NATURAL RESOURCES are consumed in large cities
Now that our world is becoming steadily more urbanized, the impact of cities as part of the human race's overall environmental footprint on the planet is increasing. In an article published last year entitled 'Why we should develop "circular cities" and how Google technology can help', Kate Brandt, Lead for Sustainability at Google, stresses: "Today, 54% of the world's population lives in urban areas accounting for 75% of natural resource consumption, 50% of global waste production, and 60-80% of greenhouse gas emissions. So, the concept of the circular economy is especially relevant in cities." Cities therefore urgently need to think again about how they manage both their energy and waste, with the aim of shortening the logistic flows that feed the system and bringing the numbers down.
circular versus linear model
Cities' role in driving the circular economy forward
The circular economy involves the entire chain from upstream to downstream, across all areas of activity
With an approach it calls 'Circular Cities', Google is highlighting the role to be played by technology, not least its its own technologies, in optimizing the way cities work. However, speakers at the recent 'Produrable' event held in Parison 9-10 April, pointed out that some cities have not been standing idly by waiting for the touted technological solutions to appear. Antoinette Guhl, an elected councillor who is in charge of the social economy, social innovation, and the circular economy at Paris City Hall, came to the conference to talk about what Paris is doing in this field. "Since 2014 the City of Paris has committed to an ambitious strategy to promote the circular economy because since the beginning of [Paris mayor] Anne Hidalgo's mandate, we've been convinced that we won't be able to transform Paris without committing to an environmental and economic transition, with a determination to transform theParis economy so that it will be able to meet the huge environmental challenges we're facing", she told the audience.
Antoinette Guhl was the first elected representative in France to head a team focusing on the circular economy and in 2014 Paris gradually started out on the path towards developing a circular economy. The city's plan embraces the many and varied aspects of the circular economy, going far beyond waste management policy – which is very often where municipal authorities begin."The circular economy involves the entire chain from upstream to downstream, across all areas of activity", underlined Ms Guhl, explaining: "We've embarked on a whole series of new policies covering composting, managing bio-waste, the circular economy in the construction sector, and also in our calls for tender.We want to ensure that all our activities, all the City of Paris departments regard the circular economy as a goal to achieve, a transformation they must bring about. The circular economy is a future-oriented branch of the overall economy, it makes perfect sense, and it has a clear environmental impact."
changing consumption patterns
Encouraging citizen and startup initiatives is key
The role of City Hall is clearly key to any city’s shift towards a circular economy, but City Hall will also need to both call on the local startup ecosystem and ensure that major local companies get involved in the initiatives. Antoinette Guhl revealed: "We did a lot of work internally, but in order to make the circular economy work for real in Paris we decided to support members of the startup ecosystem here that wanted to get involved. Our startups believe they have a duty to protect the environment, but that this is also a business opportunity, new markets that are waiting to be developed." For several years Paris City Hall has been working with the Paris&Co agency in order to create an incubator specializing in the circular economy. "At the beginning we just had informal discussions, and then, just over a year ago the first companies went through the incubator, with six major firms working with the City of Paris to assist the first batch of startups. I'm very proud of what we've achieved because it's only through business synergies of this kind that we'll be able to turn the corner", the Paris social economy expert told the Produrable auditorium.
French supermarket chain E. Leclerc is one of the firms working withParis&Co, as Stéphan Arino, the mass retail company's Director of Quality and Sustainable Development explained: "Sustainable development only makes sense if it can be translated into business and lead to real services. We had already started to work with several startups in the circular economy, but in an informal way. We joined the Paris&Co incubator because we see it as an excellent driver for acceleration as it allows us to work through the various themes relating to the circular economy. Last year we focused on 'last mile' logistics, urban agriculture and the transition to new methods of farm production. We'll be going through the process again this year with two new themes and a new batch of startups."
"Sustainable development only makes sense if it can be translated into business and lead to real services."
supermarkets in the loop
With the help of Paris&Co, E. Leclerc held an Open Innovation Day, inviting around thirty managers from the company and its chain of franchise stores.They all listened to the pitches made by the six startup entrepreneurs, and the franchise stores were then able to make contact with them and set up some initial trials. This is how Paul Dufour, co-founder of non-profit organisation La Cagnotte des Champs got in touch with management at E. Leclerc's hypermarkets. The basic idea of Dufour and his partners is to put farmers, consumers and large corporations working in this field in touch with each other. He explained: "We set up a financing solution for farming projects, which links up ordinary people and companies in the sector. For instance, we asked customers at E. Leclerc chain hypermarkets to add €1 or €2 to their shopping bill in order to help a farmer working less than one hundred kilometers away to switch to more sustainable production methods. Meanwhile, E. Leclerc commits to stocking that farmer's products in its store chain." La Cagnotte desChamps was part of last June's intake at the Paris&Co circular economy incubator.
Paul Dufour's venture appealed to the E. Leclerc hypermarket in Templeuve, close to Lille in northern France and the initial trial was launched there. The first action was to finance Franck, a dairy farmer in the region who wanted to start producing his own yoghourt: "Following the Open Innovation Day, the mechanism was set up and tested in the space of a few weeks. In one week over 1,000 people at the hypermarket responded positively to the idea of financing Franck's venture. His farm is located just a few dozen kilometers away from the hypermarket. He now makes his own yoghourt from his milk. It is sold locally in the Templeuve hypermarket and given out in local school canteens."
La Cagnotte des Champs has set itself the goal of financing 200 farm sector projects per year up until 2020, which will involve getting shoppers to come up with €2 million. Stéphan Arino revealed: "The next stage will be to step up the scale from one or two stores to an entire region, each time finding the right solution to needs and issues which will always vary, as each local situation is different. We see this as the best way of driving ahead with the circular economy, because there are no country-wide solutions in this field."
the circular economy: a springboard for the whole economy
Phenix moves to the fast growth stage
CReated by phenix in 4 years
While Paul Dufour's involvement is in the upstream phase of the circular economy, Phenix co-founder Jean Moreau is more interested in what is happening downstream, with an approach to waste management that is not about processing waste but making good use of unsold food products at stores and restaurants. "We attack the food waste issue either by selling unsold retail food products to customers at reduced prices or by donating them to charity organisations, or else we sell them to livestock farmers. This approach enables us to reduce food waste in stores and shopping malls by 80%", he told the audience. Helped by the anti-food-waste law which entered the statute books in France in February 2016, the French startup has created eighty jobs in four years and currently has an annual turnover of €10 million.
rise like a phenix
The success of this approach has aroused the interest of Unibail-Rodamco, a European leader in commercial real estate which manages, among other properties, the Paris region shopping centres '4 temps', the 'Forum des Halles' and Vélizy 2. "Unibail is closely involved in assisting the transition to a more environmentally-friendly economy and we have set ourselves the goal of halving the carbon footprint of our shopping malls by 2030. In order to reach this target, we need to get involved in the circular economy", explained Jean Collet, Director of UR Link, a startup accelerator run by Unibail-Rodamco. "The company looks to startups when we can't find a solution in-house. For instance, we don't currently have our own in-house expertise in areas such as the functional economy, e.g. selling second-hand products. So we go out and look for startups that can help us. Working on waste management with a startup such as Phenix helps us to find new solutions and come up with new business models", he told the Produrable conference. Meanwhile Jean Moreau reckons that working with Unibail will help Phenix to scale up its operation. "With Unibail, we're moving from the level of a single shop to that of a shopping mall with a wide range of shops and eateries. We centralise unsold food from food outlets such as Paul and La Brioche Dorée, hypermarkets such as Leclerc and Auchan and shopping mall restaurants. All the waste food iscollected in one place and then distributed to charity organisations", explained the Phenix co-founder.
While Paris has taken on a pioneering role as regards the circular economy, many other towns in France have undertaken similar initiatives. In the Libourne region near Bordeaux, the 'Smicval' – an organisation whose mission is to promote the circular economy in the region – has recently got together with a number of local authorities and companies and set up Nouvel'R, an organisation tasked with promoting circular economy concepts in this rural area, especially by helping people who have good ideas to bring them to fruition. Around thirty projects had already been identified at the moment when Nouvel'R was set up.
Paris City Hall
We're witnessing the transformation of our society and our economy, and we should seize this opportunity in order to create jobs through ventures that both make good sense and help to protect the environment
The French Ministry of Ecology, Sustainable Development and Energy is currently working on a national roadmap for the circular economy which is due to be published shortly. The roadmap, which will set out government guidelines in this field, may drive the creation of a good many companies and new jobs in the coming years. Antoinette Guhl, who is one of the 'circular economy ambassadors' tasked to promote the roadmap, underlined: "We're witnessing the transformation of our society and our economy, and we should seize this opportunity in order to create jobs through ventures that both make good sense and help to protect the environment. There will no doubt be some failures but we must go down this road and we'll have to take some risks. This is why we need to support all these startups. They're taking risks and we ought to be sharing those risks." Paris City Hall is therefore planning to launch a fund in September this year toback this type of 'green' initiative. "The fund will have close to €150 million. Its purpose will be to support companies and ventures – especially companies working in the circular economy – as they scale up", revealed Ms Guhl.
European cities setting an example
set to be created by the circular economy in london by 2030
A number of other European capital cities are also doing what Paris has been doing: driving ahead with the circular economy. The London Assembly Environment Committee has just published a report entitled 'Waste: The Circular Economy', which advocates moving towards a circular economy in order, inter alia, to deal with the rising volumes of waste generated by the UK capital. The recycling rate there is currently at its lowest level since 2010 andin thirty years' time there will be an estimated one million tons of additional waste requiring collection from the streets of London, i.e. an extra 500,000 truck-loads per year. This would most probably kibosh City Hall's plans to make London municipal services carbon-neutral. The report suggests that moving London towards a circular economy approach would not only reduce the volume of waste generated by fully 60% by 2041 and save the city £7 billion overall, but also create around 12,000 jobs from 2030 onwards.
massive urban renewal
London is still in the early stages of its circular economy drive, whereasAmsterdam and Brussels are already seeing the benefit of policies set in motion several years ago. In 2011, Amsterdam set up an investment fund to address climate change issues, improve air quality and promote the sustainable economy. The fund was endowed with €75 million, which came from the proceeds of a sell-off of shares in Dutch power supplier N.V. Nuon Energy. In 2015, the city made headlines with a project to transform the Buiksloterham industrial zone in north Amsterdam. This vast urban renewal project is based on the concepts of the circular economy. Some 3,500 homes and 200,000 square meters of office space have already been built by recycling as much existing material as possible from the site. The twenty companies involved in the project have signed a manifesto, the 'Circulair Buiksloterham', making a commitment to promote the circular economy.
A report commissioned by the Amsterdam City Hall, entitled 'Circular Amsterdam', estimates that savings totaling €7 billion per year could be generated by adhering to circular economy principles throughout theNetherlands, which would also lead to the creation of 50,000 new jobs. The same report sees the potential for a 17-million-ton reduction in the city's carbon footprint by going ‘circular’. In Amsterdam value creation in the construction sector would be worth around €85 million, with 700 extra jobs created and a reduction of 500,000 tons of CO2 emissions per year.
BruSSels, AN exAmple of the circular economy?
Brussels sets an example in terms of assisting 'green' startups
Another pioneering city for the circular economy is Brussels, which launched a circular economy development strategy in 2015 as part of Strategie 2025, a wider plan to reboot the city’s economy. The Regional Programme for a Circular Economy, known as the PREC, was officially adopted by the government on 10 March 2016. The PREC is being run jointly by the BrusselsEnvironment agency together with Impulse, Innoviris and the Agence Bruxelles Propreté, an agency responsible for keeping the city clean.
This vast, ambitious plan to reboot the Brussels region comprises 111measures covering fields ranging from air quality and climate action to food production, building construction, noise abatement, waste management, biodiversity and mobility. Under the plan, the 'Be Circular' organisation launches each year a call for projects run by tech startups relating to the construction, resource and waste management, logistics and retail fields. Every year the projects accepted as part as the 'Be Cicular-Be Brussels' initiative share an annual €1.5 million worth of direct support. In 2016, the first call for projects resulted in 41 startups, working in areas as diverse as logistics, construction and distribution, receiving financial backing. In 2017 the theme was the 3Rs, i.e. Repair, Re-Use, Recycle, relating to the textiles, electrical and domestic appliances, and toys sectors. Around thirty projects received funding. For 2018, the deadline for filing applications is 15 May. The Brussels region provides financial support varying from €30,000 to €200,000.
So the administrations running large European cities appear to have grasped the fact that the circular economy goes much further than just waste management solutions. Moreover, whether we’re talking about urban agriculture, power generation within the city, or new methods of local product distribution, etc., there seems to be no limit to the imagination of the project owners. These talented people are constantly finding new outlets for their skills in the urban context – and that's a good thing for all of us.