In an exclusive interview with LDaily, the CEO of Neo-Eco, Bart Gruyert, shared fascinating details about his company, which is a leader in innovation in the field of circular economy. Neo-Eco aims to create a sustainable future through the reuse of waste, benefiting both the economy and the environment. Bart Gruyer also discussed the company’s activities in Ukraine, described current projects, and shared Neo-Eco’s plans and intentions regarding investments in the Ukrainian market.
LDaily: Can you provide more detailed information about Neo-Eco and its activities in Ukraine?
B. Gruyaert: Neo-Eco, our company, has been pioneering in the circular economy for 17 years. The essence of a circular economy is to repurpose waste, giving it a second life in a way that is economically viable. This approach demands that the materials we reuse or recycle are not only technically equivalent to their original forms but also comparably priced to ensure sustainability. A prime example of our work is the metro construction project we undertook for the Société du Grand Paris. This massive project involved excavating 45 million tons of rubble, from which we successfully managed to reuse or recycle 98% of the materials through circular economy practices. Additionally, our portfolio includes significant projects like the Olympic Games and the development of the Olympic Village.
We initiated our operations in Ukraine about one and a half years ago, with our efforts presently centered around three principal elements: war debris, asbestos, and low-carbon cement. Focusing on these areas, we have started several projects across different Ukrainian regions, where we plan to make substantial investments in the upcoming months. An announcement of a significant investment in Ukraine is on the horizon. This marks a transition from a demonstration project we undertook at the onset of 2022 to a considerable investment that will pave the way for a new type of factory by 2026. Essentially, we are moving from an exploratory phase – looking at the Ukrainian market’s response to our expertise and technology – to what is anticipated to be the most significant investment in our company’s history within Ukraine.
LDaily: How has the war influenced your investment strategy in Ukraine, and what does this mean for your market presence there and in Europe?
B. Gruyaert: The situation in the Ukrainian market is particularly complex due to the ongoing conflict. This complexity has led us to a critical decision point. In Ukraine, as an investor or entrepreneur, one faces two primary choices. One option is to wait until the conflict concludes to assess the post-war landscape. The alternative is to adopt an opportunistic approach during the conflict, making long-term estimations about Ukraine’s future and acting on those predictions. We have chosen the latter path, deciding to enter the Ukrainian market during the war. Our strategy involves making investments amidst the conflict, based on the belief that once the war concludes, we will be well-positioned with our investments to serve the Ukrainian market effectively.
Our investment outlook, however, extends beyond the immediate context to consider Ukraine’s role within the broader European market. The events of last December are significant to us not only politically but also from an investment perspective. They underscore the necessity for Ukraine to align with European Union standards and integrate more fully into the European market. This integration implies that products manufactured in Ukraine could potentially cater to markets in Poland, Romania, Bulgaria, and, in our case, Turkey as well.
Our approach to mitigating the uncertainties of the post-war scenario in Ukraine involves a clear strategy: regardless of the immediate opportunities for reconstruction within Ukraine, we aim to produce goods that are viable for export to the European and Turkish markets. This strategy helps us navigate the risks associated with the uncertain outcome of the conflict. Our primary target market is the construction industry, which aligns with our core offerings and strategic direction in Ukraine.
LDaily: Could you discuss the recycling of rubble into construction materials in Ukraine, the challenges faced, and its compliance with evolving EU and Ukrainian standards?
B. Gruyaert: Our current activity in Ukraine involves sorting rubble to create new construction materials. This process, though not directly linked to our investment, is a significant part of our operations. Currently, this method faces criticism within Ukraine, including from the national government, mirroring the skepticism we encountered in France a decade ago. Despite initial resistance, such practices have since become standard in France, indicating a shift in perception towards recycling.
The primary challenge in Ukraine is the prevalent practice of landfilling or indiscriminately dumping rubble. Unlike the minimal recycling for road construction, we advocate for utilizing this rubble as a new material for constructing buildings, incorporating it into concrete. This approach has been validated by several Ukrainian companies, like Kovalska, who, upon testing our sample materials, confirmed their suitability for concrete mixing.
However, the Ukrainian market for this technology is still in its infancy, largely due to the skepticism of national politicians and legislators about the utility and future of such recycling practices in Ukraine. Despite this, we are optimistic, as the European Union is expected to introduce legislation mandating the use of recycled materials in construction by the end of the year. While currently obligatory in France, this mandate is anticipated to extend across the EU, and eventually, to Ukraine, aligning with EU standards.
We find ourselves in a transition period, struggling somewhat as we navigate between being pioneers with cutting-edge ideas and the government’s viewpoint that our approach is too complicated. However, we anticipate that these recycling practices will eventually become obligatory in Ukraine under EU standards. Therefore, patience is our key message for the next two to three years as we continue to implement these sustainable practices.
LDaily: How do you ensure the quality of your products? Can you guarantee that such materials will be completely safe for people? What is the process of quality and safety checks?
B. Gruyaert: Our approach to guaranteeing product quality involves comprehensive testing. This means sending material samples to laboratories both before and after processing to ensure compliance with Ukrainian and European Union legislation.Addressing hazardous materials, particularly asbestos, is our main challenge. The goal is to remove as much asbestos as possible from the rubble before processing, thus preventing it from becoming an issue in our final products. This is a critical step that we rigorously monitor, adhering to European Union standards to ensure safety.
To provide transparency and share our methodologies, we recently published a white paper on this subject, available in both Ukrainian and English. This document was a collaborative effort with an Austrian and a Ukrainian company, embodying a three-company approach to tackling this challenge. All of the information on how we ensure the quality in detail is available to the public.
LDaily: Where do you source the material for recycling? Do you collaborate with Ukrainian companies that supply it to you?
B. Gruyaert: Our approach in Ukraine mirrors our practices in France to some extent, where we engage with what could be termed as deconstruction companies. We have established partnerships with several Ukrainian companies that meet our standards and understand the required processes in the deconstruction sector.
In addition to this, our collaborations extend to the construction and concrete industries. Specifically, in the Kyiv region, we have worked with five companies, which, by our estimation, represent about 95% of the concrete industry in the area. This extensive coverage in the Kyiv region has been quite comprehensive. We are now expanding our operations to include the Kyiv and Mykolaiv regions, where we are actively developing new relationships.
LDaily: In which Ukrainian regions is Neo-Eco actively involved at the moment, and could you highlight some of the key projects you’re undertaking in those areas?
B. Gruyaert: In Mykolaiv, our current project involves cleaning rubble with a unique process that employs war veterans, adding a social innovation aspect to our work. We have 25 war veterans under our training and monitoring program, focusing on their technical skills and mental health. This approach of building relationships, as we’ve done in the Kyiv region in ’22 and ’23, is something we’re replicating in Kryvyi Rih and the Mykolaiv region. Our active regions include the areas near Dnipro, Mykolaiv, and Odesa. We’ve also received requests for projects in the Sumy and Zaporizhzhia regions.
Among our upcoming projects are bomb shelters constructed from rubble and low-carbon cement. This method not only recycles rubble but also reduces the environmental impact by utilizing low-carbon cement. Furthermore, we have a special project involving children from a rural area around Mykolaiv, who have lost their fathers, in the design of these bomb shelters. The aim is to transform bomb shelters into more comfortable spaces, rather than just underground concrete blocks. This initiative is not only about creating safe spaces but also engaging children in meaningful activities during challenging times.
In our collaboration with architects and the children we will construct a bomb shelter designed by children, for children, at their school. This project is blend of circular economy principles and social sustainability, marking a significant distinction between Neo-Eco Ukraine’s approach and that of Neo-Eco France, particularly in terms of our engagement with war veterans.
Moreover, our work extends to children who have been out of school for four years due to COVID-19 and the war, bringing them together to reignite joy and laughter despite their profound losses, including their fathers and homes. This initiative has touched the hearts of their mothers, who have seen a resurgence of smiles and dreams among their children, even as they engage in the unusual activity of designing bomb shelters at home. Targeting children aged 8 to 14, this project not only provides therapeutic engagement but also stimulates innovative ideas related to circular economy practices, enriching the learning environment.
Looking ahead, we anticipate the establishment of multiple bomb shelters across Ukraine that integrate this social dimension with circular economy practices, firmly believing in the important role these children will play as the future generation and ambassadors of the circular economy in Ukraine.
Additionally, we are set to initiate a pilot factory in Mykolaiv this year to produce low-carbon cement, with funding from Denmark, aiming for operational status by September. This project will eventually evolve into a larger-scale factory, representing a significant investment in the coming two years. Despite the challenges posed by the current context, the positive feedback from individual Ukrainians fuels our commitment to persevere with these initiatives.
