Innovation as a Catalyst for Circularity: How CO2 and Waste Become Sought- After Resources


TSG follows an expert-led approach to understanding innovation value chains. Our daily business revolves around this. Twice a year, ahead of the semi-annual rebalancing of the Singularity Index, we further intensify this expert interaction. The knowledge gained from these Singularity Think Tank Weeks directly feeds into the Singularity Index’s rebalancing — but we also want to share some insights with you. This is Part 1 of a Think Tank Week inspired blog series.

What sounds like a distant scenario is in fact a fluid process that has already begun: Companies are undergoing fundamental change and adapting their supply chains to achieve sustainable systems and products. The convergence and use of exponential technologies has accelerated this transformation. “Innovation is turning materials such as CO2, waste or plastic, which are actually considered harmful to the environment, into valuable resources,” says Singularity Think Tank member André Hugentobler. While this may appear provocative, it is rooted in reality: As long as emerging and industrialized countries don’t drastically reduced their emissions, the aim is to make the harmful byproducts as harmless as possible and turn them into usable and even valuable matter.

Companies that recognize the potential of this new resource extraction will almost certainly lead the recycling revolution. But technological advances have only recently enabled an acceleration: “There has been a significant and almost unnoticed quantum leap in the field of recycling that has been enabled by presorting,” explains James Khedari, also a member of the Singularity Think Tank. “Computer vision and artificial intelligence now enable sophisticated waste sorting. This is the foundation for true and sustainable recycling.” The main beneficiaries will be companies that have already secured waste streams and can cover all stages of the value chain in the future — alone or within an ecosystem. This includes being able to identify, separate, extract, clean, and finally process the various materials in the waste. Several innovation-driven methods are now being used, especially in the last step.

Plastic no longer “evil” by default

Take plastics. “The narrative that ‘plastic is evil’ is no longer true, provided plastics are collected and fed into the value chain,” says Hugentobler, an expert in advanced materials. “Improved methods of depolymerization based on enzymes, for example, allow new ways of recycling,” adds biotechnology expert and Singularity Think Tank member Juergen Eck. In addition, the field of biodegradable polymers has advanced over the years. Research institutes and companies are working on optimal decomposition times for various areas of application, he says. “In the future, there could be PET bottles, for example, that biodegrade literally at the push of a button,” Eck predicts. Novozymes, for example, is already active in this field.

Pyrolysis is considered another promising process. This type of thermo-chemical recycling breaks down both renewable raw materials and waste products such as plastics, tires or cooking oil into solid, liquid and gaseous individual components, which can then be processed into renewable diesel. Pyrolysis could displace the burning of fossil fuels in the manufacture of products and contribute to the reduction of greenhouse gasses. Countries such as Japan already pyrolyze waste. In the near future, the process could replace waste incineration. Investors should keep an eye on companies such as: BASF, Darling Ingredients or Carbios. For the consumer, this means that the goldmine of the 21st century could actually become the domestic garbage can: Whereas residents have had to pay to dispose of and recycle litter up to now, in the future their waste is likely to be worth some cash.

CO2 capture contributes to climate targets and secures carbon production in the long term

The carbon capture process has gained increasing importance within the energy transition and it will also play a role in a greenhouse gas-neutral economy. The pharmaceutical, chemical and logistics industries, for example, will continue to rely on carbon compounds. The consensus is that CO2 cannot continue to be extracted from fossil sources for this purpose — CO2 capture from the atmosphere is the solution. However, as long as CO2 neutrality is not achieved, carbon capture can also bind CO2 at the point of emission before it is released into the atmosphere. The captured CO2 as feedstock can be chemically or biologically processed and converted into useful products such as fuels, polymers or construction materials. Companies like Covestro or Evonik are already exploring the technology’s potential.

To avoid a greenwashing effect in recycling and the circular economy, investors are well advised to look into the technologies and processes behind the transformation. An investment approach based on applied innovation takes reality as a benchmark and contributes actively and pragmatically to solving the biggest problems of our time.

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