Industrial Symbiosis

Elizabeth 1Industrial Symbiosis is the exchange of materials by firms, usually in a localized area, so that one company’s by products become another company’s raw materials.1 Producers have done this for a very long time. However it virtually fell out of practice in the 20th century as industry was streamlined.2 One of the most esteemed and successful modern manifestations of this system has been in Kalunborg, Denmark. By examining the success story of Kalunborg, and carefully examining the challenges innate to industrial symbiosis, the reader will be able to see the potential this system has for economic growth and environmental protection. Kalundborg Symbiosis began in 1961 with just two firms. Now it is complex system involving the exchange of 30 resources. They were the first modern Industrial Symbiosis system and they are also the current leaders. Here is just an example of their recent savings:

“Yearly CO2 emission reduced by 240.000 tons. 3 million m3 of water saved through recycling and reuse. 30.000 tons of straw converted to 5,4 million litres of ethanol. 150.000 tons of yeast replaces 70% of soy protein in traditional feed mix for more than 800.000 pigs. Recycling of 150.000 tons of gypsum from desulphurization of flue gas (SO2) replaces import of natural gypsum (CaSO4).”3

As a nation Denmark has taken extraordinary initiative in transitioning to a sustainable economy. The EU has put forth a collaborative energy plan called Energy 2050. The goal of this plan is to become free of fossil fuel usage by 2050.4 Denmark has been the leaders in reacting and adapting to this goal, by taking on the Roadmap’s most rigorous plans. They have successfully implemented 40% of the International Energy Agency’s recommendations, which is more than almost any other EU country. Its rigorous encouragement of sustainable practices has helped foster the success in Kalundborg.

Key Concerns

As a model, Industrial Symbiosis in increasingly being studied and Kalunborg is its main subject. Lombardi et al. (2012) explain that IS is moving on from the stage of an academic model to a practical policy tool.1 The environmental benefits to this sort of system are clear. The question we must ask therefore, is what are the drawbacks? If it is so good, why isn’t everyone doing it? The drawbacks come from free market incentive, implementation, and free market pay off. My conclusion is that these disadvantages can be partially off set by meaningful national or international encouragement.

Incentive: Businesses, if not driven by sustainable strategic goals, don’t have enough incentive to buy in to this process. Often, even with the increased coordination time set aside, the intake of raw materials and the dumping of by-products is cheaper done individually than in coordination with each other.5 Much of this is because the “real costs” of their practices are not taken into account. The companies are not adequately paying for their environmental impact. If companies were required to internalize the costs of their carbon footprint, systems like these would seem much more appealing. Similarly, as long as fuel and raw materials remain cheap to use, Industrial Symbiosis will not be able to compete as efficiently as unilateral production. Fossil fuel prices are sure to increase with decreasing supply and increasing extraction costs. In this scenario, Industrial Symbiosis will become more competitive.

Implementation: The EU recognizes the current disadvantages of competing in the current global market using sustainable methods.6 However, their goals are set on the long term. The implementation of Industrial Symbiosis is the most difficult part in achieving their ambitious goals. They strive to be the leaders in sustainable enterprises, therefore, they are willing to take these costs in the short run, if it will give them the competitive advantage in a world economy that is less dependant on fossil fuels.4

The implementation stage of Industrial Symbiosis is so crucial and challenging because their needs to be trust, understanding, and belief in the project that is mutual between all firms involved.1 Many IS projects that are started, are not able to sustain a long-term relationship. Lombardi explains that these social aspects in the system may be the most important factor in the success or failure of an IS project. Projects that are planned by a larger organization or government body and then imposed onto companies have a much greater failure rate. Chertow suggests that “uncovering” potential IS systems and nurturing them would be a much wiser use of energy then trying to create or impose such systems.7 Systems that arise organically because of mutual needs and goals between local firms have a much higher success rate. This is challenging in the current environment because, as mentioned earlier, the free market currently does not promote this sort of behavior between firms.

Conclusions

What does this mean for the nearing limits of economic growth? As a theory, it presents a new way of thinking about growth. Industrial Symbiosis questions whether economic flourishing always predicates increased consumption. I believe that we currently have an enormous capacity for reorganization. If we can complete some of this reorganization before the effects of fuel scarcity are truly felt8, we can possibly save our selves from some of the economic devastation. Currently firms are encouraged by the market to work on their own. There is so much potential to reduce carbon footprints through inter-firm collaboration. I believe this is a valuable undertaking for governments and businesses to invest in. It comes down to the basic principle, don’t just make more, make smarter. Combined with fuel substitutes and becoming comfortable with lower domestic outputs, we may be able to preemptively create a new economy that accounts for environmental costs and risks. Kalundborg shows that given the right incentives, Industrial Symbiosis can decrease the carbon footprint of industries, when national incentives and collaborative corporate cultures exists.

References

1Kalundborg Symbiosis, n.d., http://www.symbiosis.dk/en.

2Lombardi DR et al. (2012) Industrial Symbiosis. Journal of Industrial Ecology 16: 2-7.

3[CSL STYLE ERROR: reference with no printed form.].

4“Reports,” Roadmap 2050, n.d., http://www.roadmap2050.eu/.

5Lombardi DR, Laybourn P (2012) Redefining Industrial Symbiosis. Journal of Industrial Ecology 16: 28–37.

6Michael Hübler M, Löschel A (2013) “The EU Decarbonisation Roadmap 2050—What Way to Walk?,” Energy Policy, Special section: Long Run Transitions to Sustainable Economic Structures in the European Union and Beyond, 55 (April 2013): 190–207.

7Marian R. Chertow MR (2007) Uncovering Industrial Symbiosis. Journal of Industrial Ecology 11: 11–30.

8For data on peak oil. “Richard Heinberg (2012) The End of Growth: Adapting to Our New Economic Reality,” Population and Development Review 38: 4. I0805593

About the author: Elizabeth Phyle is a senior Justice and Peace and History double major at the University of St. Thomas.

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