Photo: TOSHIFUMI KITAMURA/AFP/Getty Images
With global temperatures rising, consumers and companies alike are recognizing the unsustainable nature of contemporary manufacturing. Market forces continue to incentivize individual firms to maximize production and profit without sufficient regard for negative environmental and social externalities, such as waste and pollution. However, an emerging focus on broader industrial ecosystems that consider lessons from nature offers potential solutions to firms and sectors looking to enhance sustainability.
Q1: What is industrial ecology?
A1: Industrial ecology (IE), known as “the science of sustainability,” is the study of industrial systems, product design, and manufacturing processes, which works to identify and implement strategies to limit the environmental impact of production. Rooted in the notion that industrial organization should be approached the same way as a biological ecosystem for sustainability, IE examines the flow of materials and energy in production and works to mimic natural ecosystems in industrial activity, creating a system where waste is an input in the next production cycle. This movement of materials and energy has been coined “industrial metabolism.” The multifaceted relationships between firms, products, and processes often mimic the complex relationships of energy flows between organisms in an ecosystem.
No natural ecosystem is without human impact, and no industrial ecosystem is free from biological influence. IE aims to remove the divide between the two. Under an IE system, production is viewed as an extension of the natural environment around it. A key component in “closing the loop” in pursuit of a circular economy, IE perceives firms as agents of sustainability and environmental improvements, while regarding waste as a resource for future production.
The key principles of IE include reducing the amount of raw materials used, improving overall energy efficiency, using renewable sources of energy where possible, and aligning policy with IE tenets locally, nationally, and internationally. Given its interdisciplinary nature, IE has applicability in a wide array of fields, from engineering and public health to environmental sustainability and food systems.
Q2: What are some successful examples of industrial ecology?
A2: The Kalundbord Symbiosis, an eco-industrial park in Denmark, is a successful example of an IE project between different industries. Created in 1972 as a public-private partnership among several industrial facilities, firms within the park symbiotically share water, steam, electricity, and waste products that ultimately become inputs in other processes. For example, heat from the Asnæs coal power station is used to heat 3,500 nearby homes and fish farms. Excess power is also provided to the nearby Statoil refinery and Novo Nordisk plant, where resulting sludge from these firms is then sold as agricultural fertilizer. Overall, there are over 30 material exchanges among actors within the IE system. Planning and refining of the Kalundbord Symbiosis was done primarily at the local level: city and firm actors worked together as partners to determine the right resource-sharing arrangements for this specific system. This underscores the highly specialized nature of IE design. While overarching principles may guide the ecosystem, specific resource-sharing activities must make sense for the given industries within the system.
India has also emerged as a center for IE in the developing world, largely due to a historical industrial culture that values resource sharing. The Nanjangud Industrial Area on the outskirts of Mysuru, Karnataka, is a prime example. In a study of over 50 companies within the system, 99.5 percent of 900,000 tons of potential waste was reused within the system by industrial actors. In one resource chain, a coffee maker’s residue was used by an oil extractor to create a new input for a boiler fuel company. What remains unique about Nanjangud is that its IE symbiosis emerged not through a regulatory framework but instead through organic market forces and social interaction. This highlights the strength of IE design, whether intentional or unintentional, in producing efficient industrial and environmental outcomes for firms within the system.
Internationally, the UN Industrial Development Organization (UNIDO) has launched an eco-industrial park initiative with the World Bank and the German Agency for International Cooperation (GIZ) to invest in developing national IE projects. Overall, UNIDO supports 33 eco-industrial parks in 12 countries. Sectors included in these IE projects include food and beverage, aluminum and steel, logistics, mechanics, and electronics.
Q3: What are some successful examples of industrial ecology in the apparel industry?
A3: IE has been widely studied as a tool to reduce the environmental effects of fashion overconsumption and production, which, according to the United Nations, is the second most polluting industry in the world, responsible for approximately 10 percent of carbon emissions among the most heavily polluting industries in the world. Outdoor company Patagonia is a leader in closed-loop production across company processes. From its robust Common Threads clothing recycling initiative to measuring the environmental impact of select pieces of clothing, Patagonia is hailed as an industry leader in environmentally conscious fashion production compatible with IE principles. Patagonia reuses its own waste and that of other industries, recycling its worn products, scrap materials, and even making polyester from plastic water bottles. It also works to reduce its resource consumption through a solution dying process that adds the pigments to plastic before making fibers. This process has led to a 90 percent water use reduction and 96 percent CO 2-equivalent savings in Patagonia’s production processes, compared to traditional, resource-intensive batch dying techniques common in apparel production.
Other brands have implemented IE in limited practices, but not companywide. Resource intensity in the fashion process, especially with water usage, has become increasingly scrutinized and led some companies to adjust certain production standards. To mitigate water waste in its denim production, Gap Inc. provides an example of partnerships to achieve IE goals through its factory in Ahmedabad, India. The production there uses the city’s reclaimed wastewater in the manufacturing process, saving an estimated two billion liters of fresh water each year, while reducing the prevalence of wastewater in the local community. Levi Strauss & Co. has also leaned into water reduction in its Water<Less program and the usage of recycled water in some aspects of the production of jeans and denim.
Companies have also worked to reduce the water intensity of their dying processes which is a step in the direction of IE. Adidas has optimized its dying to use less fresh water, alongside Nike who uses CO2-based dying, which requires less water than traditional processes. The CO2 dying process is considered a nearly closed loop as 95 percent of the CO2 used can be reused in the next cycle and the system uses 50 percent less energy versus traditional methods.
Q4: What are the benefits to businesses utilizing industrial ecology?
A4: In addition to environmental protection and conservation benefits, IE offers firms financial benefits. Firms can save costs through limiting their waste, purchasing less materials, and avoiding waste disposal fees by sharing it with other industries to use in their production processes, as demonstrated in the Kalundbord Symbiosis example. As companies race to avoid accusations of “greenwashing,” where companies put sustainability labels on products without following through on actual environmental commitments, IE offers companies concrete ways to minimize waste and enhance credibility as the economy transitions more deeply into decarbonization.
Q5: How can industrial ecology incentivize a regenerative climate and economy?
A5: Industrial sector emissions make up 21 percent of global greenhouse gas emissions, and ecological approaches to industrial policy could help drive down emissions in this large sector. IE design can help move manufacturing into the circular economy, allowing for longer-term sustainability and waste reduction among both small and large firms operating domestically and internationally. However, the climate gains of IE can only be achieved if ecological design impacts industrial policy on a large scale.
The International Institute for Sustainable Development (IISD) cites six persistent perceived barriers facing successful implementation of IE projects: insufficient financial returns, lack of regulation, limited technology, lack of awareness, organizational complexity, and limited customer demand. While IE projects can be highly efficient and commercially successful, they can require high start-up costs. For example, facilities required to recycle wastewater within an industrial ecosystem require large capital investment and ongoing maintenance. Incremental refinements to decrease carbon intensity also require strong human capital expertise, a capacity that can be difficult to build instantly in developing countries. As a result, programs like UNIDO’s eco-industrial park initiative are often initially costly to build the long-term capacity needed to produce sustained business and climate benefits.
As the world pursues deeper decarbonization, IE can help firms and countries alike streamline resources, reduce waste, and encourage sectors to engage in regenerative circularity. Complemented with other public and private sector initiatives, such as government ratification of the Basel Convention or voluntary safe disposal of unusable waste, IE is a necessary enhancement to existing markets that better aligns smart business decisions with climate efficiency goals. Thus far, IE has largely occurred voluntarily. However, governments can—and should—play a role in encouraging more firms and sectors to adopt IE methods. Governments can encourage the intentional adoption of IE through financial support and incentives, targeted regulatory framework, and ongoing engagement with the private sector. In the case of IE, the best business environment can be cultivated by taking a page from the natural ecosystem playbook.
Emily Benson is an associate fellow with the Scholl Chair in International Business at the Center for Strategic and International Studies (CSIS) in Washington, D.C. Aidan Arasasingham is an intern with the CSIS Scholl Chair. Lexie Judd is an intern with the CSIS Scholl Chair.
Critical Questions is produced by the Center for Strategic and International Studies (CSIS), a private, tax-exempt institution focusing on international public policy issues. Its research is nonpartisan and nonproprietary. CSIS does not take specific policy positions. Accordingly, all views, positions, and conclusions expressed in this publication should be understood to be solely those of the author(s).
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