Ep 157: Inside the world of industrial symbiosis | The origins of the circular economy

Colin Webster 00:03

Welcome to the Circular Economy Show from the Ellen MacArthur Foundation. I'm Colin Webster and I'm here with my colleague, Pippa Shawley.

Pippa Shawley 00:10

Hi, Colin. And if you've been listening to this series so far, you know that we're looking at the things that inspired the circular economy, the schools of thought. So we've already talked about cradle to cradle, biomimicry and regenerative design. And today we're talking about...

Colin Webster 00:26

An idea called industrial symbiosis. And once we've talked about that, we'll talk about how that fits in with the circular economy.

Pippa Shawley 00:33

Okay, and so who have you been out to speak to for this?

Colin Webster 00:37

Two great guests today, later on, we'll hear from Radu Godina. He's an Associate Professor at the Nova School of Science and Technology. But first, we're going to hear from Lisbeth Randers, who is the Symbiosis Facilitator at Kalundborg.

Pippa Shawley 00:50

Now, Kalundborg is an industrial park in Denmark, which is not a new thing, right, Colin?

Colin Webster 00:57

No, it's like the world famous example of industrial symbiosis in action.

Pippa Shawley 01:01

You went right to the center of the experts.

Colin Webster 01:04

If you're gonna go for it, you go all the way. Yep, that's right. So I started by asking Lisbeth, what her role is of the park.

Lisbeth Randers 01:14

So what I do in my day to day job is to facilitate and to develop new symbiosis projects together with the partners in the symbiosis, and at least together with my three good colleagues in the Office of symbiosis.

Colin Webster 01:28

So what does that mean, then somebody else's will be a new phrase, for some listeners here, tell us exactly what that means.

Lisbeth Randers 01:33

Well, symbiosis is taken from biology, when you have two species benefiting from living closely together, for instance, birds and bees, you could say that say one of the best examples, they benefit from having this collaboration, and it's exactly the same sort of metaphor that, that we use when we're talking about industrial symbiosis, because when we have different partners, they can share their residue, so that you can actually turn a side stream, or a residue in one company into a resource or into a commodity in another company. So being located in the same area, in a local cluster, you can have this dialogue, how can we use the resources better? How can we maybe also create mutual infrastructure so that resources are used in different qualities among different partners? So it's actually all about sort of reaching out to your neighbors looking for new partners that you can cooperate with?

Pippa Shawley 02:40

So for those of us that haven't been to Kalundborg, what does it look like?

Colin Webster 02:44

Well, I mean, I've not been either Pippa, my travel budget doesn't extend to that, sadly. But I did ask Lisbeth to explain.

Lisbeth Randers 02:52

And yeah, you would see an industrial cluster is sort of integrated in the local community. And the most visual sign of that there's actually something special going on here in Kalundborg steam pipes that you can see running from the power station to the companies. At the other end of the industrial cluster. They provide the energy and sort of connects the power station and the companies and we use those pipes in our logo, because we think that they are a good metaphor for what for the exchange that is actually taking place in Kalundborg. But we have many other different exchanges. And some of them you can see visually in the landscape as pipelines or transportation belts, or materials being transported in trucks. Some of them are bilateral agreements, commercial agreements that you cannot actually see in the landscape. But if you talk to the companies, and you ask them to tell how they treat their side streams, you'll hear them tell this story about how they cooperate with the local partners in the area.

Colin Webster 04:01

And in order to be a member of the industrial park do you have to offer something or take something from another member?

Lisbeth Randers 04:07

For our core members, that is the criteria that they have to be willing or able to share a stream with the others with the other partners in the symbiosis. But we have also started working with associated members that can either provide service solutions, and new technologies or, or other kinds of support functions to the existing partners in symbiosis. And we have seen that that it is quite interesting for local sub suppliers to be a part of the symbiosis and to enter this world of collaboration.

Colin Webster 04:49

So a couple of times Lisbeth mentioned the word collaboration when she was telling me about what goes on Kalundborg and I wanted to ask her a little bit more about how these exchanges to actually take place.

Lisbeth Randers 05:02

We have today, more than 30 streams running between the companies. So I think that's quite a large number of exchanges. And it all expresses collaboration on different levels, because in order to shape its symbiotic product, you must have collaboration not only on on handling the physical stream, but you must, you also have to collaborate on shaping the legal frames, the economical frames around this project. So we see collaboration take place in very many different areas. Because creating a symbiotic collaboration is is quite complex and involves also that you look that you look at your supply security, that if this if this stream will someday terminate, what is your plan B, how can you sort of allow your partners to, to be timely, warned about this termination? And things like that it requires a capacity, a local capacity to design those agreements.

Pippa Shawley 06:14

Okay, this is something I've been wondering, what happens when these waste streams run out? Is there some way of evolving over time?

Colin Webster 06:22

Yeah, I mean, I guess I guess that was my thought to. What Elizabeth told me was that the park was first established in the 1970s, when there was a gas refinery, it had excess energy, that it was simply burning out. And across the road, there was a plasterboard company who was setting up a new facility. And of course, it was in need of an energy supply.

Pippa Shawley 06:44

Right. And these days, gas doesn't seem very secular. But I guess at the time, it was just making the most of what was being wasted.

Colin Webster 06:51

Yeah, I think so I think it was just a smart use of available resources to benefit to different companies. But the thing about this park is, although it started in the 1970s, it didn't actually get any widespread attention until the 1990s, when a very lovely thing happened. But let me let Lisbeth tell you this one.

Lisbeth Randers 07:12

So to start with the beginning, and there was this sustainability report made by Gro Harlem, Brundtland. And that was the inspiration of a feature week at the local high school. So they were doing all kinds of different projects at the high school there. And among them, was a group of students that were up interviewing the companies, what were they doing with their waste fraction? How could they actually tap into this sustainability definition. And they started to uncover all these collaboration agreements that existed between the companies, and, and they created an awareness among the site managers that Whoa, this is actually something special, we have a kind of ecosystem, and they build a small model of that ecosystem. And there was an sort of a symposium at the at the high school at the end of the feature week, where they invited the site managers of the big companies in the area. And they invented this definition of the symbiosis. And they name it, they named it industrial symbiosis taking the biological system, where two species benefit from a close collaboration. And, and there was a local newspaper at that symposium, writing about the symbiosis in the new industrial symbiosis is being detected by this group of high school students. And after that, there was an article in the national paper and after that, Finance, Financial Times, came to Colombo and wrote an article about what was actually going on. And from there, it spread into sort of a textbook, textbook examples of industrial ecology. And it was become becoming a kind of a best practice example of how you can actually set up an industrial ecosystem in a local community. We celebrated our 50 years anniversary back in 2022. And we were lucky enough to have a visit from one of these students from 1989 That actually was out there interviewing and detecting the symbiosis. And that was such a highlight for me to hear her talking about this, this work that they did, at that time, they want to add a price a national price also for the work.

Pippa Shawley 09:45

There are so many lovely aspects to that story, Colin, starting with how this all emerged organically between local businesses, that engaging young people in the story and actually giving some sort of Mmm power to those students to point this out the engagement of the local press, the storytelling aspect of it, and then it going international. And now it's the textbook example.

Colin Webster 10:11

Totally agree. And I don't do you know, this Pippa, I used to be a high school teacher.

Pippa Shawley 10:15

I did.

Colin Webster 10:16

Oh, well, I probably bored you with that story before. But um, so I think that's part of the reason why I really liked this tale, is because of the high school students involved in it. And also, I think what this tale tells us, too, is the power of sensible business, right? That it sounds like the businesses in Kalundborg didn't feel the need to shout about what they were doing, perhaps didn't even know what they were doing was special, that just made sense to them to work the way that they worked. Now make good business sense. Yes, Lisbeth. What she did say to me, and part of the conversation that we had was the real need to keep telling these stories, though. So that the spotlight is forever on the opportunities that industrial symbiosis offers. And that's part of her day to day operations. And part of that tale, of course, is the financial benefit, which we haven't talked about yet. But indeed, we get into that just now, as Lisbeth answers my question about finance

Lisbeth Randers 11:15

I think the financial incentive is very important. And it has been also part of the Sustainable duration of the of the symbiosis. It doesn't depend on public substitutes, or, or whatever, because it's good business. And it's, it's a good business case, when you can save money by not getting rid of your waste, as a landfill material, but that you can give it away or maybe sell it for a small sum of money to the neighbor company, you can save money on, on, on transporting waste fractions, things like that. So there's definitely an economic is insensitive, but I think also today, the environmental bottom line, you could say that the green profiles of the companies is also a part of the business case today. So if if a company can see this is a this is a good investment in the long term, but also environmental protection, protection of biodiversity, protection of local resources, plays a play a more and more important role in defining the business case.

Pippa Shawley 12:34

So there's that business case there. There's the environmental benefits, and the social benefits. It sounds like a win win win situation. But is that too good to be true?

Colin Webster 12:46

No, I in a minute on the face of it definitely does sound like that. But of course, the practice isn't widespread, which raises the question as always why? So I did ask my next guests Radu about the barriers to adopting industrial symbiosis. But before we hear him, what do you think he might say the barriers are?

Pippa Shawley 13:08

Okay, so I think we've talked about cannonball having that natural occurrence. So maybe it's that you don't have those businesses next door to each other. Lizabeth also talked about the need to keep reinforcing that storytelling to know that it's a thing. And I guess there's also something around regulation, probably because if you have all these different different industries, doing different things, they probably have different regulations that they need to conform to.

Colin Webster 13:36

I think that's a top answer.

Pippa Shawley 13:38

Thank you.

Colin Webster 13:38

So as we will hear in just a minute here from Radu Godina, Sso, to remind people Radu is the Associate Professor at NOVA School of Science and Technology, and he is a researcher into industrial symbiosis. Let's hear from Radu about what Pippa got right there.

Radu Godina 13:55

Because there are many barriers to the, to the realization, let's say, let's call it to the realisation of, of potential of industrial symbiosis. So there are in my studies we have found at the locations of industrial parks, that could be could have benefited from a dose of somebody else's from a long time, the potential of understand someone else's theory is quite high. But it wasn't implemented yet. And that has to do with because of many reasons. There are several studies that point out the lack of appropriate policies, and that is a is a barrier to the application of these practices. For example, low taxes on landfill disposal is one of them. Lack of policies that encourage on regulating to sell symbiosis, lack of funds to promote this practice and defficient regulatory framework. Another barrier is the reluctance of companies to establish this kind of relationship, not only due to a lack of knowledge of the industrial symbiosis mechanisms, but also due to lack of knowledge of other companies with the potential of receive or provide waste. Lack of trust has been has been documented several times.

Pippa Shawley 15:22

Colin, did he explain what he meant by lack of trust?

Colin Webster 15:24

Yeah, he did. That was interesting. He said that, even though two companies who could share resources might not compete with each other, there is a general reluctance to share detailed information about their processes. Because I came from a place that maybe they would be careless with the information that they've been given.

Pippa Shawley 15:42

Sounds like quite a psychological issue, which I guess we don't often think about in business. But I wonder if there are certain places where that plays out more than others?

Colin Webster 15:52

Yeah, that was exactly my thought that maybe certain societies would be more accepting and bracing of the idea for industrial symbiosis. So did I put that question to Radu?

Radu Godina 16:04

I would say that, yes. The also the environment that surrounds you also incentivize you to do it. The willingness of people to share in the north and the south variety a lot in the south people tend to become more individualistic. Trust in social democracy is lower, and, and in northern countries in Scandinavian countries is much higher. So what is the underlying idea of social democracy is sharing.

Pippa Shawley 16:43

And when ready talks about Scandinavia there, I guess it makes sense that this textbook example of Kalundborg is in Denmark, which is in Scandinavia.

Colin Webster 16:53

Yeah, absolutely. But the reality is of industrial symbiosis. There are more examples of this in China than anywhere else in the world. And what Raji went on to express was that the examples of Kalundborg and others in Northern Europe where we're an example of a bottom up approach, whereas what we're seeing in China is a top down approach.

Pippa Shawley 17:15

And does it matter if it happens from the government pushing it down or from bottom up?

Colin Webster 17:22

Well, I mean, I would have ever thought it's fine. If it happens either way, if it's a good thing, and rowdy said as much. But what he did have was some reservations about whether or not a top down approach could be long lasting. Or even if it would be optimal if those who are implementing industrial symbiosis, maybe didn't truly believe in it.

Pippa Shawley 17:42

Because if it emerges, sort of organically, like we talked about at Cannon, Borg, you have that sort of collaborative creativeness that sort of keeps you inspired to keep working on it. Whereas if it comes from the government, you're and you're being told to do it, you need the carrot and the stick.

Colin Webster 18:00

And and to reflect on some other things that we've talked about, actually, in this series. The mindset change isn't necessarily there, I guess, if it's a top down approach, right? Yeah. Changing the way that people think changes their behaviors, for the better, one would hope.

Pippa Shawley 18:14

And I think sometimes you can think that policy is going to be the magic one that fixes everything. But that is that top down approach. So they need to complement one another.

Colin Webster 18:23

I think so. But whether it's bottom up or top down, to go back to Elizabeth, she realizes the power of leadership and making all of this happen.

Lisbeth Randers 18:34

Because I think it's also very important for for the cannabis and viruses that that the leading companies has sort of shown the courage to say we believe in this way of working together, that that might not be the most obvious way to create partnerships are to create this green transition, but we believe in partnerships, and we sort of invest in them in a local setup. We think that we must allocate resources to cooperate in the local community. And I think taking that kind of, of leadership and responsibility, responsibility. That is so important. And I think we will never reach circular economy and achieve more industrial symbiosis anywhere in the world if we do not have leaders that are willing to take that responsibility to take that risk also, of failing of not succeeding and not having this partnership that attracts attention.

Pippa Shawley 19:51

That's so important, isn't it, that idea that it's safe to take risks because that's, it's on the other side of those risks that you have innovation?

Colin Webster 19:59

Yeah, we hear that time and time again for people on this podcast. But also, I think what we also hear on this podcast is this idea of the need to tell good stories. And that really came through, especially in what Lizabeth said, and some cases what Randy was saying, too,

Pippa Shawley 20:15

I think that reinforces why it's worth taking those risks as well, because you need to hear the success stories from other places to feel comfortable attempting to try something in your environment, right.

Colin Webster 20:27

And that's why we have the circular economy show is,

Pippa Shawley 20:31

so we have talked today about industrial symbiosis. But where does that fit in with the circular economy?

Colin Webster 20:37

Well, I think there's clear connections we can all see, right? It's about resources staying within the system. It's about collaboration across the system, because we we think that in order for a circular economy to work successfully, you'd have much higher levels of collaboration that we have today. Because take make waste, you wave goodbye to your resources, whereas we want to keep them in the system through various actors. So sharing resources, there's, there's waste reduction, of course, is a key part of what they're talking about an industrial symbiosis. And also, you see a lot of the living systems metaphor with an industrial symbiosis to it works like a living system, in inverted commas. Because it's about that flow of resources.

Pippa Shawley 21:26

Yeah, I guess one of the differences is that the industrial symbiosis examples that we've heard about today have happened almost by accident. Whereas in a circular economy, we talk about setting up a system that's all through design. So it's an intentional from the outset.

Colin Webster 21:42

Yeah, I don't know how representative, the Kahlenberg origin story is of industrial symbiosis across the park. But But I guess what I pick up more than anything is that the industrial symbiosis is business to business, whereas circular economy needs to be both. And perhaps there isn't an elimination of waste at the heart of what's going on, within industrial symbiosis. Through design. We are seeing a clever use of a waste resource, rather than than asking ourselves how we can design it out. So it never exists in the first place.

Pippa Shawley 22:20

It's this sort of upcycling piece rather than eliminating piece. I think that's a good way of putting it Yeah. Okay, so thank you for bringing the industrial symbiosis chat today. Colin, what are we talking about next time?

Colin Webster 22:32

Well, next time is the last in the series, where we will look at the performance economy. Great. So if you've enjoyed the show, then please share it with everyone who you think would be interested and join us next week on the circular economy show

Pippa Shawley 22:47

and make sure you're subscribed so you don't miss an episode. See you next time. Goodbye for now.