Adapting to Circular Economy: a Path to Sustainability for Chemical Industry
Haritosh Mishra
General Manager, Research and Development
Grauer & Weil (India) Ltd

In this article, the author narrates how Chemical Industry adapts with Circular Economy, the various challenges & constraints, and also the way ahead.

With predictions that the global population will reach 9 billion by 2030, it is evident that we have been and will be using more resources than the planet can offer. This also points to another fact that today's emerging economies may not be able to implement the traditional growth models as it could strain the existing pool of natural resources. Any consumption beyond what the earth can currently offer to replenish, threatens to push the world into an ecological debt mode where it starts relying on resources allocated for the future generations.

It is imperative that our future strongly depends on reusing what we have in a sustainable way. In this landscape, the word 'circular economy' is not simply a catchphrase that has started picking up off late.

What is Circular Economy?
A circular economy is a way of replacing today's linear take-make-dispose approach in context of resources. The traditional approach requires materials to be made into products, the products are then used, and finally the materials are thrown out. A circular economy, in contrast, aims to continuously keep products, components, and materials at their highest utility and value. In the circular economy, the materials are constantly cycled back through the value chain for re-use, resulting in less energy and resource consumption.

In recent years, with environmental pressure mounting on government, business and society have to preserve resources and adopt a more sustainable approach to their production and consumption habits. And circular economy has become an emerging concept. In essence, what a circular economy actually does is: it creates a closed loop for materials that aims to prevent waste and to minimize resource consumption.

Circular Economy in Chemical Industry:
Chemical industry is one of the key industries that requires to engage highly with circular economy in today's context. Chemical exposure causes as many as 8.3 percent of all deaths and 5.7 percent of the disease in aggregate worldwide. There are other perturbing statistics as well related to the chemical industry and plastics in particular. According to a report by World Economic Forum (WEF) published in 2016, it has been estimated that 95 percent of plastic packaging material with USD 80 - USD 120 billion economic value, is getting lost annually because of a short first use. About 72 percent of plastic packaging is not in a position of recovery. 40 percent ends up in the landfill and 32 percent leaks out of the collection system. Plastic waste causes a damage equivalent to USD 13 billion each year to marine ecosystems, as per the estimation of United Nations.

This brings the spotlight on the fact that there is a more pressing need now than ever before to resort to circular economy for chemical and allied industries. The chemical industry has got huge innovation potential. Moreover, chemicals create the foundation for markets such as energy, food, and materials; and are essential to the national economy development. So, in order to bring in any major change, the chemical industry plays a significant role. As this industry provides the building blocks for more than 96 percent of all manufactured goods, it holds a critical position in reimagining the products, technologies, resources, and systems that will empower a circular and sustainable economy.

Similarly, the surface finishing industry too uses chemicals and coatings that are essential to protect and enhance the life of metal and plastic. These chemicals are environmentally hazardous to a great extent. Reusing and recycling these materials will reduce the amount of chemicals discharged in the environment. It will, in turn, reduce the mining process resulting in a lesser environmental impact. Also, the huge amount of water that is utilized in the chemical engineering process also needs to be recycled. All these processes will lead to circular economy.

In countries like India, especially where issues like air pollution pose a major threat to the environment, it is even more important for collective efforts to happen in the chemical and allied industries to work towards sustainability. Circular economy presents a window of opportunity not only just to address the existing resource constraints, but also to drive transformative benefits for businesses and consumers, alike. It also focuses on the fact that the business that many key players are carrying on with, is not sustainable and there is a critical need to identify innovative models to ensure sustainable growth without straining the natural resources pool.

Circular economy offers several different business models in this direction. At its core, circular economy holds a shift towards complete elimination of waste. Waste, of course, does not hold the meaning of the traditional sense of junk, but any kind of underutilized assets and resources.

Challenges and Constraints:
It may not be easy to adopt a circular economy and it cannot be an overnight move. However, companies today have one of the biggest weapons to try out new things that will save the planet, which is 'innovation'. Since 1990, the production of the global chemical industry grew by 71 percent while the sector cut its CO2 emissions in half - an impressive feat underlining its position as one of the world's most innovative industries and also in context of Circular Economy.

The major sustainability challenges of today provide plenty of opportunities for all the companies to stand apart from the pack and to create immediate impact. Already, organizations in many industries have been implementing circular business practices. However, not all the chemical companies are able to or willing to start the transformation from a linear model to a circular economy since it is not an easy process.

Yet, it's a fact that a move towards circular economy not only focuses on responsible use of natural resources, but also enables the repurposing, reuse, recycling, and recovery of the value locked in materials that are most often viewed as waste. Circular economy initiatives should try a holistic view of the economy that considers both environmental and societal impacts of a product or material across its lifecycle. The chemical industry has the power to play a vital role in reimagining the products, technologies, resources, and systems that will empower a circular as well as sustainable economy.

In order to develop innovative services and products, it is possible to rely on today's modern digital platforms. Chemical manufacturers can join forces with suppliers, customers, and other relevant groups to develop products that stick to the circular economy principles. The products, which would be manufactured, are to be - durable, recyclable, and less susceptible to repair. A digital platform can aid manufacturers to monitor and to measure the real time impact of changes in regulatory requirements on their services and products. This would help them to meet the requisite regulatory standards in niche markets and to easily adapt those products.

Digital tools offer an optimal scope for business and manufacturing processes to catalyze an enterprise for the circular economy. Machine learning tools help manufacturers to predict product qualities as well as to minimize the energy-andresource consumption. In the chemical industry especially, manufacturers are able to track and trace the manufacturing materials throughout the whole business lifecycle with the use of technology and digital tools.

Other areas where companies can obtain competitive advantage through the circular economy in the chemical industry are chemical management, circular procurement, circular products, and end-product recycling. These can help the industry to grow further and to save carbon dioxide emissions.

Global Vision Perspective:
However, despite all its benefits, achieving this global vision of a circular economy for the chemical industry is not fraught without challenges. It is bound to take time, collaboration and resolve. Companies, which do not prioritize innovative design systems that promote life-cycle thinking and advanced operational efficiency or even bringing in materials for reuse and resource conservation, will have to make special efforts to develop a life-cycle approach with due consideration of solutions to close the loop at the end-of-life of an article and the energy requirements for such solutions.

Moreover, there are also institutional, technical, managerial, and social challenges to the circular economy. The institutional challenges need more attention in an environment where the circular economy still has to take wings. The role of the government or government agencies is important at this step. The government has to plan for and oversee the creation of infrastructure and should invest in the technology creation. There are several decisions to be taken on this front like number of recycling centres and their location, the use of recycled material, etc. If these decisions are not taken with due attention, then recycling centers get disorganized and become unprofitable for the organised sector.

A strong example of how the chemical industry is thriving in a circular manner is the one in the Arabian Gulf where the chemical industry is one of the fastest growing sectors. The foundation of the chemical industry in the Arabian Gulf was built upon the principle of circularity. By converting associated gas, which was otherwise being flared into highvalue chemicals and petrochemicals, the industry enables tremendous value creation from what was being treated as waste.

Chemical industry's journey to sustainability is still in its nascent stage. There is scope to see plenty of further improvement and innovation in the coming years. However, as the world's population grows and the strain on the planet's resources grows, developing a circular economy will become increasingly vital. To ensure this, companies need to invest in the necessary people having right skills and resources and also to invest in the access to the latest digital and collaborative tools and technologies. With all this in place and a broad-level of backing, the chemical industry can fast-track the sustainable solutions development that meets the societal needs in the coming century.