Steering Towards Sustainability

It's difficult to exaggerate the effect the chemical industry has on how we live today. It is one of the most complex and diverse in terms of interconnected value chains. Its products are needed by many other sectors to function properly. Across healthcare, agriculture, construction, manufacturing, and the transport industries, it is an essential component of their existence.

Unsurprisingly, given its tremendous influence on how we exist, the chemical sector’s total revenue in 2022 was over 5.72 trillion US dollars¹. And, perhaps it is also no wonder that its impact on climate change is similarly startling. It is the third-highest emitter of greenhouse gases (GHG) in industry, behind the steel and cement sectors. 

This reliance on fossil-based feedstocks as the base materials for its production poses particular problems for the sector as it seeks to decarbonise its operations. There’s a groundswell from its customers, and end-consumers, for lower-carbon products, and increased awareness of recycling and the issues surrounding the circular economy. There is greater demand for resource-efficient production, made more urgent by soaring gas prices and supply issues. And there is no let-up in the tougher regulatory pressures that govern the industry.

The chemical industry is acutely aware of the need to improve its sustainability credentials. As Scope 3 emissions at a customer level become more pressing, and ESG pressures increase, producers are optimising their portfolios for the long term. This is happening through various strategies, for example by moving away from phthalate-based catalysts for polypropylene production, Per- and polyfluoroalkyl substances or PFAS and other toxic chemicals. Where direct impact on climate change is concerned, the industry is moving rapidly. ExxonMobil has set a target for net-zero GHG by 2050, BASF aims to reach a 25% emissions reduction by 2030 compared to 2018, and LyondellBasell has raised their emissions reduction target from 30% to 42% by 2030 relative to their 2020 baseline.

It is the Scope 3 emissions, which cover purchased goods and services (i.e. raw materials) that are accelerating moves towards decarbonisation. Here, it is the sector’s valuable customers who are demanding action. End-retailer Kingfisher has targeted a 40% reduction in Scope 3 emissions per £million sales by 2025, whilst mid-stream customer AkzoNobel aims for a 42% Scope 3 reduction by 2030.

Rising to the challenge won’t be easy, nor will it see overnight fixes. But that isn’t stopping the industry from meeting it head-on. Take the issue of steam crackers; a vital part of the chemical industry’s production chain. These furnaces run at high temperatures around 850°C, and break down long-chain hydrocarbons from raw gasoline or naptha². The result is the production of olefins and aromatics, which are the foundation for everything from vitamins, solvents, specialty chemicals, plastics, and pharmaceuticals. Today, steam crackers are powered using fossil fuels; but what if they could be electrified?

At Ludwigshafen in Germany, that’s what BASF, Sabic, and Linde have set out to do. At the world’s first demonstration plant for large-scale, electrically heated steam cracker furnaces, the goal is to reduce CO2 emissions by 90% compared to today's usual practices.³

Though impressive in its ambitions, and promising for its potential to forever change the way the industry operates, such supply-side projects are by their nature long-dated. Lead times for new plants are typically four to five years (optimistically), with ramp-up periods before full operating rates are achieved. Then, consider that the average operating life of a plant can easily be over 30 years, and you begin to see how reaching carbon reduction targets in the timespan needed requires more than innovation.

Whilst the chemical industry is well-placed to exploit its close relationship and investment in R&D to provide solutions that address global challenges, it is a combination of factors that will reap rewards. As so often is the case with the decarbonisation journey, by employing several approaches the way forward becomes more apparent.

A recent study of decarbonisation strategies amongst European chemical producers found four levers to be most effective at reducing emissions: alternative means of steam generation, utilising residual heat, changing electricity procurement, and improving energy efficiency.⁴

As the BASF-led project demonstrates, efforts are well underway that focus on alternatives for generating steam. Seven carbon-free technologies, with varying levels of commercial availability, are being promoted: biomass, solar thermal, biogas, hydrogen, thermal storage, e-boilers, and heat pumps.

Energy efficiency, or the optimisation of systems to minimise energy losses, cuts across all these alternatives. It will be as important when they are online, as it is now. It is a fundamental lever that requires expert knowledge and experience to exploit fully. Importantly, it also has a knock-on effect on productivity, with extra savings potential relatively easy to reach thanks to the high number of small energy-efficiency measures available. That is especially relevant to the chemical industry, which is expected to see a 25% increase in demand for primary chemicals, just by 2030.

The opportunity is both real and measurable. Working with a multinational company last year, we partnered with them to trial our latest steam trap monitoring devices. By installing these on just several critically placed trap, we were able to demonstrate the benefit of focusing on their current steam system.

Impressed by the proven results of the pilot study, the company has increased the number of steam traps monitored, with more coming online in early 2024. It is worth noting that the budget for this originated from sustainability, with maintenance, repair, and operations reaping the add-on benefits.

The chemical sector is urgently seeking avenues to advance its decarbonisation efforts and reach tough sustainability goals. Whether through ambitious, groundbreaking initiatives that will forever change the face of the industry or by immediate energy efficiency measures, the endgame is the same. To continue to provide the tens of thousands of essential items we have come to expect in order to live our lives. It has become an imperative, both for the planet’s future and for the industry’s evolution. According to Jefferies Research, the cost of chemical cracking in Europe has increased ~200% over the last two years, whilst the industry as a whole is reckoned to produce ~20% of industrial sector carbon emissions. It is a balancing act that a tightrope walker would find difficult, and one the chemical industry is determined to navigate.