The Industrial Ecology neologism was popularized by Frosch and Gallopoulos (1989). The authors call for the transformation of the traditional model of industrial activity into a more integrated one. Where individual manufacturing processes took raw materials to generate products and left a large portion of materials turned into waste, the new industrial model should be built like an ecosystem
In this approach, the consumption of energy and materials would be optimized while waste generation minimized. Most importantly, the effluents of one process would serve as the raw material for another process. The industrial ecosystem is consequently expected to function as an analogue of biological ecosystems. Ayres (1989) refined the analogy and urged industries to learn from the biosphere in order to modify our industrial metabolism. He oriented the modifications needed both toward the increase of reliance on regenerative (or sustainable) processes and on the search for efficiency, both in production and in the use of by-products. Industrial metabolism – the whole of materials and energy flows going through the industrial system – is studied through an essentially analytical and descriptive approach aimed at understanding the circulation of the materials and energy flows (and stocks) linked to human activity. Industrial ecology aims to go further. First by understanding how the industrial system works, how it is regulated, and its interactions with the Biosphere; then, by determining how it can be restructured to make it compatible with the way natural ecosystems function (Erkman, 2001).
Three key elements define the industrial ecology perspective: Industrial ecology encompasses a systemic, comprehensive, integrated view of all the components of the industrial economy and their relations with the Biosphere. It departs from current approaches which mostly consider the economy in terms of abstract monetary unit and focusses on the dynamics of material flows. It also considers technological dynamics as a crucial (but not exclusive) element for the transition from the actual unsustainable industrial system to a viable industrial ecosystem.
According to Erkman (2001) four principles must be met for the industrial ecology to be fully met. Waste and by-products must systematically be valorised (1): networks of resource and waste use in industrial ecosystems need to be created so that all the residues become resources for other enterprises or economic entities (through eco-industrial networks). Traditional recycling is perceived only as one aspect in a series of matter flow recovery strategies. Loss caused by dispersion must be minimized (2): new products and services must be designed to minimize dispersion or at least eliminate its harmful effects. The economy must be dematerialized (3): the objective is to minimize total matter (and energy) flows while making sure equivalent services are provided. Distinction must be made between relative and absolute dematerialization: relative dematerialisation is sought through increased resource productivity while absolute dematerialisation aims at reducing the absolute amount on matter in circulation.
Energy must rely less on fossil hydrocarbon 4): fossil fuels being at the source of many environmental problems (from GHG emissions to smog, acid rains, oil spills).
According to Erkman, industrial ecology leads to two major consequences for the management of companies. First, it challenges the traditional exclusive emphasis on the product alone and forces companies to have a systems view (including the way waste and used resources are remaining within the boundaries of companies influence). Second, it challenges the competitiveness dogma by valuing collaboration between distinct entities in order to ensure efficient resource management.
These industrial ecology principles are central to the transition to a circular economy. First, it signals a shift from end of pipe solutions generally used towards strategies based on systems view of the relationships between human activities and environmental problems. Industrial ecology studies the material and energy flows and their transformation into products, by-products and wastes throughout industrial systems. By doing so, it provides a first set of closed-loop strategies to be implemented at micro-level, either as internal processes (through energy and material efficiency processes aiming at reducing the amount of material used and waste produced) or through active network collaborations (aiming at creating value from the exchange of by-products). Within a circular economy, the concept fits particularly in helping companies improve their internal efficiency processes, while creating value within business to business relationships through the exchange of material and energy flows. Difficulties in translating industrial ecology principles into practical implementations is however a weakness that has been identified by practitioners. The inter-enterprises synergies are not naturally created and the support of an external facilitator (through publicly-founded projects) is often seen as a requirement to facilitate the detection of synergies. The concept is also less relevant when it comes to providing circular solutions to end users. The cradle to cradle concept introduced in the next article, is also inspired by industrial ecology principles but goes further by presenting approaches that can be applied to business to consumers strategies.