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The art of doing business through industrial symbiosis
Valuable materials are already being extracted from large amounts of residual products such as slag, dust and sludge in the steelmaking industry. A current study by Swerim shows that the potential for further environmental gains and improved profit margins can be realized by adopting the concept of circular business with focus on sustainability.
Two process-industry companies can derive benefit from each other's residual products. That is the conclusion drawn by a group of researchers at Swerim when they presented the findings of an in-depth study entitled "Circular business concepts for recycling of residual products in the steel industry". Finding business situations in which industrial symbiosis arises can bring environmental gains, but the companies also need an economic incentive.
The researchers have produced a model whereby different variants of circular business based on residual products can be assessed by entering actual costs and other parameters into the model. It also works for all process industries, not solely the steel industry.
Among other things, the researchers have considered, for example, how Höganäs Sweden and SSAB may be able to establish symbiotic relations. In the study a model with hypothetical business concepts was created. Certain residual products pose more of a challenge than others when it comes to finding an economic incentive for business, while others are obvious candidates. The model demonstrates how it is possible to apply profit derived from upgrading a material in such a way that material with less economic potential can be brought into a circular business model.
The researchers have also looked at how external factors can influence the probability of circular business concepts arising. One challenge is that, to succeed with circular business, thorough knowledge of the properties of residual materials and knowledge of customers' requirements specifications is needed; this knowledge does not always exist. Business with residual products is also subject to laws and regulations in ways that business with primary products is not. If, for example, the residual product is classified as waste, the time-consuming application processes that are necessary for handling and treating it may deter both the seller and the buyer from doing business, even though the material could be very valuable.
However, there are incentives which point to the fact that we will see more industrial symbioses in future. More stringent environmental laws, as well as costs associated with landfilling, etc., help to hasten the process of finding solutions for doing business with residual products.
"We are tasked with optimizing management of residual products with focus on sustainability, so it was self evident that we would participate in Swerim's study. The model they have developed will serve as a practical tool in our ongoing work and we hope that a circular business concept will soon take the step from theory into practice," says Jeanette Stemne, research manager at SSAB Merox.
The study has been carried out by Swerim in collaboration with Höganäs Sweden, SSAB Merox, Bolliden Rönnskär and Jernkontoret's technology area 55 Residual Products, within the Vinnova-funded project "Circular business concepts for recycling residual products in the steel industry”.