Approaching zero carbon ｜ Energy saving and carbon reduction in chemical industry need multi-party cooperation
Source: The Paper.
·Energy saving and carbon reduction in chemical industry is not only a challenge of the times, but also an opportunity for enterprises to improve their competitiveness and achieve sustainable development. The chemical industry should be laid out as early as possible, take the initiative to make changes, and answer the propositions of "transformation and development" and "energy revolution".
As a major consumer of energy and carbon emissions, the actions of energy conservation and carbon reduction in chemical industry are very important to achieve the global environmental protection and sustainable development goals.
Chemical industry is an important factor affecting the emissions of other industries in "Scope 3"
The overall energy consumption of chemical industry is high, and the extended chain is long.
All along, the infrastructure of the chemical industry is based on energy and resources such as oil, ore and coal, forming industrial chains such as petrochemical industry, coal chemical industry and salt chemical industry. As one of the six high-energy industries in China, the total energy consumption of chemical industry accounts for about 32% of the national industrial energy consumption. In 2022, the chemical industry in China consumed 1.07 billion tons of standard coal, and the total carbon emission reached about 11.48 billion tons.
From the perspective of raw materials, China chemical industry is highly dependent on coal. The carbon intensity related to coal is much higher than other raw materials. Taking methanol products as an example, about 75% of China’s methanol production comes from coal chemical industry, while the global proportion is only 35%. From the product side, the energy consumption of the chemical industry mainly comes from bulk chemicals and fine chemicals. The former is located in the upstream of the chemical industry chain, with large production scale and low profit level, while the latter is processed from the former with small scale but higher added value. Among thousands of chemical products, only ammonia and methanol account for three-quarters of the total energy consumption of the whole industry.
Fossil energy such as coal and gasoline accounts for a high proportion of energy consumption.
The energy consumption structure of China chemical industry is dominated by fossil energy represented by coal and gasoline. The Declaration on peak carbon dioxide emissions and Carbon Neutralization of Petroleum and Chemical Industry in China jointly issued by China Petroleum and Chemical Industry Federation and several chemical enterprises, parks and other units in 2021 shows that by the end of 2020, there are about 2,300 enterprises with carbon emissions exceeding 26,000 tons of standard coal in the chemical industry, accounting for about 65% of the total carbon emissions of the whole industry, concentrated in methanol, synthetic ammonia, coal-to-liquids, calcium carbide and PVC and other sub-industries.
In terms of energy types, fossil energy (such as coal, oil, natural gas, etc.) is still dominant in chemical production at present. With the energy transformation, the application of non-fossil energy (such as wind energy and solar energy) in the chemical industry is gradually increasing.
From the perspective of energy consumption, it can be divided into four major links: raw material preparation, production process, energy supply and waste treatment, involving raw material treatment, chemical reaction, product separation and purification, equipment operation and other steps.
The chemical industry greatly affects the emissions of "Scope 3" in other industries.
The carbon footprint of chemical industry comes from energy consumption, chemical synthesis process, raw material processing and waste treatment. Energy consumption refers to all kinds of equipment and reactions that fossil fuels such as gas, oil and coal are used to drive chemical production. Chemical synthesis refers to the synthesis of chemicals such as polymers, fertilizers and solvents. Raw material processing refers to the process of extracting, processing and transporting raw materials. Waste disposal means that waste is burned or otherwise disposed of. In the above process, the characteristics of energy-intensive and multi-source determine that it will inevitably emit a lot of carbon dioxide.
According to the report of the International Energy Agency in September, 2022, in 2021, the main chemical products have directly discharged 925 metric tons of carbon dioxide, which is about 5% higher than that in 2020, occupying the third place in all industrial sectors. From the total amount, the total annual carbon emission of the chemical industry is less than 500 million tons, far less than that of steel and electricity. However, in terms of intensity, the carbon emissions per unit GDP of the chemical industry are relatively high. The unit carbon dioxide emission in the coal chemical industry reaches 3-11 tons.
The chemical industry is also highly correlated with the carbon footprint of other industries. The chemical industry chain is long, there are many kinds of products, the composition of supply chain and industrial chain is complex, and there are many upstream and downstream market segments, which are highly related to many other industries. The chemical industry is an important factor affecting the emissions of other industries in "Scope 3", and more than 95% of industrial products must rely on the chemical industry. Therefore, the chemical industry can boost other industries through its own emission reduction and play a key role in industrial energy saving and carbon reduction.
Main challenges of energy saving and carbon reduction in chemical industry
Chemical industry is one of the most difficult heavy industries to reduce emissions. China’s chemical industry emits about 1.3 billion tons of carbon each year, accounting for about 20% of the total industrial emissions. Non-carbon dioxide gas emissions in the chemical industry will also increase carbon emissions. The low-carbon transformation of chemical industry faces the following challenges:
First, the chemical industry in China is still on the rise, and the overall demand is increasing. With the improvement of domestic economic level and national living standard, the demand for chemical products in China still has a large room for growth.
Second, chemical production in China is highly dependent on coal, and the carbon intensity related to coal is higher than other raw materials. The coal chemical industry in China is large, which makes it more difficult to save energy and reduce carbon.
Third, the production capacity related to chemical production in China is relatively short. As shown in Figure 2, China’s relatively new chemical production capacity accounts for more than half of the global total production capacity. "Trade-in" has become a key step to promote the upgrading of old equipment and old technology, improve production efficiency and reduce energy consumption. China chemical industry should carry out carbon emission reduction transformation on the basis of existing facilities. How to solve the problem of "exchanging old facilities for new ones" and properly dispose of existing production capacity is an urgent problem to be solved.
Energy saving and carbon reduction in chemical industry should play a synergistic role in many ways.
Strengthen industrial chain coordination
The chemical industry has a long industrial chain and a wide range of products, and the relationship between supply and demand of subdivided products is complex. It is an arduous task to promote the overall energy saving and carbon reduction in the upstream and downstream of the industry. We can start from the following three aspects:
First, jointly formulate standards and guidelines for energy conservation and emission reduction. All links in the industrial chain, including upstream raw materials, intermediate products and downstream products, can jointly formulate energy conservation and emission reduction standards and unify the carbon reduction standards of the entire industrial chain in terms of energy use, production technology and equipment renewal, such as the Product Carbon Footprint Guide jointly issued by Bayer, BASF and Hankook Chemical Enterprises.
The second is to empower the industrial chain to reduce carbon with digital technology. Under the trend of integration of numbers and intelligence, we should actively introduce digital technology, optimize the carbon footprint management process in the upstream of the supply chain, formulate a comprehensive carbon footprint management cloud platform that runs through the whole industrial chain, monitor energy consumption and carbon emissions in real time, implement cleaner production, and strive to create a long-term advantage of green and low-carbon chemical industry. At the same time, we will actively and effectively manage the management of chemical carbon assets through technical equipment skill transformation and negative carbon absorption technology, and jointly promote the low-carbon development of the chemical industry through multiple channels.
The third is to explore a multi-industry collaborative governance mechanism. We should strengthen the division of labor and cooperation in the green and low-carbon industrial chain, and build a number of "little giant" enterprises specializing in special innovation in key links of the industrial chain; Promote the joint production of chemical industry and building materials, petrochemical industry and steel industry, cooperate in research and development, reduce carbon, form the symbiosis of upstream and downstream industries of multiple industries, deepen the cooperation of multiple industries, promote the green development of industries, and explore the application mode of multi-industry chain coordination.
Improve supply chain coordination
There are many kinds of products in the chemical industry, the supply chain network is complex, and the complexity and diversity of chemical reactions mean that in the chemical industry chain, fine adjustment of raw materials, ratio or process often leads to brand-new products. The supply chain carbon emissions of the chemical industry account for 77% of the total chemical industry emissions. Therefore, reshaping the supply chain and deepening cooperation are the core for chemical enterprises, especially leading enterprises, to promote the green development of the industry.
First, optimize the energy structure, fully optimize the energy structure with new energy, and improve the utilization of clean and green energy such as wind power generation, hydrothermal storage and solar photovoltaic, so as to ensure sustainable energy supply and reduce carbon dioxide emissions.
The second is to coordinate the production planning of all parties in the supply chain to reduce unnecessary energy consumption and overproduction. Unreasonable arrangement of production plan in chemical industry may lead to waste of resources and increase of carbon emissions. It is necessary to plan production plan together with supply chain partners to avoid overproduction and frequent production adjustment. At the same time, collaborative production planning can also optimize the supply chain network, reduce logistics links and transportation distances, and reduce energy consumption and carbon emissions during transportation.
The third is to invest in supply chain energy-saving projects. By investing in clean energy power plants, wastewater treatment plants and other projects with supply chain partners, resource sharing, risk sharing and benefit sharing can be realized. In addition, we can also jointly invest in R&D and energy-saving technologies, such as energy-saving and emission-reduction technologies, emission-reduction and carbon sequestration technologies and energy recycling technologies, so as to improve production efficiency and reduce carbon emissions.
Ensure that the government cooperates with the market.
Energy saving and carbon reduction in chemical industry need the cooperation of government and market.
First, the government should play the role of policies, funds and market mechanisms. Relevant policies and regulations such as energy conservation and emission reduction laws and preferential tax policies can promote enterprises to adopt more environmentally friendly production methods in terms of energy efficiency standards, carbon emission quotas and carbon taxes. In terms of financial support, enterprises are encouraged to invest in energy-saving technologies and cleaner production equipment in the form of subsidies, bonuses or low-interest loans. In addition, a carbon trading market can be established or other carbon pricing mechanisms can be adopted to encourage enterprises to reduce carbon emissions through market mechanisms.
The second is to strengthen the full-cycle supervision and management of the entire chemical related market. The chemical industry is extremely extensible and permeable, so the government should establish a set of energy and carbon reduction management system for chemical products in the whole life cycle, and establish a cooperative management mechanism for stakeholders in the whole process of raw material mining, product synthesis and development, end-use and recycling, so as to promote the chemical industry to move in a green, low-carbon and sustainable direction.
For example, in 2004, Britain’s energy and climate department joined hands with Ofgem, the government supervision agency of electricity and gas market, to issue Smart Grid Vision and Routemap, which transmitted electricity price information in real time, allowing enterprises to use electricity at peak hours, thus reducing energy waste in industry as a whole. In 2011, the United States launched the Superior Energy Performance Program (SEP) to establish a digital energy management system for many industrial enterprises. In 2023, Germany issued the Climate Protection Act and the Energy Efficiency Act, using big data analysis to help enterprises establish energy management or environmental management systems, and the leading chemical enterprises such as Baffles, Bayer and Henkel, thereby significantly reducing energy waste. Therefore, the government helps enterprises to form a digital energy management system and standards, which can reduce unnecessary energy consumption of the whole industry.
The third is to strengthen the communication and contact between industrial associations, research institutes and the government. Relevant industry associations are important participants in the formulation of chemical production standards, scientific research institutes are the source of green and low-carbon technology development, and the government is the maker and manager of public policies. It is necessary to strengthen the cooperation among the three parties, maintain close communication, integrate the application of new standards and technologies with the government’s management innovation in time, and ensure the implementation of green and low-carbon standards at all times, thus promoting the formation of a benign interactive cooperation mechanism among industry associations, scientific research institutes and the government to jointly promote the healthy development of green and low-carbon chemical industry.
Synergy between technology and management
The coordination of energy saving and carbon reduction technology and management in chemical industry is the key to realize sustainable development.
First, technological innovation of energy saving and carbon reduction supports management decision-making. The management team needs to understand the latest energy-saving and carbon-reducing technologies and incorporate them into the long-term development planning and management decision-making of the enterprise. Technical support can provide real-time data and information for management to help formulate effective energy-saving and carbon-reducing strategies. For example, the data monitoring system is used to monitor energy consumption and carbon emissions in real time, so as to adjust and optimize them in time.
Second, the improvement of management mode supports technological development and innovation. Good management systems and processes in enterprises or chemical parks can promote the implementation and operation of energy-saving and carbon-reducing technologies. The management team needs to establish corresponding systems and processes, including energy management system, carbon emission accounting and reporting system, etc., to ensure the effective implementation and continuous improvement of technology. The management team can also establish a performance evaluation and incentive mechanism, incorporate the goal of energy saving and carbon reduction into the enterprise performance appraisal system, and encourage the active participation and contribution of relevant departments and individuals through the reward and punishment system.
In a word, if China chemical industry wants to realize low-carbon or even zero-carbon transformation in a relatively short period of time, it is bound to need the guidance and drive of policies and mobilize the concerted actions of all relevant parties.
Energy saving and carbon reduction in chemical industry is not only a challenge of the times, but also an opportunity for enterprises to improve their competitiveness and achieve sustainable development. The chemical industry should be laid out as early as possible, take the initiative to make changes, and answer the propositions of "transformation and development" and "energy revolution".
(Author of this article: Wang Yukang, Dai Yuehua. Project leaders: Zhang Jun, Li Xianbo, project coordinator: Tian Chunling, and members of the research group: Gu Xiaodan, Dai Yuehua, Wang Yukang and Zhang Yunwei. Thanks to Shanghai Economic and Information Committee and Shanghai Energy Conservation and Environmental Protection Service Association for their help in this survey)