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 !