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UK needs ambitious policy on resource efficiency as it prepares to leave EU

23rd January 2017

A new report from the Aldersgate Group out today, Amplifying action on resource efficiency, brings forward new business trials showing that greater resource efficiency could deliver significant economic benefits to the UK. To reap these rewards, the UK must outline the future of its resource efficiency policy, much of which currently comes from EU legislation. 

The new research published by the Aldersgate Group on behalf of the REBus project is based on the successful delivery of 26 business pilots that have delivered £4.89m in financial savings and reduced materials consumption and greenhouse gas emissions by 62,619 tonnes and 1,953 tonnes, respectively. The work has been conducted across the UK and the Netherlands in a range of key market sectors (including electrical and electronic products, textiles, construction and ICT) that are worth an estimated €350bn to the EU economy. 

Based on the results from the pilot projects, the research also finds that adopting resource efficient business models across these key sectors of the EU economy could deliver an increase of up to €324bn of gross value added (GVA) by 2030 to the EU economy. Of this, the UK alone could see up to €88.4bn (approx. £76.9bn) in GVA gains.

The report features learnings from these business pilots as well as several case studies from Aldersgate Group members, including IKEA UK, Sky and Thames Water. The pilots taking part range from small SMEs such as iPower (whose installation of small scale fuel cells in social housing is estimated to save consumers up to 36% on their energy bills, whilst mitigating 3-4 tonnes of CO2 annually) to the Dutch Ministry of Defence (whose textile recovery programme for its military personnel has delivered additional revenue of approximately €750,000 and a savings of over 14,500 tonnes of CO2 annually).

As the UK prepares to leave the EU, the report sets out a range of key policy recommendations for the UK government based on the learnings from these business pilots:

1.    Improving the resource efficiency of the UK economy requires the development of government policy that is backed by all key departments across Whitehall and should feature in the upcoming industrial strategy.

2.    The government should develop standards that require products sold in the UK to be designed in a way that is resource efficient in order to minimise waste and ensure consumers benefit from better quality products that last as long they expect them to. These standards should be as good as or better than what will be put in place under the EU Circular Economy Package to avoid putting British businesses and consumers at a disadvantage.

3.    Government policy should help drive innovation on resource efficiency by helping businesses, especially SMEs, have better access to finance and technical advice.

4.    The UK should build on the success of its landfill tax and promote other fiscal incentives to encourage the re-use of materials, such as through variable VAT rates that favour resource efficient goods and services over their counterparts.

5.    Waste regulations need to be improved to ensure that secondary materials are not classified as ‘waste’, as long as a safe, alternative use can be found for them.

Other recommendations in the report include leading by example through public procurement practices that favour resource saving goods and services and improving the availability of data on how businesses are becoming more resource efficient. 

Steve Wallace, Director of the Aldersgate Group said: “The businesses involved in Rebus have demonstrated that resource efficiency can lead to commercial success. Theirs is an example  that others can follow. The pilots demonstrate that resource efficiency makes business sense and that there’s a double-win given the environmental benefits that coincide with the financial gains. The report that we are launching today sets out the critical actions required to encourage and support more businesses to follow this path, leading to a more resource efficient and therefore more prosperous UK economy.”

Nick Molho, Executive Director of the Aldersgate Group said: “As it prepares to leave the EU, the government should urgently develop a resource efficiency policy that will help replicate the benefits of these pilot projects across the UK economy. This policy should be supported by all key government departments and should include fiscal incentives, product standards on resource efficiency that are as good as or better than what is in place in the EU and working with businesses to remove the financial and technical barriers that stand in the way of innovation."


New business trials show need for ambitious Circular Economy Package

23rd January 2017

A new report from the Aldersgate Group out today, Amplifying action on resource efficiency, brings forward new business trials showing that greater resource efficiency could deliver significant economic benefits to EU businesses. By encouraging resource efficient design and tackling key barriers such as access to finance, the Circular Economy Package could significantly improve the resilience and competitiveness of the EU economy.

The new research published by the Aldersgate Group on behalf of the REBus project is based on the successful delivery of 26 business pilots that have delivered €5.62m in financial savings and reduced materials consumption and greenhouse gas emissions by 62,619 tonnes and 1,953 tonnes, respectively. The work has been conducted across the UK and the Netherlands in a range of key market sectors (including electrical and electronic products, textiles, construction and ICT) that are worth an estimated €350bn to the EU economy.

Based on the results from the pilot projects, the research also finds that adopting resource efficient business models across these key sectors of the EU economy could deliver:

  • Significant financial benefits: An increase of up to €324bn in gross value added (GVA) to the EU economy by 2030;
  • Reduced materials dependence: A reduction in material demand of up to 184 million tonnes and an additional 172 million tonnes of material diverted by 2030;
  • Decreases in greenhouse gas emissions: A reduction of up to 154 million tonnes CO2eq by 2030.

The report features learnings from these business pilots as well as several case studies from Aldersgate Group corporate members, including IKEA UK and Sky. The pilots taking part range from small SMEs such as iPower (whose installation of small scale fuel cells in social housing is estimated to save consumers up to 36% on their energy bills, whilst mitigating 3-4 tonnes of CO2 annually) to the Dutch Ministry of Defence (whose textile recovery programme for its military personnel has delivered additional revenue of approximately €750,000 and a savings of over 14,500 tonnes of CO2 annually).

The report also sets out a range of policy recommendations for the EU Circular Economy Package based on the learnings from these business pilots:

  1. The Ecodesign Working Plan must embrace resource efficiency standards and apply them across an increasingly broader range of products to ensure consumers are purchasing goods that last as long as they should and waste isn’t unnecessarily created.
  2. A viable innovation framework that improves businesses’ access to funding and technical expertise must be supported. This is especially true for SMEs.
  3. The Commission should encourage and support Member States to introduce fiscal incentives, such as variable VAT rates, so that circular products and services are promoted over their counterparts. The EU’s Action Plan on VAT provides a clear opportunity to address this.

Other recommendations in the report include EU public institutions leading by example through public procurement practices that favour resource saving goods and services, finalising the changes to the definition of ‘waste’ to incentivise the re-use of materials and improving the availability of data on how businesses are becoming more resource efficient.

Steve Wallace, Director of the Aldersgate Group said: “The businesses involved in Rebus have demonstrated that resource efficiency can lead to commercial success. Theirs is an example  that others can follow. The pilots demonstrate that resource efficiency makes business sense and that there’s a double-win given the environmental benefits that coincide with the financial gains. The report that we are launching today sets out the critical actions required to encourage and support more businesses to follow this path, leading to a more resource efficient and therefore more prosperous European economy.”

Nick Molho, Executive Director of the Aldersgate Group said: “The Circular Economy Package is a great opportunity to scale up the benefits of these pilot projects across the EU. By requiring more resource efficient product design, working with businesses to remove the financial and technical barriers that stand in the way of innovation and encouraging the use of fiscal incentives, the Circular Economy Package could significantly improve the resource efficiency, competitiveness and resilience of the EU economy.”

European Commission Vice-President Jyrki Katainen, responsible for Jobs, Growth, Investment and Competitiveness, said: "The Circular Economy is an important element to modernise the European economy. If we want to transform the market economy in a more sustainable direction, we must show there is a business case behind the circular way of thinking. To make it happen the Commission's and co-legislators' task is to set the appropriate framework. However, it is eventually companies that bring a more circular and sustainable economy into reality. The REBus project presents valuable evidence that being circular is profitable. At the same time it provides ideas on how to change the regulatory environment to help business get engaged in this transition."


Resource efficiency vital for business competitiveness

3rd March 2015

In a new report published today, the Aldersgate Group called on the next Government to make significant fiscal and regulatory reforms to help UK businesses be more resource efficient and boost the UK’s economic competitiveness. 

UK-based businesses are facing competitive threats posed by overseas competitors and increasing volatility in the prices of raw materials. To survive and thrive, some businesses are now moving away from the traditional economic model of ‘take-make-use-dispose’ and moving towards more “circular” processes that allow them to re-use materials. But as the Aldersgate Group points out today, this is happening despite several regulatory and tax barriers that are hampering businesses’ ability to be more resource efficient.

A new report by the Aldersgate Group, Resource Efficient Business Models: the roadmap to resilience and prosperity, published today, sets out the initial findings of an EU LIFE+ funded project, REBus. This three-year project, of which the Aldersgate Group is a key a partner, will support 30 pilot schemes to test how businesses can achieve a 30% reduction in resource consumption by 2020. Pilots are being run by large organisations and SMEs, all receiving technical expertise and support.

Steve Wallace, an Aldersgate Group Director who leads their REBus project work said: "To secure long term prosperity our nation must be resource efficient. A growing number of forward thinking companies are adopting resource efficient business models and, through our involvement in the EU LIFE+ funded project REBus, we are supporting more to do the same."

Nick Molho, Executive Director of the Aldersgate Group, added: “To make a real difference, a more coordinated approach supported by a better regulation agenda is needed to make resource efficiency the easiest and most financially rewarding choice for businesses. The report that we are launching today sets out the critical actions required to accelerate the transition to a more resource efficient and therefore more prosperous economy."

See the full report here.

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AG welcomes the EAC's call for an end to "the throwaway society"

24th July 2014

The Aldersgate Group has welcomed the latest report by the Environmental Audit Committee (EAC) demanding more government support in the transition towards the circular economy which to date "lacks ambition and leadership". The report makes a series of policy and fiscal recommendations including the establishment of an Office for Resource Management, ban on food waste going to landfill, and the removal of trade barriers for remanufactured goods.

Steve Wallace, Director of the Aldersgate Group, said: "The EAC's call to end the 'throwaway society' rightly recognises the finite nature of resources. Progressive businesses have identified this challenge and are responding to it, but much more can and should be done at a national level to facilitate the transition. Countries that proactively manage the change will have the economic advantage in the future. Those that follow a business as usual strategy will fall behind". 

The AG is a partner, with WRAP, in project REBus. The project delivers the technical support business requires to implement the models needed for such a transition and illustrates the financial benefits of doing so.

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AG welcomes Labour's commitment to resource review

20th June 2014

The Aldersgate Group have welcomed an announcement by Shadow Environment Minister Barry Gardiner that, if elected, Labour would undertake a ‘Stern Review' of resource security in a bid to better identify the escalating resource supply risks the country faces. Last year, the AG published a Business Statement strongly supporting Government Chief Economists' proposal to commission a robust and independent review into the impacts of resource security and climate change on UK growth.

Andrew Raingold, Executive Director of the Aldersgate Group, said: "Resource insecurity is already having a tangible impact on growth and the Government must play its part to understand and safeguard future prosperity.  Labour's commitment to a resource security review will be widely supported by the business community but cross-party consensus is essential to take this forward effectively."


Industrial strategy must put sustainability and resilience at its core

20th May 2014

Andrew Raingold, Executive Director at the Aldersgate Group, has urged the political parties to make an enhanced industrial strategy a priority in the election manifestos. This forms part of a new series by Green Alliance of leading thinkers, from politics, business and green groups, to set out their one big manifesto idea for the next parliament.

Mr Raingold writes: "The government have made huge strides forward with the current industrial strategy, working in partnership with industry to deliver long term economic goals... This must be built on by the next government by addressing major, long term challenges and setting greater overall strategic direction."

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Time to put circular economy theory into practice

4th March 2014

Speaking at Resource Event, the first major conference for circular economy, Aldersgate Group Director Steve Wallace asserted that it’s time to act to move businesses towards circularity. 

Wallace, addressing the drivers for such a shift, said: “The linear economy was designed for a world with much less people and much less demand for resources. It is clear that this isn’t the case now. We need to change to a circular economy and one of the barriers to change is pure inertia built into current systems. The REBus project is a collaboration with WRAP as our lead partner. It is an opportunity to get out of the theory and into the practice and find what really works.

“There’s been much effort in the recent decades building deliberate obsolescence into our systems. We need to move away from that."

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Industrial Strategy can boost UK supply chains

12th September 2013

Speaking at the joint Government-CBI Industrial Strategy Conference at Warwick University, Aldersgate Group Chairman, Peter Young, set out how the Industrial Strategy must strengthen and develop UK-based supply chains so that more value is captured domestically. 

On a panel with BIS Minister Michael Fallon, he said: "We must take the opportunity to re-invent the supply chains of both traditional and new sectors to drive growth which is decoupled from the negative externalities of past industrial revolutions. Businesses which are energy efficient and operate with low virgin resource intensity will thrive in a resource-constrained world and have a competitive edge on those that do not."

"Government must maintain a commitment long term to the various industrial strategies underpinned by clear and smooth delivery; as for example in energy policy to give business the clarity and timing to invest in future low carbon markets. The sector approach can allow both government and business to develop solutions in emerging markets with a mix of policy, investment and co-ordinated procurement to create UK supply chains which can boost jobs, productivity and exports."

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Aldersgate Group to support project to map the world's resources

3rd September 2013

The Aldersgate Group is collaborating with Anglia Ruskin University in a new project to map the world’s resources. This will investigate the effect of resource constraints on short-term GDP and seek to provide clear information to policymakers on a range of scenarios in order to close the time-lag between the short-term agenda of governments and the long-term vision of current resource models

Andrew Raingold, Executive Director of the Aldersgate Group, said: "The Aldersgate Group are delighted to partner with Anglia Ruskin University to gain a greater insight into the current interaction between resources and the economy. The scarcity and security of key resources  are a material risk for many of our business members and country specific analysis will be vital for prudent policy making in a rapidly changing world." 

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AG calls for review into resource security and climate change

11th July 2013

The Aldersgate Group has published a Business Statement strongly supporting Government Chief Economists' proposal to commission a robust and independent review into the impacts of resource security and climate change on UK growth.

The statement recognises that resource insecurity, in many cases exacerbated by climate change, is already having a tangible impact on growth. These challenges cannot be tackled by business alone. It is essential that Government plays its part to understand and safeguard future prosperity.

The Aldersgate Group has written to the DECC Chief Economist, Steven Fries, enclosing the Business Statement and expressing signatories' support for the review. The Group has also co-signed a letter to the Treasury Select Committee, calling for an inquiry into the delay of the proposed review.

Peter Young, Chairman of the Aldersgate Group said: "It is vital that the UK responds to global recognition of the direct impact on growth and economic activity of resource constraints, greenhouse gas emissions and water insecurity. This is timely, urgent and essential to steer a future growth path which avoids loss of jobs, assets and competitiveness through neglect of future resource constraints and foreseeable price shocks."


Design lies at the heart of new business models

6th June 2013

The Aldersgate Group (AG) have welcomed a new report by the RSA on the first six months of the Great Recovery project which investigates the role of design in the circular economy. As part of the project, the AG hosted a tear down workshop at the RSA with leading businesses to observe, debate, tear apart, re-build and co-create a wide variety of products. 

Andrew Raingold, Executive Director of the AG, said: "we welcome this report's emphasis on developing skills, facilitating collaboration and pushing policy. The businesses who joined us to tear down consumer products into their individual components were clear that design lies at the heart of new business models that eliminate waste. We look forward to continuing to work with leading businesses to explore innovative briefs that incorporate resource efficiency and closed loop principles at the outset."

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Businesses explore opportunities of circular economy

30th April 2013

Andrew Raingold, Executive Director of the Aldersgate Group, said that businesses increasingly recognise that they have to act decisively to prevent an impending resource crunch.

Chairing the Resource Scarcity and The Circular Economy Conference for Sustainable Business Magazine, he said "We have heard from our speakers today that the resource crunch is not just a major risk for businesses, but also can be a net creator of jobs and growth. The fact that 43% of businesses recognise that they have to revise their product and service offerings, as demonstrated by the presentation by Tom Delay from the Carbon Trust, shows that corporate leaders are slowly waking up to this issue."

"The speakers today have also emphasised the need for collaboration and partnerships. The resource revolution challenge requires system level change and can rarely by addressed effectively by actors in isolation. That includes a strong and proactive role for Government."

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Treasury blocks review on resource security

5th March 2013

The Aldersgate Group has written to the Financial Times following revelations that the Treasury has blocked a review on resource depletion, climate change and growth that had the support across Whitehall departments.

Andrew Raingold, Executive Director of the Aldersgate Group, said: "By blocking this review, the Treasury is damaging future growth prospects. Rising and volatile commodity prices are having a material impact on business. An independent analysis on how these major trends effect UK competitiveness is widely supported by business leaders and across Government departments. The Chancellor must address resource risks urgently to build a more resilient economy that exports the solutions to global challenges."

See coverage in the FT and BusinessGreen.

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Circular economy a real value proposition

12th July 2012

In an article published by CIWM Andrew Raingold, Executive Director of the Aldersgate Group, said that the circular economy provides a number of economic benefits as global resources become more scarce. He says that "a small number of companies at the vanguard of applying circular economy thinking are already demonstrating that it is a real value proposition" and that the Aldersgate Group were seeking to ensure this is scaled up.  


AG sets out circular economy vision

20th June 2012

The transition to a circular economy presents opportunities for growth and competitive advantage in a resource constrained world. In a new report, Resilience in the Round, the Aldersgate Group (AG) sets out challenges, opportunities, enablers, barriers and timescales, as well as outlining next steps that the AG will develop with stakeholders.

The AG has collaborated with the Big Picture on a multimedia platform to introduce the circular economy.


AG welcomes Resource Security Action Plan

16th March 2012

The Government's Resource Security Action Plan, published today, cites the Aldersgate Group's Beyond Carbon report as evidence for the need for a targeted resource strategy, and answers our call to develop a dashboard to raise awareness and help companies understand the risk and issues associated with the security of materials.

Peter Young, Chairman of the Aldersgate Group, said: "The era of plentiful and cheaper resources is over. Our business members are facing rising costs for essential raw materials and minerals, while constraints on their availability and price volatility are having a damaging effect on the economy.

That is why the Aldersgate Group has been calling for a strategy which goes beyond carbon to address critical resource efficiency challenges in all areas of the economy, to remain competitive in global markets, both now and in the future. The Government's action plan is a welcome first step to ensure that growth isn't damaged by potential supply uncertainty and the UK gains competitive advantage from increased resilience."

For Guardian coverage, click here.

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Significant progress on building policy but the devil's in the detail

13th February 2012

A new Aldersgate Group report, Building Britain, suggests that progress has been made by Government in shaping the regulatory and fiscal framework for sustainable buildings in the UK. However, the industry's prospects of delivering on carbon reduction targets whilst remaining competitive is still somewhat hampered by a lack of clarity, consistency and effective enforcement.

Jon Lovell, Director of Sustainability at Drivers Jonas Deloitte, who authored the report, said: "With the rising cost of energy having such a clear impact on the bottom line of business, and on the health and well being of a growing proportion of society, the government must re-double its efforts in pushing forward with a joined-up programme of effective and proportionate regulation, particularly on the efficiency agenda."

See coverage in the Guardian here.


Fears over green building standard for new schools

3rd February 2012

The Aldersgate Group and UK Green Building council have urged the Education Secretary not to scrap BREEAM requirement for new schools. In a joint letter to Rt Hon Michael Gove MP, they argue that the cost of a school achieving an "excellent" BREEAM standard would be far outweighed by the resulting saving on energy bills. 

For more information, see the Guardian coverage here.

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Plan for Growth must go "Beyond Carbon"

5th January 2012

A technical paper on the economic benefits of resource efficiency by Aldersgate Group (AG) Directors Andrew Raingold, Sir John Harman and Ian Dickie has been published in the international journal "Proceedings of ICE - Waste and Resource Management". Permission has been kindly granted to print one copy of the article for personal use by AG stakeholders. Any other use of the PDF file is subject to reprint fees.


AG Member makes the case for closed loop business models

12th September 2011

Ramon Arratia, Sustainability Director for InterfaceFlor (an Aldersgate Group (AG) member), spoke on "Closed loop business models for the future" at the B4E Climate Summit.

He drew comparisons with nature, where organisms don't eat their own waste. "In nature, waste from one organism becomes the food for another organism, and this is what we've seen in our industry. Rather than just limiting ourselves to making carpet from recycling nylon from our own carpet, we saw the opportunity of recycling other things, like fishing nets in certain countries." The closed loop business model, Ramon argued, should not be restricted to closed loops, "but just loops", incorporating "scavenging" from other industries, a process which may be threatened by creation of new materials.

The full discussion can be seen here.

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