Renewable chemicals, also known as bio-based chemicals or green chemicals, are derived from renewable biomass sources such as plants, algae, or waste materials. These chemicals are gaining prominence due to their potential to reduce reliance on fossil fuels, lower greenhouse gas emissions, and contribute to sustainable development. Renewable chemicals slowly replace fossil-derived chemicals and can often be one-for-one identical replacement materials, or in some cases, new and improved versions of the chemicals they replace.
There are several methods of producing renewable chemicals, each with its own processes and technologies. These methods leverage renewable biomass sources to create a wide range of chemical products. Here are the primary methods of producing renewable chemicals:
Fermentation
- Biochemical Fermentation: Microorganisms such as bacteria, yeast, or fungi are used to ferment sugars derived from biomass into various chemicals. This method is commonly used to produce biofuels like ethanol and butanol, as well as organic acids like lactic acid and citric acid.
- Microbial Conversion: Specialised microorganisms are engineered or selected to produce specific chemicals through fermentation processes. Examples include the production of bio-based polymers like polyhydroxyalkanoates (PHA) using microbial fermentation.
Biocatalysis
- Enzymatic Conversion: Enzymes derived from biological sources are used as catalysts to convert biomass components into valuable chemicals. This method is used in processes such as hydrolysis (breaking down biomass into sugars), esterification (producing esters), and transesterification (converting triglycerides into biodiesel).
- Metabolic Engineering: Genetic engineering techniques are employed to modify metabolic pathways in microorganisms, plants, or algae to produce specific chemicals or intermediates. This approach is used to enhance the production of bio-based compounds like biofuels, amino acids, and specialty chemicals.
Thermochemical Conversion
- Pyrolysis: Biomass is subjected to high temperatures without oxygen to produce bio-oil, biochar, and gases like syngas. Bio-oil can be further processed into chemicals and fuels.
- Gasification: Biomass is converted into syngas (a mixture of carbon monoxide and hydrogen) through partial oxidation or steam reforming. Syngas can be used as a feedstock for producing chemicals such as methanol, ammonia, and Fischer-Tropsch products.
- Hydrothermal Processing: Biomass is treated with hot, pressurised water or steam to produce bio-oil, biochar, and aqueous solutions containing chemicals like organic acids and sugars.
Chemical Synthesis
- Catalytic Conversion: Catalysts are used to convert biomass-derived intermediates, such as syngas, bio-oil, or platform chemicals, into desired products. Examples include Fischer-Tropsch synthesis for producing liquid hydrocarbons, and catalytic hydrogenation for converting furans into alcohols.
- Chemical Reactions: Various chemical reactions are employed to transform biomass-derived compounds into renewable chemicals, including esterification, hydrogenation, dehydration, and polymerisation processes.
Electrochemical Conversion
- Electrolysis: Electricity is used to split water or other compounds to generate hydrogen or oxygen, which can be used as feedstocks or reactants for producing renewable chemicals. Electrochemical methods are also used to convert CO2 into value-added chemicals like formic acid, methanol, and ethylene.
- These methods can be combined or integrated into biorefinery concepts to maximise the utilisation of biomass resources and produce diverse renewable chemicals and bio-based products. Integration of these processes often involves optimising resource efficiency, minimising waste, and creating value from various biomass fractions.
Benefits of Renewable Chemicals
- Environmental Sustainability: Renewable chemicals help reduce greenhouse gas emissions, conserve fossil fuel resources, and promote circular economy practices.
- Diversification of Feedstocks: By using various biomass sources, renewable chemicals reduce dependency on limited fossil fuel reserves and provide alternatives for energy and chemical production.
- Market Opportunities: Growing demand for sustainable products and regulatory support for bio-based industries create opportunities for businesses in the renewable chemicals sector.
- Technological Innovation: Advances in biotechnology, catalysis, and process optimisation drive the development of new and improved renewable chemical production methods.
Types of Renewable Chemicals
Biofuels: Renewable chemicals can include biofuels such as ethanol, biodiesel, and biogas produced from biomass feedstocks.
Biopolymers: These are renewable alternatives to traditional plastics. They include polymers like polylactic acid (PLA), polyhydroxyalkanoates (PHA), and bio-based polyethylene.
Platform Chemicals: These are intermediate chemicals derived from biomass that can be further processed into various products. Examples include bio-based acids, alcohols, and ketones.
Specialty Chemicals: Renewable chemicals also include specialty chemicals used in various industries, such as cosmetics, pharmaceuticals, and agriculture. Examples include bio-based solvents, surfactants, and lubricants.
Growth Industry
The global renewable chemicals market is set to experience significant growth, increasing from $300.9 billion in 2023 to an estimated $501.3 billion by 2028, according to a recent report by GlobalData. Chemicals which are produced from renewable sources such as agricultural feedstock, agricultural and organic wastes, and biomass are termed renewable chemicals. Renewable chemicals are widely used as direct substitutes for petro-based chemicals due to their lower carbon footprint.
The growth is expected to be driven by increasing environmental concerns and a shift towards sustainable alternatives to petro-based chemicals. The report highlights that the fine chemicals segment, which includes pharmaceuticals, agrochemicals, and cosmetics, accounted for over 34 per cent of the market in 2023. This dominance is attributed to the growing demand from these end-use industries. The renewable chemicals market is projected to grow at a compound annual growth rate (CAGR) of 10.8 per cent between 2024 and 2028.
Geographically, the Asia Pacific region held the largest market share of over 34 per cent as of 2023. This is largely due to government initiatives promoting the development of bio-based industries, including renewable chemicals. However, other regions are also expected to see growth.
The Middle East and Africa accounted for 0.8 per cent of the market share in 2023. Renewable chemicals, produced from sources such as agricultural feedstock, organic wastes, and biomass, are gaining popularity as direct substitutes for petro-based chemicals due to their lower carbon footprint. The market’s expansion indicates a positive trend towards sustainability and a reduced reliance on fossil fuels in the chemical industry.
Neste and Lotte Chemical Team Up
Neste (NESTE, Nasdaq Helsinki) creates solutions for combating climate change and accelerating a shift to a circular economy. The company refines waste, residues and innovative raw materials into renewable fuels and sustainable feedstock for plastics and other materials. Founded in 1976, LOTTE Chemical (HQ, Seoul, Korea) is a leading chemical company in Korea that has secured outstanding competitiveness through continuous business expansion, and is building a stable business operation and an efficient business portfolio.
Neste and South Korean chemical company Lotte Chemical are teaming up to make chemicals and plastics more sustainable. The companies embark on a strategic collaboration to replace fossil resources with renewable raw materials in the manufacturing of chemicals and plastics. This will enable products and applications with a lower carbon footprint compared to those produced from fossil resources.
The collaboration will see Neste providing renewable Neste RE™, a raw material for chemicals and plastics, that is made from 100% renewable raw materials. Lotte Chemical will use Neste RE at the company’s Korean sites to produce various common types of plastics and chemicals in Lotte Chemical’s broad product portfolio. These plastics and chemicals may be used in multiple applications and in supply chains for various products ranging from packaging to construction and from textiles to electronics. The quality and performance of the end products remain unchanged.
With chemicals and plastics still largely depending on fossil resources, both companies see an urgent need to make a switch to more sustainable alternatives. “We are looking forward to increasing the share of renewable solutions in collaboration with Lotte Chemical,” says Jeroen Verhoeven, Vice President Value Chain Development for renewable polymers and chemicals at Neste. “Together, we can pave the way to more sustainable supply chains and lower emissions for a wide range of sectors and applications.”
Neste and Mitsubishi Corporation
Neste and Mitsubishi Corporation (“MC”) have agreed to establish a strategic partnership focusing on developing value chains for renewable chemicals and plastics for and with Japanese brands. The partners are targeting brands in industries such as food and beverage, apparel, and consumer electronics. Through the partnership, Neste and MC aim to accelerate their efforts to build defossilised supply chains for brand owners in Japan.
In the course of the cooperation, Neste will provide its expertise in sustainability and more sustainable materials, also in the form of renewable Neste RE™, a bio-based raw material for plastics production. MC will provide its strong experience in business development and supply chain management of petrochemical products and derivatives in the region. Together, the partners will offer comprehensive solutions for Japanese brands looking to reduce greenhouse gas (GHG) emissions and reliance on fossil resources in their supply chains.
Neste and MC have already cooperated on several individual projects in the past, including a collaboration with other partners to enable the production of renewable PET bottles for Suntory Holdings Limited as well as a multi-party collaboration to produce apparel from bio-based materials for Goldwin Inc.
“Through this partnership, we will be able to provide sustainability-minded companies in Japan with a full package to reduce their plastics-related GHG emissions,” says Carrie Song, Senior Vice President, Commercial at Neste Renewable Products. “Together, we can provide the materials and the know-how. Together, we can also get the materials into the value chains, making it easier for companies to make the switch to more sustainable solutions.”
“Our strength lies in our capability to establish supply chains and access a wide variety of brand owners in Japan,” says Yoshiyuki Watanabe, Division COO, Business Development Div. at Mitsubishi Corporation. “We have cultivated this strength over many years through traditional trading and strategic investments in collaboration with trusted partners. Recognising that these achievements cannot be made alone, we are eager to strengthen our relationship with Neste. We are thrilled to expand our network to include partners who share similar values, thereby generating economic, societal and environmental benefits to meet the needs of society.”
Moving forward, Neste and Mitsubishi Corporation will accelerate the transition from fossil to renewable plastics under this strategic partnership, contributing to the early realisation of a de-fossilised society in the materials sector.
Renewable chemicals offer many benefits that contribute to sustainability and environmental protection. They have a reduced carbon footprint compared to traditional fossil-based chemicals, leading to lower greenhouse gas emissions and helping mitigate climate change. Renewable chemicals promote resource conservation by utilising renewable resources that can be replenished, reduce dependency on finite fossil resources, and enable the recycling and reuse of materials. Overall, the adoption of renewable chemicals aligns with sustainable development goals and fosters a more environmentally friendly and resilient industrial sector.
