CITY OF VENLO A Circular Economy Business Model Case

Abstract

This report presents a case study of the city of Venlo and its circular business model, selected by the R2π project along with 17 other cases, due to its position within the construction and building materials sector, which is one of the priority areas of the European Union’s circular economy strategy. The objective of the report is to analyse the contextual and business factors affecting the circular business model, as well as to assess the enablers and barriers to implementing such a model and to provide considerations for both business leaders and policy makers.

The city of Venlo (NL) embraced the Cradle to Cradle® (C2C®) principles as first region in Europe. In 2008 Venlo decided to build their City Hall as shining example of C2C® design. The creation of a pleasant and healthy workplace for employees of the Municipality of Venlo has been the central theme: a building that offers a comfortable and healthy working environment, combined with sustainable innovation. Venlo considers the C2C® principles as a revolutionary economic concept and true driver for innovation, based on new circular economy business models and the use of materials in perpetually cycles. Based on these principles, Venlo applied a wide variety of circular measures within a circular economy business model, for which they invested €3.4 mln. This investment creates a net saving of € 16.8 mln over the use time of the building and a positive cash flow after year 1. Besides, the building has been realized within the budget and without dependency on subsidies. Since the building is in use (October 2016), the operational costs are significantly lower compared to former and traditional (linear) buildings. The above mentioned circular measures show that, during use time, indoor air quality is even better than outdoor air quality (while indoor air in offices is on average 4-8 times worse than outside). This is one of the results of the creation of a pleasant and healthy workspace being a central theme for the City Hall. Furthermore, due to its green roofs and facades, the building purifies a measurable 30% of the fine dust and CO2 level in an area of 500 meters around the city hall. Moreover, the building generates its own energy and a helophyte filter purifies grey water, which is reused in the building. Numerous C2C CertifiedTM products are used. The building is approached as a material bank for future valuable raw materials and designed for disassembly. Arrangements are made with suppliers about residual value and guaranteed take-back of materials. This resulted, for example for the furnishing concept, in a residual value of 18% with a maximal number of C2C CertifiedTM materials. In less than 1,5 years, after opening in October 2016, the city hall Venlo has seen over 25.000+ visitors with a special interest in the Cradle to Cradle® approach. Of these 60% are Dutch, 40% are international visitors. As a result of these visits, many organizations have been inspired to apply the circular principles within their own context. Also other developers in Venlo have been applying C2C® principles in their real estate project, such as primary schools, gyms, residential houses and companies. The circular principles even became part of Venlo’s strategy, facility management and procurement criteria. This case study describes Venlo’s vision and approach in realizing buildings with a positive impact. The municipality of Venlo wants to give an exemplary role in the transition towards a circular economy and strives to “do good rather than less bad”. The scope of this case study is the business model of Venlo’s newly built city hall. The uniqueness of this case study, compared to other case studies within the R2Pi project, is the fact that Venlo is a local government. As a consequence, this case study differs slightly from other case studies