Making circular economy actionable and scalable in precincts

Circular Australia, supported by Aurecon, seeks to transition the nation to a circular economy by 2030 through collaboration across government, industry, and research sectors. The report promotes place-based circular economy projects as practical pathways for systemic change, using precincts as local ecosystems that facilitate reuse, regeneration, and sustainable resource management.

Solving complex problems

Circular precincts use systems thinking to manage interconnected materials, people, and infrastructure. This approach supports national programs such as Net Zero, ReMade Australia, and Renewable Energy Zones by aligning funding and sustainability objectives. Four major challenges are addressed: embodied carbon, regeneration of natural systems, infrastructure transformation, and the housing crisis.

Reducing embodied carbon is critical, as 65% of Australia’s greenhouse gas emissions stem from material management. Circular precincts promote localised material flows, recycled inputs, and design for disassembly, helping to achieve net zero goals and comply with frameworks such as the Taskforce on Nature-related Financial Disclosures (TNFD). Regenerating natural systems integrates green infrastructure and water systems to enhance biodiversity and mitigate urban heat. In infrastructure, precincts enable decentralised hubs that enhance resilience and manufacturing capacity. For housing, circularity promotes affordability and sustainability through shared utilities and eco-villages.

Defining circular precincts

Circular precincts are geographically defined areas uniting people and organisations to design out waste, retain materials at their highest value, and regenerate natural resources. They combine business, research, and community participation to deliver measurable environmental and social outcomes. Sustainable infrastructure, renewable energy systems, and shared resources underpin these developments, enabling local economic growth and job creation.

Precinct types

Three leading types are identified: industrial ecology precincts (e.g. Kwinana, WA), which exchange materials and energy among colocated industries; circular material hubs (e.g. Eastern Creek, Sydney), where recycling and reuse businesses operate collaboratively; and circular communities (e.g. Yarrabilba, QLD), integrating sustainable living and mobility. Many precincts combine these features, such as Tonsley Innovation District, which merges community and business circularity.

Australian circular precincts

Existing and emerging examples include Kwinana Industrial Area, Bega Circular Valley, Hunter Valley Circular Hub, Circular Monash, and Parkes Special Activation Precinct. These initiatives vary by scale and focus, demonstrating localised approaches to resource efficiency and economic development.

Circular precinct principles

Six key principles underpin successful precincts:

• Economic drivers – Circularity could add $210 billion to GDP by 2048, addressing Australia’s low material productivity (US$1.20 output/kg vs OECD US$2.50). Circular precincts foster regional resilience, new jobs, and value retention.
• First Nations – Integrating “Caring for Country” with circularity ensures projects respect Indigenous knowledge and local ecosystems.
• Collaboration – Co-design and engagement with stakeholders ensure shared vision, policy alignment, and innovation.
• Governance and network brokers – Dedicated governing bodies and political support are essential for coordination, risk management, and long-term precinct viability.
• Shared resources and infrastructure – Precincts promote resource-sharing through renewable energy, water recycling, and material exchange hubs, where one entity’s waste becomes another’s input.
• Finance and investment – Education of investors is needed to attract funding. Governments can de-risk early-stage projects through grants, incentives, and low-interest loans.

Barriers

Barriers include limited stakeholder awareness, siloed governance, inadequate policy frameworks, lack of financial incentives, and difficulties in measuring circular outcomes. Specific challenges arise at each stage of precinct activation—Engage & Explore, Design & Deliver, Attract & Activate, and Manage & Monitor—highlighting the need for better collaboration, data systems, and circular procurement practices.

Recommendations

The report calls for national and state-level policy action to embed circular economy targets across major projects and to establish an independent governing body to coordinate circular precincts. Governments should implement sandboxing programs with regulators to test new reuse and recycling methods, and integrate circular standards into planning and procurement frameworks. Financial institutions are encouraged to embed circularity into ESG policies, sustainable finance taxonomies, and reporting frameworks. Industry is advised to pilot circular supply chains, share infrastructure, and include circularity in procurement and corporate strategies.

Four steps to activate your precinct

The accompanying Circular Precincts Guide outlines four activation steps:

1. Engage & Explore – Build stakeholder understanding and align goals.
2. Design & Deliver – Develop enabling infrastructure and systems.
3. Attract & Activate – Foster investment and collaboration.
4. Monitor & Manage – Measure and share performance outcomes.

Collectively, these actions aim to scale place-based circular economy practices, generating long-term economic, environmental, and social benefits across Australia.