Over the past 30 years, it has been striking to see that the productivity of human resources has significantly increased, with large-scale implementation of information technology, computer networks or the Internet. During that same period, financial capital substantially increased. In fact, we leveraged it so much that our economy nearly died from it.
Contrast that with the productivity of natural resources, which has not correlatively improved. Indeed, resource efficiency is going in the opposite direction. As an example, the resource intensity of the global economy, measured as a ratio of resource usage to gross domestic product has continuously increased.
Last month’s Waste Wise column highlighted how an exponentially increasing worldwide population is resulting in the commensurate escalation of raw material consumption, which will create substantial constraints on resource availability. The question is not if, but when, this will happen.
Much has been said about how the availability of oil will peak in the near future, but less is known about the availability of other raw materials. The U.S. Geological Survey estimates that most raw materials and energy resources, assuming our current rate of consumption without the discovery of additional significant reserves, could become seriously limited by the following dates:
• Rare metals (e.g. silver, gold) by 2025;
• Traditional metals (e.g. tin, lead, copper) by 2040; and
• Fossil energy resources by 2050 (oil), 2110 (gas) and 2160 (coal).
Since huge segments of the industrial world rely on these same critical resources, improving the efficiency of how they are managed and utilized will be a key for many segments, including the solid waste industry. There is uncertainty as to when particular resources may be depleted. However, what is inarguable is that our resources are finite.
Based on our society’s current consumption model, energy is utilized to manufacture materials. These materials are consumed, and waste is then generated as these materials are utilized or discarded. Resource scarcity has led to a realization that proper management of waste from one industry can yield the raw materials for another. Such a circular model helps to secure supplies for industries threatened by the scarcity of certain resources or price volatility, contributes to the reduction of greenhouse gases and generates skilled jobs that cannot be relocated.
In this model, material products are treated as capital assets rather than consumables which helps create services and products with the highest possible use/value for as long as pos- sible while consuming as few material resources and energy as possible.
This new “waste to resources” paradigm, if embraced by the solid waste industry, would transform the industry from the traditional “volume” approach to a “value” approach, where the measure of performance is how much value can be extracted from the discarded materials. If we are not already, these trends suggest that the solid waste industry may soon be at a crossroads where a choice must be made to embrace a business model that manages resources or one that disposes of waste volumes.
Note: This article was co-authored by Henry St. Bris, senior vice president of Suez Environnement, one of the largest solid waste firms in Europe. Mr. St. Bris currently serves as Chairman of EREF’s Board of Directors.