INSIGHT: Closer cooperation might secure a future for EU industry

13 August 2014 16:14 Source:ICIS News

By Nigel Davis

LONDON (ICIS)--It costs a lot to cut carbon emissions, particularly for energy intensive industry players such as those producing chemicals. And change takes time. New processes require new plants, and initially the capital to fund their construction. Replacing, or changing older ways of doing things does not take place overnight.

An EU, low-carbon industrial parks initiative, however, thinks it has identified some of the actions which, taken collectively, can help significantly to reduce the energy intensity of processes from current levels, and cut carbon dioxide emissions.

LOCIMAP, a project involving a number of Europe’s industrial parks and groups interested in their well-being is pressing for greater cross-sector process integration, or industrial symbiosis (IS). This area has been underplayed, it says.

“The analysis done in the LOCIMAP project shows that integrated industrial parks designed appropriately for process integration with optimised heat recovery have the potential to exceed the EU ETS 2020 and SPIRE 2030 targets,” it adds in a white paper released this week.

The targets mentioned are those set under the EU’s emissions trading scheme. The SPIRE 2030 “ambitions” are to reduce energy intensity from fossil fuel and non-renewable raw material intensity by 30% and 20% respectively from current levels, according to LOCIMAP.

“It is expected that the contribution in CO2 emissions reduction will be about 40% compared to current levels,” it says.

SPIRE is a private, process industry-led initiative to promote resource and energy efficiency intensive industries such as chemicals, steel, minerals and cement.

Fourteen European companies are involved in LOCIMAP, which is half-way through its two-year remit. The project’s team members come essentially from four industrial parks, at Tarragona in Spain, Wilton in the UK, Kokkola in Finland and Kalundborg in Denmark. It wants to provide insight into what might be achieved at these and similar locations through better resource and energy efficiency.

The energy issue is the most critical for industrial sites in the EU, which all face intense competition from overseas production locations, some of which are energy or feedstock advantaged. The chemical industry and other energy-intensive sectors in Europe have become increasingly concerned with the thrust of EU energy policy, driven by the region’s climate change goals.

The EU’s energy- and resource-intensive industrial sites have tended to be developed by one company or companies in one industry sector, although there are a handful of locations where producers from different sectors, such as chemicals and iron & steel are co-located. Kalundborg, however, has shown for the past 20 years how producers from different industries can develop together and derive environmental benefits.

“Europe’s industrial parks have to deal with enormous changes in global supply chains, markets and competition in each of the industry sectors,” says LOCIMAP. “They also face challenges to keep a balance between their own objectives, industry objectives and citizen needs, especially in regard to environmental constraints.”

Those objectives may ultimately mean that production in Europe is closed down and investments made in other parts of the world. This is the “carbon leakage” that the chemical and other industries in the EU are so concerned about, or the investment leakage driven by Europe’s weakened industrial competitiveness.

Better integrating industrial sites with their local communities is possibly another way to help secure a stronger future for current locations. And there are a few examples of energy or waste projects being developed on industrial sites with some community support in mind. “The evidence from the project is that this integration is at a very modest stage,” LOCIMAP says.

“The existing resource and energy intensive industry in Europe is, as has become clear from the work of the partners in LOCIMAP, traditionally been sector focused, and this provides opportunities for things to be done very differently,” it adds.

“Industrial Symbiosis seems to be the answer, but cannot be considered as a panacea. There are obvious questions as to how IS can be applied to existing industrial parks, what key technologies need to be developed and deployed, and what business models can support this change.”

The LOCIMAP partners say they will look in future papers at IS, what they call the “Smart Future Park”, and new operational and organisational structures.

Impact of integration on heat demand

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By Nigel Davis