In light of the UK’s commitment to a net zero carbon economy by 2050, the chemicals industry is facing an identity crisis. To stay relevant, the industry must adapt. The elephant in the room is that 98 per cent of all the chemicals we use are made using fossil fuel feedstocks. By 2050 this will probably have to be much closer towards zero if the sector is to truly align itself with the goals of the Paris climate agreement. With its historic ties to the fossil fuels industry, this will be no easy task. So far the industry appears to only be taking action on reducing the direct emissions from its chemical plants, leaving the indirect emissions from fossil feedstocks for others to deal with. Is the industry ready to tackle its biggest sources of emissions and fully divorce itself from fossil fuels?
The industry’s indirect emissions are a big issue
This problem is evident when you look at the whole lifecycle of typical chemical products like plastics. Our new report shows the indirect carbon emissions of plastics can be double the direct emissions (ie from power and heat) associated with producing them. Indirect emissions come from extracting the fossil fuels required (including methane leakage) and the end of life incineration of waste plastics or their slower breakdown in landfills. While the sector can address its direct emissions through new technologies, like electrification, hydrogen and carbon capture and storage, getting the industry to net zero will mean tackling the wider question of feedstocks head on.
Unfortunately, there’s no easy solution. To manufacture most chemicals (besides some fertilisers), both hydrogen and carbon are needed. Green hydrogen is one solution as it can be made by splitting water using renewables. For carbon, the options are more complex.
Alternatives to fossil fuels should be carefully considered
We considered the pros and cons of the main alternatives to fossil fuels as a source of carbon for chemical production. These are biomass (plant material), carbon directly captured from the air, carbon captured from industrial sources and plastic waste. Some of these also provide hydrogen, but none of them offer a perfect like for like replacement for fossil fuel carbon, and they also have downsides.
Biomass sourced from crops could put huge pressure on land and nature if used more widely, while potentially taking land away from food production. To directly capture carbon cleanly and at scale would require vast amounts of renewable energy, needed elsewhere in the economy. And industrially captured carbon could lock in fossil fuel use in other sectors. Opting to chemically recycle plastic waste into new chemicals is hugely energy intensive and could be an incentive to create more waste. It is critical that all these impacts and trade-offs are properly considered by the industry when choosing its route to modernise for net zero.
Circularity will help
The main issue, though, with all the possible alternatives, is that there isn’t anywhere near enough of them to meet the industry’s projected demand. Business as usual will mean continued growth in single use plastics production; for this, the global industry would require 831 million tonnes of feedstocks (10 per cent more than currently) to meet global chemicals demand in 2050. Even the most ambitious estimate of how much ‘sustainable biomass’ might be available to the industry by then (720 million tonnes) will not be enough.
To phase out fossil fuels within the timescale required, the task should be made more manageable. The company SystemIQ suggests that the introduction of more circularity measures could reduce the global industry’s total feedstock demand by nearly half. And, in our research, we’ve identified greater resource efficiency as a necessary major step for chemicals sector decarbonisation. The scope for improvement is enormous as these options have so far been largely ignored. By changing business models to those that provide more incentives to use chemicals much more efficiently, the industry could then consider alternative feedstocks on a scale that is feasible.
A government plan should guide the way
So the answer sounds simple. But, the chemicals industry faces stiff competition for these limited resources from other industries also struggling to give up their high carbon ways, such as aviation and construction. What is needed is a government led plan for where the limited resources and technologies available should be most effectively deployed across the economy, without affecting people and the planet.
Forthcoming Green Alliance work will examine the intersections and interactions between sectors, to come up with proposed hierarchies of use for different alternatives to fossil fuels, that will work for the chemicals industry and other industries.
The net zero carbon economy is coming; it is cemented into our legislation. All parts of the UK economy must change to reach it. The chemical industry is no exception. If it is not lose out to global competition it has to rise to this challenge, not just for the power it needs but also for its feedstocks. It won’t be easy for it to come off fossil fuels, but it can, and embracing a greener, cleaner future now will be better for it and all of us in the long run.