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Why Does the Bioeconomy Matter for Utilities?

Bioeconomy or biobased economy, as well as circular economy, provide sustainable solutions for the future.

Climate change, population growth and the need for resources have become an increasing concern all over the world. At the same time, bioeconomy or biobased economy, as well as circular economy, provide sustainable solutions for the future. The utilisation of renewable biomass will reduce our dependence on fossil resources and prevent biodiversity loss, and at the same time, create economic growth and jobs.

The ‘bioeconomy’ relies on renewable natural resources (e.g., plants, crops and animals) to produce food, feed, products, materials, energy and services. The bioeconomy includes a wide range of sectors: traditional ones, for example, include agriculture, forestry, fisheries, pulp and paper production. Also, novel bioeconomy sectors, such as the chemical, biotechnology and energy industries, contribute increasingly to overall bioeconomic production.

Circularity in bio-based systems

When discussing the concept of bioeconomy in a wider perspective, also circular economy enters the scene. The circular economy means an economic system where waste is minimized and resources are used effectively. The circular economy includes reuse, sharing, repair, refurbishment, remanufacturing, and recycling to create closed systems.

When combining bioeconomy and circular economy, the most is gotten out of these two brilliant concepts. A circular and more bio-based economy provides innovative solutions for enabling sustainable way of living. To support a sustainable future, the links between the bioeconomy and circular economy should be twinned together. In this, the role of close cooperation between the business sector, and research and innovation for developing sustainable bioeconomy solutions, is in a key position.

A central concept in bio-based circular economy is also the use of leftovers or residuals as raw material. This is called as industrial symbiosis, an industrial ecosystem where unused resources or leftovers of one company are utilised by another. This results in mutual economic, social and environmental benefits.

To develop a successful and sustainable bioeconomy, a strategic cross-sectoral approach is necessary. However, due to the concept's wide scope and differing international approaches, to fully understand and utilize the bioeconomy is challenging.

Examples of bio-based circular economy

In order to share the knowledge and success stories of bio-based circular economy, the BIOREGIO project ‘Regional circular economy models and best available technologies for biological streams’ (2017-2021) has gathered examples from different corners of Europe. In this project, funded by the Interreg Europe program, good practices of technologies and cooperation models are transferred between six European regions. Based on the knowledge exchange, all regions develop their strategies in supporting the bio-based circular economy even more in the future. Some outstanding examples of good practices are presented below.

Decentralized power from organic materials

In Thessaloniki, Greece, a small-scale bio-based power generator for converting organic residues into electric power and heat has been developed. BIO2CHP combines two well-known technologies, gasification and gas engines. An automated control system operates the energy production and produces energy at a price three-four times lower than the grid currently available in Greece. Several materials have been tested for operation in real-life conditions: grape pomace, peach kernels, olive kernels and almond shells. The system is built inside a container and operates at a standalone mode.

Xylitol from oat mill side streams

A recent innovation from the Päijät-Häme region in Finland comprises of xylitol production from oat hulls. The food company Fazer has initiated a production line utilising the side streams of its own oat mill. Until now, the hulls have been used in energy production or as feed for animals. However, oat hulls contain xylose that can be used to manufacture xylitol. Through this new process resource utilisation is maximized when all parts of oat are used. Right now, the new xylitol manufacture plant is being built next to the oat mill, in order to minimise the need for transport. The xylitol production will begin in 2020.

Bio-herbicide to benefit the environment

In Spain, Castilla-La Mancha, a bio-herbicide from lignocellulosic waste, wood vinegar, has been developed to replace the glyphosate. Glyphosate is chemical pesticide, which has been forbidden in some countries and, for example, some municipalities have limited its use in public parks due to serious effects on human health and environment. Currently, a good chemical substitute does not exist.

Wood vinegar is obtained through condensation of gases produced in thermal treatment of lignocellulosic waste. It consists mainly of water and organic compounds were acetic acid is the major component. The product is innovative because of its benefits to the environment and safety for human health.

Strong potential of new emerging sectors

Supporting sustainability is one of the key issues in developing the future bioeconomy. To be successful, the bioeconomy has to be sustainable and based on circular economy principles. Currently, traditional bioeconomy sectors like food, wood, fish and waters as well as fuel and energy are best known and considered more relevant than other bioeconomy industries. At the same time, there is an increasing potential for new sectors, such as textiles and pharmaceuticals. The opportunities of these bioeconomy sectors should be taken seriously, by both business and decision-makers.

Education, research and innovation play key roles when transformative and sustainable improvements are developed. To comprehensively support the bioeconomy and release its full potential, different sectors and actors need new dynamics and ability to see the connections.


Interreg Europe 2019a. Regional circular economy models and best available technologies for biological streams.

Interreg Europe 2019b. Good practice: Xylitol from oat mill sidestreams.

Interreg Europe 2019c. Good practice: Use of organic residues for energy production.

Interreg Europe 2019d. Good practice: Wood vinegar as a natural bio-herbicide.

McCormick, K. & Kautto, N. 2013. “The bioeconomy in Europe: An overview’, Sustainability, 5, 2589-2608; doi:10.3390/su5062589

Vanhamaki, S., Schneider. G. & Manskinen, K. 2019. Perspectives on Sustainable Bioeconomy in the Baltic Sea Region. International Journal of Economics and Management Engineering, 13:4.

Vanhamäki, S., Medkova, K., Malamakis, A., Marisova, E., Huisman, D, Moussiopoulos, N. 2019.: Bio-based Circular Economy in European National and Regional Strategies. International Journal of Sustainable Development and Planning, 14:1, 31–43. 


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