Construction regulations must be updated to facilitate the transition to the circular economy, the Competition Council recommends following the completion of the study on the competitive advantages of the circular economy in construction.
Currently, Romania has a low circular economy level of 1.3%, compared to the European Union average of approximately 11.5%.
Although the construction sector generates a large amount of hazardous waste, with a significant impact on the environment, disposal by storage is the main form of their management, at the present time, there being no technological norms that allow the use of recycled materials in new constructions.
As a result, the competition authority recommends updating national standards and norms in the field, as well as regulating the certification procedure for construction and demolition waste (DCD) so that it can be reused in road construction activities.
The authorities try to stimulate the recycling of both construction and municipal waste by forcing companies to pay a fee (contribution) for the amount of waste they do not recycle. In Romania, this tax is only 160 lei/ton (approx. 33 euros/ton), while in other European countries it is much higher (for example, about 100 euros/ton in Belgium).
Under these conditions, most construction companies prefer to pay the tax and store the waste (throw it away), because the costs of recycling are higher, up to double the tax, depending on the processes involved (collection, sorting, transport and treatment of recyclable materials). Moreover, the costs for the storage and further treatment of DCDs are not clearly defined in the technical projects of the infrastructure works.
Thus, the Competition Council recommends clarifying these aspects related to costs and considers that, in order to increase the degree of recycling, the level of the contribution (tax) must be set at a value higher than the cost of recycling.
Another barrier to the transition to a circular economy is the lack of waste management infrastructure, given that the purchase of equipment/machinery involves a high cost and represents a significant effort for companies.
Under these conditions, in order to facilitate the transition to the circular economy, the Romanian state initiated a series of support measures for the business environment, totaling more than 890 million euros.
It is about the “Recycling Factories” Program, for the construction of new recycling facilities for separately collected waste, the De Minimis Aid Scheme for the transition to the circular economy, the Regional State Aid Scheme for investments aimed at reducing the negative effects of waste on the environment and reducing the consumption of primary resources, the “ConstructPLUS” Program.
The competition authority recommends a better implementation of these measures so that they can be accessed by operators in the field.
“There is definitely room for growth in this area. By accessing the funds made available by the state, part of the financing needs can be covered to develop waste management systems, so that we can make the transition to a modern, competitive and efficient economy from the point of view of resource use,” said Bogdan Chirițoiu, the president of the Competition Council.
The circular economy is a production and consumption model based on the principles of reducing the natural resources used, extending the life cycle of products and minimizing the production of waste, by reusing, repairing, renovating and recycling existing materials and products as long as possible.
The preliminary version of the study “The competitive advantages of the circular economy in the construction sector and its impact in achieving the climate objectives of the European Union” can be consulted on the website of the institution until October 30, 2024.