Biolubes in Europe: Regulation the prelude to growth
Globally, bio-lubricants are still in what you would describe as the nascent stage, comprising roughly 1% of the total finished lubricant market and offering boundless opportunity for growth. Driven by regulation and a shift in consumer sentiment, the sector is gradually beginning to organize itself. A recent report* predicts worldwide demand to grow from an estimated USD 2.47 billion in 2017 to reach USD 3.36 billion by 2022, at a compound annual growth rate (CAGR) of 6.4%. Another narrative, published by Grand View Research in September 2016, estimated demand at more than 630 kilo tonnes in 2015, and forecast it to reach 1,115 kilo tonnes by 2024.
Hydraulic fluid applications accounted for the largest share of the bio-lubricants market (in terms of value) in 2016. Lubricants with a high degree of biodegradability and low toxicity are commonly used in stationary and mobile equipment such as hydraulic elevators, sweepers, garage trucks, forklifts, motor graders and front- end loaders; and now also marine thanks to the U.S. Vessels General Permit (VGP). The industrial segment is the principal end-use segment for bio-lubricants, with increasing environmental awareness a primary reason for a shift in consumption patterns.
Clear leaders in the adoption of bio-lubricants are North America and Europe, comprising a staggering 84% of the overall market, as recently as 2016. The North Biolubes in Europe Regulation the prelude to growth F+L Magazine Quarter Two 2018 41 American juggernaut is projected to exhibit the strongest growth to 2022, fuelled in part by an emerging supply of synthetic bio-based base stocks and the Federal Bio-Preferred Program. Though, the combined European region is the leader in terms of share, propelled by countries such as Germany — where bio-lubricants are valued at USD 200 million.
Indeed, a number of European companies dominate the embryonic bio-lubricants sector. A Kline blog post in November 2017 confirms Germany’s Fuchs and Switzerland’s Panolin as the leading suppliers of finished bio-lubricants worldwide, “driven by their bio-lubricant range and focus, global reach and OEM partnerships.”
However, the dynamic pairing of Europe plus innovation has not always been so obvious. A 2007 paper on the economic advantages of the Lead Market Initiative for Europe highlighted relative underperformance in innovation and that “the EU as a whole, and most of the EU countries, still lag significantly behind the top innovation performers in the world, such as the U.S. and Japan.” By way of example, the report cited that in relation to its population, Europe generates fewer patents with high economic value than the U.S. or Japan. In biotechnology, EU-25 accounted for only 27% of high-value “triadic” patents, compared with 55% for the U.S.
Perhaps stung by this criticism, Europe resolved to facilitate the marketing of new innovative products and services in areas with the potential to become the world leader. As a result, communication on a lead market initiative was launched, identifying a first set of markets with potential to become LM. In 2010, the European Commission published the ‘Europe 2020 Strategy’ — emphasizing a goal of smart growth by promoting knowledge and innovation. Accelerating the development of the market for bio-based products was identified as a key enabler in shaping Europe’s industrial future.
Undoubtedly, this is easier said than done. With the “bio” prefix comes various complexities. The term “bio” is commonly linked to the expectation of a product’s breakdown in the environment. Unfortunately, just because a product is called “bio” doesn’t always mean it is an environmental savior.
Lubricants made from biomass can biodegrade rapidly, slowly, or not at all. Contributing base oils can be natural (unchanged renewable material) or synthetic (chemically modified biomass). There are countless examples of lubricants courting “bio” credibility. Clear and unambiguous terminology is of particular importance to avoid confusion, misinformation and to maximize environmental effects.
Irrespective of the expanding awareness of ‘environmentally compatible lubricants,’ a dearth of technical language describing these products and associated standards, has impeded the growth of bio-lubricants. Notably, “environmentally compatible lubricants” are not technically needed to fulfill the functional requirements of existing specifications and their base oil chemistries are far more expensive than lubricants from upstream. Europe has recognized the importance of regulation and standardization as a prelude to growth.
Much of Europe’s bio-lubricant success can be attributed to strict environmental protection understanding, mandatory purchase requirements and considerable self-regulation — driven by business leadership and trade associations. Wide-ranging labeling programs, including the European Eco-label (EEL), have underwritten recognition and acceptance of bio-lubricants since 2005, and continue to reward companies that design sustainable products that promote innovation and resource efficiency. EEL products include renewable content, biodegradation criteria and more stringent aquatic toxicity criteria. Developments in the leading German market have also been supported by legislation, notably the Blue Angel label and the no longer active FNR (Fachagentur Nachwachsende Rohstoffefe) subsidy scheme.
Despite these instruments, it is essential to build upon existing biodegradability standards, particularly as bio-based content on its own is not an acceptable environmental premise. Bio-lubricants’ list of expanding requirements includes biodegradability, aquatic toxicity, content of biomass and performance.
Europe identified the need for a “general, non-contentious and well-accepted description and definition including biodegradability, renewability and aquatic toxicity, consistently valid for all kinds of lubricants.” Until recently, standards and definitions were only available for single groups of lubricants, for example, hydraulic fluids.
The European Committee for Standardisation (CEN) Technical Committee CEN/TC 19 “Gaseous and liquid fuels, lubricants and related products of petroleum, synthetic and biological origin” prepared a new European standard DIN EN 16807 entitled “Criteria and requirements of bio-lubricants and biobased lubricants” that was published in December 2016. The standard finally qualifies the term “bio-based product” with respect to tests on the fully formulated lubricant.
The criteria and requirements published in the document are “intended as horizontal requirements for all kinds of bio-based lubricants and should be seen as minimum requirements compared to the European Ecolabel for Lubricants.” The future direction of bio-lubricants will be dictated by CEN, as the proposed criteria of the European ecolabel’s third revision endangers the bio-no-tox lube achievements. The consequence? 75-80% of existing eco-labelled lubricants may disappear, unable to meet the new criteria, according to Mathias Woydt, head of Division 6.3, Macrotribology and Wear Protection, BAM, a senior scientific and technical institute under Germany’s Federal Ministry for Economic Affairs and Energy.
More recently, the technical committee has specified a new test method for determining the degree of aerobic degradation of fully formulated lubricants in an aqueous solution. A range of existing ISO and OECD-test methods exist for determination of aerobic biodegradation with a “broad scope of preparation tools to maintain comparable results for all different materials appearing liquid, solid, water-soluble, non-water-soluble or emulsifiable.” Low levels of reproducibility and repeatability are evident depending on the choice of test method, preparation procedure or inoculum, according to the document.
Existing test methods are missing defined precision statements for biodegradation, provoking conflict around individual company claims of biodegradation levels. The prEN 17181 “Lubricants – Determination of aerobic biological degradation of fully formulated lubricants in an aqueous solution – Test method based on CO2 production” is dealing with this issue. In contrast to existing test methods measuring released CO2, the new test method “uses a precise preparation procedure for non-water soluble organic material,” the first to include precision statements from round robin tests with different types of fully formulated lubricants. The Inter Laboratory Study (ILS) research report was approved at the recent CEN/TC 19 WG 33 meeting at TOTAL’s office in Paris, France, on November 16, 2017.
Based on the findings of the prEN 17181 task force, the next technical steps are on the table and will be explored to further improve precision. The CEN/TC 19/ WG 33 ‘Bio-Lubricants’ 26th meeting was held on January 29, 2018 in Mannheim, Germany, at FUCHS SCHMIERSTOFFE.
*From marketsandmarkets.com entitled “Bio-Lubricants Market By Base Oil Type, Application, End Use – Global Forecast to 202 2”
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