Constructing joint production chains: An enterprise input-output approach for alternative energy use

Abstract

Although there is already an extensive literature on waste and end-of-life (EOL) product recycling methods, the contribution of such methods to the environmental sustainability of entire production chains (PC) seems to have been ignored. Since many PCs belonging to diverse sectors have become more interconnected through recycling, the above mentioned problem is of vital importance to promoting cooperation among the actors of these PCs. The aim of this paper is to propose several sustainable PC combinations, namely joint production chains (JPCs), and to foresee how potential environmental effects can be mitigated by linking these PCs. To this end, in this paper an enterprise input-output (EIO) model is introduced to evaluate the potential environmental benefits of cooperative actions taken by the actors in these joint production chains (JPC). Moreover, it is aimed that the proposed model serves as a material planning tool for the companies involved in JPCs. Two main cases are investigated from structural perspective: (i) waste to main product substitution and (ii) EOL product to main product substitution. The proposed model provides dynamicity to input-output coefficients, thereby facilitating the calculation of the impacts of resource use change that stems from waste/main product recycling. This makes the model a novel material planning tool for modelling possible alternative material/energy use scenarios. Two empirical case examples from second-generation bioenergy PC and EOL tires PC validate the constructed model to demonstrate its applicability. The results indicate that the proposed model is able to compute not only the direct influence of recycling but also its indirect and resultant consequences on the all processes carried out by the involved actors. Substantial savings of energy and natural resources, and reductions in waste and CO2 emissions are found in the case examples. The model is particularly useful for implementing policy shifts, planning future material purchasing strategies, and foreseeing the necessary actor involvement to reach complete material substitution for companies.