How to Initiate a Systemic Transition to a Circular Bioeconomy
The current linear economy system has failed to preserve nature and induced severe environmental burdens such as pollution and climate change threatening living on Earth. The shift to the circular economy is then crucial. As a major source of waste and by-product generation while possessing a high potential of nutrient and energy recovery, bio-based side and waste stream (BSWS) valorisation and utilisation play a crucial role in establishing the circular bioeconomy within the big picture of the circular economy. This topic is explored in the master’s thesis The operational environment of circular bio-based side and waste streams for biogas and nutrient recovery by Tran Ngo from Tampere University.
The Most Important Requirements for Success
Interlinkage of Circular Operational Models
Establishing connections and synergies between small-scale self-sustaining models, medium-scale rural-urban symbiosis, and large-scale industrial ecosystems.
Stakeholder Engagement
Active participation and collaboration among various stakeholders including businesses, governments, research institutions, and citizens.
Legislative Support
Governments play a crucial role in creating enabling policy frameworks, regulations, and incentives to foster the development and adoption of circular practices and business models.
In dedication to foster the transition to circular bioeconomy, the master’s thesis generates an overview of the current circular bioeconomy operation and identifies its associated challenges and opportunities. The research was conducted following a literature review of state-of-the-art valorisation and digitalisation technologies, an examination of relevant legislations, 10 stakeholder interviews, and a questionnaire covering three case studies: HAMK manure hygienisation project, MTK e-marketplace, and ECO3 industrial ecosystem. Those 3 case studies represent 3 operational models of self-sustaining circularity, rural-urban symbiosis, and industrial ecosystem that form the circular bioeconomy operational environment at different scales (Figure 1).
Bioeconomy Transformation Challenges
The key circular bioeconomy challenges through PESTLE analysis are illustrated in Figure 2. The PESTLE acronym stands for Political, Economic, Social, Technological, Legal and Environmental factors. PESTLE analysis is utilised to assess the operational environment from different perspectives of political, economic, social, technological, legal, and environmental factors.
Political: Unharmonised regulation between the new and existing regulations and ununited regulations between the countries.
Economic: Financial access and competition between circular products with other resources (organic fertiliser with traditional fertiliser, biogas with electricity as vehicle fuel).
Social: Integrating sustainability into education to prepare the sustainability workforce and raise awareness.
Technological: Solving the critical issue of low-quality products, which induces a costly upgrading process, from the root causes (sustainable material design and feedstock quality).
Legal: Restriction in processing and utilisation of bio-based side and waste streams hindering technological innovation and market development for circular bioeconomy.
Environmental: Decoupling raw material extraction from economic growth by utilising bio-based side and waste streams as alternatives or mixing with virgin materials.
PESTLE Analysis
- The PESTLE acronym stands for Political, Economic, Social, Technological, Legal and Environmental factors.
- PESTLE framework is a tool to analyse and monitor the macro-environmental factors that have an impact on a company and the industry environment in which it operates.
- The PESTLE analysis was invented in 1967 by Francis Aguilar, who was an American scholar whose expertise was in strategic planning. In the late 1960s, Aguilar published a book titled Scanning the Business Environment in which the now known PESTLE tool was first identified.
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Systemic Transition Requires Interlinkages
Initiating a systemic transition to a circular bioeconomy requires close interlinkages between small self-sustaining circularity models, medium-scale rural-urban symbiosis, and large-scale industrial ecosystem operational models (Figure 3).
As feedstock quality and logistics and its associated cost and environmental impacts are mentioned as the key challenges, the onsite technological innovation for self-sustaining practices or pre-treatment of BSWS should be in focused development as the fundamental circle of the circular bioeconomy loop. Where self-sustaining practices are not feasible, rural-urban symbiosis can optimise the circularity by gathering, trading, and recovering BSWS in local facilities or mobile solutions, or by pre-processing feedstock for the industries.
Following that, the centralised solution of the industry circle not only recirculates the industrial BSWS flow but also can uptake the feedstock processed from rural-urban symbiosis. By doing so, the feedstock quantity and quality gap between the primary producer and the industries can be bridged. Furthermore, the industrial synergies and large production can create a market for BSWS, generate demand, and pull the smaller operations to grow circularity with it. The more circles and interlinkages created between the circular operation models, the larger the systemic circularity.
Lastly, the systemic transition is driven by the synergy of multidisciplinary stakeholder engagement in enabling technological advancements, market demands, political support, and sociocultural changes that promote the adoption of circular products and services.
To achieve systemic operation, it is essential to develop small-scale, self-sustaining circularity. This approach improves nutrient recovery, minimises logistics, and reduces associated impacts. In cases where self-sustaining practices are not feasible, medium-scale rural-urban symbiosis can be developed. This model addresses logistical challenges, optimises the use of bio-based and waste streams, and prepares qualified feedstocks for the industrial ecosystem. Finally, large-scale industrial ecosystem development is necessary to recirculate industrial streams and utilise feedstocks processed through rural-urban symbiosis. This bridges the gap in feedstock quantity and quality between small primary producers and industrial operators.
The Replicable Practices of the Circular Bioeconomy Transition
The following aspects are based on the findings of the thesis and are important to consider when working on the transition to a bioeconomy.
Legislation
Governments play a crucial role in setting up the political and legal frameworks necessary for the development of a circular bioeconomy. Their responsibilities include implementing regulations that support circular practices, providing funding for circular initiatives, and offering tax incentives to encourage businesses and industries to adopt circular models. These legislative actions create the necessary pre-conditions for the successful transition to a circular economy.
Technology
The advancement of technology is central to the circular bioeconomy, driven primarily by research institutions and consultancies. These entities focus on developing sustainable material designs, which are essential for creating products that can be recycled or reused. Additionally, significant efforts are made in innovating BSWS separation and pre-treatment technologies, as well as valorisation processes that convert waste into valuable products. Digitalisation in value chain management also plays a critical role, enhancing efficiency and tracking within the circular system.
Finance
Financial support is pivotal for the circular economy’s growth. Governments facilitate this through funding and financial incentives that make it easier for businesses to transition to circular practices. For businesses and industries, adopting circular business models and technologies often requires significant initial investments.
Stakeholders
The transition to a circular bioeconomy involves multiple stakeholders, each playing a distinct role. Businesses and industries are key players in creating markets for circular products and adopting sustainable practices. Governments act as regulators and supporters, providing the necessary legislative and financial framework. Research institutions and consultancies drive technological innovations, while citizens and consumers influence demand by adopting and supporting circular products. Lastly, circularity platform developers or transition coordinators are responsible for coordinating these efforts, ensuring that all stakeholders work towards common goals and driving the circular initiatives forward.
Society
Societal change is a crucial component of the circular bioeconomy. Citizens and consumers must shift their behaviour towards accepting and preferring circular products and services. This sociocultural change supports the broader adoption of sustainable practices and helps embed the principles of the circular economy within everyday life. Promoting awareness and education about the benefits of circular products is essential for this transformation.
Environment
The technological push towards sustainable material design and BSWS valorisation has a significant positive impact on the environment. By reducing waste and promoting resource efficiency, these technologies contribute to environmental sustainability. The circular economy aims to minimise the environmental footprint of production and consumption by creating closed-loop systems where resources are continuously reused.
Governance
Effective governance is critical for the success of the circular bioeconomy. System orchestrators, such as circularity platform developers or transition coordinators, play a central role in managing and coordinating the overall system. They ensure that all stakeholders are aligned and working towards the same objectives. Additionally, government’s role in governance includes implementing and enforcing regulations that support circular practices and providing the necessary support and incentives to facilitate the transition.
Organisation
Organisational structure and management are crucial for the successful implementation of circular economy initiatives. System orchestrators are responsible for organising and managing these initiatives, engaging stakeholders in common goal actions, and ensuring the scalability and replication of successful models. Businesses and industries also need to reorganise around circular business models and practices, adopting new processes and technologies that align with circular principles.