Bioeconomy in Italy: what it is, examples, innovation and agriculture

28 January 2025
Circular Economy, Innovation, tecnologia, Focus On

Bioeconomy uses all renewable biological resources, including waste, to produce sustainable goods, services and energy. Italy, with initiatives such as the TERRA NEXT accelerator, has the potential to become a global leader in the sector: here's why

 

What is Bioeconomy?

When we talk about Bioeconomy we mean to refer to the socio-economic system that includes and interconnects economic activities that use resources in a sustainable way. natural renewables from land and sea - including waste and refuse - to produce goods , services and energy .

A sector closely linked to the territories given the ability to create supply chains multidisciplinary integrated in local areas and return nutrients to the soil, making the Bioeconomy one of the pillars of the European Green Deal and of numerous projects included in the NRRP.

The Bioeconomy, therefore, complises transversally all the industrial and economic sectors that use natural resources (e.g. biomass) such as agriculture, forestry, energy, aquaculture and fishing, chemical and pharmaceutical industries, textiles, cosmetics, paper, food and industrial biotechnology.

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Circular Bioeconomy: The Link Between Innovation and Sustainability

Putting at the centre the use of first and second biological​ generation and their transformation into intermediate goods and services, the Bioeconomy represents a meta sector with a high innovative potential capable of responding to contemporary global challenges such as the climate change, the reduction of CO2 emissions and the regeneration of the biosphere, while simultaneously protecting the environment and biodiversity.

In this perspective, the Bioeconomy and the paradigm of the circular economy integrate reciprocally. In fact, the circular economy aims to extend the life cycle of products with a consequent reduction in waste generation. In fact, when a product is no longer able to fulfill the functions that determined its placing on the market, the materials that compose it are introduced back into the economic cycle (in all circumstances where it is possible). In this way, the aforementioned materials can be reused, entirely or partially, to generate new value in the production cycle through a waste management system intended as secondary raw materials .

Bioeconomy - including the sustainable production of renewable biological resources and their transformation in industrial products with new value like food, bioenergy and bio-based products - integrates and complements each other with the circular economy, thus becoming circular bioeconomy.

This happens because the production method of the Bioeconomy relies on renewable biological resources in various sectors to create regenerative and sustainable production processes, and places sustainable development at its centre by creating an economic model that respects the environment, therefore reducing dependence on fossil fuels and non-renewable resources .

Consequently, the Bioeconomy falls fully within circularity, although it represents only one component of the circular economy that focuses on maximising the recycling and reuse of resources whose availability is limited, while simultaneously promoting innovation in several key sectors.

Furthermore, the Bioeconomy is fueled by innovative environments, since the growth of the economic model is inextricably linked to the constant contamination with new technologies. In this perspective, research, development and innovation represent the foundations on which the circular Bioeconomy rests, making the collaboration between different actors such as companies, innovative startups, universities, research centers, institutions and the financial world, that are strategic to realize the ecological and energy transition.

Bioeconomy: Georgescu Roegen's definition

Although it is increasingly central and constantly growing, the Bioeconomy is not a “new” concept. Nicholas Georgescu- Roegen, Romanian economist and mathematician, was in fact the first to theorize the model in the book The Entropy Law and Economics Process published in 1971.

For Georgescu-Rogen, Bioeconomy is based on a simple yet incisive assumption: all economic activities derive from biological resources, and every economic aspect is intrinsically linked to natural cycles as they are crucial not only for maintaining resources, but also for energy production and the regulation of environmental systems.

According to the Romanian luminary, in fact, the infinite economic growth – pursued for a long time – is not possible due to the limited resources of the Planet . Bioeconomy therefore represents an answer to this problem, proposing an economic system that respects the limits of Earth ecological systems and introducing the idea that the economy should be interpreted as a subsystem of the system ecological global, with an integrated analysis that interconnects these two aspects together with the social dimension.

In Roegen's definition, Bioeconomy is an economic system that takes into account the exhaustibility of natural resources - especially non-renewable ones such as fossil fuels and minerals, entropy and sustainability, since for the survival of humanity in the long term the economy is obliged to operate respecting the limits imposed by ecological and natural processes.

The areas of application of the Bioeconomy

There are therefore many contexts in which the Bioeconomy is currently applied: from the energy transition- essential to achieve global sustainability goals - to the circular economy, through sustainable agriculture and biotech innovation (through technologies that enable sustainable production thanks to renewable resources such as bioplastics, biofuels and biomaterials), up to the change in consumption models that must favor goods and services with a reduced environmental impact.

How much is the Bioeconomy worth in Europe and Italy?

Italy as indicated in the 10th Bioeconomy Report in Europe drawn up by the Research Department of Intesa Sanpaolo in collaboration with the SPRING Cluster and Assobiotec Federchimica and presented in June 2024, plays a leading role in the EU area .

At European level, the Bioeconomy - understood as a system that uses biological resources as inputs for production - in 2023 generated an estimated output of approximately 1,751 billion euros (in constant growth compared to 1,459 billion in 2021 after the record recorded in 2022 due to the Russian-Ukrainian conflict and the consequent strong increase in prices) between Germany (542.9 billion), France (459.1 billion), Italy (437.4 billion) and Spain (311.9 billion), representing 8.4% of the total and employing more than 7.4 million people.

Comparing the levels of Bioeconomy output in 2023 with those of 2021, positive results are observed for all EU countries, with better indications for Italy , which recorded an increase of 20.6% : a figure slightly higher than the French one (20.1%), with Spain (17.4%) and Germany (12.6%) following.

Furthermore, in our country the set of activities connected to the Bioeconomy generated a growing production value, reaching 9.3 billion more than in 2022 , providing work to 2 million people (7.6% of the total) . The weight of the Bioeconomy on the Italian economy was also confirmed, as it is equal to 10% of the overall output.

Taking 2023 as a reference, in Italy the agri-food supply chain is worth approximately 63.2% of the Bioeconomy with an output of over 276 billion euros compared to 216 in 2021 (+28%), of which 195 generated by the food, beverage and tobacco industries and 81.2 from agriculture, followed by the bio-based fashion system (production equal to 48.2 billion) and by wood and furniture. Paper accounted for 7% of the overall output in 2023 due to a drop in production (from 34.6 million euros in 2022 to 30.5 in 2023), not fogetting the importance of bio-based pharmaceuticals and chemicals as well as bioplastics, bioenergy and biomaterials used, for example, in construction sector.

 

Bioeconomy in Italy: examples in agriculture

Bioeconomy plays a key role in agriculture as the sector is particularly polluting, and in Italy there is a lack of examples of applications that highlight the evolution towards new sustainable models.

In fact, first of all many Italian agricultural companies use manure, agricultural by-products and organic waste to produce biogas and bioenergy. In Lombardy and Emilia Romagna, for example, anaerobic digesters transform scraps agricultural in renewable energy and organic fertilizers. Furthermore, agro-food waste is increasingly valued as in Campania, where tomato peels are used for the extraction of natural pigments and the creation of bioplastics.

Another application relates crops for the production of biomaterials, like in Tuscany and Piedmont where hemp is grown for the production of ecological building materials, or like in Puglia where the grown flax fibres are used to produce sustainable fabrics.

Many Italian companies are developing biofertilizers based on algae or other microorganisms, thus improving soil health. Another example comes from Veneto, where biopesticides based on plant extracts are used to reduce the use of chemical products. A further use of various waste agricultural consists in the transformation into biodegradable packaging as happens in Sicily where, for example, citrus fruit residues are used to produce sustainable paper and packaging.

 

The importance of innovation for the development of the Bioeconomy

The vitality of the Bioeconomy in Italy is also demonstrated by the 808 innovative startups registered in 2023, equal to 6.6% of the total companies registered in the specific Register. The majority part from the innovative startups in the Bioeconomy, spread throughout the peninsula, are concentrated in the R&D sector (45%), followed by agri-food (25%).

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The importance of innovation for the development of the Bioeconomy

The vitality of the Bioeconomy in Italy is also demonstrated by the 808 innovative startups registered in 2023, equal to 6.6% of the total companies registered in the specific Register. The majority part from the innovative startups in the Bioeconomy, spread throughout the peninsula, are concentrated in the R&D sector (45%), followed by agri-food (25%).

Investments in Research and Development: the gap to be filled between Europe and its main competitors

Despite the liveliness in our country, according to the report "The future of European competitiveness", presented by Mario Draghi and Ursula von der Leyen on 9 September 2024 to the European Commission, the innovation gap between the EU and the main global competitors (the United States and China) remains.

Looking at Research and Development activities, the 2023 data reveal this gap. In fact, despite an overall investment of around 387 billion euros in R&D, the Old Continent still lags behind the United States (928 billion) and China (19 billion). In particular, Europe is at a clear disadvantage in terms of Venture Capital investment, with collections standing at 5% of global funds compared to 40% in China and, above all, 52% in the United States.

For the European Commission, consequently, the role of the Bioeconomy to achieve the objectives of the Green Deal requires further investments amounting to 50 billion euros between public and private sectors. Also because investing in this area is necessary to support innovation, reduce dependence on fossil fuels and thus drive the transition towards circular and resilient production models.

To speed up the transition to these models, it is also necessary to intervene on the slowing elements such as bureaucracy to attract Italian and international investors and thus bridge the gap with China and the United States, making Italy a catalyst for innovation and investments in the many sectors. sectors related to the Bioeconomy.

tecnico di laboratorio che prende una foglia in provetta tecnico di laboratorio che prende una foglia in provetta

Bioeconomy and Open Innovation: the TERRA NEXT acceleration program

It is therefore necessary support innovative realities and promote the culture of Open Innovation. In this sense, on the initiative of CDP Venture Capital with Intesa Sanpaolo Innovation Center as of promoter and co-creator and the support of Cariplo Factory as operational manager, in 2022 was born TERRA NEXTthe first Bioeconomy accelerator aimed at startups and SMEs innovative, aiming to create interconnections with the scientific excellences of the territory and with leading companies in the sector.

TERRA NEXT was conceived to support over a period of 3 years up to 30 startups, scale-ups and innovative SMEs with high potential that have created solutions for the Bioeconomy, focusing on nutraceuticals, circular & bio-materials and regenerative agriculture. In this sense, the acceleration program has become the point of reference for innovative startups in the sector , receiving over 450 applications from Italy and the rest of the Old Continent in its “first” three years.

In 2024, 7 innovative startups - selected by the Selection Board among the 191 Italian and European companies that applied - had the opportunity to participate to the third edition of the acceleration program held at the San Giovanni Teduccio Campus of the Federico II University in Naples.

The course - which lasted 3 months - allowed startups to grow thanks to to mentorship , training , networking and in-depth moments dedicated to consolidating the value proposition and business model , to the technical validation and prototyping of the respective solutions, to the go-to-market and fundraising support, receiving a total pre-seed investment of 750 thousand euros.

The results of the first three years of activity of TERRA NEXT

Looking at the first three years of activity, TERRA NEXT has accompanied and supported the growth of 22 startups, which in total have benefited from investments from the program amounting to 3.5 million euros, also raising 10.5 million between follow-on and external investors .

As proof of the value of the program, the third edition of TERRA NEXT, in addition to the patronage of the Ministry of the Environment and Energy Security, involved the corporate partners Pastificio Garofalo (core partner), Gruppo Getra , Gruppo Nestlé and Novamont - who provided their contribution in terms of know-how, assets and network for the development of startups - and the companies Aristea, Nolanplastica , Selepack and Tecno, members of TERRA NEXT.

Another sign of the constant growth for the acceleration program that brought the Pisan startup DND biotech- protagonist of the first edition and active in the creation of robots for bioremediation - to participate as a sub-contractor in the large remediation project of 250 hectares of land in Kuwait . A concrete testimony of the value and uniqueness that distinguish TERRA NEXT, as well as the opportunities it offers to innovative companies. active in the main sectors of the Bioeconomy .