DSM: in Europe we need a more integral approach to the bioeconomy from regulators

In Europe there is a need for stability and coherence in the regulatory field of new energy. The Commission’s decision to limit to 5% the use of first-generation biofuels (those derived from food crops) goes in the wrong direction. To say it is Martijn Antonisse, director of new projects on bio-based products for DSM, the giant Dutch multinational active in the fields of life sciences, nutrition and materials (22 thousand employees worldwide, with a turnover of € 9 billion in 2011) . One of the first industries to sniff the new business of bio-economy, the new economy based on biological resources, and invest good money.
Mister Antonisse, how much is DSM investing for bio-based products?
We don’t reveal our R&D expenditure for any specific subject. What we can share is that we spent 5.3% of net sales on R&D in 2011
Well, I think a significant percentage. But what makes DSM so decided to focus on the bioeconomy?
We don’t know exactly what the future holds for our planet, but we strongly believe that we need to prepare for the era when fossil feedstock will become too expensive, or even limited in availability. As our great-grandparents and their ancestors did, we will need to return to living of the land – using wind, solar energy, hydro and crops, be it smarter (a/o through the use of biotechnology) than we did before we found oil.
According to Bloomberg New Energy Finance, next-generation ethanol alone could create up to a million man-years of sustainable employment in Europe between now and 2020, and help reduce road transport green house gas emissions by 50%.
DSM wants to be a leader of this revolution. Thanks to our company, new enzyme and yeast technology exists that has made cellulosic ethanol – that is biofuel made from (non edible) plant residues– commercially viable for the first time.
So what do you think of the European Commission’s decision to restrict the use of first-generation biofuels to 5%? The discussion in the whole of Europe is lively …
The proposal to limit the use of crop-based biofuels to 5% and at the same time double or quadruple count several non-food-related alternatives, will eventually lead to a lower percentage of current fuel consumption being fulfilled with renewable alternatives. To us that is a disappointing direction, since we work from the belief that the transition from non-renewable to renewable feedstock is the first important objective. Regulation should help to increase the level of responsible thinking involved – not stop, or limit the demand.
What measures should be introduced by Europe to effectively drive the bioeconomy?
DSM feels that we need a) a more integral approach to the bio-economy from regulators (rather than one-sided thinking, either from energy, or agricultural, or environmental perspective) and b) measures that create a more level playing field for bio-based solutions versus their alternatives that are based on non-renewable feedstock. In this sense, we feel that Europe is severely lagging behind the USA and Brazil when it comes down to supportive policies and (consequential) market conditions.
Fortunately, however, DSM is not investing only in the U.S. or Brazil. It also does in Italy: in Cassano Spinola in the province of Alessandria, there is a plant of Reverdia, your joint venture with Roquette
Today the vast majority of chemical building blocks that go into making foods, resins, polymers and pharmaceuticals are derived from oil.
In a first significant step away from this model, DSM has partnered with Roquette, a leading French starch and starch-derivatives company, to produce bio-succinic acid, a key chemical building block that is made from plants rather than fossil carbon sources.
Bio-succinic acid, which is made from starch using an innovative enzyme-based fermentation technology, has environmental benefits in two respects: not only does it avoid the need for non-renewable hydrocarbon ingredients; it is also much less energy intensive to produce, requiring 40% less energy to make than conventional succinic acid.
Mario Bonaccorso

7 thoughts on “DSM: in Europe we need a more integral approach to the bioeconomy from regulators

  1. Giorgio 15 November 2012 / 10:02 pm

    Torniamo davvero alla vita dei nostri antenati! Interessante la posizione di DSM

  2. Don McNeil 28 November 2012 / 2:22 pm

    In my opinion what you need to do is allow the free market to dictate what products are used and not some regulator with a political agenda. Products which produce a better economy will always win!

  3. James Ashworth 28 November 2012 / 2:25 pm

    Don, I do not think the “free market” has either the freedom, knowledge, or ethics to make a good decision on this matter. Free marketeers are bottom line motivated, microscopically focussed on their share options and little else. The lowest common denominator triumphs. Greed:1 Everybody Else:0

    Let me take 3 steps backwards… please indulge me.

    Imagine yourself as “Custodian” of Planet Earth.. why? Because you have the imagination, aptitude and rational thought to be good at that job. What are human beings? Arguably a plague that is growing exponentially and, like lemmings, charging towards the edge of extinction, which will be a good thing from the Earth’s point of view. The real challenge is: how do we justify and sustain our continued existence?

    Zooming in on the field of lubrication, bio lubes have many attractive features and also some pretty nasty properties too, compared with mineral derived varieties. If bio lubes are used and this leads to premature failure of machinery and the cost of replacement (materials, energy, pollution etc.) is greater that if we had used a properly formulated mineral oil, it is clear that bio fuels would be the bad choice.

    Conclusion: the choice and use of bio lubes should be based on a balanced and rational approach. It certainly must not become a political football. And those who decide on what is right and wrong must have absolutely no skin in the game.

  4. Don McNeil 28 November 2012 / 2:26 pm

    I agree with some of what you are saying, but the problem with your assumption is that you apparently believe that any governmental ccommisioner is capable of making decisions that are balanced and rational. That is an oxymoronic assumption because if it involves the government it will be political and that does not meet the criteria you just described. We have not advanced the state of lubrication technology to this point by having the government decide what is good or bad for the market nor will government regulation or control ever accomplish anything close to what the free market can achieve in new technology. Some regulations are required in any society to make sure things that are developed are not harmful, but having more regulations that require the development of more bio products in general is a bad idea!

  5. Allen Aradi 28 November 2012 / 2:27 pm

    I just finished watching the Formula One race of Brazil, and it is clear that many factors make for winning the race. The more important ones are: 1) Engine, 2) Breaks, 3) Steering mechanism, and 4) Driver Skills. Similarly for a winning economy you need: 1) Free Market Forces, 2) Regulations, 3) Government Funding, and 4) Skilled Manpower.

    A proper balance is necessary since ephasis on free market forces alone has huge negatives (see James Ashworth’s comment above). In addition, government involvement in funding of emerging technologies is well proven in the case of the USA, and we can get into that with regard to, for example, free market technolgy spin offs from NASA activities the military, etc. And lets not forget the fundamental foundations laid down by research institutions such as colleges, universities, and national labs – all funded for predominantly by tax payer money. In fact all advanced economies have used the same mechanism to get nacent technologies off the ground in instances where they were deemed too risky for free markets to invest in. Once over the hump, free markets were happy to rush in, but too often soon to forget the critical government role underlying their subsequent success.

    Also it is a falacy to assume that in all human activities, only free markets attract exclusively the most honerable, responsible and honest, and therefore should not be regulated. Unfortunately the profit motive of the free markets tends to also attract a larger percentage of the unscrupulous and dishonest, and therefore should be subject to the same level of oversight as, for example, the use of vehicles on roads.

  6. Don McNeil 28 November 2012 / 2:27 pm

    Allen – you should read the original post and what it was recommending, which was to have an integral approach from regulators in order to develop new technology! Regulation is a necessary evil but I have never seen a regulator who helped in advancing new technology. The free market with appropriate regulation for safety and equality will always outperform one that is regulated and controlled by the politicians. You mention NASA but the difference in what was being recommended and NASA is that even though NASA was funded by the government they operated independently of the poiticians for many years in partnership with private industry to accompish a goal, which was to put a man on the moon. That worked well for the first 10 or 15 years but is now a joke because the politicians have taken over and they have no directive. They are now a huge beauocracy that can’t even get out of their own way! All of the technology that came from the space program was then developed and marketed by private markets. Keep in mind that the money that government pays to develop new technology isn’t free because all of the money that any government has comes from their tax payers. While the US government spends a huge amount of money to fund the development of ndew technology, most of it is a total waste because the politicians try to use this money to pay off their supporters. WE don’t need more government we need less!

  7. Allen Aradi 28 November 2012 / 2:28 pm

    Don – Yes I did read the original post.

    DSM is not opposed to government regulations.

    DSM is not even opposed to the level of those regulations.

    Instead, what they are opposed to is EU regulations limiting biofuels from agricultural foodstuffs to 5%, rather than letting free markets determine the final volume. This is because, in their biomass to renewables business, DSM has focused their R&D to enzymes and microbes that process feed stocks derived from biomass currently being cultivated to provide food for livestock and people. In other words, what is at stake here is DSM’s bottom line interests. Period. Nothing wrong with that. However, it is important to recognize it for what it is.

    So, the idea that “WE don’t need more government we need less!” is entirely yours, not DSM’s.

    Your attempt to turn my NASA example around on its head to prove your point is not accurate, so let’s correct that. It is important to emphasize that NASA is a CREATURE of the US GOVERNMENT, created by POLITICIANS, with the overriding military objective to counter the Soviet lead in space. The failure you are ascribing to NASA during its later years was due to the fact that once the original objective was achieved; a new one was not clearly articulated. This type of failure is not unique to enterprises created by government with oversight from “government politicians”, as you may want us to believe. Rather, it is a failure mechanism also quite common in the “free market” private sector. I can give you endless pertinent examples. At this time, it suffices to remind you that the art of politics is also practiced in the private sector, just as in government.

    Next, let’s examine more closely the gist of your argument, namely, you want conditions that give more freedom to market forces while minimizing government oversight (“WE don’t need more government we need less!”). To borrow from my Formula One analogy, you want an increasingly more powerful engine while minimizing breaking power. Since the result of a Formula One race is realized in hours and not years, this analogy is, in fact, an accelerated test of your hypothesis. As such, we have many examples of wrecked race cars that illustrate the fallacy of your argument.

    Finally, bringing this back around to the context of this forum, production and marketing of “green” lubricants will also be subject to similar government oversight being developed around biomass derived fuels and chemicals. As with the latter, you just can’t cherry pick those regulations you agree with in pursuit of your subjective desire for ‘less government oversight, not more’ and discard the rest addressing interests of those other than you.

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