31 October 2007 17:12 [Source: ICIS news]
By John Richardson
SINGAPORE (ICIS news)--If you attended just about any petrochemical conference three years ago, the only mention of the environment would have been a few slides on Responsible Care.
But now it appears to have become almost compulsory for anyone senior standing on a podium to talk about the positive role the industry can play in reducing carbon emissions, from the more efficient running of plants to carbon capture, to the wonders of technology and application development.
Increased use of polycarbonate (PC) is, for example, often cited as a way of reducing the weight of cars and, as a result, boosting fuel efficiency.
Public perception could be everything. Companies, particularly those headquartered in the developed world or Asian companies with a global presence, run the risk of losing their licences to produce if the battle over popular opinion is lost.
A few well-designed PowerPoint presentations are not going to save the planet.
What you often see in the very same presentations are bold plans for capacity expansions to cope with the huge increase in demand in the developing world. How sustainable are these capacity increases given that no matter how energy-efficient the new plants will be, they will place a further strain on hydrocarbon resources and add to pollution?
These are questions rarely addressed, particularly in Asia where the colossal growth in petrochemical demand dominates the agenda.
Take China growth as an example. Shanghai-based CBI Research & Consulting predicts that the country’s deficit for the six major synthetic resins will widen to 12.32m tonnes by 2011 from this year’s 10.93m tonnes.
Projected deficits attract investments, whether they are overseas to serve China or in China itself.
Shell estimates that China could add up to 20m tonnes/year of ethylene capacity in 2010-2020, a significant amount of which could be coal-based. China plans to invest $130bn in its coal-to-chemicals sector by 2020.
These huge complexes will also produce lots of fuels for transportation, heating and cooking, including dimethyl ether (DME).
Increased use of DME will cut the number of deaths from breathing in toxic fumes when coal is burnt directly for heating and cooking. DME also produces less tail-pipe emissions than gasoline when used in motor vehicles.
But there are as many arguments against ramping up coal-to-chemicals and coal-to-liquids production in China as there are those in favour.
Mining is a huge source of methane emissions - a far more dangerous greenhouse gas than carbon dioxide. The increased coal mining necessary to supply raw materials for the new complexes could cause a lot of environmental harm.
Carbon capture or sequestration might limit carbon dioxide emissions from the plants.
But will the Chinese government always use the best technologies? And even if the central government wants to use the right technologies, can legislation be enforced at a local level?
And if carbon dioxide is not captured, how green are to coal-to-chemicals and coal-to-liquids?
The Climate Center at the Natural Resources Defense Council, a US non-profit organisation of scientists, lawyers and environmental specialists, carried out a study into coal-to-liquids last year.
It concluded that well-to-wheel emission rates for the process were 49.5lbs per gallon of fuel compared with 27.5lbs for conventional gasoline.
China’s decision on how much chemicals to make from coal might be based on energy security rather than the environment.
The danger it confronts from the current naphtha-based wave of petrochemical construction is a big feedstock deficit, as the refineries it is also building could be run mainly to make gasoline.
The industry faces some tough choices as the evidence pointing towards a rapid increase in global warming keeps on building.
It’s not just climate change that the industry has to worry about. A report released last week by the UN Environmental Programme concluded that humans were using up the earth’s resources at such a rate that “humanity is at risk” from, for example, depletion of fish stocks and degradation of land through pollution.
The very growth that is presented at so many petrochemical conferences as a justification for more capacity could be under threat.
Elizabeth Economy, environmental author and Senior Fellow and Director for Asia Studies at the Council on Foreign Relations in the US, has calculated that environmental degradation and pollution is costing China 8-12% of its GDP a year.
Will China have enough clean water, energy and raw materials to sustain its economic boom?
Pan Yue, vice minister with China’s State Environmental Protection Administration, apparently thinks not. He was quoted in 2005 as saying: “The (economic) miracle will end soon because the environment can no longer keep pace.”
Seriously bright people work in chemicals and they have already contributed a great deal towards developing technologies that provide environmental solutions.
But ultimately, though, would you be able to go to your boss and say: “I don’t think we should expand to improve our economies of scale and grow market share in China and India because this wouldn’t be good for the environment.”
The nature of capitalism has led to innovation, but it also threatens the search for solutions to the biggest-ever challenge our industry has faced.
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