Breaking the vicious cycle with circular lighting

An interview with Anton Brummelhuis, Senior Director of Sustainability, Philips lighting

There’s a quiet revolution afoot. Business models are slowly changing as industries move away from the traditional linear model of “take, make, waste” production and towards a circular economy – one that is inherently restorative by design. That means it aims to keep products and materials at their highest utility and value.  Some of the world’s top companies, including Hewlett Packard, H&M, Cisco and Unilever are shifting to this more sustainable mode of production. And, of course, the lighting industry isn’t immune to these changes. In this interview, Anton will elucidate how this concept is affecting companies like Philips lighting.

What exactly is circular lighting?

Circular lighting is the circular economy approach translated to our Philips lighting business. This change is best accomplished through a product/service combination, orchestrated by the producer. Imagine you’re a client and you want to update your lighting system. That can be an expensive proposition because you have to buy new equipment – money that you might rather spend on core business activities. But a circular lighting business model adopts a different strategy. The client simply buys the light they need and allows another party to take care of all the other details such as installing the equipment (which the clients simply leases) and service and performance for a contracted period of time.

We want to avoid waste to landfills by embracing this new circular business model. If you look at the current lighting industry in Western Europe, only 10% of discarded luminaires are officially collected and registered. So what happens to the other 90%? It’s not entirely known. Lighting industry experts estimate that about 75% of the remaining 90% goes into the gray economic area of metal scrap dealers and the other 15% goes into landfills. That’s something we want to change.

What are the primary benefits of circular lighting?

Circular lighting tackles the waste problem in two main ways: first, we apply dedicated designed luminaires that can be used and re-used – in other words, they have a much longer lifespan than traditional luminaires – and second, as part of our service, we take responsibility at the end of the contract for the materials. We’ll do our utmost to repurpose 100% of the collected hardware. Circular lighting is vastly more sustainable, drastically reducing what goes to landfills. However, the most optimal situation when a client’s contract term expires is to extend it for a new term. We do that by providing new functionality or upgrading the lighting system to meet the customer’s evolving needs.

It’s also an energy efficient solution because the customer can immediately benefit from the cost-savings of LED and connected systems without an upfront investment. This concept is also more efficient with materials – there’s no ripping out luminaires and putting new ones in. And yet customers can benefit from the latest innovations. You know, a lot of customers hesitate to invest in lighting because they’re also worried about how quickly the industry is innovating. But a circular lighting solutions provides future-proof lighting. Plus, at the end of the contract the hardware still has value. It depreciates far less than traditional luminaires. 

Lastly, buying your lighting, and only your lighting, simplifies operations immensely for a client. A producer such as Philips lighting takes responsibility for everything – professional services like a lighting audit, installation, spare parts management, maintaining the quality of the light, and, as I mentioned before, also managing what happens with the products at the end of the contract.

What are the primary benefits of circular lighting

I know that Philips lighting helped Schiphol Airport with their circular lighting project. Can you tell me more about that?

Well, this was really a project that touched people’s imagination. Schiphol’s goal is to be the most sustainable airport in the world. They’re aiming for zero waste to landfill by 2030. They’re embracing circular economy principles and they like to do innovative experiments with leading companies.

They asked for our help with updating the lighting in terminal lounge 2, an area of the airport with 24/7 lighting. Providing them with light as a service means that Schiphol only pays for the light it uses while Philips lighting and Engie [formerly Cofely, a technical service provider] will be jointly responsible for the performance and durability of the system and ultimately its re-use and recycling at end of life. And the new LEDS are already helping Schiphol save energy by providing a 50% reduction in electricity consumption over conventional lighting systems.

How does circular design play a role in the circular economy?

What we’ve seen is that many LED luminaires became a sealed for life solution. In other words, everything was glued permanently together. Circular design means that you construct a luminaire in such a way that it fulfills five criteria:

1) The materials can be recycled back to pure materials or towards existing waste streams
2) You can easily decompose it – it’s optimized for disassembly
3) It’s modular in nature. That means it consists out of building blocks, sort of like Legos
4) It’s easy to repair and maintain
5) Most importantly, you have options for upgrading it in order to increase performance or bring new functionality to the luminaire

How will circular lighting shake up the traditional value chain? What will everyone’s roles be in the future?

More than ever, we see that it can’t be only one country or company that has the ability to manage the transition to a circular economy. It’s all about collaboration. For the project at Schiphol, we collaborated with several companies to bring that project to fruition.

I think producers like Philips lighting will take on a more prominent role. The reason for that is that the producers have maximum influence on the designs. Also they’re probably the best customers of repurposed equipment.

The lighting pioneers of the circular economy

For clients that take the circular lighting approach – what will happen at the end of their contract?

That’s where the concept of reverse logistics comes in. After their five year contract with us, they have the option to extend it, meaning we would come in and make updates to their lighting that they may need. The most sustainable option would be to simply upgrade the lighting – the so-called product service combo. This would mean that we could avoid the cost of dismounting and the installation of entirely new luminaires.

However, they could ask for new luminaires and then you’d enter into what we’d call a refurbishment loop. Once we’d get a luminaire back, we’d try to make it as good as new and then re-sell it. Or we could possibly take the luminaire apart, harvest the spare parts then re-use those. The final option – and the one we want to avoid – is that we have to recycle the luminaire. Inevitably, if you have to recycle, a small percentage of impure materials might end up in a landfill so that makes this step the least sustainable.

How will circular lighting alter existing business models?

The transition to a circular economy will be a lengthy one. It’s also an irreversible one. Once we shift to this sort of economy, we’ll never go back. For the most part, people stay in their habits. The beauty of this model, is that it’s the ideal “habit” to get stuck in. Clients can benefit from the best lighting performance for lowest cost, virtually hassle-free while also employing the most sustainable solution.

We began the transition four years ago and we aim to provide the best benefits to our customers, to the environment and to ourselves. I would say that it’ll take another 35 or 40 years before we have all moved towards a perfectly circular economy.  In the meantime, Philips lighting is at the vanguard of propelling the entire lighting industry into a circular economy.