Reshoring American Manufacturing with ‘Eco-Industrial Parks’

Reshoring American Manufacturing with ‘Eco-Industrial Parks’

As the reshoring trend is gaining strength, it is important to evaluate innovative, alternative solutions to the past industrial models. Otherwise, it might be difficult to ensure that the return of manufacturing in the US will be resilient in response to any future attempts of delocalization in serving the domestic market. There are a few main options to choose from as the decision to reshore is being made:

  1. Restart existing plants with no upgrades
  2. Restart existing plants with partial or complete upgrades
  3. Build new plants
  4. Acquire plants

The reshoring location will thus be at the core of the decision process. I, among many others, would prefer to see a new economy being built after the great recession based on sustainability criteria. How can the decision on reshoring location be linked to sustainability? Through the eco-industrial cluster or park. According to OECD’s definition, an eco-industrial park is “a cluster of companies that cooperate closely with each other and with the local community to share resources, to improve economic performance and minimize waste and pollution. The collective benefit is considered greater than the sum of the benefits companies would realize when optimizing only their individual performance.”

Eco-industrial parks are the latest and most systemic form in the evolution of sustainable manufacturing concepts and practices:

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Source: OECD (2010), Eco-Innovation in Industry: Enabling Green Growth, p. 37

What is the difference between eco-industrial clusters and traditional industrial or technology clusters? The following are some of the characteristics of the eco-industrial clusters which make them more attractive to reshoring for the long-term:

  1. Diversity of industries, providing a hedging strategy against the negative impact of the business cycle in a homogenous industrial cluster where companies are in-sync
  2. Highly collaborative rather than competitive, between all entities involved, private and public
  3. Provide risk mitigation against material, energy, transportation price volatility and increase
  4. Induce innovation in product design, production processes and services through the pro-active search of finding usage for all the waste or by-product streams available
  5. Create positive economic externalities through stable employment, regional sustainable development, elimination or reduction of land used for landfills, reduced regional ecological footprint with associated lower health and other social costs
  6. Open to continuous expansion thought the availability of waste or by-product streams to new users

The global benchmark and the oldest eco-industrial park in continuous existence and expansion since 1961 is the Kalundborg Symbiosys in Denmark (for a picture of its 2011 structure, see http://www.symbiosis.dk/en/system). The criteria for a successful industrial symbiosis, based on the experience at Kalundborg, are the following:

  • the members fit together but can be different
  • the members focus on large, continuous waste streams
  • every project is economically feasible
  • the geographical distance between the members is small
  • the ideological distance between the members is small

In the US, the By-Product Synergy (BPS) network managed by the United States Business Council for Sustainable Development (US BCSD) has been expanding since 1997. Their stated goals are:

  • Reduced resource use – energy, water, petroleum, natural resources
  • Reduced carbon emissions resulting from the reuse of existing materials rather than use of new materials with a carbon generating extraction/production stream
  • Reduced waste to landfill and reduced processing and disposal costs of hazardous materials
  • Innovations in manufacturing discovered and developed for efficiency and productivity
  • Opportunities to address regulation issues and reduce barriers to materials exchange processes

US BCSD is planning to have 20 US cities with ongoing by-product synergy programs by 2015. These cities could make a good reshoring location for anchoring the future eco-industrial clusters.

Tianjin eco-industrial park image via propertyguru.com.sg

One thought on “Reshoring American Manufacturing with ‘Eco-Industrial Parks’

  1. Silvia, please send me your current email address; you can find mine at aut.ac.nz;
    romie-dot-littrell-at-aut.ac.nz

    I’m adding your Romanian data to a paper relating to east/central Europe.

    Regards,
    Romie

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