Unlocking Sustainability's Potential for Chemicals
Despite being attacked for not producing enough environmentally friendly substances, the chemicals sector is also protecting the planet. Muriel Axford reports.
From biofuels to biodegradable plastics, sustainable construction materials and global warming, the chemicals industry has thrown its weight behind providing solutions to many of the problems now faced on a global scale. Though detractors may argue the industry has exacerbated some of the problems we now face, the chemicals sector is embracing the desire to find sustainable, lasting solutions.
These challenges have meant that even through recent economic difficulties, the chemicals sector has continued to focus on research and development.
Biofuels has seen significant sums invested in recent years. According to a report, Algae 2020: A Study of Biofuels Markets, Business Models, Strategies, Players, Technologies and Commercialisations: Outlook from 2012 to 2020, between 2007 and the summer of 2009 some $1bn in private and public money was committed to the development of algae-based biofuels.
The report was produced by Emerging Markets Online and follows concerns that fuels based on crops such as corn are pushing up food prices and affecting the world's poorest nations.
Oil and chemical majors are, however, among the leading investors in the biofuel R&D sector. Perhaps one of the most significant R&D investments came from ExxonMobil, which said in 2009 that it would commit $600m to start research and development into biofuels based on photosynthetic algae. The research is being carried out as part of an alliance with biotech company Synthetic Genomics Inc.
In August 2009 BP announced that it was investing $10m to establish a research partnership with US-based Martek Biosciences Corporation. Under the agreement the companies will work together to develop a large-scale, cost-effective microbial biodiesel production demonstration project that will use algae to improve the efficiency of the fermentation process. Even in the more mature area of petrochemical processing technology, major petrochemical companies continued the push during 2008 to develop technology for improved processes and products.
Saudi Arabia-based global player Sabic said its "ambitious" research and technology programme allowed it to file 500 new patent applications globally during 2008. Among the company's main advances that year was the development of a new catalyst for acetic acid technology. The catalyst costs 40% to 50% less than the existing one. The company also developed a new method for allowing dilute fertiliser to be applied to crops. The method is said to permit nutrients to reach crops easily during irrigation, leading to improved field productivity and lower costs.
At the same time Germany's Bayer, which operates in the areas of healthcare, crop science, material science and services, increased its 2008 R&D spend. Some 66% of R&D investment during 2008 was attributed to healthcare, while crop science and material science accounted for 24% and 8% of 2008 spend respectively.
At the end of 2008 Bayer said that despite global economic difficulties it would expand its R&D activities into 2009. On announcing the expansion Werner Wenning, chairman of Bayer's board of management, said: "The task now is to set the right course. Only through innovation can our company generate the growth that is essential to safeguard its sustained success."
Chemicals, R&D and the 2010 outlook
With rapidly changing economic and global conditions, chemical companies are adapting to customer needs. During 2009 Dow Corning announced it would focus "increasingly on researching and developing solutions linked to global megatrends such as the drive for efficiency, increased focus on alternative energy and clean water and rapid urbanisation in fast-growing emerging geographies".
The company is now committed to directing more than half its R&D spending on sustainability-based projects. Dow Corning said the move represented a transformation of its business strategy to help customers become more efficient, innovative and sustainable.
Across the globe chemicals businesses are seeking to meet not only customers' needs but also society's demands for solutions to the multi-faceted issue of sustainability.
But as European chemicals industry association Cefic points out, turning many of the ideas that come out of R&D into marketable products (what it refers to as "innovation") is another issue. This is why Cefic has called on EU policymakers to help in the development of a "strong, reliable innovation framework that transforms ideas into sustainable products and technologies".
"A coordinated framework of harmonised policies and messages is necessary to increase investor / consumer confidence, encourage innovation and strengthen value chain cooperation," Cefic says.
As turning R&D projects into marketable ideas grows ever more costly, there are calls for national governments to recognise that they have an important role to play as they seek to grow economies and create jobs and wealth.
Bayer's Wenning said that, along with providing conventional project support, Germany's politicians could introduce more sustainable tax breaks for research and development through the increased deductibility of R&D expenditure – as already happens in some European countries. Wenning argues that such as move would create additional incentives for investment in innovation and thus in Germany's future.
With climate change and sustainability high on the political agenda, the chemical sector now has the perfect opportunity to lead the way in improving our future.