Circular economy

Pioneering Industrial Symbiosis for Green Growth in Colombia

Jooyoung Park for Portafolio | Updated on January 09, 2018

Production of goods and services leads businesses to use water, fuels and metals, which entails waste and emissions. In Colombia, agriculture and cattle grazing contribute only 6% of Gross National Product (GNP), but consume 40% of the country’s water, generating 48% of greenhouse gases.

Colombia’s 2016 peace accord with guerrilla forces, following 50 years of war, has triggered international aid to help the country build rural infrastructure and support green growth. Companies are encouraged to reduce costs and do less damage to the environment by using resources more efficiently, e.g., by controlling leakage, renewing equipment and reusing waste. Efficiency increases by exchanging waste, because waste from one company can serve as input for another. Pulp and paper producers use bagasse, a residue from sugarcane processing, as a substitute for wood. Sharing infrastructure and services among companies, such as wastewater treatment plants, can also improve efficiency.

Collaboration among companies for resource efficiency is called industrial symbiosis (IS). Competition has promoted innovation and market development, but collaboration is the passkey to promote resource efficiency and sustainability.

The world’s most famed IS experience was launched 40 years ago in Kalundborg, Denmark; a dozen plants developed 30 resource sharing projects. Today, industrialized countries employ IS as environmental policy. In South Korea, 159 IS projects were undertaken by 592 companies from 2005 to 2014, generating combined benefits of USD 1.3 billion. In China, more than 108 industrial parks are accredited as eco-industrial parks, promoting a circular economy.

In Colombia, IS has become a feature of the Sustainable Enterprise Network (RedES in Spanish) program led by Universidad de los Andes School of Management (UASM). In 2017, a pilot IS project involving 13 companies was launched outside the capital city of Bogotá with support from the Cundinamarca Regional Environmental Authority (CAR). These firms had previously engaged in RedES’ cleaner production program, which currently includes some 330 companies. The IS project is pursued by ten large (over 200 employees by Colombian standards), two small (under 50), and one medium-sized company. All are located in relative proximity to each other, in sectors that range from building materials and construction to packaging, soft drinks, food processing, chemicals, cosmetics, poultry, and waste management.

At this writing, nine prototype IS projects are in design stage. In one project, the food processor provides 62 tons of its monthly wood and plastic waste to the building materials firm for free, which in turn produces plastic crates and provides them to the food processor in return, thus replacing the latter’s wood crates; the plastic crates last up to five times longer than those made of wood. In another project, a restaurant chain provides about 400 tons of coffee residues to a poultry producer as an odor absorbent and compost ingredient. A third project links several companies that share a waste management service to collect and dispose of sludge and hazardous waste. This reduces waste management cost and optimizes transport needs, which in turn reduces carbon emissions. In total, nine projects were estimated to generate about USD 475,000 in economic benefits from cost savings and revenues; reduced environmental impact includes diverting 1,446 tons of waste and avoiding 1,018 tons of greenhouse gas emissions.

To generate IS economic benefits, companies must commit time and resources. The right match of inputs and outputs requires information on the attributes of materials exchanged, and compatible technologies. Infrastructure may be needed – such as a pipeline to channel steam from waste heat from one company’s plant to that of its partner. From an organizational standpoint, IS requires trust. Trust emerged among the 330 companies in the RedES program, as each firm designs and implements its own cleaner production project with assistance from UASM consultants.

A second IS project will start soon, with a wider range of firms. All RedES program firms are provided with follow-up support for implementing IS and cleaner production projects. Also, companies reducing their environmental impact obtain recognition from the regional authority, thus reducing the latter’s cost of enforcing regulations. As the program expands across Colombia, additional IS projects will be launched for green growth.

Jooyoung Park , Universidad de los Andes School of Management, A Contribution for Portafolio

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Published on October 27, 2017
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