CTalks: Holland Circular Hotspot - Freek van Eijk (Part 2)

(For Part 1 of this inteview click here.)

Continuing from where we left off in our Part 1 of the interview, we continue the discussion here where Freek tells us more on how government can help stimulate CE, role of public perceptions, relative ease of adopting CE among industries, and more.

1. Do you see competitors for your organization at the moment? If so, who are they?

Holland Circular Hotspot is a Foundation that aims to accelerate the transition to a circular economy and create opportunities for Dutch companies and knowledge institutes in the process. We are facing an unprecedented planetary challenge. We need all the support we can mobilise. That is why we are actively engaging with a network of other circular hotspots in the world. Remember the African proverb: If you want to go fast, go alone. If you want to go far, go together.

2. For some industries, it is relatively easy to implement a switch to a leasing or renting model, while for others it would involve significant investment in setting up the new processes. How can a business know when it is the right time to make the switch to such a model?

For no industry it is easy to make a switch from a linear to a circular model. The first movers were start-ups with new disrupting models and multinationals that were aware that business as usual is not an option.

Remember that Signify’s (previously called Philips) “light as a service” business model took 7 years to grow from idea to being a commercial viable alternative. If you want to create a market for Struvite, recovered phosphate, from sewage water you have to realise that it requires changes in soil-, fertiliser- and waste regulation in order to be allowed in agriculture. That takes time.

Companies have to ask themselves how long “business as usual” is really an option. First movers can have a market advantage (but will run into all the first mover challenges). There is the opportunity perspective. Can they get more money? Can they grow their market share in traditional low innovative market just like (not so circular) platforms as Airbnb and Uber have done? Can they create additional value by giving their product an extended life (like Philips remanufacturing of medical scanners) or multiple lives (modular designed and refurbished Smart Phones).

Can they reduce risk in their value-chain by keep strategic and scare resources into a closed loop? The first step is often cost saving: using less materials, less energy and less water is all about spending less money. By collaborating with partners in a circular model the risks in general are lower because there is a win-win for all.

There can be momentum, like the Volkswagen emission scandal that drastically changed the speed of circular innovation in the Automotive Sector. There is no lack of opportunities.

If you study EU regulation carefully you will realize that a circular future is inevitable. Things are moving (very) slow but producer responsibility will be extended, eco-design implemented, eco-labelling stricter, and waste being reduced to a minimum to name a few that are in the pipeline. Although not an EU responsibility, we can expect that CO2 may fetch a higher price. Frontrunners like DSM already calculate with a 50-euro CO2 price in new business plans.

3. How important do you think will social perceptions and acceptance from the public play a role, especially when they are told that a product they use is designed from the waste of something else? Did you face any issues on this point?

I think that awareness is creeping in. People feel deep down that we cannot continue the way we are living now. We are aware of Climate Change. In this digital age there is less and less acceptance of unethical and unsustainable behavior by companies as we have seen in the Chinese baby milk scandal or in the Volkswagen emission scandal. In our personal lives, behavior still has to follow. We want to be more sustainable but seem reluctant to pay more and certainly do not want to make concessions on quality and comfort. The discussion related to plastics is one step further than Circular Economy because everybody can identify with it. It has reached the living room and there seems to acceptance that measures and alternatives for single use plastics. Raising awareness early on and designing likeable circular products without concessions to the consumers will remain very important.

(Image: Adopted from United Nations Industrial Development Organization’s document on Circular Economy, 2017)

4. We come to the final question of the interview. The Dutch Government has ambitious goals for a long term CE based future: to achieve 100% circularity by 2050. What is your opinion on it?

In the Netherlands, a vulnerable delta with limited resources, the urgency of a transition to a circular economy was noted early on and a government-wide ambition has been formulated as a guiding vision. The Dutch are said to have one of the best CE policy examples in the world. The Netherlands is considered a living lab and a circular hotspot.

For a successful transition there needs to be direction and ambition. In October 2016 the governmental program A Circular Economy in the Netherlands by 2050 was launched. In this program a nationwide plan has been drawn up by multiple departments, to function as a vision for the successful implementation of the circular economy. The goal formulated in this report is to reduce the amount of primary (non renewable) resources used in the Netherlands by 50% in 2030, and to become completely circular by 2050.This can be accomplished through resource efficiency, a shift to renewable and recycled resources, and creating new markets and business models. The program was followed by the development of Transition Agendas and an implementation program. A clear focus on 5 priority sectors, each with a specific ministry in the lead, allowed a critical mass of stakeholders that are needed to scale-up. The Dutch furthermore created the conditions for change by choosing a set of interventions.

If you ask me my opinion: I think it is a big heavy audacious goal to be fully circular in 2050. It is a moonshot, but it is inspirational, and I believe we will get close to that target. I am positive, it is exciting to work in a CE environment. There are a lot of new possibilities and there is a lot of positive energy in society that can be mobilised.

Sustainability is often seen as moralistic, nice to have but not essential in times of crisis. CE is about economic potential and environmental potential, it is inspirational, can start small and scale up.

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