Triple Bottom Line Accounting Applied for Industrial Symbiosis Forth ALCAS Conference Sydney, Australia, Feb 2325, 2005 Biji Kurup, William Altham & Rene van Berkel Centre of Excellence in Cleaner Production Curtin University of Technology GPO Box U1987, Perth, WA 6845
Presentation Overview Project background Industry Sponsors Industrial ecology Industrial symbiosis Industrial symbiosis in practices Example of industrial symbiosis Evaluation method TBL & LCA approach Three case studies Water reclamation Cogeneration Gypsum reuse Closing remarks & future research 2
Project Background Despite its compelling logic, industrial symbiosis faces a number of barriers; one of these is the limited evaluation of the complete costs and benefits of industrial symbiosis to both the individual participants and at the project level. Reports relative, not absolute impacts; relative to conventual or current practices as or Need to measure and report the full implication of industrial symbiosis projects using a TBL and LCA approaches as an aid to decision makers. Focus on heavy industrial areas with high concentration of minerals, metals, chemical and energy production. 3
Industrial Ecology Industrial ecology mimics natural processes in industrial production and consumption to achieve better environmental, economic and social outcomes. Industrial symbiosis Green chemistry Biomimicry (van Berkel 2004) 4
Definition of Industrial Symbiosis Industrial symbiosis engages traditionally separate industries in a collective approach to competitive advantage involving physical exchange of materials, energy, water, and/or byproducts. The keys to industrial symbiosis are collaboration and the synergistic possibilities offered by geographical proximity (Chertow 2000) 5
Industrial Symbiosis: 5 Models 1. Waste exchanges Recycling schemes etc 2. Firm, company or organisational level exchanges 3. Over the fence exchanges EcoIndustrial Park 4. Regional exchanges (<20km??) 5. Virtual, exchanges across broad regions (>20 km??) 6
EcoIndustrial Parks and Industrial Symbiosis Networks Ecoindustrial parks and industrial symbiosis networks are defined as a community of manufacturing and service businesses seeking enhanced environmental and economic performance through collaboration in managing environmental and resources issues including energy, water and materials. By working together, the community of businesses seeks a collective benefit that is greater than the sum of the individual benefits each company would realise if it optimised its individual performance only. (adapted from Lowe 1997) 7
Industrial Symbiosis in Practices Sharing of facilities and equipment Laboratories etc Water Reuse/Cascade Recycle/Filter Gas Capture and supply SO 2, as gypsum N 2, H 2 etc CO 2 Carbonisation Sequestration Energy Cascade of steam Heat recovery Cogeneration Materials Cascade/reuse Waste Convert to byproducts Bulkup recyclables Collaboration in transport, storage and logistics 8
Examples of Industrial Symbiosis Kalundborg Water saving of 3.2 million m 3 per year 170,000 tonne gypsum per year from power station for wall board Energy saving through waste heat recovery for heating Puerto Rico Steam production cost reduced by 70% ($9.35 to $2.75) SO 2 & NOx emissions reduced by over 84% Fresh water saving of 6.57 million m 3 per year for power station Kwinana 106 exchanges and increasing Scheme water saving of 6 million m 3 per year Education retention program for secondary schools 9
Evaluation Method TBL approach Social Environmental Economic Integrated indicators Socioeconomic Ecoefficiency Social justice Life cycle approach Stages Planning & design Construction Operations Refurbishment Decommission Implement consistent system boundaries 10
Economic Method Life cycle costing Total cost Direct & indirect Overheads Material cost and disposal fees Internal & external Tangible & intangibles Reputation Productivity Indicators Business generated Capital required Wages paid Taxes paid Profitability Share value 11
Life Cycle Costing Allows the comparison of projects with large upfront capital cost and lower operating cost with projects with limited capital requirements and higher operating costs Allow the comparison of projects with variable time frame Need to consider the issues of capital availability and opportunity costs 12
Social Method Social impact assessment Employees and local community Engagement Quality of life Job security Community stability Health and safety Skilled workforce Indicators Jobs creation Sensory stimuli dust odour noise Hours of training Lost time injuries Sickday taken 13
Environmental Method Life cycle assessment Direct and indirect impacts Indicators Material use Energy consumption Water consumption Waste generation Wastewater generation Air emissions Greenhouse Gases Land use impacts Product toxicity 14
Kwinana Water Reclamation Plant Reverse osmosis plant for secondary treated effluent Treated water supplied to 5 major water consumers Reduced scheme water consumption Industrial wastewater diverted from sensitive marine environment 15
TBL Impacts of KWRP Life Cycle Stage Environmental Score Social Score Economic Score Planning and Design (1998 2002) Material & energy use and impacts from pilot tests. New skills developed for planning and designing of the water reclamation plant. Community commitment in planning. Wages for planning & designing team. Generate business for local suppliers. Capital investment. Construction (20032004) Land for plant and infrastructure. Material & energy use for plant and pipe infrastructure. Job creation as construction and manufacture of supplies. Skill enhancement as the result of a new technology. Wages for construction workers. Generate business for local suppliers. Tax generated from wages paid. Capital investment. Operation (Nov 2004 ) Scheme water conservation. Water quality and ecosystem improvement in coastal zone. Energy use and GHG emission. Chemical use. Improved recreational value of coastal zone and reduced health risks to community. Job creation and security. * Water security for industry users. Better opportunities for tourism and aquaculture in coastal zone. Tax generation. High grade water for industry. Increased water cost for industry. Refurbishment Every 5 years[28] Waste from refurbishment. Material and energy use for refurbishment. Maintain water security. Job creation (temporarily). Wages. Generate business for local suppliers. Capital investment. Decommission (2029) Land reclamation. Recycling of material. Waste from decommissioning. Temporary job creation. Permanent job loss. Loss of water security. Wages from temporary employment. Loss of business for local suppliers. Value from recycled material. major negative, negative, minor negative, 0 neutral, minor positive, positive, major positive * Job creation and security will principally be because of industries using the KWRP water have greater security for their process water, together with increased tourism and aquaculture in waters of coastal zone and not the plant itself which will be fully automated. 16
Cogeneration 116megawatt gasfired cogeneration plant Produces both electricity and steam from a single operation. Generates 2,800 tonnes per day of steam Plant avoids 170,000 tons of CO 2 per year Victorian Cogeneration Association 17
TBL Impacts of Cogeneration Life Cycle Stage Environmental Score Social Score Economic Score Planning and Design (1995) Material & energy use and impacts from pilot test. New skills developed for planing and designing the cogeneration plant. Community commitment in planning. Wages for planning & design team. Generate business for local suppliers. Capital investment. Construction (1996) Land for plant and infrastructure. Material & energy use for plant and pipe infrastructure. Temporary job creation as construction and manufacture of supplies. Skills enhancement as a result of a new technology. Wages for construction workers. Generate business for local suppliers. Tax generated from wages paid. Capital investment. Operation and maintenance (1996) Chemicals use. Impacts avoided energy efficiency and gain, with associated reduction of GHG. Improved use of refinery gas. Permanent job creation. Sales of power and steam. Further refinery efficiencies as a result of greater and more realistic steam supply. Wages for plant operators. Tax generation. Decommission (2044) Land reclamation. Recycling of material. Waste from decommissioning. Temporary job creation. Permanent job loss Wages. Recycling of waste material. major negative, negative, minor negative, 0 neutral, minor positive, positive, major positive 18
Gypsum Gypsum is a byproduct of many industrial processes This byproduct has a variety of uses including: cement manufacturing process. wallboard manufacturing. soil stability. 10,000 tonne per year of stockpiled gypsum used for soil conditioning in Kwinana 19
TBL Impacts of Gypsum Reuse Life Cycle Stage Environmental Score Social Score Economic Score Recovering from stockpile Reduction of stockpiled waste. Reduced hazards associated with stockpile. Reduction of liabilities encountered with gypsum stockpile. Use of gypsum Improved site rehabilitation. Reduced water erosion. Reduced dust. Improved amenity value of rehabilitated site. Reduced liability. Improved vale of rehabilitated site. Gypsum Mining Avoided impact from gypsum mining. Reduced transport. Reduced jobs in mining. 0 Mine operations. 0 major negative, negative, minor negative, 0 neutral, minor positive, positive, major positive 20
Benefits of Industrial Symbiosis to Regional Sustainability Economic Increased business opportunities Increased wages and taxes Social Increased job creation Improved job security Increased revenue for local authority Improved local services Environmental Improved environmental quality Reduced resource consumption and ecological footprint Reduced waste generation and landfill demands 21
Closing Remarks One of the problems encountered is difficulty in quantifying and allocating economic, social and environmental benefits for participating companies and effected communities, as well as industry and community at large. Further method developments and quantification is necessary, and the evaluation method is likely to be most useful in cases were straight financial project evaluation does not provide compelling evidence for project implementation. Need to resolve what to do when mixed results Identify method to factoringin capital cost 22
Future Research Develop and trial a model in 35 heavy industrial areas, the model comprises Facilitation structure Evaluation method Operational and contractual arrangements Need to minimise transition costs Promoting business interdependency Both parties have different aims to meet 23