The Circular Economy and Eco-industrial Parks

Kristín Linda Árnadóttir, VP Landsvirkjun and Ríkarður Ríkarðsson, EVP Business Development and Innovation Landsvirkjun

The challenges that stem from the threat of humanity‘s unstustainable lifestyle are both vast and extensive. The solutions are essential, but neither simple nor cheap.

Utilisation of energy resources is the foundation for quality of life today. Pertinent changes in the coming years are, e.g., switching fossil fuels for renewable energy sources and adapting all systems to new paradigms. And no industry will be exempt.

Presently, most companies are seeking ways to adapt to a new reality by developing new and environmentally friendly solutions for their manufacturing or services operations. Various industries globally will rethink their manufacturing practices in the coming years and decades. This will not only present challenges, but much rather opportunities, as the progress to sustainability is as much about the opportunity to improve quality of life, as it is about the dos and the dont‘s. In addition, it is an opportunity to develop a robust and healthy society and a vigorous economy, with good jobs and strong green innovation. How nations tackle the challenge of the energy switch and the adaptation to sustainability, will very much dictate how their competitiveness will evolve.

Is Iceland Ready for Green Manufacturing?

Landsvirkjun was established 56 years ago to advance the utilisation of Iceland‘s natural resources. During this time, the Company has promoted investment in energy intensive industries. In the beginning, while the infrastructure was being developed, the focus was on heavy industry, but in the past years the group of buyers has become more diverse. Development and advancement of the energy system and other infrastructure has made it possible for Landsvirkjun to accommodate new and diverse industries, e.g., data centres, food production and biotechnology companies. Now the start of production of hydrogen and electric fuel for the energy switch is imminent in the near future.

To attract progressive and preferable companies, it is important to look at Iceland‘s competitive position in the global energy market for energy intensive projects. The question is how well geared up is Iceland for undertaking such operations?

Operations of this nature will not be developed in an environment where infrastructure and other important supporting factors are lacking. In Iceland‘s neighbouring countries a stiff competition exists between municipalities to accommodate various operations. To put things in perspective, the likelyhood that the international chainstore H&M would open its stores in Iceland would have been low, had infrastructure in retail property and services not been in place. At Landsvirkjun, experience has shown over the decades that it can be significantly more complicated and time consuming to bring foreign companies to Iceland, compared to other countries Iceland aims to be on par with.

Eco-industrial Parks

Many industries are faced with various challenges when it comes to environmental issues. One of the solutions on the horizon are eco-industrial parks. Their ethos is based on the circular economy, which creates opportunities for manufacturing companies to improve utilisation and put to use waste and by-products from their production. This can happen, e.g., when different companies collaborate and connect, by minimising waste and decrease as much as possible the undesirable effect from waste, and by using the waste from one manufacturer as raw material for another. The criteria for the development of an eco-industrial park is a clear long-term vision in business and environmental issues, strong collaboration between different invested parties, and that vision must be in tune with the community in the area.

Eco-industrial parks in Iceland could draw on the strong existing foundation of industrial manufacturing, and be the source for vast value increase, as well as minimising waste. Eco-industrial parks could improve the utilisation of energy, infrastructure, and raw material that has already been invested in, in order to create new opportunities. Production of domestic fuel from emissions and improved utilisation of geothermal heat for food production, are such examples.

If the goal is to adapt the economy to the demands of tomorrow, while simultaneously creating good jobs and increasing the quality of life, the opportunity offered by eco-industrial parks demands further examination, and should be approached with an open mind. Eco-industrial parks are the path that most of Iceland‘s neighbouring countries have already taken.

Eco-industrial parks in Iceland are one way to seize opportunities and embrace the future.