The Australian Housing and Urban Research Institute (AHURI) recently completed a series of linked research projects on the subject of ‘Building a Circular Economy in Housing’. The research is timely given that our ecological and housing crises are both at a critical point. Can we meet Australia’s housing needs in a way that is environmentally sustainable?
What is a Circular Economy
Most of our economic activity is based on what has been described as a ‘linear economy’. In this model raw materials are extracted and used to manufacture products (or burned for energy), these are used for a finite period and then dumped, replaced by new items produced in the same way. Cory Doctorow calls this ‘pump and dump capitalism’. This model has produced great wealth, although it is very unevenly distributed, but it is not sustainable because the earth is finite. We can see this in the fact that we are approaching or crossing multiple planetary boundaries including resource depletion, pollution, climate change and habitat destruction.
Circular economics provides and alternative to this model, in which little or nothing is wasted. Circular economics is focused on sustainability, using renewable resources, building things to last, re-using raw materials and component parts, and recycling waste.
The AHURI study defines circular economy housing as:
“...housing that is produced and consumed utilising closed-loop principles, prioritising local employment, resilient and functional design, and carbon-neutral or energy-efficient operation…. CE promotes affordable, accessible, fit-for-purpose housing that is appropriately located, so that it addresses social, environmental, economic and intergenerational equity concerns.”
How is the Australian Housing Industry placed?
In its four linked studies the AHURI researchers examined circularity in housing and neighbourhood development and apartment building, and took deeper dives into building materials and social housing retrofits. They then invited each of the researchers to develop policy options within an overarching framework.
They identified three key stages in the overall Circular Economy approach:
Housing and neighbourhood production – construction and development, including materials input from various upstream industries.
Housing consumption, including owner-occupiers, rental investors and government/social landlords, and the resources used in the ownership and use of the housing.
End of life – demolitions and re-use or disposal.
Their findings are detailed and complex, so at risk of doing them an injustice let me try to simply summarise what they found. In short, it’s not very encouraging. There are a number of issues standing in the way of building circularity into our housing market.
There are few clear standards for the various aspects of circularity like materials, construction techniques, demolition and disposal.
There is little or no regulation to mandate circularity beyond energy efficiency.
There is not widespread knowledge of circularity in the building industry.
The economic incentives work against circularity – it increases the cost of materials and construction, while reducing the long-term cost of owning and running the building. Since homes rarely built by, or directly for, the people who will inhabit them, the builders don’t benefit from the extra investment as this is not reflected in the price.
There is no tracking of material flows, so we don’t know how long many things last and what happens to them in the long term.
It’s not all doom and gloom. For instance, the National Construction Code requires standards of energy efficiency in new-build housing, and these are in the process of being increased. The researchers also report some experiments in material re-use, although these have encountered a number of difficulties. Some material sectors, such as timber production, have certification processes that can provide some assurance about sustainability of products, although compliance with these is voluntary.
What can we do?
The glass half full interpretation of this story is that there are a lot of things we can do to improve the situation.
At a policy level we need a clear policy intent from Commonwealth and State/Territory governments around moving towards circularity.
This then needs to be matched by practical measures to help the industry shift towards circularity. The sort of things the researchers say might help include:
Clear and consistent regulation about circular practices in the industry, including standards in the Building Code and in regulations around materials certification and waste disposal.
Support for improvements in technology to make circularity more doable and affordable.
A way of valuing buildings that ensures energy efficiency and circularity are accurately reflected in the value of the property, as a way of creating financial incentives towards circularity.
Investment in education and skill development for the various professions and trades involved in property development and building.
They sum up the various possible interventions through an overall framework involving four elements, outlined on Page 18 of their summary report:
Reappraising value: value inclusion and prioritisation, market setting, institutional frame.
Shaping market practice and processes: regulatory/steering instruments, performance-drivers, market-shapers etc.
Tilting investment flows: finance, capital, and tax incentives.
Building capacity: skills, knowledge, and training.
There’s a lot to digest in this set of reports, some of it quite dense and technical/academic – if you’re interested in the subject its worth taking a look at the reports.
Resources
If you want an introduction to the idea of circular economics, it’s hard to go past Kate Raworth’s Doughnut Economics. There’s a handy summary at this website or read the book – I borrowed a copy from my local Council library.
The summary report from the AHURI project is:
Horne, R., Dorignon, L., Lawson, J., Easthope, H., Dühr, S., Moore, T., Baker, E., Dalton, T., Pawson, H. and Fairbrother, P. (2023) Informing a strategy for circular economy housing in Australia, AHURI Final Report No. 403, Australian Housing and Urban Research Institute Limited, Melbourne. Download here.
The report above is the summary report of the project which also includes four more detailed research reports.
Baker, E., Moore, T., Daniel, L., Caines, R., Padilla, H. and Lester, L. (2023) Sustainable social housing retrofit? Circular economy and tenant trade-offs, AHURI Final Report No. 397, Australian Housing and Urban Research Institute Limited, Melbourne. Download here.
Dühr, S., Berry, S. and Moore, T. (2023) Sustainable housing at a neighbourhood scale, AHURI Final Report No. 396, Australian Housing and Urban Research Institute Limited, Melbourne. Download here.
Easthope, H., Palmer, J., Sharam, A., Nethercote, M., Pignatta, G. and Crommelin, L. (2023) Delivering sustainable apartment housing: new build and retrofit, AHURI Final Report No. 400, Australian Housing and Urban Research Institute Limited, Melbourne. Download here.
Dalton, T., Dorignon, L., Boehme, T., Kempton, L., Iyer-Raniga, U., Oswald, D., Amirghasemi, M. and Moore, T. (2023) Building materials in a circular economy, AHURI Final Report No. 402, Australian Housing and Urban Research Institute Limited, Melbourne. Download here.
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