De-Fossilization: The Next Big Driver for the Bio-Lubricants Market?

De-Fossilization: The Next Big Driver for the Bio-Lubricants Market?

As issues caused by climate change continue to cause worldwide concern, policymakers are scrambling to meet their future goal of becoming carbon neutral (or carbon negative).  Among the initiatives they’re expending the most research and development efforts on: decarbonization and de-fossilization. 

“The ultimate goal is to reduce reliance on petroleum-based basestocks,” says Sharbel Luzuriaga, Industry Manager in our Energy sector. “Therefore, de-fossilization advocates for higher participation and sustainable use of biogenic carbon from renewable sources, including renewable energy and materials such as organic waste stream, post-consumer material, and biomass.” 

According to Luzuriaga, global initiatives such as the United Nations (UN) Global Compact and UN’s Sustainability Development Goals (there are 17 in total), in confluence with national policies, are placing stronger emphasis on the circular economy and supporting the proliferation of bio-based basestock projects. 

Why bio-based basestocks may go mainstream 

Although basestocks derived from plant oils (acquired from certified sustainable plantations) have the best carbon footprint standards, their use has been limited so far. The reason: Primary interest has been centered on the environmental credentials they deliver when used rather than on their carbon footprint reduction attributes; this assesses the total carbon impact of the lubricant product from the moment its raw materials are sourced until the moment it ends its life cycle. 

“To improve their ratings on the sustainability front, blenders will look to source basestocks that have a lower carbon footprint,” Luzuriaga says. “It is expected that this will boost demand for bio-based and, to some extent, re-refined basestocks; until now, these basestocks have been operating in their own niche market, but they have the potential to become mainstream going forward, particularly in high-value markets such as automotive lubricants.” 

How multinationals have entered the fray 

Meanwhile, multinational companies have ventured into the bio-based basestocks market. Among the industry’s most noteworthy developments: 

In the first half of 2022, Clariant launched Vita, its 100% bio-based range of surfactants and polyethylene glycols (PEG). Clariant uses 100% bio-ethanol derived from sugar cane or corn to create the ethylene oxide, which constitutes the building block of the company’s bio-based values chain. 

Repsol, a leading Spanish oil company, has awarded Nuspec Oil – a United Kingdom-based startup developing bio-based base oils – with the financial support of EUR 100,000 for one year. 

In September 2021, VERBIO, a German bio-fuel and technology company working in cooperation with XiMo, a catalyst technology company, announced the first ethenolysis plant operating in Germany. By means of using ethenolysis, the company will reach commercial scale on a non-fossil basis with three new products from a rapeseed oil methyl ester feedstock, including multifunctional esters, bio-based alpha and internal olefins, and a mixture of oleochemicals. 

In December 2021, BioAccelergy and ExxonMobil joined efforts to achieve commercial-scale opportunities for the production of bio-based lubricants basestock. In virtue of this joint-development agreement, ExxonMobil Research and Engineering Company, plus BioAccerlergy Ventures, will progress the development of a new bio-based basestock for lubricants manufactured from seed and vegetable oil. The multi-year agreement aims to demonstrate the viability of producing bio-based basestock at a cost-effective commercial scale. 

Chevron’s plans to increase the supply of bio-sourced basestocks through its acquisition of Nexbase from Neste, with Chevron also being an equity partner in Novvi. 

How the Green Deal is boosting the industry 

Finally, the bio-based industry is getting considerable financial support as part of EU’s Green Deal platform. The Circular Bio-based Europe Joint Undertaking (CBE JU) is a EUR 2 billion partnership between the European Union and the Bio-Based Industries Consortium (BIC) which provide finance projects promoting a competitive circular bio-based industry in Europe. 

“All these are positive movements for the bio-lubricant market,” Luzuriaga says. “The increasing supply of high-performing and more cost-competitive synthetic bio-basestock technologies is bringing the bio-lubricants industry to the next level, coming closer to scalability and reducing costs — which still remains a major obstacle preventing a broader adoption of bio-lubricants.”

For more information on the subject, be on the lookout for Bio-Lubricants: Market Analysis and Opportunities, scheduled for publication this month. A comprehensive analysis examining the opportunities and challenges in the bio-lubricants market, the report assesses key lubricant product categories where the use of bio-lubricants is rapidly growing and evaluates the various market forces driving growth. The effect of sustainability efforts and the impact of COVID-19 on the bio-lubricant market are also examined. 

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