Microalgae As Future Business Model of Circular Economy in Japan
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THE MICROALGAE/BIOMASS INDUSTRY IN JAPAN - AN ASSESSMENT OF COOPERATION AND BUSINESS POTENTIAL WITH EUROPEAN COMPANIES – Tokyo, April 2016 Manuel Herrador TABLE OF CONTENTS Table of Contents I Disclaimer and Copyright Notice III Acknowledgements IV Executive Summary V List of Abbreviations VI List of Figures VIII List of Tables XII 1. INTRODUCTION 2 1.1. Microalgae 2 1.2. Microalgal Biomass 9 1.3. Products Derived from Microalgal Biomass 12 2. THE MICROALGAE INDUSTRY IN JAPAN 21 2.1. Profile of Microalgae Industry in Japan 23 2.1.1. Main Strains of Microalgae Used in Japan 24 2.1.2. The AIIC (Algae Industry Incubation Consortium, Japan) 27 2.1.3. The Japan Association for Microalgae Fuels (JMAF) 28 2.1.4. The International Symposium on Algal Biomass (ISAB) 29 2.1.5. Algae Science Japan 30 2.1.6. Tsukuba 3E Forum 32 2.1.7. Tsukuba System of International Strategic Zone 42 2.1.8. Core Laboratory for Algal Biomass and Energy System 43 2.1.9. Initiatives for Next Generation Aviation Fuels (INAF) 44 2.1.10. Newest Trends on Microalgae in Japan 49 2.2. Profile of Biomass Industry in Japan 53 2.3. Support Provided by the Japanese Government 68 2.4. Analysis of 7 Notable Initiatives (extracted from interviews) 73 3 THE MICROALGAE INDUSTRY IN THE EU 95 3.1. Overview of Relevant EU Projects 95 3.2. List of EU Companies 101 3.3. Support Provided by the EU 107 I 4 POTENTIAL BUSINESS OPPORTUNITIES FOR EU COMPANIES 111 4.1. Opportunities of the Japanese Market 111 4.2. Challenges of the Japanese Market 113 4.3. Recommendations for EU Companies 114 5 CONCLUSIONS 116 6 REFERENCES 121 ANNEX 1: LIST OF MEMBERS OF THE ALGAE INDUSTRY 131 INCUBATION CONSORTIUM (AIIC) OF JAPAN ANNEX 2: VIRTUAL MAP OF THE EU AND JAPANESE COMPANIES 148 ANNEX 3: CONTACT POINTS OF EMBASSIES IN TOKYO 149 ANNEX 4: A POTENTIAL CIRCULAR ECONOMY BUSINESS MODEL 153 BASED ON MICROALGAE A.4.1. Introduction to the Circular Economy in the EU and Japan 153 A.4.2. A Potential Circular Economy Business Model Based on 160 Microalgae A.4.3. The Circular Economy Business Model of Microalgae in the 163 Context of the Circular Economy Package II DISCLAIMER AND COPYRIGHT NOTICE The information contained in this publication reflects the views of the author and not necessarily the views of the EU-Japan Centre for Industrial Cooperation, the views of the EU Commission or Japan authorities. The author believes that this paper is reliable and reasonably clear. While utmost care was taken to check and translate all information used in this study, the author and the EU-Japan Centre may not be held responsible for any errors that might appear. This report does not constitute legal advice in terms of business development cases. The author can be reached at: [email protected] © EU-Japan Centre for industrial Cooperation III ACKNOWLEDGEMENTS First, I would like to thank Mr. Jora (General Manager of the EU-Japan Centre for Industrial Cooperation) for all the support received, for the patience shown and for the advice received in order to improve the preparation of policy reports and the report itself. Secondly, I would like to thank to Mr. Mura for believing in me since the interview in the selection process. I would like to specially thank the MINERVA fellows: Guillaume, Ines, Jérome and Ryuichi, but without forgetting about Mr. Suzuki, and the rest of the office partners from the EU and Japanese sides: Edgar, Etsuko, Fumiko, Giuseppe, Hiromi, Kana, Luca, Marco, Masanori, Masayuki, Michael, Naoko, Noriko, Sam, Satoru, Shiori, Stijn, Toshiro, Yasue, Yayoi, Yoko, Yukiko, Yuko and Yumi. Finally, I wish to express my thanks to EUGLENA INC., ISUZU Motors, Dr. Watanabe and Dr. Inouye from the University for Tsukuba and the Algae Industry Incubation Consortium (AIIC) Japan, respectively, for the interviews provided, and also to the ones willing to collaborate in this report having interviews, networking and exchanging emails. IV EXECUTIVE SUMMARY This work has its main focus on the Industry of Microalgae in Japan mainly involving the products derived from Microalgal biomass, in order to create joint business opportunities with EU Companies. In terms of size, the Industry of Microalgae in Japan consists of a small number of stakeholders - Companies, Public Administration and Universities -, the number could be around 100, however, when compared with EU countries and considering the size of the country, this specific Industry is one of the most developed worldwide. This paper has been divided into 6 sections (Figure 0); (1) An introduction to Microalgae, Microalgal biomass and products Derived from Microalgal Biomass. (2) The Industry of Microalgae in Japan. (3) The Industry of Microalgae in the EU. (4) Potential business opportunities for EU Companies including challenges of the Japanese market and recommendations for EU Companies. (5) Conclusions (including a SWOT diagram) and future perspectives. (6) 4 Annexes; the first annex contains a list of member of the Algae Industry Incubation Consortium of Japan (AIIC); the second annex is represented in 2 virtual maps shows stakeholders and EU Companies of the sector; the third annex lists the contact points of Embassies in Tokyo, and lastly, a fourth annex depicts a potential Circular Economy Business Model based on Microalgae. Conclusions & Annexes Business Opportunities for the EU Companies Industry in Japan and in the EU Introduction Figure 0. Structure of the report. V LIST OF ABBREVIATIONS Abbreviation Meaning EU European Union CE Circular Economy Company Small and Medium Enterprise UN United Nations COP-21 United Nations Conference on Climate Change METI Ministry of Economy, Trade and Industry CO2 Carbon Dioxide ACE Actions for Cool Earth PBR Photobioreactor CCS Carbon Capture and Storage Mt Millions of tons LNG Liquified Natural Gas R&D Research and Development GHG Green House Gas kWh Kilowatt-hour Kl Kiloliters RPF Refuse Paper and Plastic Fuel FIT Feed-in tariff BDF Bio-diesel fuel JPY Japanese Yen kW Kilowatts CDM Clean Development Mechanism J-VER Japan-Verified Emission Reduction JORE Japan Organics Recycling Association NEDO New Energy and Industrial Technology Development Organization of Japan BTL Biomass gasification and liquefaction TSS Total Suspended Solids DAF Dissolved Air Flotation DHA Docosahexaenoic acid EPA Eicosapentaenoic acid PLA Poly-Lactic Acid PCB Polychlorinated Biphenyl 3R Reduce, Rehuse and Recycle DfE Design for Environment LCA Life-cycle assessment AD Anaerobic Digestion AIIC Algae Industry Incubation Consortium ANA All Nippon Airways HHV Higher Heater Value VI HTL Hydrothermal liquefaction HRT Hydraulic Retention Times AOAIS Asia-Oceania Algae Innovation Summit MAFF Ministry of Agriculture, Forestry and Fisheries FY Fiscal Year TF Task Force JCR Journal Citations Report ORP Oxidation-reduction potential CEN European Committee for Standardization USA United States of America H2020 Horizon 2020 MIC Ministry of Internal Affairs and Communications NICT National Institute of Information and Communications Technology of Japan NCP National Contact Point CONCERT Connecting and coordinating European research and technology development COSME Competitiveness of Enterprises and Small and Medium Enterprise JETRO Japan External Trade Organization EEN Enterprise Europe Network NCP National Contact Point JEUPISTE Japan-EU Partnership in Innovation, Science and Technology JBCE Japan Business Council in Europe EU-BRT EU-Japan Business Round Table ErP Enterprise resource planning WEEE Waste Electrical and Electronic Equipment Directive RoHS Restriction of Hazardous Substances Directive REACH Registration, Evaluation, Authorization and Restriction of Chemicals PEF Product Environmental Footprint EIG European Interest Group STI Science Technology and Innovation EUR Euros ISO International Organization for Standardization VII LIST OF FIGURES Figure Description 0 Structure of the report. 1 Various species of Microalgae and their biomass-based product applications [3]. 2 A photobioreactor (PBR). 3 An integration of Microalgae cultivation and possible application. 4 Cultivation systems: (a) unstirred pond, (b) raceway pond and (c) circular pond [10]. 5 Cultivation closed systems: tubular (a), photobioreactor (b), airlift (c) and flat plate (d) [10]. 6 Process flows of harvesting methods for recovery and dewatering of microalgal biomass. Drying is optional, depending on the selected downstream process for conversion of Microalgae to bio-fuels and/or bioproducts [11]. 7 Biomass extracted from Microalgae harvesting [12]. 8 Chemical composition of microalgal species of different groups. 9 A possible Microalgae biorefinery [13]. 10 Summary of the Microalgae-based bio refinery process. 11 An example of Spirulina tablets [17]. 12 A plastic made of Microalgae-based biomass [19]. 13 Applications in Medicine 14 Comparison between the fossil fuel imports. 15 Domestic algal markets in Japan. 16 Chrorella Microalgae strain. 17 Dunaliella Microalgae strain. 18 Spirulina Microalgae strain. 19 Euglena Microalgae strain. 20 Nannocholopsis Microalgae strain. 21 Haematococcus Microalgae strain. 22 AIIC logo and banner 23 Activities of the AIIC. 24 The Nippon Oil & Energy logo. 25 Logo of the ISAB. 26 Business domain of 5Fs. 27 Diversity of Microalgal-based fuels. 28 Diverse products from Microalgal biomass. 29 Goal of the Tsukuba 3E Declaration 2007 30 The Tsukuba Eco City concept. 31 Structure of the Tsukuba 3E Forum. 32 Biotask force for biomass. 33 Logo of ABES. 34 Aims of the ABES. 35 R&D activities in ABES. VIII 36 Structure of the ABES. 37 ABES Research Consortium. 38 Collaboration of 3 Japanese Universities on Microalgae projects. 39 Timetable of ABES for profitability. 40 Plant for extraction of Microalgal bio-fuel. 41 Open systems for harvesting of Microalgae. 42 First driving experiment using algae blended fuel. 43 Hand cream “moina” with the participation of DENSO. 44 Sustainable system of oil production in the sewage treatment and use as fuel in the sludge incineration. 45 Demonstration project in Fukushima. 46 Algae Biomass Production R&D Center, Minamisoma, Fukushima. 47 Fukushima’s native algae(1). 48 Fukushima’s native algae(2).