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The BRopportunities for collaboration NL and trade between the Netherlands and Brazil in the field of Circular Economy
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Circular Economy Netherlands - Brazil
The opportunities for collaboration and trade between the Netherlands and Brazil in the field of Circular Economy
Author: Lodewijk Luken Supervision: Maarten Rusch
Rio de Janeiro, February 2018
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CIRCULAR ECONOMY NL-BR
SUMMARY OF FINDINGS The current linear economy of ‘take-make-dispose’ has put pressure on the environment. Raw materials are extracted and waste is generated. The concept of Circular Economy (CE) has come up as an alternative for the current system. It refers to a system in which resource input and waste are minimised through maintenance, repair, reuse, remanufacturing, refurbishing and recycling.
between the Netherlands an Brazil is found yet, but on the long term they might arise, considering the global concerns and the potential of the CE approach in this sector. 4. Built environment and construction. No interest in the implementation of the CE concept has been identified.
In the Netherlands, a growing environmental awareness and the believe in this CE concept has led to many innovations, projects and start-up companies. Also the Dutch government embraced the concept and came up with the plan ‘A Circular Economy in the Netherlands by 2050’. From an economic perspective, research institute TNO has estimated that implementation has a huge potential positive impact on the Dutch economy of 7,3 billion euros and 54.000 jobs.
Three steps In general, the main difference between CE in Brazil and the Netherlands is the level of organization and collaboration to make the transition to a circular economy. Furthermore, a stimulating government (by implementing enabling policies for example) and awareness about the CE concept still lack in Brazil. Also research and knowledge development is still required. For this reason, the focus of the Netherlands in Brazil is not only on direct export of CE expertise. A three step strategy consists of:
I. CE NETHERLANDS - BRAZIL All expertise that is being acquired in this area is identified as an opportunity for export. Therefore, the Dutch governmental network in Brazil has started various initiatives, such as the publication of the book ‘Economia Circular Holanda Brasil’ and the organization of several missions and events.
1: CE AWARENESS RAISING INFORMATION 2: CE KNOWLEDGE DEVELOPMENT INNOVATION
A more focused approach started in September 2017. The research question was:
3: CE BUSINESS AND POLICIES IMPLEMENTATION
What are the opportunities for the export of Dutch Circular Economy expertise to Brazilian industries and what steps have to be taken to enable this? Focus Certain sectors were selected to map the current state of CE, the involved actors and the opportunities to implement Dutch CE solutions. Based on the five focus areas for CE in the Netherlands (biomass and food, plastics, manufacturing, construction and consumer goods) four sectors were chosen. These are prioritized in the following order: 1. Textile and clothing. A large number of small, innovating start-up companies aims for implementation of the CE concept in the industry. But what makes this sector mostly interesting, is the presence of several bigger companies (fashion brands) that have real ambitions to implement the CE concept in their businesses. 2. Electronics. Several Brazilian e-waste recycling companies have shown interested in the broader Dutch CE approach, which is more than only recycling. However, for real implementation of these models (product to service for example), the involvement of manufacturing partners is important. 3. Plastics. No starting point for CE collaboration or trade
Activities Related to this strategy, the following activities are undertaken: •
Circular Economy profiling and promotion:
Presenting the Dutch CE approach to industries, participate in missions and events, visit companies. •
Living lab Circular Economy:
The Living Lab Circular Economy is a way to establish contact between the Netherlands and Brazil and to bridge the gap between research and the industry. On the long term, this could lead to trade between the Netherlands and Brazil, since partnerships and collaborations are developed during the process. The first focus is the clothing industry, with involvement of specialized design and business universities from the Netherlands and Brazil. Student mobilization will start in September 2018.
4 •
CIRCULAR ECONOMY NL-BR CIRCO Circular Economy workshop:
In the three-day workshop ‘Creating business through circular design’ (focused on the manufacturing industry), CIRCO helps companies to identify opportunities for circular business and design. At the same time, FIRJAN trainers are educated as future teachers of the workshop. The workshop will be organized in August 2018.
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Apply new focus: - different sector (electronics, plastic or other) - focus on a certain CE (business) model
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Continue identifying opportunities for potential CE solutions, also outside the focus
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Create conditions: policy making, social inclusion, knowledge development
Next steps •
Textile and clothing: Connect with Dutch CE partners
ROADMAP CIRCULAR ECONOMOMY ROADMAP CIRCULAR ECONOMY NETHERLANDSNETHERLANDS - BRAZIL AC T I ON S AN D AC T IVITIES
T H RE E STE P STR ATE G Y 1
- BRAZIL
AWARENESS RAISING OF CE INFORMATION
social inclusion
CREATE CONDITIONS 2
CE KNOWLEDGE DEVELOPMENT INNOVATION
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CE BUSINESS AND POLICIES IMPLEMENTATION
OLYMPICS
CE MISSION TO NL
Business event: a seminar about CE, followed by round tables about specific CE topics
Innovation mission about CE with the Brazilian core stakeholders: FIRJAN and FIEMG
stimulate rules and regulation
support knowledge development (CE Nucleus)
CIRCO TRAINING
CIRCO HUB BRAZIL
‘Creating business through circular design’ with FIRJAN and associated companies
to coordinate, stimulate and identify the necessary system changes and the development of Circular Economy strategies
LIVING LAB CIRCULAR ECONOMY Applied research in the field of CE, in a collaboration between Dutch and Brazilian universities, working with real cases from the industries. Activities: student exchanges, internships, joint applied research, knowledge sharing.
BOOK PUBLICATION ‘Economia Circular NL - BR’
universities
governments
companies network organizations
CE BUSINESS NL-BR 2016
2017
SEC T OR O R THE M E SPE CIFI C C O N CR E TIZ ATIO N*
TEXTILE (CONSUMER GOODS)
2018
2019
BUILD NETWORK
DEVELOP CE SOLUTIONS
CE BUSINESS IN TEXTILE
Mapping the Brazilian textile industry and identification of the relevant stakeholders (innovators, established companies, governments)
Collaboration with the Dutch network organizations Circle Economy and Modint + associated companies on mature CE solutions (business models, technologies)
Dutch-Brazilian solutions are applied in the textile industry, such as: - a commercialized defibration technology
ELECTRONICS (MANUFACTURING)
FROM E-WASTE TO CE
Start with the willing: find the right moment in time to accelerate
DEVELOP CE SOLUTIONS
CE BUSINESS
PLASTICS CONSTRUCTION
*it must be noted that in a Circular Economy a strict sector-approach does not serve, since new connections and sectoral crossovers are an essential part of a Circular Economy
II. CE IN THE CLOTHING INDUSTRY What are the opportunities for the export of Dutch Circular Economy expertise to the Brazilian clothing industry? Considering the focus on the clothing industry, a more in-depth analysis to the current state of CE in this sector is made. As a basis, six main themes to make the transition to a circular clothing system are defined, based on reports by Ellen MacArthur Foundation (2017) and Modint (2016). From here, Brazilian and Dutch CE-related projects are mapped and catagorized per theme. Also, the maturity
and (potential) impact on the chain of the projects are indicated. The following trends are identified: • •
There is a great diversity of CE initiatives in both countries. Some focus on product design, others on new business models or recycling options. Maturity vs. impact: Most projects that have a small (potential) impact on improvement of the chain are often in research/plan/pilot phase. Example: chemical recycling (SaXcell). Projects that have small influence on the chain are often more matured. Example: reuse of old shirts to make boxershorts (Van Hulley).
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A CIRCULAR CLOTHING SYSTEM fibre, yarn and fabric production
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clothing production
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retail
raw material
waste-to-textile
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4 landfill or incineration
1: NEW PRODUCTS AND MATERIALS
2: THE PRODUCTION PROCESS
1A: Make the fabrics and clothes suitable for recycling 1B: Avoid microplastic release of the clothing 1C: Substitute raw material with alternatives, such as biodegradable materials or plastic waste
2A: Reduce or recycle water 2B: Phase out pollutants 2C: Run on renewable energy 2D: Reduce solid waste generation (cut-offs etc.)
3: CLOTHING UTILIZATION 3A: New business models (product to service, lease models) 3B: More durable clothing
5: RECYCLING OPTIONS 5A: Fabric recycling 5B: Yarn recycling 5C: Fibre recycling (mechanical recycling) 5D: Polymer recycling (chemical recycling) 5E: Monomer recycling 5F: Align clothing design and recycling processes •
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In both the Netherlands and Brazil, there is great willingness in the sector to make the chain circular. Brazil is, however, behind on governmental and institutional level. In both countries, also bigger fashion brands are starting their own initiatives in post-consumer collection and collections made of recycled products.
4: COLLECTION AND SORTING 4A: Collection 4B: Seperate fabrics from buttons, zippers etc. 4C: Sorting by fibre type
6: ENABLING TOOLS 6A: Information and evidence base 6B: Chain approach: alignment industry players, collaboration 6C: Policy 6D: Transparency
Real business opportunities for Dutch companies in Brazil are not identified. From the potential supply side (the Netherlands), it must be noted that many innovations, such as the recycling technologies, are not sufficiently matured yet for export. From the demand side (Brazil), certain problems in the industries, such as excessive waste generation in the production process and govermental
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pressure to reduce waste, request any kind of solution. An example of this was found in the Nova Friburgo lingerie confection industry. Dutch CE innovators have to be made aware of these opportunities. Living Lab Circular Economy - clothing Where no mature CE models and technologies are available, it is an option to collaborate on the development of such a CE solution. The Living Lab is a tool to get the Dutch and Brazilian side in contact with each other, potentially leading to collaboration and trade on the long term. In this Living Lab, BR and NL universities with different expertises and research agendas are involved: both design and business. The next step is to connect these acadamic partners to the industries. Companies (fashion brands) have to be requested to formulate specific research questions to generate content in the LLCE for the students to work on. This report, with the six themes of innovation in the transition to a circular chain, could help the involved partners to formulate specific research questions that connect to a certain theme.
III. CASE: NOVA FRIBURGO INDUSTRY By focusing on clothing and getting to know the sector, the following challenge in the Nova Friburgo lingerie confection industry could be identified. Problem and opportunities for CE innovation In the production process, on average 10-20 percent of the fabric is lost as cut-offs. Currently, waste processing companies collect these cut-offs to discard them to landfills. Considering (1) the pressure from the Nova Friburgo municipality, (2) the interest of the confection industry to cut on the costs of discarding their residues and (3) the environmental concerns, the right conditions appear to be in place to push innovation and develop circular strategies. Apart from the implementation of recycling options, two other opportunities for CE innovation were identified (see scheme below). The role of the Netherlands could be either providing a ready to implement solution or to develop a solution in collaboration with the industry (Living Lab).
NOVA FRIBURGO LINGERIE CONFECTION` 3
material
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stock
fabric cutting
defibration?
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confection
final product
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FROM CHALLENGE
80-90%
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10-20% cut-offs
landfill
TO NEW BUSINESS THROUGH CIRCULAR DESIGN
1. Cut-off waste from production Around 20% of the imported fabrics is wasted as cutoffs, which pollutes the environment (landfills) and costs money for the companies to discard.
Recycling options In collaboration with the right partners the defibration technology can be developed in the Living Lab to circulate this part of the chain. Waste is then turned into a valuable product.
2. Unused material stocks Unused stocks of fabrics, yarns, buttons and laces are stocked in all Nova Friburgo production facilities, not valued as resource.
Trading platform Making the information on stocks available for everyone, supply and demand can be matched. Unused materials are revalued.
3. Use of material blends Currently, lingerie is made of a material blend with materials that are part of the technical cycle, complicating the recycling process.
Substitute material for recyclable input By anticipating on recycling, different choices can be made regarding the used matierial. For example, material blends could be avoided, or biobased material could be used.