Developing a Responsible Circular Economy in the Netherlands
The Case of Pyrolysis Technology
Introduction
Millions of discarded tires would have become landfill or worse, go directly to incineration (ETRMA, 2019). Today, tires are taken in by an innovative Dutch company, Black Bear Carbon, where they are transformed into carbon black through a thermochemical process called pyrolysis, used then to make newer tires and other products (Williams, 2013). Material recovery-use of waste tires increased from 8% in 1994 to 57% in 2017 (ETRMA, 2019). This is a prime example of the rise of the circular economy through pyrolysis.
Driven by socio-environmental pressures, emerging innovations in upcycling of waste into products, or waste valorisation, is a vision found within the agenda of most developed nations (Malinauskaite, Jouhara, & Spencer, 2017). Pyrolysis is the decomposition of materials under high temperatures in the absence of oxygen and is under continuous research and development or is already on the market for a particular waste stream (Chua, Bashir, & Tan, 2019). Common waste streams in the Netherlands (food waste, tires, plastics) that are converted into energy and products through pyrolysis techniques incorporate different stakeholder groups which presents a challenge when extrapolating top-level values of the innovation system, and can introduce potential value conflicts (Islam et al, 2010).
The main question addressed is whether pyrolysis technologies, under a unifying circular economy value system, is being developed responsibly in the Netherlands. Let’s also ask ourselves 3 things:
1. Does strategic niche management exist for emerging pyrolysis innovation?
2. Does circular economy govern the values of the innovation system?
3. Does policy intervene to resolve value conflicts and steer responsible innovation?
Innovation System
The Quadruple Helix (QH) model (Carayannis, Campbell 2009) is adopted as the framework to map out the innovation system (Figure 3).
To first map pyrolysis beside existing technical alternatives, the Ladder of Landsink (Figure 4) is used as a framework by the EU under the Waste Framework Directive to “evaluate technologies/processes that protect the environment alongside resource and energy consumption from most favorable to least favorable actions.” (Hansen, Christopher, & Verbuecheln, 2002). Based on recycling of materials and energy recovery, pyrolysis is ranked highly by institutions (Ganzevles, Potting, & Hanemaaijer, 2016), indicating strong political representation as a promising waste processing technology.
Pyrolysis technology is largely based on an Edisonian approach to innovation (Huber, Brown, 2017), and is therefore positionally unique and opportune to shift from an archaic innovation system to a strategic and networked one (Newell et al, 2020). The Pyrolyse Proeftuin (PP) is an innovation facility in Moerdijk dedicated to pyrolysis research and development. It currently hosts four pyrolysis companies (Waste4Me, Nettenergy, Charcotec, Patpert Teknow Systems) with similar technological readiness levels and motivations for development (Koudelková, Milichovský, 2015). Figure 6 presents a map of the innovation system of Waste4Me at PP, a company aiming to transform plastic waste into energy and oils.
The deepening of academia-industry collaborations is also an avenue to attract public funding (Hillerbrand, Werker, 2019). The Center of Expertise Biobased Economy (CoE BBE), a research consortia consisting of academic experts of the Avans and HZ University of Applied Science, exchanges knowledge with Waste4Me while drawing in research funding as co-developers.
The PP’s 6 million euro grant (OPZuid Stimulus Program) from the European Regional Development Fund shows that subsidized pyrolysis demonstrations take precedence in the EU agenda. In short, the PP can be considered a ‘protected space’ to facilitate strategic niche management for emerging pyrolysis innovation in the Netherlands.
The Social Map
Applying the notion of social proximity (Lazzeretti, Capone, 2016), the more influential members of the system are the upstream and downstream commercial stakeholders — waste producers/logistics and pyrolysis product buyers. SUEZ is a logistics company that collects, separates and recycles waste together with innovation partners to ensure long-term profit (Verrips et al, 2019). The Port of Moerdjik supports Waste4Me by using derived bio-oils refined into transport fuel for ships, which accelerates the valorisation of plastic waste within this market niche.
The QH model emphasizes the fourth Helix: the media and culture-based public. “People have become better educated, more emancipated, and they have — thanks to social media — more capacity to express themselves towards the rest of society”. The presence of cultured-media endow the innovation system with democratic influence, which impacts innovation drivers on:
- Energy: Historically, public acceptance affects development of energy systems (Werker, Jolien, & Ligtvoet, 2017). Pyrolysis is considered (bio)energy technology and public opinion affects the support received from municipalities (Elaheh, 2011), such as that of Provincie Noord-Brabant towards the Proeftuin facility.
- Waste: Figure 7’s image is not unfamiliar, the impact of plastic waste is easily accessed and understood by the public, which can be a structural driving factor for institutions to strengthen financial support for industrial symbiosis and waste processing pyrolysis (Baggio et al, 2007). According to a study by Wageningen University, plastic collection increased by 30% from 2014 to 2017 (Brouwer et al, 2019). This highlights that responsible disposal of plastic waste by the public is increasing (Maja, 2015), making it easier for companies to procure materials at a decreased cost and streamline innovation.
Sustainable products: Similarly for consumption behavior, people are now more aware of a product’s lifecycle and carbon footprint (Verrips et al, 2019). This increases the demand for sustainable products with proper certification, for instance Cradle2Cradle (figure 8) that is given to Black Bear Carbon’s products derived from pyrolysis which incentivizes the industry (Brouwer et al, 2019).
The Value Map
The Dutch Ministry of Infrastructure and Environment released a Government-wide Circular Economy policy program which highlights future agendas and goals (Ministry of IenM, 2016). The Ellen MacArthur Foundation published a report on circular economy, taking a European perspective on cross-value chain innovations that spans public and private sectors (Ellen MacArthur Foundation, 2013).
Pyrolysis in a circular economy allow companies to decarbonize (reduce emissions) and dematerialize (reduce waste) commercial activities, which means pyrolysis innovation has a systemic property and occurs in different dimensions (Blomsma, Brennan, 2017); products/services, business models, and ecosystems (Talmar et al, 2018). Products refer to technology that inherently carry values (Correljéet et al, 2015). Business model innovation is about how a firm captures long-term commercial value (Chesbrough, 2010) and ecosystem innovation refers to how “loosely coupled” organizations interact to achieve a collective result (Jacobides, Cennamo, & Gawer, 2018).
Due to the dependency on stakeholder collaboration and complexity management in the supply chain, ecosystem innovation is key to achieve responsible pyrolysis development (Konietzko, Bocken, & Hultink, 2020). Values of the blue ocean strategy is clearly adopted by the PP, based on “the shared understanding between competitors that there is a healthy balance between supply of waste and demand for pyrolysis solutions” to allow for co-development (Chan, Mauborgne, 2005). It is evident that values toward dematerialization and participation into industrial symbiosis are by and large mutual, while economic growth and circular design possess varying underlying motivations between different actors highlighted below, the strong and the weak.
Values embedded in the technology
- Less Waste
- Less Emissions
- Inherent Circular Design
Values embedded in the institutional context
- Inclusive and sustainable economic growth
- ‘Systems Thinking’ and Industrial Symbiosis (B2B reuse & recycling)
- Open Innovation and Co-development
Pyrolysis Tech: CharcoTec
Focus on slow pyrolysis, or what we all call carbonization
Waste logistics (e.g. SUEZ)
Business depends on waste streams and future business models
Sustainable profit from new waste processing technologies — like pyrolysis
Pyrolysis products buyers (e.g. Port of Moerdijk/Partners)
Interest in sustainable materials and products
Dependent on B2B contracts to ensure future products are sustainable
Co-development is key to ensure future supply due to stricter environmental regulations across the sectors
Dutch Government (Ministry of Infrastructure and Environment)
Strong goals for waste management & ‘Conscious use’ of materials
Strong goals to reduce reliance on natural resources (i.e. natural gas)
Goals on ‘Smart Design’ (European Ecodesign Directive)
Economic growth and healthy employment rates
Pushing demand for circular products and services
Strong support for raw material entrepreneurs
General Public Consensus and (Social) Media
Strong public understanding of the global ‘waste problem’ threat and changes in consumption behavior
Strong public understanding of climate change, public acceptance still shapes energy projects but to a lesser extent for pyrolysis
General concern over health of the economy and relevant job opportunities for individuals
Some influence due to public acceptance of waste flow streams (for e.g. protesting towards illegal plastic waste dumping in oceans)
Interventions and Policies
Discrepancies arise when juxtaposing the innovation social map with circular economy ideals. Institutional interventions may serve to resolve this, by highlighting three policy actions below.
1. Incentives for experimentation and co-development: The Dutch government highly promotes co-development between partners to build a circular economy (Miandad et al, 2019). The Smart Regulation programme (or Ruimte in Regels) is in place to support circular initiatives in their development by providing incentives for collaborative efforts (Ministry of IenM, 2016). This resolves the conflict between pyrolysis developers and their product buyers by allowing new business models to cultivate whilst pyrolysis products are not completely cost-competitive with traditional ones just yet (Baggio et al, 2007).
2. Incentives for energy: Governmental perspectives has ramifications on the available public funding offered to pyrolysis as a bioenergy technology (Mohan, 2016). For research purposes, a senior policy advisor of the Ministry of Economic Affairs and Climate was questioned on the future of such support, the conclusion being that subsidies for bio-based heat generation is being reduced, due to better alternatives like geothermal in the Netherlands (Anonymous, Interview). This is a looming barrier to innovation. In comparison, the UK offers a Renewable Heat Incentive (RHI) which allows consumers to sell heat just like electricity to the grid, and a key success factor for a number of energy start-ups (Van de Kaa, Kamp, Rezaei, 2017).
3. Monitoring roadmap implementation: Accountability structures should be set in place to ensure technology actors continuously align with values for dematerialization and decarbonization, which means stringent monitoring on waste lifecycles and emissions. Avoided landfill and incineration benefits the environment, however, in practice, “increasing the circularity of one product may lead to less circularity in another” (Ganzevles, Potting , & Hanemaaijer, 2016). Hence, a state-appointed “ombudsman” (Pesch, 2008) is, in our case study, the CoE BBE who conducted a life cycle analysis (LCA) on Waste4Me’s plastic processing on behalf of the public stakeholders. This is a form of active responsibility and integral to ensure best practices according to the EU’s waste framework directive and should be replicated across industry (Malinauskaite, Jouhara, & Spencer, 2017).
Conclusion
An underlying notion is present: the shared values (and goals) toward an inclusive, circular economy can be a clear and strong unifying factor for emerging pyrolysis innovation. Using the PP as an example, this is largely facilitated by the government, the culture-based media and public and supporting commercial actors on technology developers. While discrepancies in proximity to values exist, institutional interventions have the opportunity to resolve them — through incentives and policy for co-development, energy demonstration projects and active responsibility, so that we can all achieve circular economy as a proud Dutch nation.
For for information about the writer and his work with pyrolysis: Head over to www.pyropower.eu
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