In the last two decades, environmentalists have correlated the concept of ecology with industry as a strategy to achieve sustainability. Under this concept, the utilization of waste from one industry is used as a raw material in another industry.
When the metaphor ‘Ecology’ is connected to Industries, it is believed that the inherent concept of circular economy internalizes the negative externality of the pollutants. It is obvious for firms to continue and increase the utilization of the raw material which not only produces solid waste but also gaseous and liquid waste. The research question that motivates this study is, therefore, to know the impact of encouraging the use of one waste on the change in the generation of other waste from the same firm. In brief, the study intends to discover the impact of increased utilization of solid waste by the industry on its gaseous emissions. We have set-up a general microeconomic model to test our hypotheses and offer evidence from panel data extracted from the website of Central Electricity Agency (CEA) from the year 2011 to 2017 of more than 150 electricity-generating coal power plants, in India.
Our generalized model analyzes the ecological, environmental and economical aspect applicable to a wide range of pollution-generating industries. It is found that the utilization of solid waste and the emissions of a competitive firm are positively correlated. There is a positive correlation between the sale price of the solid waste and the emissions from the industrial plant.
The empirical results are obtained by using Feasible Generalized Least Square Method (FGLS) from the data of coal power plants in India confirm the outcomes of our general theoretical model.
We suggest that the goals of industrial ecology shall fall short of its achievements if utilizing the industrial waste byproducts are not accompanied by supplementary regulations for its other forms of pollution. Hence, an industrial policy based on ecology needs to be comprehensive with an objective of utilizing a waste byproduct while inclusive of maintaining the standards on other pollutants by the firm.