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  • Ru Chen

Circular Construction Supply Chains are Greatly Needed

Circular Economy and Construction Supply Chains

It was pointed out by the United Nations in 2017 that construction is responsible for 36% of annual energy consumption and 39% of CO2 emissions globally. Furthermore, by 2030, buildings will lead to 12.6 GT of energy-related emissions, while 70% of urban infrastructures have not been built yet to address a fast-growing global population. Such consequences can be explained by the nature of the construction industry: fragmented value chains and multiple stakeholders. To release the construction industry from the pressure of poor environmental performance, the integration of supply chains (or supply chain management) and the application of circular thinking are emphasized by many researchers. In other words, a circular construction supply chain is proposed.

One of the holistic definitions of circular supply chain management is presented by Farooque, Zhang, Thürer, Qu, and Huisingh in their 2019 research paper “Circular supply chain management: A definition and structured literature review”: "Circular supply chain management is the integration of circular thinking into managing the supply chain and its surrounding industrial and natural ecosystems. It systematically restores technical materials and regenerates biological materials toward a zero-waste vision through system-wide innovation in business models and supply chain functions from product/service design to end-of-life and waste management, involving all stakeholders in a product/service lifecycle, including parts/product manufacturers, service providers, consumers, and users." However, merely developing sound concepts and definitions is far from facilitating the global-level implementation of circular supply chains in the construction industry. A clear presentation of opportunities and motivation is needed to attract attention from all directions.


According to the Emissions Gap Report (UNEP's flagship 2020 edition), 5.9 GT of emissions can be reduced by 2030 if existing infrastructures are upgraded toward such a sustainable goal. A list of practices is suggested respectively on the level of governments, businesses, and individuals. For instance, government organizations can contribute to the progress by starting to retrofit their own buildings, like applying solar cells, heat storage technology, central cooling, and energy-efficient lighting. From a bigger picture, cities can be planned more strategically to provide necessary services for neighbourhoods at the local level. Individual efforts also matter, such as active participation in community activities. The latter can improve relevant awareness, recognition of energy efficiency before we buy or rent a home, and adoption of curtains and blinds for a cooler environment instead of energy-consuming solutions like air conditioning. However, the recommendations for the business area are less constructive and need to be supplemented with other materials.

After reviewing 261 articles, Farooque, Zhang, Thürer, Qu, and Huisingh propose in their research paper several aspects of the construction industry to facilitate the circular economy (CE) transition:

  • CE & Product/service design: It is crucial to alter the design thinking process because it determines the whole value chain from the very beginning.

  • CE & Procurement: By introducing CE principles to the procurement process, the value of price, time, and quality will be redefined for every party. In addition, improvement is expected in the utilization of raw materials.

  • CE & Production: Aims at resource consumption reduction, cleaner production and green manufacturing.

  • CE & Logistics: Evaluating the environmental impact of different strategies like the choice of vehicles and routes.

  • CE & Consumption: Includes relevant education for improving customer awareness and behaviour.

  • CE & End-of-Life (EoL) and waste management: The most common approaches are repurposing, refurbishing, remanufacturing, and recycling, amongst others.

Notwithstanding the aspects listed above, the CE transition also needs to be driven by new business models and technologies. With this regard, we can take a look at some initiatives.

Procurement Initiatives

The adoption of circular construction materials can be strongly motivated by their corresponding environmental benefits. A life cycle analysis study compared the environmental impact of the manufacturing process for two different types of construction insulation materials. The results suggest that the carbon emissions of material 1 (recycled from discarded textiles) are 64.02% lower than those of material 2 (made of new raw materials). Although there are such significant environmental gains, material 1, the more circular material, is still defeated in terms of purchase by the ones with lower prices. It was pointed out by the distribution company of material 1 that customers or material contractors tend to pay more attention to the price instead of the environmental credits embedded in the whole supply chain.

Such low incentive for the CE transition in the construction market is attracting the attention of public procurement. For instance, seven public construction buyers, among them representatives of Amsterdam, Belgian Post, and Budapest, are working together under the Big Buyers Initiative. To address the challenges in different construction stages, several pilot projects in circular construction are conducted. The importance of the design stage for realising a circular construction supply chain is further emphasized - resource efficiency can be optimized by adjusting procurement strategies, but the goal is only possible when recycled materials are already considered in the design and planning stage.

Based on this common understanding, several circular procurement criteria are under consideration and examination in the pilot projects. For a bypass project in Amsterdam, the material suppliers provide the services of design, construction, maintenance, and demolition. The Extended Contractor Responsibility can stimulate the selection of durable and recyclable materials since the adopters of circular materials benefit directly from their own decisions. The requirement for "using a minimum percentage of recycled materials" is satisfied in Zurich as well, where recycled concrete aggregates and asphalt (in social housing and road projects) reach 70% and 98%, respectively. In Copenhagen, a construction waste management plan (specifying the sorting approaches of waste, the position of waste containers, and so on) must be submitted before a project commences, corresponding to the criteria "Foresight for On-site Material Management.”

Waste Management

Waste generation is a big issue in construction projects since most of the waste ends up being landfilled and imposes adverse impacts on the environment. Hence, it is imperative to improve construction waste management. As the adoption of circular construction materials increases, waste management skills become even more important because of the higher remaining value in the materials after use. Considering the complexity and fragmentation of construction supply chains, more advanced technologies to assist construction waste management are required.

Building Information Modeling (BIM) contributes a lot to integrating construction supply chains by providing a collaboration platform for facilitating decisions and sharing information among stakeholders. However, it considers little about designing waste-efficient buildings at the function level, where early intervention is highly effective in avoiding waste generation at subsequent stages. Especially, the lack of measurement mechanisms for construction waste is regarded as responsible for the underperformance of construction waste management. Starting from these standpoints, a BIM-compliant computational tool for waste analysis during the design stage is developed. As illustrated in Figure 1, given the necessary parameters such as construction type, gross floor area, and project usage, amongst others, waste data can be predicted and classified into three groups: reusable, recyclable, and landfilled waste. Looking at the subset of machine learning, the method of artificial neural networks is adopted. The latter means that the performance of the tool can be improved gradually along with obtaining, inputting, and learning more data.

Figure 1: The template of the report

Technologies like this can encourage not only a waste-driven design process but also facilitate the planning of waste logistics. A very relevant application is reverse logistics. This implies moving the waste from its original destination to the place of remanufacturing, refurbishment, and all other post-use stages. From the management perspective, the implementation of reverse logistics is largely dependent on the perception of its economic benefits and associated risks. In practice, however, a reverse logistics system cannot be operated successfully without sound forecasting and inventory planning, which need support from more advanced technologies.


Considering both the existing impacts and future trends, the construction industry is calling for an improvement in resource utilization and environmental performance. Efforts can be increased in various directions, and one of the most systematic solutions is the transition toward a circular construction supply chain. This seems like a promising direction not only for its sound definition but also for the clear identification of opportunities, as well as the traceable implementation of initiatives.

To support the implementation of circular construction supply chains, a list of concrete practices is suggested by UNEP at the three levels: government, business and individual. The research done by Farooque, Zhang, Thürer, Qu, and Huisingh supplements the input for business areas. They present a set of initiatives involving procurement and waste management to specify how the construction industry can be pushed toward adopting a circular supply chain. This article intends to help improve awareness around circular construction supply chains. In the slowly changing construction industry, any level of effort is appreciated, especially in the profit-driven business sector.


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