The options for a greener way of building are endless. It's time for a more sustainable construction industry.
“We cannot solve our problems with the same thinking we used when we created them.” A quote by Albert Einstein that I usually use when I introduce the circular economy. It seems superficial, even obvious, at first. Yes, if you run into a problem, you should probably not continue doing what got you into that mess in the first place. However, I interpret it on a much larger scale, as I assume Einstein would have done too. We are facing global problems that require a drastic shift in our thinking and our actions. We need to rethink the operating system of our economy. We do it all the time for our PCs, so why not for our planet? We’ve had the same dominant operating system for years, decades, centuries – and it’s starting to show. Just like an outdated Windows™ version that isn’t being supported anymore, so is the case with capitalism.
At the start of the industrial revolution, a clear increase in CO2 emissions was already seen, although some increase in CO2 levels didn’t necessarily indicate a problem. Various systems in nature are more than capable of taking up the extra carbon in the air, some even thrive due to higher levels of CO2. An increase that went far above natures carrying capacity however, meant that – amongst others – global warming started to become a problem.
The flourishing of capitalism was also made possible by offsetting social negatives to our society. Modern slavery is still in existence; monopolies are a very real problem; some people are working more than full-time and hardly getting by; tax evasion by large corporations; unfair competition towards SMEs… the list goes on. All are symptoms of underlying faults in the system.
And before you might write me off as a communist hippie, I do believe capitalism brought society a lot of good things, although most of its gains are for individuals. I’m also not saying that it is the only system that would have caused the above outlined problems, yet one can hardly dispute it’s ridden with faults and cracks. It is negatively affecting many aspects of our life and is susceptible to crisis, which has become more apparent in the last couple of months due to the Covid-19 pandemic. While the negative impacts of the pandemic are awful and apparent, it can also be a good opportunity to kickstart the change we need.
This change must be quintessentially sustainable. If it isn’t, don’t even bother. After studying in this field and consecutively working in it for over 5 years, I am (willingly or not) biased. Yet I’m happy to see that also from an economic standpoint there is a strong case to be made for major change and the eclipse of capitalism. Jeremy Rifkin, for instance, makes a case for changing towards a zero marginal cost society, as outlined in the book under the same name. In it, he uncovers a paradox at the heart of capitalism: one essential component of this system is the competitive market, which drives productivity up and marginal costs down; enabling businesses to reduce the price of their goods and services. While a reduction in marginal cost is welcome, it was never anticipated that – due to a technological revolution – they would drop to near zero, making goods and services priceless, nearly free, abundant and no longer subject to market forces.
What Rifkin outlines as the new dominant system is a.o. inherently sustainable and a system very fitting for the circular economy. There are other new systems that some believe might become the dominant one, which also have circular and sustainable characteristics, e.g. the resource-based economy.
For me, it’s clear we need to change it up. We need a major shift in our economic system, with one of the major parts being the move from linear to circular. A linear economy is when you take something from the earth, make something with it, use it, and then dispose of it. This goes hand in hand with the capitalist system; where taking from the earth and disposing in it are virtually free. A circular system is close to nature: materials are not disposed of, there is no waste, and everything continues to have a function, to be a resource.
History has shown us that major shifts usually happens in one of two ways: either by (violent) revolution or by gradual change. My view is that the current change has already gradually begun and will continue to do so. I also believe bouncing back from Covid-19 can accelerate this. It gave us a new ‘normal’. For companies to adapt to this, they must focus on green transformation and invest in research and development as essential elements for the transformation. In what follows, I will go into more detail on how I think we can go about this in the construction industry.
The construction industry is mostly conservative and rightly so. We want to live and work in safe and sturdy buildings, so why shouldn’t you use safe and sound materials and techniques? This implies a.o. the use of concrete, a very sturdy material indeed. This has become apparent by, for instance, Roman structures that are over 2000 years old. Yet the concrete industry is responsible for 6% of the global CO2 emissions. Concrete also requires materials that are becoming increasingly hard to come by. The pure sand, a key ingredient, is running out. Furthermore, the concrete industry relies on ‘just-in-time’ transport and has such low margins it needs to operate at full capacity all of the time. Needless to say, Covid caused some issues.
So how do we shift away from the use of concrete and bounce back? The way I see it, there are two major options: we keep using concrete but with different ingredients, or we use other building techniques, designs and methods that do not require the use of concrete. My assumption is that it will be a mix of both. As a company you can look into the use of local, environmentally friendly materials and into different ways to use your concrete manufacturing infrastructure. Bigger concrete manufacturing and concrete prefabrication companies have everything in-house to make such a switch: accurate mixing machines, labs to preform various tests on-site, skilled labourers, large-scale machines… On the short term: companies can investigate incremental change and innovation. On the long-term: companies can make a sustainable roadmap with what you need to change to safeguard your green transformation.
Concrete is often said to be a very forgiving material. When poured it will fill in any cavities (or ‘faults’). Certain insulators have this same fault-filling capacity (e.g. PUR foam). The downsides, however, are also very comparable with concrete. A couple of years ago, two plants in China had major problems at the same time. This resulted in a problem in the EU insulation market, as these two plants were responsible for a widely used insulator: a very cheap insulator that capitalism dictates we use. The Covid-19 crisis caused similar problems with the supply of this same material. Yet as we don’t produce this locally, wouldn’t it be very easy to switch to a different material post-pandemic? Natural insulating materials are abundant: paper, straw, hennep, wool… These can be locally produced, processed ánd used. And the good thing is: if they should ever be given back to nature, they won’t form an everlasting problem. The environmental impact of its production and processing is also minimal.
As to the ‘forgiving’ nature of the products: Yes, this is a good property, but they are way too sticky to use! Let me clarify: most buildings are basically a bunch of materials all glued together. Initially this makes sense: you don’t want things falling down, you want a fairly airtight structure, you don’t want any hassle from rain, wind and other weather elements. However, this also means that when you want to change or remove a building, you end up with a lot of waste. It either takes too long to strip it down to its individual components (and therefore too expensive) or materials get destroyed or are impossible to restore to their original state. This makes for a sector that generates a lot of waste and uses a lot of virgin materials. Which in turns make for a dependency on a constant stream of materials from abroad. This makes the consequences of Covid-19 all that much harder.
Another side-effect that the Covid-19 crisis may bring for the construction industry is a decline in demand. It will lag behind due to the longer lead time of building projects. The current, large-scale projects have been commissioned years ago. It is expected that Covid-19 will affect this. So how do you tackle a decline in demand for your services? By becoming a service provider, for example.
Construction has increasingly shifted from providing a one-time service (building a structure) to long-term commitment (designing, building and maintaining a construction project for 10-15-20 years). As-a-service (AAS) models have gained traction over the last couple of years. So why not look into new (service) business models that are a good fit with your organisation and start experimenting with them on a small scale?
Mitsubishi Elevator did just that a couple of years ago. They saw their revenue in the Dutch market decline. Clients increasingly wanted low-cost elevators and didn’t care as much for the total cost of ownership during its lifespan. Mitsubishi products – while they do have a longer lifespan and are of high quality – are also more expensive. They didn’t want to make cheaper and lower-quality models, so they created a new business model: you don’t buy an elevator, you pay for vertical movements. The elevator-AAS model was born and is now responsible for a major part of the annual revenue in the Netherlands. Mitsubishi stays the owner of the installed elevators; the clients pay a monthly fee – partly based on the total amount of elevator movements.
The AAS model provides better incentives for the manufacturer of the product to make the product more sustainable and fit for the circular economy. Because the manufacturer retains ownership of their product, it is in their own best interest to be able to reuse the product and/or its parts or materials. They will want long-lasting products. They will want smart products with predictive maintenance. All of which can be achieved by keeping the producer in charge. The client usually doesn’t have the knowledge nor the incentive to take on this responsibility. They are likely to care mostly about the functionality of a product. They are also likely to be interested in having the burden of maintenance, repairing and replacing items to be lifted. In other words: the client wants light at their desks, they don’t care much about what kind of LED-lights and fixtures are used, and if and how they can be repaired and replaced. So why not offer them a service contract just for the light?
This switch – from purchasing products to purchasing a service – may seem drastic at first. It requires a mind shift, both from the suppliers and the client. One key aspect is to make use of in-depth financial models to work out feasibility studies and price-setting for this new business model.
Another technology that has been able to resolve Covid-related issues is 3D printing. It enabled local 3D designers to create much-needed ventilator couplings for only a couple of euros, for instance – long live the maker movement! 3D printing may be useful for the construction industry. Very recently, a 2-story 3D printing structure was revealed by Kamp C in Westerlo, Belgium. The first commercial projects have caught on since a couple of years. And while the circular and sustainable benefits are questionable, it does provide an interesting perspective. With 3D printing you can print exactly what you want, while some traditional methods generate a lot of excess material. With perimetric optimization based on strength requirements, you can build a slimmed-down structure that is up to the task yet requires less materials.
There are also some interesting options in terms of the materials that could be used for 3D printing. Most 3D-printed constructions have used a cement-like substance (basically cement, but with more chemical component), which increase the impact on the environment. However, 3D technologies should be able to use more sustainable materials. These materials could be sourced locally (e.g. clay, loam, hempcrete). You would just have to change the settings, depending on the substance you will print with. And then, with a push of a button, a new house will be ready in a matter of hours.
And while 3D printing is definitely not the holy grail, it provides interesting, feasible opportunities to help build the sustainable world of the future.
3D printing also offers perspective for mass customization. A technology that allows for producing on an industrial scale but with a lot of freedom of choice, without slowing down the building process. We could consider this for building houses.
Houses are a lot like cars: most products have the same basic components and most clients don’t care too much about how these work exactly. All cars have an engine, yet most people driving a car have no in-depth knowledge about the way this engine works. Most likely, they don’t really care, as long as the car (comfortably) gets them from A to B, is affordable, looks good and doesn’t burst out in flames. What most people care about is the appearance, the add-ons (airco, stereo), performance, and costs.
The same can be said about houses. Most people won’t care that much what is in their walls specifically, as long as they are sturdy, acoustically sound, and keep the house at a comfortable temperature year-round. The type of insulation used will be a small detail, but the comfort it offers is of much greater importance. So why don’t we make houses like cars? You offer your clients a choice in appearance, price range, choices of add-ons… The ‘skeleton’ underneath is pretty much fixed. One key issue here is to make sure that the choices made don’t affect this. When you pick a new car at the dealership your choice in type of seats won’t affect what’s underneath. They won’t have to change the whole car to fit your individual needs and wants. For some housing projects however, every building is an individual project where you start from scratch. It’s very much craftmanship, in a metaphorical and sometimes even in the literal sense of the word.
So, however counter-intuitive it may sound in terms of sustainability, perhaps it is time for construction to move to a more industrial scale. Currently this is mostly limited to the building of new structures. But in Europe most buildings for 2050 have already been built; they just need to be renovated. Not an easy task to do this in an effective, efficient and timely way – to achieve the sustainable goals set in the EU.
We need industrial-scale renovation where clients can make their own choices between a set of standard options. It’s a great way to make renovations more financially feasible. Governments are already making regulatory changes in favour of upscaling renovations. Link this with the use of the right materials and you’ve got yourself a golden goose when it comes to green transformation.
The construction sector needs to change, has to change and will inevitably change. So why not use the current crisis as a jumping point to accelerate this change? Above I have outlined some examples that can inspire us to do this. My aim is to get you interested. I may not be too far off from hippie ramblings by an environmentalist, yet I stand by it in the ‘real’ world. Sustainable alternatives to cement, a shift from product-offering to service-offering, and upscaling sustainable renovation to an industrial level are examples of things I believe we can focus on today – in our current economic reality – and can at the same time be beneficial from an economic perspective. Green transformation doesn’t only make ecological sense. It also provides economic benefits, especially in the long run.
 Marginal cost is the cost of producing additional units of a good or service, if fixed costs are not counted.
 For most of what follows I will use my knowledge of the (Western) European construction Industry as that is the one I am familiar with – although some of what I’ll describe is applicable to other geographic parts as well.
 At Rebel we have the expertise to assist with this and help you kickstart new, successful models that are ready for the future.
 They were subsequently sued for this by Big Pharma, who charge a lot more money for these items. Isn’t capitalism great?!
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