It doesn’t take a genius to understand the advantages of getting the best raw materials at the best prices. One way to do that – and an increasingly important part of our procurement strategy – is to take advantage of industrial biotechnology
Biotech now presents some truly exciting opportunities as a source of raw materials and intermediates that may be cheaper, more sustainable, and offer advantages in terms of performance that were never imaginable with materials produced by more conventional ‘straight chemical' technologies.
The exciting developments that offer such great promise in what most of us understand as biotechnology are the consequences of breakthroughs over the past half century that have allowed scientists to manipulate the most fundamental processes in living cells and organisms. And in white biotech, those breakthroughs mean, among other things, that microorganisms can serve as infinitesimally small factories that produce specific compounds of industrial value.
So how exactly can companies take advantage of industrial biotechnology? At AkzoNobel our focus in white biotech is on working with partners who can produce raw and intermediate materials for us using biotechnology that feed into our chemical plants.
The specificity and efficiency of production using white biotech are perhaps the most obvious advantages, but there are a number of other factors that make biotech an attractive alternative to traditional sources of raw materials. Relative to traditional production methods, biotech is often far more energy efficient, which means both lower costs and a reduction in the carbon footprint.
The technology is quite flexible, allowing production facilities to be located closer to the customer (or even on-site), so shipping costs can be cut and logistics simplified. That flexibility also allows for a variety of raw materials to be produced using the same equipment.
But how real is all of this? Actually, it's quite real, and at AkzoNobel we have already entered into a number of agreements with firms that have real products and processes they can offer to us. A far-reaching study has been carried out which has looked at the raw materials that AkzoNobel uses, assessing such considerations as volume and environmental footprint, and the potential to replace petrochemical based materials with bio-based ones.
Essentially we've cross-checked what is important against what is possible. We've looked at players who have developed processes in this area, done technical and economic assessments of what they are proposing, and we've subjected their proposals to a reality check. When we find ones that seem realistic, we start to build a relationship, and work out what a pathway to commercialization will be.
Potential partners may be startups with a new idea and backing from venture capitalists, or they may be larger companies with established track records. One of the most promising partnerships involves a joint development agreement with Solazyme, a California-based firm that has developed technologies to produce oils and other materials from algae.
Last July, AkzoNobel and Solazyme announced a multi-year agreement under which Solazyme would provide up to 10,000 tons of algal oil for surfactant production. The company has also announced a partnership with a Canadian firm, Enerkem, to work together on the development of waste-to-chemicals facilities in Europe, and an agreement between Industrial Chemicals with Amsterdam-based Photanol will produce "green" alternatives to building blocks traditionally derived from the oil barrel by using engineered cyanobacteria to convert CO2 into predetermined products such as such as acetic acid and butanol when exposed to light.
At AkzoNobel we are constantly looking for non-traditional solutions as we strive to do more with less and these kinds of partnerships - which help us significantly reduce our carbon footprint - are a perfect example of our Planet Possible approach to sustainability.
However, establishing these partnerships is not easy and they not only require imagination to get them started but also commitment to see them through. There needs to be genuine mutual benefits to make the partnership work for all the parties involved and a tailored approach taken for each partnership.
In summary, businesses that are able to utilize white biotech and manage the transition to bio-based materials successfully will ultimately stand to benefit. To achieve this, companies need to have the necessary vision to understand the long term advantages of expanding the use of renewable alternatives but also the ruthless efficiency to deliver this vision. This is not an easy road to take but a vital one to travel down in the long term.
Alistair Reid is Manager of Innovation, Partnerships, and Complexity Reduction at AkzoNobel and Dale Steichen is Director of Business Development at AkzoNobel
