The Japanese understand the Value of a by-Product Economy

By Zachary Alexander on

A couple of stories from Japan surfaced last week that shows they understand that the next economic era may be based on by-products. The first is that the Japanese have started a three year program which will reuse and/or repurpose hydrogen from oil refineries. Hydrogen is used to increase octane in gasoline.

The second story is that Japanese companies are recycling rare earth minerals. You will see recycling play a bigger role post-Globalization because rare earth minerals are so difficult to process. We suggest that you will continue to see industrial design changes that will facilitate better recycling efforts and eventual knowledge spillover.

Hydrogen Convergence will still power this brave new world. Most economic activity will use hydrogen fuel cells. For those industrial processes that require things to be burned like steam methane reforming, closed loop carbon sequestration systems will be deployed to capture greenhouse gases and generate hydrogen.

Currently, there is a very subtle industrial shift in the way by-products are captured and valued. In fact, you may even think of it as a disruptive innovation movement traveling under the radar. While the by-products are valuable, the concentration is so low that it will not support the cost structures of any large transnational corporation.

Zachary Alexander