As the Netherlands races to meet its climate and circular economy goals, it must make significant strides in a heavily polluting industry—construction—by meeting future demand for housing primarily through timber. This is according to a new report by a Community of Practice (CoP) named Building with Wood (Houtbouw). The report details a value chain roadmap of how timber construction may develop in the Netherlands, illustrating enablers for a ‘Timber Revolution’ and barriers to realising this ideal.
Construction is often overlooked in its contribution to climate change, being less obvious than air travel and less relatable than food. Nonetheless, the Dutch construction sector accounts for half of the country’s resource use and a staggering 35% of its CO2 emissions—primarily owing to its use of emissions-intensive materials like cement, concrete and steel. While traditional construction materials pose a problem, bio-based alternatives—like timber—present a promising solution. Tree growth absorbs CO2 from the atmosphere and locks it into place, and timber allows for modular, prefabricated construction, slashed costs and significantly speedier construction processes.
The CoP, in collaboration with ABN AMRO and Invest-NL, has identified two crucial enablers for timber’s successful uptake in the Netherlands, and four potential pathways the industry could follow on the journey to 2030. The paper elaborates on barriers, as well as means to surpass these barriers in building a clean, sustainable and safe future.
From the research, two trends emerged that highlight how timber-use can be revolutionised: legislation and industrialisation. The future success of timber will be made or broken by its pricing, ultimately driven by developments in policy and law. The Dutch policy MilieuPrestatie Gebouwen, which measures the sustainability of materials used for a building, will likely ignite a shift in the materials prioritised by architects and contractors. Similarly, the Dutch CO2 tax and EU Emissions Trading Scheme prices are expected to grow, hiking up the price of emissions-intensive materials like reinforced concrete by up to 33%—and concurrently driving down the cost of sustainable alternatives. Similarly, a professionalisation and industrialisation of the sector, resulting in faster project delivery and costs slashed by 30%, are crucial for timber’s successful upscaling.
The paper highlights four scenarios we can embark upon over the next ten years: Timber Revolution, Timber Evolution, Timber Disappointment, and Business as Usual. In the ideal scenario—Revolution—80% of the demand for new housing will be met by timber, and the industry boom will create thousands of new jobs throughout the country. The other options aren’t so attractive: while Evolution will see large-scale investments in bio-based materials and up to 30% timber use, Disappointment and Business as Usual scenarios fall short, resulting in sluggish development and poor investments in the sector.
Why might we continue down the latter two paths? Timber is currently more expensive than traditional building materials and a lack of long-term insight on the part of investors and financiers could result in a fragmented, small-scale industry carrying forward. The impact of covid-19 also has a role to play in timber’s potential triumph (or lack thereof): efforts to ‘build back’ including regulatory rollbacks and weakened climate legislation, as well as failure to stimulate price incentives for sustainable construction, might hinder timber’s uptake as a viable alternative material.
The good news: currently, there is more than enough growth to meet Dutch housing demand, and timber’s popularity is gaining momentum across the continent. For the Timber Revolution to become a reality—and for Business as Usual to fall by the wayside—it is necessary for investors to analyse opportunities and returns in the long-term, and recognise the inevitable truth: the future of construction lies in the forest, not the factory.
