices should be matched with law and policy, such as the Resources and Waste Strategy. This leaves flexibility for future or additional approaches, strategies, and requirements to be incorporated in plan formulation and decision-making. Moreover, the National Planning Policy Framework (2021) primary purpose is sustainable development. The Framework defines this as “filling the requirements of the present without jeopardising future generations’ capacity to satisfy their own needs”. Even if this is a broad statement, it is consistent with circular economy ideas.


The environmental aim of the National Planning Policy Framework (2021) asks for “using natural resources judiciously, minimising waste and pollution, and mitigating and adapting to climate change, including transitioning to a low carbon economy”, all of which may be accomplished by transitioning to a circular economy. The other two National Planning Policy Framework (2021) goals (economic and social) are interrelated and must thus also be addressed.

Circular development methods are congruent with the economic goal of constructing a “strong, responsive, and competitive economy… to sustain growth, innovation, and enhanced productivity.” The social purpose is primarily focused on housing, but it also asks for a “well-designed and safe built environment,” which circular economy activities would also assist in achieving.
The National Planning Policy Framework (2021) expects planning policy and application decisions to support the transition to a low-carbon future, noting that the planning system should help “shape places in ways that contribute to radical reductions in greenhouse gas emissions, minimise vulnerability and improve resilience; encourage the reuse of existing resources, including the conversion of existing buildings; and support renewable and low carbon energy and associated infrastructure”. This supports circular methods of development by encouraging reuse.

Life-Cycle-Cost-3 circular economy
integrate the circular Economy and cost management in Civil Engineering

Circular Economy and Global Warming

While the primary objective of the Circular Economy is to bring environmental advantages, increase resource supply security, and stimulate the Economy, it also plays a significant role in minimising the effects of climate change. This is acknowledged in the government’s Net Zero Strategy(Bonome and Filho, 2016), which contains a section on the sustainable use of resources and states, “Net zero will imply maximising the value of resources in a more efficient circular economy.”
Adopting a circular economy means detaching development from the prevalent culture of wasteful consumption in the United Kingdom by incorporating sustainability metrics into policy. By embracing a circular economy and minimising wasteful activities, Greenhouse Gas (GHG) emissions may be drastically decreased, protecting Kent’s residents from the most severe effects of climate change.


As these sectors account for 55 per cent of Greenhouse Gas (GHG) emissions (de Freitas et al., 2018), current climate policies often emphasise transitioning to decarbonising energy supply and transport and pushing for higher energy efficiency. However, decarbonising these industries alone will not satisfy the United Kingdom’s legal requirement and 2050 goal of reaching net-zero emissions.
The other 45 per cent of greenhouse gas emissions come from producing items such as automobiles, clothing, and food (industrial, agricultural, and land use activities), and these sectors must also decarbonise to meet the government’s net-zero emissions goal. According to projections, two-thirds of these industries’ Greenhouse Gas (GHG) emissions might be decreased by 2050 via technical innovation and a change in consumer behaviour. Increasing the pace at which assets are used and recycling the resources used to create them would lower the emissions caused by their creation. Nonetheless, the remaining one-third (10 billion tonnes of global Greenhouse Gas (GHG) emissions) must also be decreased considerably if global net-zero emissions are to be realised.


Building and construction are responsible for 39% of global carbon emissions while operating emissions (from the energy required to heat, cool, and light buildings) account for 28% (Kent County Council, 2021). The remaining 11 per cent comes from embodied carbon emissions or ‘upfront’ carbon linked with materials and construction procedures during the building’s entire lifecycle.


11 % of urban GHG emissions come from the refurbishment and construction of buildings using materials such as aluminium, steel, and concrete, of which 15 % is wasted during construction and disposed of in landfills when structures are demolished.

Each year in Kent, around 3 million tonnes of construction, demolition, and excavation debris are generated18. Reducing this waste in line with circular economy principles decreases the demand for primary raw materials (including minerals), reducing the Greenhouse Gas (GHG) emissions related to their extraction and manufacturing of aluminium, steel, and concrete.
Renovating existing structures instead of constructing new ones is an essential strategy for reducing carbon emissions. Forty per cent of European residential buildings were built before the 1960s, and most of these structures lack energy-saving and usage technologies. However, rather than destroying and replacing historic buildings with new structures with energy efficiency and waste reduction measures, renovation may integrate these elements while ensuring demolition debris is not landfilled. Therefore, the construction sector’s Greenhouse Gas (GHG) emissions may be reduced by moving to a circular economy by refurbishing current projects rather than constructing new structures.

REALISING VALUE

The business opportunity

London will reap substantial advantages from implementing a circular economy strategy in the built environment sector. London Waste and Recycling Board (LWARB) believes that adopting circular economy principles might contribute between £3 billion and £5 billion to London’s development by 2036 and produce up to 12,000 new employees (Mayor of London, n.d.).
Material optimisation and waste minimisation will help developers by increasing the productive use of resources and decreasing material and disposal expenses. By recycling excavation and demolition trash on-site and minimising construction waste, developers like Clarion may save millions of pounds by reducing construction waste and reusing excavation and demolition waste.
Innovation in material optimisation, designing lighter structures, and reducing embodied carbon; reusing and recycling demolition and excavation materials; designing out waste through both design and construction; ensuring that buildings are adaptable; and collaborating with suppliers to lease and replace rather than sell products and systems will generate both short- and long-term value.
Reducing the number of fresh materials brought into the city and the garbage discharged to the outlying boroughs would help London. It will assist London in becoming less dependent on imported materials and exported garbage. Smart technology and improved waste reprocessing, storage, and logistical infrastructure will promote more efficient material use and reuse.


Utilising resources more efficiently and minimising waste would aid in reducing vehicle traffic, congestion, related air and noise pollution, greenhouse gas emissions, and the health effects of pollution, which disproportionately negatively impact low-income neighbourhoods. It will also liberate and maximise the use of land designated for trash management.


London Waste and Recycling Board (LWARB) Circular Economy Route Maps illustrate how the circular Economy allows firms to become market leaders. The transition to a circular built environment will need time and the active participation of the whole built environment industry.
Therefore, business leadership is crucial for the transition to a circular economy. Businesses must provide goods and services that adhere to circular economy concepts. Significant investments, including venture capital and equity, are needed, with a portion coming from commercial investors and the remainder from the public and non-profit sectors. To facilitate the shift, the Greater London Authority (GLA) and London Waste and Recycling Board (LWARB) assist SMEs in developing goods and services for the Circular Economy. To aid the transition to a circular economy, the Greater London Authority (GLA) is collaborating with the London Waste and Recycling Board (LWARB), the UK Green Building Council, and other partners to encourage the adoption of circular economy practices by businesses.

The transition from Linear to Circular Economy in the Construction Industry

Since ancient times, individuals have manufactured specialised commodities and given various services based on prospective customers’ requirements. In response to this market need, organisations of people and essential resources (now known as companies) were formed. In this sense, construction firms are enterprises engaged in the construction process of facilities (buildings/non-building structures) and their connected renovations.
The building industry faces more ambitious investment endeavours. Their success hinges on adopting technical or administrative advances as rapidly as feasible. Attaining a competitive edge over other organisations has grown more dependent on making sound judgments.
Construction projects need significant changes in their execution phases. The more prominent contractors are keen to adopt innovations as quickly as possible, whilst the smaller ones are observing and preparing for the future deployment of innovative solutions.
Moreover, the environment has become a critical success element for industry leaders. Alternative energy sources and enhancements to the energy efficiency of buildings seem to be the trendiest subjects in this field. However, there are other obstacles to be concerned about. An environmentally friendly construction phase aims to decrease construction and demolition waste (CDW) and energy consumption across the project life cycle, including manufacturing and transporting building materials. From this perspective, a life cycle evaluation may be an effective method for comparing the environmental performance of various building designs (Dani et al., 2022).
In addition, new materials and technology solutions (such as prefabrication) are anticipated to expedite the building process, make work more efficient, lessen the human component, and reduce the environmental effect.


Similar to other industries, natural (wood, water, soil, aggregates, etc.) and manufactured (plastics, concrete, etc.) materials are used in building production processes (composite plastic, etc.).

These materials are routinely altered in form and content to be included in constructions. Most old items that end their useful life are discarded in landfills.

However, a substantial percentage of this garbage should not be in landfills. In most cycles, it is possible to preserve a specific value. The Circular Economy (CE) answers this issue since it helps keep renewable and non-renewable resources in circulation for as long as feasible. To illustrate the complexity of the task, the most critical construction company-related aspects may be classified into three categories: people, processes, design, and technology.

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Figure 3 illustrates the proposed scheme’s specifics.
A construction business that chooses to apply the notion of abandoning the linear model in favour of the circular economy approach may achieve more remarkable economic outcomes with reduced environmental costs by maximising its inventive potential. According to the Ellen MacArthur Foundation, the two primary categories of materials (natural and synthetic) may be seen in biological and technological cycles. In the first material, the nutrients from biodegradable materials are returned to the Earth via composting or anaerobic digestion, aiding in the world’s regeneration. In the second cycle, items are recycled, reused, repaired, and remanufactured, never to become garbage (Ellen Macarthur Foundation, 2019). This implies that the construction business may comply with the Circular Economy (CE) if certain conditions are satisfied.
Circular Economy (CE) often refers to abandoning the present linear model-based approach of thinking about goods and supporting a new production system based on the eternal circulation of resources. Due to the plethora of industrial processes inside building projects, enormous volumes of several sorts of waste are created. When evaluating supply chain models in the construction sector, it is essential to remember that they represent the interdependence of construction project stakeholders in terms of material flow. According to the literature, a reverse supply chain relates directly to the circular Economy (Masood et al., 2022). When creating value for clients, a closed-loop paradigm might be considered (Figure 4).

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Figure 4 Value management for building projects using a closed-loop project value chain

Materials and Procedures

This section examines the notion of circular Economy in construction enterprises in the context of prevalent leadership styles using scientific research methodologies.
An algorithm is based on the authors’ beliefs on coupling three domains: a building enterprise, its management procedures, and a circular economy. The framing of the scientific problem concludes the following phase. In the subsequent step, the accessible sources of literature were evaluated. Sixty-four articles served as the foundation for the qualitative evaluation of the issue under study, while twenty-five papers were employed for the quantitative analysis of keywords. Initially, the ScienceDirect database and the google.com search engine were used, but the Scopus database was utilised in the second iteration. Both databases provide information on scientific publications that have been published, with ScienceDirect displaying their complete versions from Elsevier’s journals and Scopus containing abstract-only versions from several major publishers.


The subsequent phase is to conduct a survey, analyse the data, and draw conclusions and organisations. To apply those above, it is essential to recognise the management team’s significant impact on the growth of a construction firm.

Employee motivation may be influenced by leaders’ human resource management abilities, resulting in the conscientious performance of obligations. Consideration was given to the three leadership types outlined by Kurt Lewin: authoritarian, democratic, and laissez-faire. Utilising a quantitative questionnaire, the required information for the study was gathered. It comprised 12 questions, with nine asking respondents to pick the correct solution from 1 to 5, while the other three needed just one answer. The demographic questions covered gender, management experience, and the organisation’s size.
The questions were concise, straightforward, nonsuggestive, exact, and consistent. The questionnaire, exclusive to construction enterprises, was given to 231 Polish respondents through email, leading to the Microsoft Forms platform. The respondents to the survey completed it online.
The survey included top and intermediate management as well as Polish site managers. They represented general contractors and businesses doing subcontracting work in the construction industry. These construction companies ranged in size from microbusinesses to multinational corporations. Confident respondents were chosen on purpose to represent all building markets. Construction management specialists approved the selection of individuals. Thirty-two surveys were received successfully, representing 13.8% of all requests issued.

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Conclusion and Recommendation

We enhance the current knowledge of circular Economy (CE) studies reported in the construction sector using a thorough literature assessment of peer-reviewed journal publications published between 1990 and 2019. The review included a total of 50 papers.
According to the study’s results, substantial research on sustainability in the construction sector has concentrated on resource use and waste management. Research on the effects of circular Economy (CE) on the construction industry’s supply chain integration, building designs, legislation, energy efficiency, land usage, offshore manufacturing, cost reduction and cost management, whole life costing, and risk, health, and safety is limited. These are essential areas that influence construction choices and actions to facilitate a speedy transition to a circular economy (CE) in the construction sector and are thus potential study fields. More studies must be conducted on policy interventions to promote the building industry’s transition to a circular economy (CE). Research on the effect of circular Economy (CE) on offshore manufacturing, entire life cycle costing, and building designs will affect sustainable strategy choices that enhance resource use and waste reduction. Research must uncover the impacts of supply chain integration and risk management frameworks for supply chain organisations to reassess their operations and speed their transition to circular economy (CE) standards. For a paradigm shift away from current business models, research on cost optimisation and health and safety in the Circular Economy (CE) context regarding productivity and investment advantages will provide essential advice. Concentrating on these areas will be crucial in advancing the building sector toward a more sustainable future.

Research methods
In addition, the data demonstrated that qualitative research methods predominate in extant Circular Economy (CE) research. This recommends that future studies embrace quantitative or hybrid methods to offer a more objective perspective on the value of circular Economy (CE) to the sector. One of these approaches will open up more opportunities for creating and using construction-specific circular economy (CE) models. In addition, there is a reasonable balance between research undertaken in developed and developing nations. However, this finding is not surprising considering that circular Economy (CE) may be essential in advancing the sustainability agenda. Nonetheless, comparative studies using other nations and building activities as the unit of study have not been adequately examined. A hypothetical future study agenda might encompass two or more nations on separate continents, particularly emerging and industrialised nations.
Although this investigation discovered several studies on circular Economy (CE) in the construction sector, the study’s primary shortcoming is the selection criteria that confined the retrieved studies to published peer-reviewed papers. Future research may investigate published books, conference papers, and grey articles that may give more insights into the building industry’s use of circular Economy (CE).

Reference list

Bonome, L. and Filho, G. (2016). Lean healthcare: review, classification and analysis of literature. null, [online] 27(10), pp.823–836. doi:10.1080/09537287.2016.1143131.

Dani, A.A., Roy, K., Masood, R., Fang, Z. and Lim, J.B.P. (2022). A Comparative Study on the Life Cycle Assessment of New Zealand Residential Buildings. Buildings, 12(1), p.50. doi:10.3390/buildings12010050.

de Freitas, S.M.A.C., Sousa, L.N., Diniz, P., Martins, M.E. and Assis, P.S. (2018). Steel slag and iron ore tailings to produce solid brick. Clean Technologies and Environmental Policy, 20(5), pp.1087–1095. doi:10.1007/s10098-018-1513-7.

Ellen Macarthur Foundation (2019). Circular economy diagram. [online] ellenmacarthurfoundation.org. Available at: https://ellenmacarthurfoundation.org/circular-economy-diagram.

Kent County Council (2021). Kent Minerals and Waste Local Plan 2013-30. [online] Available at: https://ehq-production-europe.s3.eu-west-1.amazonaws.com/143e4cdc2d6d98ec947007d7919f76bd159d7283/original/1639418074/c1167f3f42a45c9afee75c5240e369d9_Circular_Economy_Topic_Paper.pdf?X-Amz-Algorithm=AWS4-HMAC-SHA256&X-Amz-Credential=AKIAIBJCUKKD4ZO4WUUA%2F20220612%2Feu-west-1%2Fs3%2Faws4_request&X-Amz-Date=20220612T123749Z&X-Amz-Expires=300&X-Amz-SignedHeaders=host&X-Amz-Signature=9b9697e9e5a1d603960d9202dc5db9fef9e211e84697285c283b0a3b22f26d7c.

Leising, E., Quist, J. and Bocken, N. (2018). Circular Economy in the building sector: Three cases and a collaboration tool. Journal of Cleaner Production, 176, pp.976–989. doi:10.1016/j.jclepro.2017.12.010.

López Ruiz, L.A., Roca Ramón, X. and Gassó Domingo, S. (2019). The Circular Economy in the construction and demolition waste sector – A review and an integrative model approach. Journal of Cleaner Production, [online] p.119238. doi:10.1016/j.jclepro.2019.119238.

Masood, R., Lim, J.B.P., González, V.A., Roy, K. and Khan, K.I.A. (2022). A Systematic Review on Supply Chain Management in Prefabricated House-Building Research. Buildings, 12(1), p.40. doi:10.3390/buildings12010040.

Mayor of London (n.d.). Design for a circular economy. [online] London.gov. Available at: https://www.london.gov.uk/sites/default/files/design_for_a_circular_economy_web_2.pdf [Accessed 12 Jun. 2022].

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