The Circular Bioeconomy – From Niche to Norm
Jacquie McGlade outlines what the Circular Bioeconomy is, and how it could work in Kenya. This article originally appeared in The Daily Nation.
The oldest business model in the world is the circular bioeconomy. Nothing wasted, everything used and reused, with Nature as the powerhouse. A growing number of the world’s top CEOs, investors and leaders do think that this is the blueprint for a post-COVID world. So what is a circular bioeconomy and how can it help build a more sustainable and equitable future for Kenya?
Back in the 1970s, ideas of modernity were inextricably linked to fossil fuels. New affordable vehicles, global aviation, amazing branded packaging, plastics everywhere, new textiles, and construction. It was all about the versatility of oil and our growing addiction. But the consequences of endless burning and processing of fossil fuels, is a world filled with pollution that is harmful to both people and planet.
The circular bioeconomy seeks instead to draw on nature-based solutions to our everyday needs. With an expanding range of innovative products from agro-forestry and biological processes, consumer markets are opening up to biobased solutions across the world. The circular bioeconomy has the potential to solve the multiple challenges of encouraging local investment, generating livelihoods and improving health, education and food security whilst protecting ecosystem services such as clean water, biodiversity and cultural heritage. So how does it work and could it happen here in Kenya?
Wood as a miracle building material
First, consider commercialising parts of our forests, not simply as a source of timber, but as raw resources for a wide range of products that are made in country. An example of what can be achieved is UPM.com. Formed in the 1870s as a timber company producing pulp and paper, it now produces a myriad of products for local and global supply chains. These include renewable and sustainable biofuels to help companies replace fossil fuel raw materials and reduce their carbon footprint, self-adhesive labelling materials, biocomposites combining cellulose fibres and polymers into new high-performance products for construction, revolutionary fillers for lightweight applications with electrical insulating properties, without polycyclic aromatic hydrocarbons, different kinds of bioplastics and a nanofibrilar cellulose hydrogel for 3D cell culturing that is highly biocompatible with human cells and tissues – but free from any animal- or human-derived material. The wood comes from certified forests globally which safeguard biological diversity. Another example is Stora Enso, the largest producer of wood in the world and the oldest forestry company dating back 1000 years. This company is now reshaping the construction and textiles industries with wood products. Modular housing with good static load capacity, that reduce the need for multiple container loads, and noise in construction sites, multi-storey buildings up to 20 floors that are light enough to be built over tunnel areas and withstand seismic shifts, and construction products that are strong and light, produce half the emissions of concrete and steel, store carbon for their lifetime and at the end-of-life can be used for energy or recycled. In one summer day, they can grow enough wood for a very large building. And all with biodiversity, conservation of ecosystems services and carbon storage at the core.
In a warming world where greenhouse gas emissions need to be reduced and carbon stored, it makes social and business sense to invest not only in planting millions of trees, but also in the R&D and new product technologies to create new value chains linked to domestic and export markets and generate livelihoods for millions of Kenyans in the construction, packaging and textile industries.
Enhanced forestry and regenerative agriculture
Kenya has many millions of rural farmers, many barely making enough to provide food or school fees or medicine. With well-devised policies on land stewardship and well articulated product regulations, many different biobased industries could be established in Kenya to the benefit of local farmers. Novamont, an Italian company, has been able to generate new bioproducts, as well as increase rural employment,, reinforce community resilience and increase soil health through land regeneration. Using the principles of agroecology or regenerative agriculture for improving soil health and productivity, the company has integrated composting and all streams of organic waste from crops and vegetation into the industrial production of bioplastics and lubricants. This has enabled local communities to flourish and enjoy the financial and social benefits of locally derived resources.
Vava Coffee is a Kenyan company with a commitment to sustainable and ethical growing practices. Working with local producers to create a specialised product of washed coffee it has buyers all over the world wanting to combine an excellent product with the knowledge that local farmers are benefitting. Expanding the co-production of specialised crops, such as coffee and tea, within the setting of a healthy, biodiverse forest with intact ecosystem services, is another way that Kenya can become a global leader in the circular bioeconomy.
Where pollution becomes a source of safe products
In another step up to addressing some of the most tenacious problems of our fossil-fuel economies, LanzaTech is turning the global carbon crisis into a feedstock company with the potential to displace 30% of crude oil in use today and reduce emissions by 10%. Using bacteria to take carbon emitted from industrial processes such as steel production, the carbon is turned into ethanol. Most recently, the company has set up its carbon recycling technology in China next to a steel mill and turned it into aviation fuel used in a Virgin Atlantic flight.
Investing in the circular bioeconomy
Imagine a setting where virtually everything that is used in everyday life could be biobased and reused or recycled. The flows through the economy would add value without creating the large scale negative externalities associated with fossil fuels and chemical pollutants. However, the circular bioeconomy does more than simply reduce externalities, it can fundamentally shift the risk profile of an investment. Whether it is impact development bonds, green financing or social impact bonds, the evidence is that investments in nature-based solutions and the bioeconomy are top-tier. The European Bank for Reconstruction and Development, with partner countries in northern Africa, has earmarked portfolios of green projects and social projects against which the proceeds of its Green Bonds and Social Bonds are tracked. These bonds are issued in accordance with the Green Bond and Social Bond Principles and are linked to projects such as sustainable and stress-resilient agriculture, including investments in water-efficient irrigation and sustainable forest management, reforestation, watershed management, and the prevention of deforestation and soil erosion. Private investors are seeing the benefits of the bioeconomy and projects that have environmental and social purpose as well as profit as their purpose.
Circular Bioeconomy of Wellbeing and the Great Reset
Investing in Nature to Transform the post COVID economy sets out six transformations and four enabling actions to build the new circular bioeconomy, within The Great Reset as outlined by the World Economic Forum. In it, researchers from leading institutions around the world, including Strathmore University Business School, present a new economic model that builds on transformative policies, purposeful innovation, access to finance and risk-taking capacity and new sustainable business models and markets based on valuing nature.
The potency of these ideas are gaining traction. And Kenya already has many of the ingredients that would enable it to benefit from a shift to a circular bioeconomy: there are vast areas of land linked to bioproduction, significant forest resources with a political and social commitment to increase their extent, recognised innovative entrepreneurs, a young and increasingly literate population and a vibrant market economy connected to global export markets for some of its specialist crops. Turning these around into a circular bioeconomy where biobased value chains are enhanced through domestic processing and manufacturing and the wellbeing of communities could become the core of a prosperous future that can be realised by Kenyans.