(291f) The Challenges of Diminishing Natural Capital in the Transition to a Bio-Based Industry

For most of human history, global economic activity has been largely derived from the exploitation of the earth's biosphere via agricultural processes. It is not incidental that the motto of the US Department of Agriculture, which was established during the Lincoln administration, is ?The source of all industry and commerce?. However, due to the abundance of natural capital, the earth's resources have historically not been considered or translated into economic terms as real capital.

Today, the fact that most of the world's industrial economy is dependent on finite fossil resources causes great concern due to supply as well as the numerous negative environmental impacts of fossil fuels. This concern has catalyzed an irreversible trend toward exploiting the biosphere with more activities than simple food production. Developed economies are now demanding biofuels and bio-based materials from agricultural systems while developing nations are increasing their demand for food. In addition, agriculture itself has become enmeshed with the ?unsustainable? industrial systems of the XX century due to its dependency on fossil fuels in transport and farming and the use of synthetic fertilizers mainly derived from natural gas. In concert, these trends are causing unprecedented strain on the earth's biosphere as well as driving commodity prices to record highs. Biofuels, which were once heralded as the answer to energy and climate change issues, are now being blamed for rising commodity prices and agricultural strains.

The limits of ?natural capital? are evident and there is now a new appreciation for the limits of the biosphere. It is our argument that there is a bright future for the bio-based industry if we accept the real cost of natural capital and we nurture it accordingly. In this talk, we will review present and future prospective for the bio-processing industry; with an emphasis on bio-fuels and biomass. We will argue that while the trend is not reversible, a systems approach of process engineering needs to be applied to the biosphere of production at a macro-scale and not only inside the plant gate to deliver the promise that these technologies hold. This approach enables unique opportunities for new avenues of academic research and industrial applications to responsibly leverage natural capital in a global economy.