Disposal Options in a Circular Economy

Looking at Disposal Options through the Lens of Innovation

Disposal is inevitable. At some point, a product will need to be disposed of. It’s what occurs at, during, and after that disposal that has led many utilities to believe there are only a few set and costly options.

However, that’s looking through the lens of traditional methods—an economic method where the product is discarded at the end of its life. This is also known as a “linear economy” approach.   For centuries, it was about the only model anyone knew, and it has left us with the problems we have today: what to do with all of this waste, much of which is damaging our atmosphere. While the problems with this model have been mitigated by improved production practices and by the rise of recycling, the business model of the vast majority of companies still takes the linear model for granted.

Breaking out of this thought process represents a hugely disruptive form of innovation. For many companies, it takes looking at the product’s life cycle, and how it applies to them, in a different way. I’ve mentioned before the concept of a circular economy, which in essence extends the life of the product by repurposing it at the end of one life into another useful life.

The circular economy is a relatively new trend, but many businesses are already taking on the model for purposes of both environmental sustainability and profitability—both achieved through the elimination of waste. Environmental constraints suggest that businesses ought to incorporate the idea of the circular economy into their business models.

And, believe it or not, seeking innovation in this area makes business sense. The elimination of waste is a cost-saving measure—landfills, for instance, are getting more and more expensive to use. This can be a brand differentiator and create deeper customer relationships, the kind of “stickiness” that makes customers or clients adhere to a particular vendor. Repurposing the disposed-of product in a way that it can somehow be led back to the customer is a powerful model. The investment community views the circular economy as a positive contributor to company profitability, primarily through a reduction in the cost of raw materials. As a result, many direct their dollars based on the ability of companies to perform well in this area.

Learn more about how your company can change its existing processes and methods to become a more sustainable—and profitable—operation by grabbing your copy of Transforming the Utility Pole: Using Innovation to Disrupt Commodity Markets and Fuel Sustainable Business.

What is Truly Waste? What Cannot be Reused and Everything Else

Utilities want to reduce waste; the EPA wants to reduce landfill usage; and everyone wants to find an environmentally friendly way of disposing of this treated wood waste. The question becomes, what can be reused and what is truly waste that just can’t be repurposed?

A challenge we found when building a disposal program for repurposing poles was that only a relatively small amount of the wood collected is actually in good enough condition to be used again. Typically, only about 40 percent of the material to be disposed of is really reusable anyway, and the rest—whether it is rotted out, full of nails, or whatever the case may be—is landfilled. Sometimes utilities may believe they are headed down a more sustainable path by implementing a disposal program based on repurposing poles when, in fact, 60 percent of that material is not marketable as a reusable product, so it goes to a landfill either way.

The current slate of disposal options leaves us with a tough situation; in every case, we run into a disposal situation where there are significant costs (financial or environmental) and obstacles to implementation. From a life cycle perspective, we keep running into a wall at the end of the process, which moves from development of the raw material (tree growth), manufacturing (cutting and treatment), use, and finally disposal. You grow the tree, you harvest the tree, you manufacture it, it goes up in service, and then ultimately it gets disposed of one way or another.

It’s that last step, the end of the line, that keeps presenting difficulties. Even in the best-case scenarios currently available, the material has to somehow go away, albeit in a relatively environmentally friendly way that can produce some value in the form of energy. Even reuse, as I mentioned, does not keep the pole from eventually being a waste product.

That is where there is more room for innovation as we seek to find ways to dispose of true waste in a manner that is productive or environmentally friendly. Learn more about what some utilities are doing to be more sustainable in my next post.

Brand-Differentiation-Barry-Breede

What Brand Differentiation in a Commodity Market Looks Like

Brand differentiation is not common in commodity markets; nor is innovation. What is common is downward pressure on prices; often, for the end user, price is the only differentiator for commodity producers, so the only competition that occurs is a race to the bottom on price.

As in any commodity market, the buyer of utility poles—the employee of a utility who controls which poles are purchased from which vendors—has a lot of power to shape the market. If the buyer only looks at price, then competition keeps happening only on the basis of price; this is how industries fall into the commodity trap. Creative, disruptive innovation is needed to help companies operating in commodity markets escape this trap.

It can be done.

Looking Beyond the Commodity

When it comes to treated wood products, for example, it likely will always be a commodity market. If you put two utility poles produced by two forest products manufacturers next to one another, 99.9 percent of the buyers are unlikely to identify any brand-relevant difference between them.

How then could a commodity product such as the utility pole differentiate itself? The answer is typically not found in the product, but rather in the potential related services that surround the use of the product itself.  The challenge becomes helping the buyer understand the value of these services so ultimately they are willing to pay more for your product than competition. Creating services that have recognizable value in the eyes of the buyer requires adopting the mindset of the buyer and understanding what current processes create challenges for them—and therefore represent opportunities for new innovation to occur. For us, a key area of focus was what disposal of the utility pole looks like down the road.

Differentiation Lies in Looking at the Entire Lifecycle

Typically, our buyers don’t spend a lot of time thinking about where the poles come from, and probably no time at all thinking about where a pole is going to go fifty years down the line at the end of its useful life span. The pole is a line item in their budget; apart from due diligence, they will most likely make their purchase decision—based on price. However, it is in their best interest—just as it is in many industries—to understand the product lifecycle and its impact on multiple stakeholders down the road. That is where true differentiation lies—by treating business transactions as a part of an entire process, not just one exchange of product procurement.

In the case of utility poles, it has been our priority to help buyers engage in the supply chain conversation and walk them through what the costs of disposal actually are. At some point, those poles will need to be replaced, to go somewhere—a consideration that is all-too-often dismissed. However, when this challenge is discussed upfront, everyone is aware of critical aspects in the process and why the end of a product’s life is just as important as the procurement of it.

In this industry—as in many others in today’s market—sustainability and a more responsible approach to a product’s life cycle is expected. Beyond the financial benefits, which I’ve discussed in previous articles, commitment to sustainability is a shift that utilities are seriously considering and many are starting to fully embrace. Learn more about implementing innovation in commodity markets and how sustainability initiatives may be one area worthy for you to incorporate into your business by visiting, barrybreede.com.

Listen to the Market

When the Market Speaks, What Wins?

When it comes to offering something new, always listen to the market. If you don’t, your company certainly won’t win.  All too often, innovations tend to be ahead of the market, and sometimes it will take a significant amount of time before the market will accept them.

Companies that don’t heed the market’s voice will find themselves investing resources into innovation that may not be accepted. Years ago, I was a part of this kind of scenario, where we created an RFID-based business, Sustainable Management Systems (SMS), that could create a great amount of value to our customers – or so we thought.  We failed to understand the specifics behind our go-to-market strategy. We erroneously thought the utilities were ready to adopt RFID into their business – they weren’t.

In this case the innovation was cutting-edge and had the potential to be extremely valuable.  However, the market wasn’t prepared to incorporate that kind of technology. We learned from this experience, and while the SMS technology is now a relevant offering, we made sure that our next innovation would be a recognized market need. To accurately identify what the market wanted, we needed to implement a dedicated innovative process.

In the early stages of the formal innovation process, which I’ve described in previous posts,  we made sure to conduct market research among customers and prospective customers, to see what their pain points were and how we might be able to help address them. Through this process, it soon became clear that there was a huge opportunity present in trying to find ways to help these customers create more sustainable business models for themselves. We kept hearing from our biggest customers—investor-owned, publicly traded utilities—about the greatly increasing scrutiny they were facing with regard to their environmental sustainability practices, so we knew that making these practices more sustainable from an economic standpoint as well would be very attractive to our customers.

By integrating the market’s voice into our innovation process, we not only gained valuable ideas and insights, we would create an innovative initiative that would be welcomed and embraced by the very market we serve. When the market speaks, listen; more importantly, take the time to actually ask the market. Doing so will ensure successful implementation of your innovation from the beginning.

Learn more about our successful approach to innovation by getting your own copy of Transforming the Utility Pole which you can find here.

Repurpose

Find Your Repurpose in Life

Finding your (re)purpose: it may sound like a self-help topic, and in some ways perhaps it could be considered that, but for your business. Like finding your purpose in life, helping your business find its repurpose opportunities are just as important to its future.

As discussed in my previous post, the concept of introducing a repurpose step in your product’s life cycle is not only beneficial for the environment, it can ultimately help your bottom line.  Doing this requires a shift from the traditional linear model – which produces, uses, and disposes of – to a circular model that loops the “disposal” back around to production.

Making the Shift

Product life cycle management or looking at the supply chain and value chain from a holistic perspective is clearly the first step on the way to a circular model. For a company to be able to divert its used products from disposal (which is so often going to be in a landfill) back into the production process, it has to have some control over the entire product life cycle—not only how it’s conceived from a materials standpoint and how it’s designed and manufactured, but also its use and disposal.

This means treating the raw material of your product as an asset to be taken advantage of beyond its just being input to the initial production process. From this point of view, letting the raw material be simply discarded at the end of its useful life starts to look like a mistake from a bottom-line point of view—a waste of a potential resource.

The question then is how you can take the raw material output and loop it back around to an earlier stage in the production process so that the process becomes regenerative rather than linear. This also makes business sense, as the elimination of waste is a cost-saving measure—landfills, for instance, are getting more and more expensive to use—and it can be a brand differentiator and create deeper customer relationships, the kind of “stickiness” that makes customers or clients adhere to a particular vendor. Repurposing the disposed-of product in a way that it can somehow be led back to the customer is a powerful model.

It’s a model that can work, but will require a commitment to innovation and change.  The key is to accomplish two things: create a more environmentally friendly business model and making sure the business will be more profitable through the proposed repurposing.

Fortunately, insofar as circularity is a way of eliminating waste and taking advantage of access to raw material assets, these two objectives can go hand in hand. Often companies look at circular economy or even total life cycle management and see only the up-front costs; however, the long-term benefits are worth it.  Learn more about repurposing and implementing a circular economy model within your business by reaching out.

Environmentally

Innovating Environmentally Safe Ways to Dispose of Your Company’s Waste

Did you know, the utility industry is predominately dependent on landfills as the primary disposal option for their poles? While this has been “what we’ve always done as an industry,” there is less and less landfill space to work with – coupled with the fact that it’s simply not the best option environmentally.

In many instances, the decision about where or how a pole can be disposed of is not in the hands of the utility, but rather lies with the regulatory bodies at the state and federal levels responsible for managing treated wood waste. As a result, in the early stages of our innovation process, it became clear that one of our first conversations needed to be with the government bodies that control pole disposal, simply to understand their perspectives on this issue.  


As you seek to innovate and implement environmentally friendly alternatives to your current waste disposal processes, consider the following:

  • Get on the same page as the federal government (likely the EPA). For corporate innovators working in industries that are in some way regulated by the government (and who isn’t?), it’s important to develop a shared understanding of the problems that need to be solved before you embark on potential solutions. In doing so, there is a far greater chance that you’ll create an ally in your innovation process rather than a potential future stumbling block. Often this will take some extra time and energy to educate folks on issues that you live with daily while they do not. However, the longer-term upside is well worth the effort.
  • Understand the state laws that are applicable to your business. Regulations governing what specific disposal options are available locally vary from state to state. The result is that disposal solutions available in Massachusetts may not be available in Missouri. This is posing a challenge for larger investor-owned utilities that operate on a regional or multistate level.
  • Be prepared to be your own advocate for your desired disposal options. Misalignment between different states, as well as continual changes and uncertainty at the federal level due to changes in administration, make governments an unreliable partner in this area, so businesses have to take the lead in pushing for sustainable solutions that are economically feasible.


As I’ve discussed in previous posts, the need for alternative disposal methods is imminent.  Take inventory of your company’s current processes and start the discussion about how to improve upon those processes.  Learn more about implementing innovation within your organization by visiting, barrybreede.com.

Waste

One Major Question for Your Business: Where Does Your Waste Go?

All productive human activity produces waste in some form, and—while it may not seem like a profound philosophical question—we have always had to ask ourselves: “What do we do with all of this stuff once we’re done with it?”

Waste is often material we don’t really want to keep around, but we can’t help producing it, and it has to go somewhere.  The first modern landfill started operating in 1937 in Fresno, California. In the years since, most Americans have come to take the facilities for granted, simply throwing waste away without thinking about where it is going.

Utilities too have long operated on the assumption that there is essentially limitless landfill space. In the eighty years since the first landfill was created, the vast majority of utilities have not changed their waste disposal operations, with most relying heavily on landfills to take in their used poles. The traditional model for most utilities is to cut up and pile the used poles in a dumpster. Once the dumpster is full, they call a local waste management company to come pick it up and empty it into a landfill.

Just to give some perspective: every year, about four million tons of treated wood utility poles are disposed of, and at least 60 percent (or 2.4 million tons, a conservative estimate) are landfilled. The space for these poles, though, is limited; this solution is unsustainable. Of course, when space goes down, the price of entry goes up.

There needs to be another alternative for the disposal of these poles. And while there are alternatives becoming available, both the utility industry and government regulators together need to address how best to dispose of poles that use chromated copper arsenate (CCA) as a treatment process. CCA poles are cost effective and continue to grow in market share, but per current regulations, they currently can only be disposed of via the landfill, as it can’t be incinerated. Fast-forward to twenty or thirty years from now, and, without the development of any new disposal solutions and associated changes in regulations, we’re going to have a majority of poles coming out of the ground that can’t go anywhere but the landfill—and there likely won’t be any landfill for them to go to.

Seriously consider your company’s disposal practices and what your future strategies are in this area; space is running out and the future of our environment is dependent upon our ability to be as sustainable as possible.  Learn more about alternative disposal methods that may be available for your utility by visiting, barrybreede.com.

Barry speaking on stage

The Environmental Impact of Your Product Life Cycle (and How to Reduce It)

Each passing year, industries – including the utility and commodity markets – are increasingly more aware of the impact their companies have on the environment.  It’s a concern that stakeholders in these industries recognize as a duty to address for the sake of consumers and the environment.

Understanding what that impact is and how to potentially reduce it won’t be clear until you comprehensively consider your product’s entire lifecycle from cradle to grave.  That may provoke you to consider the materials used to manufacturing or provide your product/service.  Could you potentially use more environmentally friendly materials?  If so, what would be the new impact of those materials?

However, what may initially seem like an improved concept may not necessarily reduce the overall environmental impact.  For example, many have questioned the use of other materials for utility poles – the idea being that perhaps other resources such as concrete or steel could outlast wood and therefore be more environmentally friendly. In theory these ideas seem credible.  However, from the view point of sustainability and carbon footprint, the more responsible material is still wood.

It comes back to understanding this particular product’s entire life cycle.  Studies* have been done and have found that treated wood compares favorably against galvanized steel, concrete, and fiber-reinforced composite poles along several environmental metrics, including greenhouse gas emissions, fossil fuel use, ecological toxicity, and water use.

The main reason why?  Forest products are organic raw material. Part of the production of this material involves thirty years of wood growth in the form of a tree.  This growth process actually removes carbon (in the form of carbon dioxide) from the atmosphere, rather than contributing to carbon emissions—a remarkable side effect of using this organic raw material. The so-called “carbon sequestration” process generates a “carbon credit” early in the life cycle that allows the final product to have a much lower carbon footprint than competing products.  During the 40 years a pole stands, another tree will have grown in its place – canceling out the carbon release from the retirement of the pole.

Being aware of the details – large and small – of your product’s life cycle will allow you to identify where you can reduce your impact on the environment and where you are making the best choice given the options available.  Learn more about how to reduce your company’s environmental impact through innovation by visiting this site.

 

 

*Christopher A. Bolin and Stephen T. Smith, “Life cycle assessment of pentachlorophenol-treated wooden utility poles with comparisons to steel and concrete”

chemicals

The Impact of Chemicals on the Product Life Cycle

One of the most frequent questions I hear from people outside of our industry, particularly those with environmental concerns is, “Why do you have to put chemicals on the poles to begin with?” The common belief is that these chemicals, which are really derivatives of pesticides, will have significant negative effects on both humans and the environment.

It’s not as harmful as one may believe; it plays a significant role in extending the life cycle of a renewable resource.  To recognize the true impact, it’s important to understand how much and why chemicals are used in the process.

All major pole producers abide by manufacturing standards developed by the American Wood Products Association (AWPA). This association, composed of scientists, academics, and industry personnel, collectively establishes the amount of chemical required during the manufacturing process to maintain the proper functioning of the pole. Per AWPA standards, the typical pole is impregnated with chemicals that, depending on tree species, penetrate less than four inches of the entire diameter of the pole. Given an average-sized pole based on industry standards, this means that less than 5 percent of a pole’s entire mass receives chemical treatment, a relatively small fraction.

Chemicals help extend the pole’s life span by protecting it from things like fungi or termites—basically, any organic thing that might feed off the wood and lead the pole to rot out and fall apart. If the poles went untreated, they would rot out so quickly that they would become much more likely to break, especially during inclement weather – creating extremely difficult situations for vendors, utilities, and consumers.

Consider too how this would impact the environment: if poles only lasted five to ten years, as opposed to decades, that would dramatically increase the amount of timber needed to supply these poles – roughly four times the amount harvested today.  Add to that the changes in environmental impact caused by the decline of sequestered carbon in the forest, as well as the effects of logging and manufacturing to increase output, and the overall result is that chemical usage actually does more to help preserve our environment than to harm it.

This isn’t to say today’s chemicals will be the best process for the future. The idea of cleaner, more eco-friendly preservatives is being explored which could replace current processes that extend the life of a utility pole. Learn more about how the utility pole life cycle impacts the commodity industry here.

Life Cycle

The Life Cycle of a Utility Pole

Before you can understand the significance of innovation within the utility pole industry, it’s important to better dissect the true-life cycle of a pole, from initial planting of the tree, through manufacturing, and then ultimately to disposal. In this way, we can determine whether an innovation that is designed to have an impact on one part of the life cycle might also have a positive effect on others.

  • Harvesting of Trees – Generally speaking, the most common tree species used for poles in this country are southern yellow pine and Douglas fir trees. A designated group of foresters works with private landowners who grow and harvest the wood for manufacturing purposes.  Together with farmers there is a collaborative effort to purchase, plant, maintain and manage the land.  The utility pole industry will typically leverage the “last cut” or the oldest trees.  Depending on the need from different utilities, a specific kind of tree size – or “pole” class – will be determined and selected.

 

  • Manufacturing of Poles – The trees we have cut are taken to a peeling plant, where the bark is stripped off and the diameter of the tree is further shaped and smoothed prior to being treated. The poles are then taken to a treatment facility, where they are placed on a rail tram-like device and rolled into a giant tube called a treatment cylinder. The cylinder is filled with a chosen chemical preservative, and a liquid (water or diesel fuel) is added that helps to serve as a “carrier” for the preservative as it impregnates the wood. Through a vacuum pressure treatment process, the poles soak up the liquid, and the chemical preservative with it. The poles are then removed from the tube, the chemical is pumped into a storage facility for safe handling, and the poles are then either air or kiln dried.

 

  • Final Preparations – the poles are moved to what’s termed a “framing yard,” where workers drill holes into the poles at specified locations to allow the utility to fit cross arms onto the pole. These cross arms serve an important role, allowing for power lines to be successfully strung from pole to pole.

 

  • Delivery and Use – The final output of this process is a pole that can be sold to a utility and put to use in the field. Just how long the pole will last in the field depends on multiple factors, including which preservative it has been treated with and the climate it will be subjected to.

 

  • Disposal – This is the step where recent innovation has occurred. Whether due to a pole reaching the end of the roughly forty years that it can function or due to its being removed to make way for something like a widening road, utilities need to get rid of the pole in some way. Traditionally this has meant disposal via landfills. The carbon found within these poles, however, could be used to generate energy after the end of the pole’s life as a utility pole—providing opportunities to eliminate waste and transform the pole even further.

Understanding the life-cycle of the utility pole helped expose an area of the process that provided no real value to stakeholders.  It’s what led a group of innovators to contemplate the following: how do we generate environmental value downstream in the process, at the time of disposal, when traditional approaches offer zero value for everyone involved?

When was the last time you carefully considered your product’s lifecycle with the lens of value-creation throughout the entire process?  Doing so will likely provide several feasible ideas for innovation and improvement that will benefit your stakeholders.  Learn more about finding the right approach to innovation for your organization here.