Industry
Manufacturing
TCS Neural Manufacturing: Driving Agility & a Competitive Edge
Highlights
- With environmental conservation becoming a top priority for governments the world over, the push for adopting circular economy models has never been more.
- For process manufacturing firms, embedding the circular economy principles into their operations may not be easy. This is because it will require heavy investments in research, technology, and infrastructure.
- However, if companies can crack the code, they are looking at a range of benefits including resource optimization, reduced wastage, brand recognition among the increasingly environmentally conscious consumer, and so on.
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Adopting circular economy
Circular economy entails the use and reuse of resources to extract the maximum value before recovering and regenerating them.
The chemical process manufacturing sector supports several industries such as healthcare, electronics, agriculture, and transportation. Its criticality to various businesses, however, cannot justify the environmental degradation caused by this resource-intensive industry that generates a significant amount of waste and greenhouse gases.
The circular economy concept can help process manufacturing companies reduce waste, increase efficiency, and create a more sustainable future. Transitioning to this model, however, won’t be easy. It will require process manufacturing companies to focus on research, technology, and infrastructure.
Collaboration across the value chain, from suppliers to consumers, is essential to creating an efficient recycling system and developing new product designs that facilitate disassembly and reuse. To realize the circular economy vision, process manufacturing companies will need to focus on the following three areas in particular:
Raw material dependence: The industry relies heavily on finite, non-renewable resources, such as fossil fuels and minerals. Shifting to renewable or bio-based feedstocks will require significant investment in research, technology, and supply chain development.
Complex supply chains: Intricate supply chains of the chemical process manufacturing companies make it challenging to track and manage materials throughout their lifecycle. Developing efficient collection, sorting, and recycling systems requires collaboration among various stakeholders.
Chemical complexity: The diversity and complexity of chemical products make recycling and recovery difficult. Designing products for disassembly and reuse, while maintaining performance and safety standards, is a significant challenge.
Additionally, chemical companies must address the concerns related to product quality and safety when using recycled materials. Rigorous testing, certification, and standardization can help ensure that recycled inputs meet required standards.
Resource optimization takes center stage
The transition to a circular economy model holds the promise of reduced resource consumption, minimized waste, and improved environmental outcomes.
Here is how chemical process companies will be able to improve resource utilization and efficiency:
Reduced raw material dependency: Circular economy principles focus on minimizing raw material consumption by emphasizing on the reuse and recycling of resources. In the chemical industry, this means shifting from a linear take-make-dispose model to one that involves the recovery and regeneration of materials. This will enable companies to reduce their dependency on costly primary raw materials by recycling and reusing them. This will not only lower extraction costs but also reduce the financial risks associated with the price volatility of raw materials.
Increased resource efficiency: Circular economy practices encourage the optimization of resource used throughout the production process. By implementing cleaner production techniques, efficient manufacturing processes, and recycling initiatives, the chemical industry can minimize waste generation and improve resource efficiency. This reduces the need for excessive extraction, lowers energy consumption, and decreases production costs. Using secondary raw materials instead of primary raw materials can result in 20-90% energy savings and considerable water savings. Moreover, using resources efficiently will allow companies to improve market competitiveness and overall profitability.
A monetization strategy
Circular economy models will help companies create new revenue streams.
Besides reducing dependency on raw material and driving sustainable use of waste and by-products, chemical process companies will benefit from:
Value extraction from waste and by-products: In a circular economy, waste and by-products are seen as potential resources. The chemical industry can extract value from such materials, that were previously discarded, by implementing innovative technologies and processes. These waste streams can be transformed into valuable inputs for other industries or even for internal use. This not only reduces disposal costs but also creates new revenue streams and reduces the financial burden associated with waste management. For example, carbon renewable technology allows waste to be recycled, which would otherwise go to landfills, into sustainable fiber. This is produced from a combination of recycled waste content (40% mass balance approach), recycled cellulose (20%), and sustainably harvested wood pulp (40%). The result is a high-quality, sustainable fiber product made from 60% recycled content.
Product life extension and servitization: Circular economy strategies emphasize on extending the lifespan of products through repair, refurbishment, and remanufacturing. In the chemical industry, this can be applied to products such as chemical containers, equipment, and machinery. The industry can generate additional revenue and reduce the financial burden on customers by offering maintenance and repair services as well as product leasing or rental options.
For example, leasing chemicals instead of selling them to extend their use. Take a solvent, for example. A chemical provider could apply it to a company’s manufacturing process, then recapture and clean it for use by another company. This can be done by using cradle to cradle approach where solvents are designed and managed in a way that enables them to be reused or recycled after the current life cycle. This shift from a product-focused approach to a service-oriented model can also help the industry overcome cost barriers associated with capital-intensive investments.
The road ahead
This transition may not happen overnight.
Adopting circularity in the system will lower pollution and drive innovation, leading to newer technologies for further sustainable production. Innovative recycling methods will recover precious materials, fostering resource efficiency. Collaboration between industries will spur eco-friendly supply chains, cutting down on raw material consumption.
Another important aspect is regulatory support. Governments and regulatory bodies are increasingly recognizing the importance of circular economy principles and are implementing supportive policies and regulations. These measures include incentives for resource-efficient practices, tax benefits for recycling and reusing materials, and stricter regulations on waste disposal. Such support reduces the financial burden on the chemical industry by creating a favorable business environment, incentivizing sustainable practices, and ensuring a level playing field. We believe regulations will continue evolve to incentivize chemical companies to adopt circular economy practices, preparing the landscape for a greener future.
