An indicator-based method supporting assessment and decision-making of potential by-product exchanges in industrial symbiosis

https://doi.org/10.1016/j.jclepro.2020.125593Get rights and content

Highlights

  • Qualitative and quantitative indicators to assess by-product exchanges.

  • Proposal of coverage ratios to judge the technical and operational fit of processes.

  • Technical, economic and environmental assessment of symbiotic alternatives.

  • Three-stage method to guide decision-making.

Abstract

Limiting global warming and increasing resource efficiency remain central tasks of our time. In the quest for sustainable development, approaches aimed at the transition from linear to circular supply chains and networks are increasingly drawing attention in research, politics and business. Industrial symbiosis is one such approach, which aims to create ecological and economic benefits through the novel exchange of underutilized resources between processes and companies. To decide for or against the realization of potential exchanges, the compatibility of the processes and potential benefits of the exchange must be assessed in advance. Currently, however, this prospective assessment focuses primarily on the network level and on quantifiable information using absolute or relative indicators tied to specific dimensions or units. While these indicators are essential to quantify the environmental and economic impacts of resource exchanges, they are insufficient regarding compatibility measurement of the processes involved. In addition, a clear procedure for handling the indicators is rarely provided, which increases the effort for their selection, definition, and consequently for the assessment. Therefore, we propose a method that incorporates qualitative and quantitative indicators into an adaptive three-stage assessment process to first roughly estimate and later calculate the fit of different processes or companies. This procedure is intended to reduce the time and effort required for information collection and synergy assessment by industrial actors and intermediary stakeholders. The indicators represent the technical feasibility, economic viability (including managerial aspects) and environmental benefits of potential resource exchanges. Key features of the method are its guidance through the assessment, exclusion and decision-making process and the introduction of dimensionless coverage ratios to assess the technical or operational match of the entities involved.

Introduction

Environmental sustainability has become a new paradigm of businesses. A discipline that pursues sustainable development of industries is industrial ecology, referring to the study of material and energy flows with the goal to minimize the environmental impact of industry. An approach linked to industrial ecology aimed at increasing resource and energy efficiency on a primarily local scale is ‘industrial symbiosis’.

Industrial symbiosis (IS) refers to the novel exchange of underutilized resources (material, energy, etc.) across companies and industries in order to yield environmental and economic benefits (Chertow, 2000). The benefits result from higher resource utilization due to reduction of waste (downstream) and primary inputs (upstream). This definition of IS has been gradually extended to cover cases where IS occurs in a single company or industry (Coronado et al., 2015). Lombardi and Laybourn (2012) further broadened this definition to include also the sharing of knowledge and human resources through the network, emphasizing mutual learning and sustainable innovation. IS can be planned (top down), facilitated or emerge self-organized (bottom up). In this paper we focus on physical exchanges between previously unconnected processes within and between companies emerging from bottom up and top down approaches. These exchanges are hereinafter also referred to as synergies.

A prerequisite for the implementation of synergies is the identification of feasible and beneficial ones. For this purpose, usually the technical, economic and environmental dimension of a potential synergy are examined (Valenzuela-Venegas et al., 2016; Neves et al., 2019). Technical feasibility determines whether any opportunity for a synergy exists, while (long-term) economic viability and environmental impact determine whether this opportunity will be beneficial to stakeholders. However, determining a match between supply (available output) and demand (required input) and assessing its economic and environmental benefit remains a challenge due to potentially conflicting objectives (Bin et al., 2015). Inter-firm IS poses an additional challenge, as multiple actors are involved, who have to exchange information, align their objectives and, if necessary, processes in order to investigate and implement symbiotic opportunities (Hodge, 2007).

So far, the scientific literature has primarily presented retrospective assessment, i.e., an evaluation of already implemented synergies or IS networks (e.g., Chertow and Lombardi, 2005; Jacobsen, 2006; Martin et al., 2015), whereas prospective assessment of potential synergies has only recently received more attention (Martin and Harris, 2018). The assessment of the expected impact of IS is carried out for different dimensions and scales: individual company, bilateral IS, IS network, spatial area and overall environment (Fraccascia and Giannoccaro, 2020). For example, Valenzuela-Venegas et al. (2016) identified 249 possible measurements for the social, ecological and technical impact of IS networks. Fraccascia and Giannoccaro (2020) provide a comprehensive overview on the various indicators applied in IS using a taxonomy. It classifies absolute economic, ecological and social indicators as well as hybrid indicators considering either economic and ecological aspects or quantitative and qualitative effects simultaneously. In Section 3 we present a selection of existing assessment indicators for IS.

Altogether, there is a plethora of indicators, but their applicability or meaningfulness is highly case-specific. Most indicators are tied to specific dimensions or units, which impedes the comparability of different synergies. Moreover, selecting appropriate indicators and calculating them can be time-consuming and difficult, especially for small and medium-sized enterprises, due to limited resources for non-core business activities (Ormazabal et al., 2018). Finally, it is questionable which indicators are/can be used in practice for decision-making with regard to the implementation of synergies, as most indicators do not allow statements about the (especially technical) compatibility of processes and companies. Indeed, most indicators focus on absolute values in upstream or downstream processes (Wang et al., 2005; Geng et al., 2014; Fang and Chen, 2015). However, as Fraccascia and Giannoccaro (2020) suggest, ratios are decisive when comparing different IS alternatives. Accordingly, we observe the following gap:

  • Prospective assessment focuses on the network and neglects bilateral synergies.

  • Indicators do not represent the compatibility of processes to aid decision-making

  • Most assessment approaches seem to assume full information disclosure, which may not be realistic at an early project stage.

Therefore, we provide a practical approach to assess the potential synergies identified. Thereby, industrial actors (i.e., resource suppliers and consumers) and intermediary stakeholders assisting sustainable industrial development (e.g., research institutes, consultants, industrial park operators) shall be enabled to make informed decisions regarding the implementation of a synergy. The proposed method is based on an indicator system and a multi-stage process that guides the assessment and decision-making process. We followed the approach of action research adapted from Kurt Lewin, where research is strongly connected to industrial requirements (Coughlan and Coghlan, 2002). Therefore, the indicators were either derived from the literature on IS (e.g., Resource Function or Cooperation, Environmental Load) or developed by us in cooperation with companies (e.g., Coverage ratios). We focus on non-dimensional ratios to enhance usability in various industries and provide general indicators for stakeholders and enable cross-sectoral benchmarking as opposed to very context-specific measures.

In the next section, we position our research object—synergy assessment—within the general IS process. In Section 3, we describe our approach to the development of our method. The proposed method, consisting of the indicator system and its application, is presented in Section 4. In Section 5, we present two case studies to illustrate our method. Section 6 discusses our approach with its limitations and suggests further research, and Section 7 concludes the paper.

Section snippets

Theoretical background

In the following, we outline the overall process of establishing synergies or IS networks to clarify where the assessment of a synergy is located. Several handbooks describe the steps necessary to implement IS (e.g., Lowe et al., 1996; Koenig et al., 2009; Meylan and Alhilali, 2018), which can be structured into 5 main stages: (1) Raise Awareness, (2) Synergy Identification, (3) Synergy Assessment, (4) Implementation, and (5) Operation (Fig. 1). Each stage, especially stages 2 and 3, involves a

Our approach

We have developed our method based on the understanding that the implementation of synergies represents a decision problem. Decision-making involves “identifying and choosing alternatives based on the values and preferences of the decision maker.” (Harris, 1980). In our approach, decision makers are either external stakeholders carrying out an assessment on behalf of potential industrial partners or the companies themselves.

Decision-making processes according to Mintzberg (1979) resemble the

Assessment procedure

Fig. 3 illustrates the assessment procedure that consists of three: target specification, preliminary assessment, and detailed assessment. Depending on the involvement of intermediaries, the basis of trust between the industrial actors and the availability of personnel, the first two stages can either be carried out separately or in a joint effort, possibly with an intermediary.

Target Specification (31): The feasibility and benefits of a synergy depend on the context and may differ for each

Case study

To illustrate the presented method, an abridged example based on previous project experience is outlined below (Table 4). In essence, it involves the use of heat from a combined heat and power (CHP) unit fired with biogas, produced from waste water of a paper mill.

The example above illustrates the difference to LCA. While LCA has a strong product-related focus with an ecological analysis, our approach concentrates on processes. Furthermore, we do not examine the entire (production) cycle, but

Discussion

As introduced in Section 1, we address the lack of guidance for prospectively assessing the compatibility and expected impact of a potential synergy. With regard to practical applicability, an approach that can be applied comparatively fast and demands little information was required. At the same time, it had to be profound in terms of technical, organizational and temporal assessment, so that potential synergies could not be discarded due to a possible shortcoming of the method. For example,

Conclusion and outlook

This article aims to close the gap between the identification of potential resource exchanges and the selection of an advantageous one. This gap was motivated by our experience with industrial projects and confirmed by reviewing the literature. Therefore, an indicator-based multi-stage method that allows a prospective assessment of identified potential exchanges is proposed. Our approach combines qualitative and quantitative indicators to assess the technical compatibility of different

CRediT authorship contribution statement

Linda Kosmol: Conceptualization, Methodology, Writing - original draft, Writing - review & editing. Martin Maiwald: Conceptualization, Methodology, Formal analysis, Writing - review & editing, Funding acquisition. Christoph Pieper: Investigation, Writing - review & editing, Funding acquisition. Joscha Plötz: Conceptualization, Methodology, Validation, Investigation. Thorsten Schmidt: Writing - review & editing, Supervision, Project administration.

Declaration of competing interest

The authors declare that they have no known competing financial interests or personal relationships that could have appeared to influence the work reported in this paper.

Acknowledgements

This work was supported by the Federal Ministry of Economic Affairs and Energy of Germany [grant number 03ET4034]. Furthermore, we thank the anonymous reviewers for their constructive and valuable comments to improve this paper.

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