Although the
Circular Economy (CE) has made remarkable technological progress by offering a wide range of alternative engineering solutions, an obstacle for its large-scale commercialization is nested in the adoption of those
business and
financial models that accurately depict the value generated from
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Although the
Circular Economy (CE) has made remarkable technological progress by offering a wide range of alternative engineering solutions, an obstacle for its large-scale commercialization is nested in the adoption of those
business and
financial models that accurately depict the value generated from
resource recovery. Recovering a resource from a waste matrix conserves natural reserves in situ by reducing demand for virgin resources, as well as conserving environmental carrying capacities by reducing waste discharges. The standard business model for resource recovery is
Industrial Symbiosis (IS), where industries organize in clusters and allocate the process of waste matrices to achieve the recovery of a valuable resource at an optimal cost. Our work develops a coherent microeconomic architecture of
Chemical Leasing (Ch.L.) contracts within the analytical framework of the
Sherwood Plot (SP) for recovering a
Value-Added Compound (VAC) from a wastewater matrix. The SP depicts the relationship between the VAC’s
dilution in the wastewater matrix and its
cost of recovery. ChL is engineered on the SP as a financial contract, motivating industrial
synergies for delivering the VAC at the target dilution level at the market’s minimum cost and with mutual profits. In this context, we develop a ChL
market typology where
information completeness on which industry is most cost-efficient in recovering a VAC at every dilution level determines
market dominance via a
Kullback–Leibler Divergence (D
KL) metric. In turn, we model how payoffs are allocated between industries via three ChL contract
pricing systems, their profitability limits, and their fitting potential by market type. Finally, we discuss the emerging applications of ChL financial engineering in relation to three vital pillars of resource recovery and natural capital conservation.
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