Taking the European Chemical Industry into the Circular Economy

Transcription

1 Taking the European Chemical Industry into the Circular Economy Circular Materials Conference Dierckx Ann, Sustainable Development Director Cefic

2 The world is changing fast Page 2

3 Mainstreaming in EU policy Page 3

4 The Cefic Sustainability Charter as of July 2016 Enabling role of the European chemical industry for a sustainable society Supporting role for Cefic Roadmap to progress in Sustainable Development: Page 4

5 Start dialogue with stakeholders Page 5

6 Impact and opportunity focus Purpose Impact of the Circular Economy on the European chemical industry beyond schemes of better waste recovery to start a meaningful debate Page 6

7 Taking the chemical industry into the circular economy: A perspective thought to ideal recovery Linear Model Disposal of molecules at end of lifecycle (landfill, etc.) Unmanaged CO 2 emissions Increasingly bent models Partially renewable feedstock and energy Some level of product reuse and recycling Energy recovery Circular Model (total recovery) Full re-use of molecules with or without modifications of molecular bonds Design to re-use for most end products Climate neutrality Copyright 2016 Accenture. All rights reserved. 7

8 Circularity has two aspects: Circulating molecules and enabling circularity in downstream end uses Approaches towards a more circular economy for the chemical industry (A) CIRCULATING MOLECULES (B) ENABLING CIRCULARITY Raw Material Chemicals Customer industry End use Raw Material Chemicals Customer industry End use Maximizing utility of existing molecules e.g., reusing/recycling molecules such as PET bottles Enabling maximum utility in end usage e.g. higher durability of goods, sharing cars, decreasing energy need by passive houses Copyright 2016 Accenture. All rights reserved. 8

9 Circular advantage requires development of business models free of the constraints of linear thinking New business model opportunities along the 5 archetypal chemical loops Raw material Chemicals Customer Industry use End use Renewable feedstock Energy recovery Chemical recycling Mechanical recycling Product re-use Circular Supplies: Provide bio-based material to replace single-lifecycle inputs Carbon capture and utilization: Develop technology and services, innovate chemical synthesis routes, catalysts, etc. Rebuild chemical precursors: Develop technology and services, participate in reverse infrastructure models Keep molecules intact for reuse: Develop compatibilizers, separation techniques; invent product-as-a-service models Extend end product lifecycles by repairing, upgrading and reselling Enable increased product utilization by making possible shared use/ access/ ownership Source: Accenture Copyright 2016 Accenture. All rights reserved. 9

10 Each conceivable circulating loop reduces the demand for new molecules Out of 106 Mt chemicals delivered to customers, up to 60% can be circulated EU 28 Chemical production in Mt Chemicals for customers EU 28 Chemicals for customers in Mt Polyvinylchloride Ammonium nitrate Urea Polypropylene Other Polystyrene Polyethylene Raw material Chemicals Customer Industry use 1 Renewable feedstock 5 Energy recovery 4 Chemical recycling 3 Mechanical recycling End use 2 Product re-use 107 Specialties 28 As-is 106 Mt (ca. 12 Mt 2 ) ca.10 Mt ca.8 Mt ca.19 Mt ca.17 Mt Circulation potential: ca. 66 Mt further products assessed, some with limited loop potential, e.g., non-recoverable materials such as nano particles, coatings, solvents 2. Loop 1 is fed with biomass rather than from chemicals for customers. Assuming that, after consideration of loops 2-5, ca. 50% of remaining feedstock need can be substituted from biomass Source: Accenture research Copyright 2016 Accenture. All rights reserved. 10

11 All in all, circular economy has the potential to substantially disrupt current chemical value chains Summary: volumes, values, energy, capex needs As-is Enabling circularity Circulating molecules Volume 330 Mt +52 Mt +88 Mt -99 Mt -117 Mt Value 553 Bn EUR +127 Bn EUR +215 Bn EUR -108 Bn EUR -122 Bn EUR Value per unit 1,676 EUR/t +103 EUR/t +164 EUR/t +239 EUR/t +314 EUR/t EU energy consumption w/o chemical industry 1,051 Mtoe -146 Mtoe -409 Mtoe - - EU energy consumption chemical industry 53 Mtoe +6 Mtoe -2 Mtoe -8 Mtoe +21 Mtoe CAPEX 20.7 Bn EUR/ year not assessed Bn EUR Bn EUR Results for the capitalize on opportunity scenario Results for the thought to the end scenario Copyright 2016 Accenture. All rights reserved. 11

12 Circular economy implies several imperatives for the European chemical industry Impact and imperatives Circular economy impact Circular economy is driven by customers as well as through regulation Circular economy adoption in end uses can create growth for chemical producers Circular economy changes the business model of selling molecules Chemical economy will disrupt conventional chemical value chains (e.g., assets, capabilities, partners) Imperatives for EU chemical industry Analyze impact of circular economy trends on demand for your product and service portfolio Partner with OEMs, move closer to end users. Lobby for incentives to reduce energy consumption downstream Prepare for shift from volume to value and from selling products to circulating molecules Shift Capex and Opex, understand which capabilities are required and how to source/build them, identify new partners Source: Copyright 2016 Accenture. All rights reserved. 12

13 Dechema Technology focus Purpose To provide quantitative data as input to the discussion on the future of the European chemical industry and the transition towards a carbon neutral society. Promising low carbon technologies Potential impact on CO 2 reduction Technological and financial limitations and barriers Page 13

14 Study scope What does it intail for the chemical industry to be carbon-neutral by 2050? Low-carbon chemical production Methanol Propylene Ethylene BTX + Low-carbon fuels production and use Ammonia (urea) Chlorine accounting for ⅔ of the sector s GHG emissions Methanol, bioethanol, synfuels Not included: Impact of chemical products on GHG savings in other sectors 14

15 Technological options Industrial symbiosis Low carbon power supply Alternative carbon feedstock CO 2 (CO) Biomass Recycling Power to heat Energy efficiency 15

16 Scenarios Business as Usual; low limit scenario assuming required extension of existing capacities, but no implementation of new technology options and no further advancement of efficiency measures Intermediate; continuous efficiency improvements of 1% annually and slow starting, but steadily increasing deployment of breakthrough technologies; assumptions: policy measures to support emission reduction and pathways become sufficiently competitive, no early replacement of old plants Ambitious; consequent implementation of technology options, fuel sector fully supports transition to carbon-neutral fuels; assumptions: minimum time for R&D, pilot or demonstration activities, commercial deployment without delays; full policy support and no economic constraints as hurdle; old plants are replaced early, decommissioning of depreciated plants. Maximum scenario; full carbon neutrality of the chemical industry and fuel sector by 2050 via a mix of the described technologies 16

17 190 Mt (Maximum) 4900 TWh (Maximum) 140% of anticipated capacities 300 Mt (Maximum) 250 Mt (Maximum) 215 Mt (Ambitious) 27 bill. /y (Maximum) Available in 2050: 3400 TWh (IEA) 19 bill. /y (Ambitious) 95 Mt (Ambitious) 200 Mt (Intermediate) 1900 TWh (Ambitious) 100 Mt (Ambitious) 17 bill. /y (Intermediate) 65 Mt (Intermediate) 960 TWh (Intermediate) 50 Mt (Intermediate) 2 (BAU) Avoided CO 2 (Mt) Low-carbon power Demand (TWh) Alternative Feedstock Demand (Mt) CO 2 (Mt) Biomass (Mt) Investment Requirements (bill. /y) 17

18 Research, development and innovation requirements Area Power to heat Power to hydrogen Alternative H 2 production Power to chemicals Biomass Alternative chemical production Circular economy and industrial symbiosis RD&I topic Heat pump technology Hydrolysis technology (PEM, AEM, SOE, ) Pyrolysis, photolysis, thermochemical process & CSP Electrolysis improvement Electrochemical and catalytic process improvement Plasmatechnology Lignocellulosic technologies New synthesis routes for Ammonia and Olefins (e.g. direct electrocatalytic conversion) Valorisation of waste streams and residues 18

19 Priorties Challenges Key messages Access to cheap and abundant low C energy as prerequisite Biomass availability (focus the use of biomass feedstock on highly functionalised chemical components with high biomass utilisation efficiencies) Large investments Production cost not competitive Initiate ambitious R&I programmes, priority topics are e.g. efficient hydrogen generation and better valorization of biomass Engage in public-private partnerships to enable deployment and risk sharing Intensify the dialogue between public and private stakeholders, facilitate more (cross-sectorial) collaboration models and strong policy support 19

20 Overall conclusion Moving towards a circular economy is a long term journey and will need: An abundant amount of low-carbon power at a competitive price Significant levels of investment Widespread collaboration R&D and Innovation Page 20