INSIGHT: Asia petrochemical industry warming to green future

31 May 2011 15:59  [Source: ICIS news]

By Tahir Ikram

FUKUOKA, Japan (ICIS)--Asia is leading the recovery in global petrochemicals as economies bounce back from the recession, with a growing awareness among regional producers that strict adherence to environmental regulations is a must to sustain industry growth.

At this year's Asia Petrochemical Industry Conference (APIC) in Fukuoka, Japan, industry executives highlighted the issue of climate change and how players can help in the push for a greener future.

“Look around you…climate change is wreaking havoc in country after country these days,” said Aditheb Bisalbutr, chairman of the Petrochemical Industry Club of Thailand, to delegates at the conference.

“Last month, for example, good old warm Thailand had three to four seasons altogether, including some Siberian cold days. Professional planners must therefore take natural disasters and climate change into account,” he warned.

Bisalbutr was echoing growing sentiments among a large number of delegates at APIC, who feel the environment is a key issue that needs to be tackled by the industry.

According to the International Energy Agency (IEA), global emissions of carbon dioxide (CO2) hit their highest levels ever in 2010, with the growth driven mainly by coal-reliant emerging economies like China and India.

CO2 emissions rose by 5.9% to 30.6bn tonnes in 2010, according to IEA estimates released on 30 May.

The agency said emissions rose again after a dip caused by the financial crisis in 2009, and ended 5% up from the previous record in 2008.

China and India account for most of the rise, though emissions have also grown in developed countries, according to a BBC report.

“The global petrochemical industries are gradually [going] back to stable status from the after-effects of an economic depression,” said Chong Bum-shick, chairman of the Korea Petrochemical Industry Association.

“Starting from 2009, emerging countries, including newly industrialised Asian economies, are leading the global petrochemical market in earnest,” he observed.

“We have to focus on the changes of international environmental policies surrounding our petrochemical industry. The concern about global environment is further increased and various environment regulations such as Climate Change Convention are getting stricter.

“To cope aggressively with the regulations that are getting severe, we need to mutually share our experiences and ideas, maintaining the petrochemical industry’s competitiveness,” he said.

He cited improvement in energy efficiency and the reduction of greenhouse gases as the way for the industry to go forward.

Japan Petrochemical Industry Association (JPCA) chairman Kyohei Takahashi told ICIS that the most significant challenge facing the Asian petrochemical industry is securing sustainable growth via conserving energy and other natural resources, while protecting the environment.

Preston Chen, chairman of the Petrochemical Industry Association of Taiwan, said at the conference that efforts to protect the environment should continue to be one of the top priorities of the industry.

Investments in green energy, biotechnology, semiconductors and other high-tech industries that are inter-related with the petrochemical supply chain are expected to contribute more to the future growth of the industry, Chen added.

Chiew Nguang Yong, a board member at the Singapore Chemical Industry Council, said the city-state contributes less than 0.2% of the global CO2 footprint. The country has a target to reduce energy intensity by 35% from 2005 levels by 2030.

“From the industry perspective, chemical companies in Singapore will need to continuously innovate through the application of new chemical technologies to help reduce greenhouse gas emissions and to improve energy efficiency,” he added.

Philippa Davies, a petrochemical industry consultant with Tecnon OrbiChem, said the industry must adopt realistic targets while dealing with environmental challenges.

“There is widespread recognition that protecting the environment is a crucial and urgent goal, and many chemical companies have shown a real commitment to this goal. But it is not clear what is the best approach,” she said, citing two options, namely, recycling or sustainable feedstock.

“What is clear is that a thoroughly researched and thoughtful approach to greening the chemical industry must be followed, and this commitment will have to be sustained over a long period of time in order for chemical companies to establish and maintain their real green credentials,” Davies added.

Technological advances have allowed for the use of bio-based feedstocks, although with some limitations, and made recycling possible, particularly in packaging like polyester and polyethylene (PE) bottles and bags, she said.

However, bottle-to-bottle recycling in the US and Japan are being hampered by a shortage of waste polyethylene terephthalate (PET), which is being exported to China and Hong Kong, Davies explained.

She cited data from the Association of Post Consumer Plastic Recyclers showing that about 55% of all PET bottles collected in the US were exported mainly to China.

“So, despite the positive initiatives made by many petrochemical companies and their customers, a real switch to a green chemical world is still a long way off,” she concluded.

Read John Richardson and Malini Hariharan’s Asian Chemical Connections blog

By: Tahir Ikram
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