OIL AND THE GREEN LOGIC

OIL AND THE GREEN LOGIC

Dear employees and friends of AVISTA OIL

The well-known German economist, Hans-Werner Sinn, published a work paper way back in 2008 with the title Das grüne Paradoxon: Warum man das Angebot bei der Klimapolitik nicht vergessen darf (published in
English as: The green paradox: a supply-side approach to global warming). On his Website www.hanswernersinn.de/en/topics/GreenParadox he writes in this context that “… politicians believe that we can reduce emissions of carbon dioxide and thus save the climate through green legislation, which curbs demand for fossil fuels. But how will that work? …

If we threaten the owners of resources with ever greener policies that will ruin their businesses in future, they will simply side-step the threat and extract their resources from the ground even faster than before. Instead of slowing down global warming, we accelerate it. That is the green paradox.” But what could provide a remedy here? Where is the green logic decisive for the climate?

There are certainly a number of different approaches to this. A remedy could be provided by certified, CO2-reduced and CO2-saving Substitute fuels instead of fossil energies. A solution could be to recognise alternative fuels and thereby give them priority over conventional resources. This does not necessarily have to be controlled by laws that would just strengthen the green paradox: the solution would be a settlement as part of the trade in emissions.
We, AVISTA OIL, have demonstrated in recent years with the help of numerous studies that the resource crude oil to manufacture conventional base oils can be replaced by used oil as the raw material for base oils. Particularly seen in the light that our production processes achieve a base oil yield of around 60%, whilst that of the crude oil industry is solely 2%.

Together with the IFEU Institute in Heidelberg and DEKRA, we determined the CO2-saving that we can guarantee to our customers compared to conventional base oil producers: 30% (~ 825 kg per ton). An ecological milestone in the manufacture of basis oils. The raw material used oil offers a further saving referred to the consumption of resources. For every ton of used oil deployed in ecological refineries, 29 tons of crude oil do not need to be expensively extracted causing pollution to nature. Our hydraulic oils, for example, provide an upstream CO2-reduction to the deploying industrial works that should also give a monetary incentive in the settlement (in this case, reduction) of CO2 emissions: particularly in
the trade with CO2 certificates. The creation of clear incentives for using things like sustainable raw materials and consumables in production processes, which reduce the CO2 footprint, should act as cost-cutters.

The aim must be to no longer regard production processes as pure chains of value creation, but rather of chains of sustainability, which should bring positive affects to the CO2 balance. Companies can deal
with the CO2-saving like value-added tax; they could post input materials with the CO2-saving in kg/t guaranteed by their upstream supplier and assess these as through-going items. This would provide realistic evidence of their CO2-saving for all stages of value creation. The Overall value determined would then be the saving, which would have to be positively assessed in the CO2 balance.

We can see the green logic here!

As far as our customers are concerned, this method would mean that they use our hydraulic oils to reduce their CO2 footprint. They not only gain added value in ecological, but also economic terms. By returning the used oils, they reap further added-value because 60% of new basis oil is created from this.