Tracking Progress: Chemicals and petrochemicals
The chemicals and petrochemicals sector remains the largest industrial energy user, accounting for 28% of industrial final energy consumption in 2014. Of the sector’s total energy input, 58% was consumed as feedstock. To remain on a 2DS trajectory, annual increases in process energy consumption must stay below 3.6% and direct CO2 emissions below 3.6% during 2014-25, a period in which demand for primary chemicals is projected to increase by 47%.
Global production of high-value chemicals (HVCs), ammonia and methanol recovered the ground lost during the global financial crisis, growing by 19% (HVCs), 13% (ammonia) and 51% (methanol) over the period 2009-14.
Major shifts in the fossil fuel landscape in recent years have had significant impacts on the global feedstock mix. Notably, the shale boom in the United States has contributed to a regional divergence in natural gas prices, resulting in a cost advantage for US chemical producers reliant on lighter feedstocks3 such as ethane and liquefied petroleum gas (LPG). A 16% increase in global ethane steam cracker capacity between 2010 and 2014 accompanied this shift.
The production of HVCs, ammonia and methanol accounted for 73% of the chemicals and petrochemicals sector’s total energy use in 2014. Actual SEC4 values for these large volume processes are 12.5 GJ/t HVC to 34.6 GJ/t HVC of process energy for HVCs, 10.4 GJ/t to 31.4 GJ/t for ammonia, and 11.6 GJ/t to 25.1 GJ/t for methanol.5
Bio-based routes to both primary chemicals and downstream chemical products present promising avenues for decarbonisation. Bio-routes to primary chemicals, such as bioethanol-to-ethylene and biomass-based ammonia and methanol, exist mainly at pilot scale. Global production capacity of bioplastics totalled 1.7 Mt in 2014, but was dwarfed by the overall plastic materials demand of 311 Mt.
Average annual growth in the sector’s process energy consumption and direct energy-related CO2 emissions was 2.3% and 2.6%, respectively, during 2000-14. Energy use as petrochemical feedstock, which grew 2.3% annually during the same period, also plays an important role, with over half of the sector’s energy consumption and 19% of its direct CO2 emissions. Annual average increases in process energy consumption and direct energy-related CO2 emissions through 2025 must stay below 3.6% and 2.8%, respectively to meet the 2DS trajectory. Future evolution of energy prices, feedstock-related CO2 emissions, and demand for chemical products could be challenges to a long term transition to low CO2 production.
Process energy use for the production of HVCs, ammonia and methanol accounted for 32% of sector’s TFEC in 2014, increasing slightly to 33% in 2025 in the 2DS. Global average declines in the process energy intensities of the sector’s main products – 13% for HVCs, 5% for ammonia and 15% for methanol – are outpaced by the energy savings from shifts to higher yielding feedstocks.
Two levers provide the majority of the 2DS’ direct CO2 emissions savings in 2025, relative to the RTS: process energy efficiency (78%) and switching to lighter fuels and feedstocks (18%). The remaining 5% is provided by increased plastics recycling. Post-consumer waste plastic collection rates, recycling yield rates and the extent to which recycled polymers displace virgin resin consumption (i.e. reduced down-cycling) all increase steadily until 2025. These increases deliver 9.8 Mt of annual primary chemical savings in the 2DS in 2025, compared with the RTS.
Two key categories of sector-specific mitigation options should be given priority in the short to medium term. The first category is fostering best practices among existing plant operators to lower energy and emissions intensities for key production processes. The second category is removing barriers to enhancing resource-efficient production and waste treatment. Ensuring the presence of price signals to incentivise resource efficiency strategies throughout the chemicals value chain can promote positive action. Harm to competitiveness can be minimised if collective action is taken globally.
Both the quality and quantity of publicly available statistics in the chemicals and petrochemicals sector have long needed to be improved. The appraisal of policy initiatives, such as those noted above, requires detailed and robust statistics.
Published: 16 May 2017Download Full Report