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Historical Transformations in the
Chemical Industry
Ernst Homburg, Maastricht University
VoltaChem Annual Event, Amsterdam, 11 December 2019
Four major transitions: 50 to 100 years each
Raw materials/ Chemical feedstocks Energy sources
Plants/ animals > Minerals (inorganic
substances)
1780-1870
Wood
Peat
Horse dung; Sun
Plants/ animals > Coal (organic
substances)
1760-1910
Coal (1800-today)
Coal > Oil/ natural gas
1910-1980
Oil/ natural gas (1910-today)
Petroleum etc. > Biobased, CO2, etc.
2010-ff
Electricity, renewables
2010-ff
Outline
• (1) Transition theory
Cases
• (2) From plants/ animals
to minerals
• (3) From plants/ animals
to coal
• (4) From coal to oil & gas
• (5) Lessons from the past
and recommendations
(1) Multi Level Perspective (MLP): Arie Rip,
Frank Geels, Johan Schot
Genericfunctions(’upstream’)
Intermediaryfunctions
End usefunctions(’downstream’)
Materialssupply
Energysupply
Businessservices
Transport Communication
Housing(shelter,heating)
Recreation/entertainment
Feeding,drinking,cooking
Personalcare (washing,clothing, cleaning)
Healthcare
Different societal functions
Transition and system innovation
Socio-technical system
for transportation
Culture and symbolic
meaning (e.g.
Freedom, individuality)
Regulations and policies
(e.g. traffic rules,parking fees,emission standards, car tax)
Road infrastructure
and traffic system
(e.g. lights, signs)
Vehicle (artefact)
Markets and user practices
(mobility patterns, driver
preferences)
Industry structure
(e.g. car manufacturers,
suppliers)
Maintenance and distribution network
(e.g. repair shops, dealers)
Fuel infrastructure
(oil companies,
petrol stations)
Multi-level perspective
Niches
(novelty)
System/regime
Landscape
Increasing structuration
of activities in local practices
Micro-meso-macro: Not economic, but innovation (seamless web)
•Novelty emerges as ‘hopeful monstrosity’ (Mokyr)
•Niches offer protection against mainstream market
•Small network, unstable ST-configuration, diffuse rules
•Learning processes, network formation, expectations (SCOT, ANT)
Time
Product performance Invading product
Established product
T (1) T (2)
Micro-level: niches
(2) From plants/ animals to minerals: 1780-1870
Examples (* specific trajectories for each chemical – no general
transition!)
• 1800-1850 Barilla/ kelp >> soda from sea salt/ rock salt
• 1850-1870 Phosphates from bones or guano >> Rock
phoshates
• 1860-1870 Potas from wood >> Potassium mines
(production – research + “pilot plants” much earlier)
“Landscape” influences
• Population growth
• Rising demand textile industry and agriculture
• Deforestation (wood scarcity)
• Wars
• Transport infrastructures; mining equipment
Chemistry vs. Technology
• 1730-1780: long struggle to
establish clear relations between:
- Mineral alkali (soda)
- Plant alkali (potash)
- Volatile alkali (NH3)
• Ca. 1775 the proces for making
soda ash from (sea) salt was known
in chemical terms.
• It was Nicolas Leblanc who ca.
1790 designed the equipment
(furnaces), that basically would stay
in use till ca. 1860.
Niche development: France 1790-1814
• 1791 Leblanc supported by Duke of
Orleans starts producing 320 tons/
year
• 1793-1795 wars with England etc.;
supply of barilla stagnates; Duke
killed under the guillotine; process
details Leblanc made public
• Numerous new factories:
technology becomes mature
• 1815 France leading; 10.000-
15.000 tons / year
• 1805 high salt excise in Britain to
finance the war
• Continental blockade: problems
barilla import; kelp? 1815: Britain
500 tons
Industrial production
• UK: After 1814 barilla import resumed,
growth from 9000 to 15.500 tons/ year
• Soda industry “killed” after te war.
• UK 1825: end of excise on salt and
limestone
• Huge growth soda industry UK; completely
overtakes France
• Barilla import from 15.500 (1830) to 1.400
(1850)
Lessons: (a) France during the war as a
“niche”; (b) role taxes – govenment policies
(c) large international differences (raw
materials; transport; government policies)
(3) From plants/ animals (wood) to coal: 1760-1910
• Charcoal > Coke (18th C – only in UK)
• Wood tar > Coal tar (c 1760 in UK – after 1850 in USA)
• Tar destillates (c 1815-ff in UK)
• Natural dyes > Coal tar dyes (1856-1910)
• Natural drugs > Synthetic drugs (c 1880-1910)
• Synthesis gas (c 1910)
• Natural rubber > Synthetic rubber (WW I)
“Landscape” influences
• Deforestation (wood scarcity)
• Urbanization (light gas industry)
• Iron and steel industry (byproduct coking)
• Transport infrastructures; mining equipment
• WW I (synthetic rubber + other Ersatz)
Impact of coal tar industry on aromatic chemistry
• 1760-1820 coal tar for
shipbuilding
• 1810 town gas industry
• 1815 tar distillation
• 1848-1855 rectification of
tar oils; benzene and
nitrobenzene production
(impure) (Mansfield,
Pelouze etc.)
• 1865-etc. improved
rectification (Coupier etc.)
Discovery aromatic substances
From coal tar
• 1819 naphtalene
• 1832 anthracene (para-n)
• 1834 aniline
• 1834 phenol
• 1834 chinoline
• 1840c benzene
• 1841c toluene
• 1846 picoline
• ETC
From plants and animals
• 16th C benzoic acid
• 1771 picric acid
• 1786 gallic acid
• 1806 pyrogallic acid
• 1825 benzene (from
whale oil)
• 1826 aniline
• 1834 cinnamic acid
• 1838 salicylic acid
• 1841 toluene
• 1841 anthranilic acid
Case: Dyes
• Dyes (general): from natural > synthetic (Revolutionary
… BUT also Evolutionary)
• Gradual technological development and slow scaling-up.
Economies of scope.
• Market development: adapting recipes for dyeing etc.
N.B. local and national contexts again very important
Niches: silk dyes + Germany• Perkin 1856. Production 1857.
• First aniline dyes briljant, but very
expensive
• Only for wealthy customers, wearing
silk cloths, and following the latest
fashion
• First aniline dyes not suited for
cotton, and too expensive for
woollens
• First dye companies founded in the
centres of silk textiles: Lyon, Krefeld,
Elberfeld, London, Milan, by dyers
and merchants
• No patent law in Germany > (1)
more producers + (2) survival of the
fittest + (3) economies of scope
1857-1866 dyestuffs “boom” in silk dyeing
Start-ups later produced also dyes for wool and
cotton
Number of Dye Firms in the World, 18 57-1914
1857 19141885
With and without counting subsidiaries both domestic and foreign
0
10
20
30
40
50
60
70
80
90
with subsidiaries
without subsidiaries
Dynamic equilibrium between start-ups and
failures
Global Firm Entries and Exits 1857-1914
1857 19141885
0
2
4
6
8
10
12
14
16
18
20
Entry 3- YMAV
Exi t 3-YMAV
Growth of number of German dye firms until ca.
1900 – thereafter mergers and consolidation of the
dye industry. Almost all natural dyes replaced.
Number of Dye Firms by Count ry, 1857-1914
USA Britain Germany SwitzerlandSwitzerland France
1857 19141885
0
5
10
15
20
25
30
35
40
Country comparison
• Start in Britain in France
• Decline in France: patent monopolies
• Stagnation in Britain: patent issues – block economies of scope
• Germany continuous rise: no patent law until 1877 –evolutionary struggle: many entries, many exits; survival of strong companies; possibility to establish economies of scope + organizational capabilities
• In Germany also merchants founded dye companies, together with chemists. Direct link between sales and production.
Coal tar dyes differed chemically from most natural
dyes, with the exception of madder and indigo.
Even then new recipes had to be developed.
• No simple substitution!
• Madder and synthetic alizarin
are all different mixtures.
• There were well tested
recipes for dyeing and
printing with madder.
• For alizarin new recipes had
to be developed. It took time
before dyers and printers
accepted.
Gradual replacement of natural dyes 1856-1910
• 1856-1868 aniline dyes, briljant, but
expensive: mainly on silk (luxury
market)
• 1868-1878 alizarin replaces madder
(also on cotton and wool)
• 1880c azo dyes, later followed by direct
cotton dyes
• 1880-1910 indigo
• (Cheap) dyewoods were still used to
some degree by 1910.
Lessons: (a) silk dyeing as a “niche”; (b)
(b) absence of patent law was a niche for
Germany; (c) gradual expansion to other
textile sectors; (d) long period of co-
existence of synthetic and natural dyes.
(4) From coal to oil & gas: 1910-1980
• Start in USA: Union Carbide 1920 ethylene; Shell 1927-ff ammonia,
propylene, solvents; Dow 1930s organic chlorine and bromine
products; Standard Oil 1930s hydrogenation, olefins, aromatics
• WW II: cat crackers, ethylene, propylene, butylenes, synthetic
rubber.
• Europe: after WW II: start with polyethylene.
“Landscape” influences
• Abundance of oil and gas in US
• Political control of world oil market by US after WW II; end of
Autarky
• Economies of scale in US industry
• “Wage explosion”, detrimental for coal.
Case: West German (Organic) Chemical Industry
• 1945 almost 100% coal based
• 1961 just over 50% petro based
• 1980 almost 100% petro based
Lesson: Gradual process taking
decades. Co-existence of two regimes
• First post-war years still an autarky-
policy; it took several years before
one dared to rely on world oil supply,
guaranteed by US political power
Lesson: Role of political factors
• Growth of car use in 1950s/ 1960s
Lesson: cross-links between chemical
industry and other sectors
West German Chemical Industry - 2
• Catalytics reforming > aromatics from oil,
early 1950s (crucial for German companies)
Lesson: relevant technology not there in 1920
• German companies first wanted to adapt
their extensive acetylene chemistry to petro
feedstocks; only later they shifted to ethylene
Lesson: carbo-petro hybrids
• Polyethylene was the first large scale
petrochemical, joint ventures with oil
companies
1955 BASF + Shell Wesseling
1958 Bayer + BP Dormagen
Lesson: PE was the niche because of scale; no
large-scale carbo equivalent + high demand
(5) Lessons from the past: general
• Transitions take 50 – 100 years
• Long period of co-existence of two
technological regimes + hybrids
• Scaling-up from lab to large scale
production takes time (AND the time
to realize price levels that make the
new technology competitive)
• Market development takes time too
• (# does that still apply in case of
substitution?)
• Great differences between nations (or
regions) in speed of transition
• Fast growing demand for (certain)
products creates opportunities
• (# does this apply now?)
“Landscape” influences
• Deforestation (wood scarcety)
• Abundance of oil in US
• Growth of other industries +
cross-links: transport (rail; car
use); mining; towngas;
textiles; agriculture; iron and
steel)
• Politics (autarky; US
domination; excise taxes)
• Wars
• Costs of labor (wage
explosion)
Role of “niches”
• France and soda: disturbance of
imports + a policy to make know-how
public + no foreign competition
• Dyes: high growth in the silk luxury
market + entrepreneurship of silk dyers
and merchants + no patent law in
Germany > more, strong firms, with
larger port-folio
• Fast growing demand for PE
internationally + availability of large
scale PE technologies (risks could be
calculated, also via involvement oil
companies)
Recommendations - 1
• Develop a broad view on the
present and the future state of the
industry (reconstruct the
components of both the old and
new “socio-technical system.”
• Identify bottlenecks.
• No “single issue” views, e.g. only
CO2 related.
• Be aware that the transition will
take long.
Transition and system innovation
Socio-technical system
for transportation
Culture and symbolic
meaning (e.g.
Freedom, individuality)
Regulations and policies
(e.g. traffic rules,parking fees,emission standards, car tax)
Road infrastructure
and traffic system
(e.g. lights, signs)
Vehicle (artefact)
Markets and user practices
(mobility patterns, driver
preferences)
Industry structure
(e.g. car manufacturers,
suppliers)
Maintenance and distribution network
(e.g. repair shops, dealers)
Fuel infrastructure
(oil companies,
petrol stations)
Recommendations - 2
• Reflect broadly on
promissing “niches” and on
how to protect them.
• So, don’t look only to
technological options, but
also to demand + to political
and/or economic
possibilities of protecting
new developments against
competition by proven
petrochemical technology.
•Novelty emerges as ‘hopeful monstrosity’ (Mokyr)
•Niches offer protection against mainstream market
•Small network, unstable ST-configuration, diffuse rules
•Learning processes, network formation, expectations (SCOT, ANT)
Time
Product performance Invading product
Established product
T (1) T (2)
Micro-level: niches
Thank you !