Circular Resource Models for a Sustainable Supply Chain | ENGIE Impact

How to Adopt Circular Resource Models for a More Sustainable Supply Chain

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Vincenzo Giordano Director, Sustainability Solutions - EMEA
Andre De Fontaine Director, Sustainability Solutions - Americas
Sustainability Transformation
Circular Economy
Industrial Symbiosis

As organizations will inevitably face multiple financial, ecological and operational questions in the years to come, it will be critical to use the lessons of circularity and industrial symbiosis to better position themselves for a more profitable and sustainable future.

Since the 1970s, circular resource strategies have been applied in several industries such as manufacturing, agriculture and water treatment. In a circular framework, companies take a fresh look at their waste streams and seek to reuse, share or sell resources that were previously destined for the dump. In a manufacturing or heavy infrastructure context, we often use the term “industrial symbiosis” to describe the mutually beneficial outcomes that can occur when one organization’s waste stream becomes a valuable input into another’s production process. There are many benefits to this circular approach, including reduced pollution, lower costs, new revenue streams and enhanced resilience of overall supply chains.

However, industrial symbiotic practices have not been widely adopted just yet due to a lack of transparency around available resources and technology, inconsistency in measuring and reporting on economic benefits and, ultimately, the status quo. This piece will dive deeper into these barriers to adopting circular resource models and the external factors helping to break down these obstacles.

The Top Barriers to Adopting Circular Resource Strategies

Traditional Mindsets

There are multiple financial, cultural and technological barriers to adopting circular resource strategies. One such barrier is traditional mindsets—recasting waste streams as revenue streams requires organizations to completely rethink what their primary product or service is. This process may be met with resistance and questions from stakeholders, as making waste streams into revenue streams may very likely challenge an organization’s existing business model and growth strategy.

As an example, some wastewater treatment agencies are beginning to imagine a future with no sewer fees. In this scenario, agencies would shift completely to circular business models and collect revenue from the sale of products, such as energy, nutrients, chemicals and clean water recovered from the waste stream. This is a profound shift away from a stable and often regulated revenue source (sewage fees) to a less certain revenue stream that is dependent on sales of products into competitive markets. The risks are clear, but the strategy also presents powerful benefits of improved environmental sustainability, a more satisfied customer base with residents and businesses no longer paying monthly sewage fees, and opportunities for greater growth as the agencies enter dynamic markets.