Circular Economy Taxonomy Study

The "Circular Economy Taxonomy Study," published in February 2023, was conducted by a consortium of seven organizations, including various European green building councils. The study involved 29 market participants from ten European countries, including Austria, Belgium, Denmark, France, Germany, Ireland, Spain, Switzerland, the Netherlands, and Turkey. Its primary goal was to assess the market-readiness of the proposed Circular Economy EU Taxonomy criteria specifically for building activities by applying these criteria to 38 real building case studies, consisting of 35 new construction projects and 3 renovation projects.

The results of the study revealed that none of the 38 buildings could be classified as aligned with the proposed EU Taxonomy criteria for circular economy. This lack of alignment was attributed to several factors:

Additionally, structural barriers were identified, which included a lack of appropriately aligned frameworks, definitions, digital tools, and clear references necessary for documenting alignment with circular economy principles in construction and real estate.

Despite 90% of the projects adhering to the EU Construction & Demolition Waste Protocol, only 40% managed to prepare 90% of their waste for reuse or recycling, which is a requirement of the Taxonomy. Furthermore, while 90% of the projects conducted life cycle assessments, 80% could not publish their results due to the absence of member state registers.

The study also noted that 70% of the assessed projects supported circularity in design, focusing on resource efficiency, adaptability, and dismantlability, and 80% met the corresponding Do No Significant Harm (DNSH) requirement. However, none of the projects met the material quotas, which require a minimum of 50% reused, recycled, or renewable materials, with only a third achieving the renewable materials quota.

Challenges such as a lack of data, high benchmarks, and ambiguity in methodologies were cited as key obstacles to achieving alignment with the circular economy criteria. Despite these challenges, 90% of the projects successfully avoided the use of asbestos and hazardous substances (SVHCs). Additionally, 70% utilized electronic tools to document materials and components, providing end-of-life guidance for those materials, though 60% of the projects lacked comprehensive information on maintenance and reuse pathways.

The study offered several recommendations to the EU Commission and the Platform on Sustainable Finance. It highlighted the need for clarity regarding ambiguities in scope, definitions, and documentation needs. Furthermore, it emphasized the necessity for improved frameworks, tools, infrastructure, and ecosystems to support circularity within the built environment.

In conclusion, while the proposed taxonomy criteria are ambitious and present significant implementation challenges, studies like this one help build organizational capacities and identify areas for improvement. They are crucial for advancing toward a circular economy in the construction and real estate sectors in Europe.