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A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This document is based on content development by the consultant team as well as an expert workshop that was held on the 27-08-2012

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Page 1: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment

Industry sector – chemicals document

This document is based on content development by the consultant team as well as an expert workshop that was held on the 27-08-2012

Page 2: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

Content – Industry sector - chemicals

2

▪ Summary and references

▪ Context and historical trends

▪ Methodology

▪ Details of the ambition levels and costs per lever

▪ Resulting scenarios

▪ Most important barriers to decarbonisation

Page 3: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

Executive summary for the chemicals sector

3

• In a high growth scenario overall chemical activities increase by 20% in 2050 compared to 2010, equivalent to an average growth rate of 0.49%, which could be considered as a fair compromise between high historical growth rates for Belgium and the stabilisation of the chemical sector at the European level.

• In a neutral scenario a zero growth is assumed, which expresses the view that Belgium remains an important producer of chemicals, but as the market for final products stabilises in Europe it is assumed that new activities will be mainly located outside Europe.

• In the low growth scenario, the activities decrease by 50% compared to 2010 levels and expresses a rather pessimistic view for the Belgian Chemical sector.

Construction of different future

production trajectories

• Development of green chemistry, i.e. chemical products produced from biomass or algae production might contribute by replacing fossil based plastics and by fixing carbon in materials for several years. Energy efficiency might improve by better process control and reducing heat losses and energy performance of new plants might significantly outweigh those of existing plants. In traditional chemistry, a significant penetration of biomass is unlikely due to the specific processes, but hydrogen production can be based on electrolysis. CCS is also considered as an option, starting with process CO2 emissions from hydrogen and ammonia production and later on for bigger installations emitting more than 1Mton/year

Estimate of potential and

cost for the GHG reduction

opportunities

NOTE Except explicit mention, the reduction potential figures are mentioned at constant production, as reduction percentage versus 2010. Actions are applied in sequential order and the biomass potential is not included in the total. Levers are of ambition 3 (except for CCS where level 2 is also detailed)

Page 4: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

List of references

Association of petrochemical producers in Europe (APPE).

Belgium greenhouse gas inventory data 2010 (NIR CRF v1.4), submitted to the UNFCCC.

Belgium ETS registry.

Rapportering benchmarking convenant (Vl.)/Accord de branche (Wal.)

Essenscia website, http://www.essenscia.be.

Ecofys, JRC-IPTS (2009), Sectoral Emission Reduction Potentials and Economic Costs for Climate Change (SERPEC-CC) – Industry and refineries sector, October 2009.

ICEDD, Atlas énergétique de la Wallonie, http://www.icedd.be/atlasenergie/

VITO, Energiebalans Vlaanderen, http://www.emis.vito.be/cijferreeksen

PRIMES model documentation

4

Page 5: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

Content – Industry sector - chemicals

5

▪ Summary and references

▪ Context and historical trends

▪ Methodology

▪ Details of the ambition levels and costs per lever

▪ Resulting scenarios

▪ Most important barriers to decarbonisation

Page 6: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

Belgium has reduced its emissions by ~8% since 1990

GHG emissions in Belgium, MtCO2e

▪ Emissions have gone down by ~8%

▪ This is due to the Energy production industries (-12%) and the rest of the Industry

▪ At the same time, emissions in both Transport and Buildings have grown significantly by 18% since 1990

‘10

132

‘05

144

‘00

146

‘95

151

‘90

143

Energy

Industry combustion

Agriculture, Waste & others

Industrial processes

-8%

Transport

Buildings

Delta 90-10 %

-12%

-28%

+18%

-15%

+18%

-27%

-8%

Source: Belgium GHG emissions inventory, Climact 6

Page 7: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

Industry emissions are decreasing, mainly because of the steel industry

NOTE: Cement & Lime assessed based on Wallonia low Carbon, Minerals deducted from total non metallic minerals from Regional data, Oils and Gas included in chemicals, Machines skipped and construction assessed from Regional data SOURCE : NIR CRF v1.4, Wallonia 2050 Low Carbon Growth 7

5,0

-23%

2010

37,2

2005

44,5

2000

48,9

1995

51,8

1990

48,5

13,4 14,5 15,0

13,9 11,2

Industry emissions (MtCO2e)

Other

Minerals Industry (glass)

Lime Industry

Cement Industry

Non-Ferrous metals

Construction (Bricks and ceramics)

Food, drinks and tobacco Industry

Pulp & Paper Industry

Chemicals Industry

Steel Industry

Refineries (in chemicals)

~85% covered by workshops

Wallonia data

Page 8: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

Chemical industry represents 29 % of GHG emissions and 27% of the industrial energy consumption

8

13%11%

1%

1%

4%8%

2%

100%

Emissions

37

3% 6%

29

19% 26%

27

11%

7% 1%

5%

5%

119

Energy

2%

5% Non-Ferrous metals

Construction (Bricks and ceramics)

Food, drinks and tobacco Industry

Pulp & Paper Industry

Chemicals Industry

Steel Industry

Refineries (in chemicals)

Cement Industry

Minerals Industry (glass)

Lime Industry

Other

GHG emissions and energy consumption in Belgium 2010 (MtCO2e, TWh, %)

MtCO2e TWh

NOTE: (1) Excluding electricity emissions and consumption

(2) Amongst solid fuels, coke use in steel industry has two function (raw material and energy) Both are included in the analysis but only the 2nd creates emissions in the atmosphere

SOURCE: NIR CRF v1.4

• Food represents 6% of emissions for 8% of the energy

• Non metallic minerals (Cement, Lime and Glass) have high process emissions

• In steel, there would be less TWh if the coke used as reducing agent was not included in the analysis (cfr with the IEA data)

~85% covered by workshops

Wallonia datasets

Page 9: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

Petrochemical industry seems to stabilize in Europe

9

European capacities and production statistics (kton)

SOURCE : Association of petrochemical producers in Europe (APPE) For propylene Appe reports higher production figures than capacities. This is related to the definition of ethylene and propylene production capacities. In fact ethylene and propylene may sort in different yields within boundaries from the same installations.

0

5,000

10,000

15,000

20,000

25,000

30,000

2007 2008 2009 2010 2011

Cap ethylene

Cap propylene

Cap benzene

Prod ethylen

Prod propylene

Prod benzene

Page 10: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

Outstanding decline in energy intensity at EU level But less progress for Belgium

10

0

20

40

60

80

100

120

140

160

180

200

1990 1995 2000 2005 2009

Ind

ex

bas

e 1

99

0

EU-Production

BE-Production

EU-Energy consumption

BE-Energy consumption

EU-specific EC

BE-specific EC

Belgian and EU production and energy consumption index (index base 100 in 1990)

SOURCE : calculations based on CEFIC and Essencia

Energy intensity has dropped due to increased share of fine

chemicals

Page 11: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

This visions seems not to be shared by Belgian chemical federation

11

Belgium has a high

concentration of bulk

chemicals

SOURCE : Essenscia

Page 12: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

The chemical industry is important and complex...

Essenscia represents 245 sites in Flanders and 75 sites in Wallonia

In Flanders energy statistics for approx. 165 sites are available: 47 benchmark/ETS, 36 audit convenant and 82 SMS companies

Production of several hundreds of chemical products, involving (almost) as many different processes

The total energy consumption is of 178 PJ (1)

− Benchmark/ETS companies consume 95 %

− 24 sites have an energy consumption above 1PJ –representing 86 % of energy consumption

Within the benchmark sites energy consumption is composed of: − 44% recuperation fuels

− 19% electricity

− 9 % steam from CHP

− 28% classical fuels of which 2/3rd natural gas

There is a high penetration of CHP

12

Characteristics of chemical industry in Flanders

NOTE : (1) including electricity (35.4 PJ) and steam from CHP(16.7PJ), excluding non-energetic use (340 PJ)

Page 13: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

13

Ethylene

Propylene

Benzene

MTBE

Caprolactam Fertilisers

Adipic acid

Nitric acid

Toluene

Hydrogen

Butadiene

Amines Aniline

Ethylene oxide

Acrilates

Styrene

Formaldehyde

Ammonia

Mono vinyl chloride

Sulfuric acid

......

Base chemicals Derived products

LDPE, HDPE,

Polystyrene

PVC

Rubber

.....

The chemical industry is involved in the production of many products and processes

Page 14: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

Sector emissions increase because of higher activity

14 SOURCE: NIR CRF v1.4

• Significant increase in fuel and process-emissions (+19%).

• Fuel switch to gas

• Sharp reduction in process emissions Nitric acid production

• Other process emissions ???

Increase is sharpest in Flanders

Chemical sector GHG emissions ( Mt CO2eq)

0

10

20

30

40

50

60

0

2

4

6

8

10

12

14

16

1990 1995 2000 2005 2010

Bill

ion

Process emissions ammonia production

Process emissions Nitric acid production

Process emissions Caprolactam production

Other process emissions (H2 ?)

Other fuels

Biomass

Gaseous Fuels

Solid fuels

Page 15: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

Most of the CO2 emissions are in Flanders

15

Verified emissions of ETS companies in chemical sector (ktCO2e)

SOURCE: ETS registry CO2 process emissions of ammonia are not included CHP emissions are only included for autoproducers

Page 16: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

Most of the CO2 emissions are in Flanders

16

0

200

400

600

800

1000

1200

Kton

CO2

Verified emissions of ETS companies in chemical sector (kton CO2e)

SOURCE: ETS registry

Production sites located in Flanders Production sites located in Wallonia

Page 17: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

In PRIMES models, energy intensive industries reduce CO2 emissions by 25 % in EU-low carbon scenarios

17

0

50000

100000

150000

200000

250000

1990 2000 2010 2020 2030 2040 2050

kto

e

Energy consumption of energy intensive industries in EU roadmap

Reference scenario

Energy efficiency scenario

Diversified supply technologies scenario

Energy consumption of energy intensive industries in the EU roadmap

(ktCO2e) Lack of

transparency in EU-Roadmap

Emissions chemical

industries? Activities? Application

CCS?

Page 18: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

In PRIMES model chemical industries comprises the following activities

18

Subsectors Energy uses

Fertilizers Air compressors

Petrochemicals Low enthalpy heat

Inorganic chemicals Lighting

Low enthalpy chemicals Motor drives

Electryc processes

Steam and high enthalpy heat

Thermal processes

Energy use as raw materials

But this is the only information which is publicly available

Page 19: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

Growth prospects Belgium Trends apparent at world, EU and Belgian level

19

World

• China biggest chemical producer worldwide

• Demand for chemical products increases sharply in fast-developing countries

• Likely strongest increase in bulk-chemical production outside Europe

EU(1)

• Shift from industry to services

• Stabilization of internal demand for chemicals

• Opportunities to increase exports to fast developing countries

• Capital intensive sector, suffering less from labor costs

• Biomass production

• Growing importance of pharmaceuticals

Belgium(2)

• Competitive, capital intensive industry

• Dependence of EU market (72 % of sales)

• Strong demand for insulation materials

Page 20: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

Content – Industry sector - chemicals

20

▪ Summary and references

▪ Context and historical trends

▪ Methodology

▪ Details of the ambition levels and costs per lever

▪ Resulting scenarios

▪ Most important barriers to decarbonisation

Page 21: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

Focus of the consultations

6 5 4

3 2 1 Adapt the DECC model to

Belgian data and improve it Test each sector with

external experts Bottom up study by sector of

feasible GHG reductions

Consultations by sector with external experts

Discussions with international experts

Review conclusions with the steering and high level

consultation committees

Federal administration

Industry

Civil organizations

Academics

Detail key implications for these scenarios

Define and model various scenarios

Industry is one of the various sectors studied in the process of constructing the low carbon scenarios

21

Part intermittente faible(~40%) – CSC inclus

Part intermittente faible(~60%) – CSC exclus

DEM

AN

DE

ENER

GET

IQU

E et

EMIS

SIO

NS

OFFRE ENERGETIQUE ET CAPTURE D’EMISSIONS

Demande et émissions élevées

Demande et émissions moyennes

Demande et émissions faibles

Scénario E

Scénario A Scénario B

Scénario D Scénario C

5 scénarios de décarbonisation de 80 à 95%

25%

18%

18%

8%

Agriculture and waste (incl. LULUCF)

Industry (combustion)

Power generation

20%

BuildingsIndustry (processes)

Transport

Others

1%

10%

100% = 131,4 MtCO2e

Page 22: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

Cross-government engagement

Industry Workshops and Evidence

Energy and emissions Natural resources

Emissions Technology

The Open-source Prospective Energy and Emissions Roadmap Analysis tool (OPE²RA) developed in partnership with the DECC (UK) will be used to develop the scenarios

22

Page 23: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

OPE²RA balances demand and supply based on fixed input parameters as well as modifiable levers

23

-80 to -95% GHG emissions vs. 1990

Page 24: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

Industrial sectors modelled

24

Sector Consultation

Refineries Belgian Petroleum Federation

Iron & Steel Steel Federation

Chemicals Essenscia

Paper Cobelpa

Food Fevia

Bricks & Ceramics Bricks Federation

Non-ferrous metals Agoria

Cement Low Carbon Wallonia Roadmap

Lime Low Carbon Wallonia Roadmap

Glass Low Carbon Wallonia Roadmap

Page 25: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

Understanding the industry Modelling demand trajectories

Modelling trajectories with intensity levels + CCS

Analyses Definition of the value chain Analyses of growth and competitiveness Potential of CO2 reduction incl. costs

Results Modelling the emissions tree Demand trajectories Trajectories with different intensity levels + CCS

A detailed analysis is performed for each industrial sector

25 SOURCE: Climact

Page 26: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

Levers are applied in a sequential manner on an in-depth modeling Modeling logic for the chemical industry

Sub-industries

Fertilizers

Olefins

Electric processes

Other ETS

SMEs

Tons

2010-2050

TWh /tons

2010-2050

Production Intensity Fuels

% Electricity

% Solid fuels

% Liquid fuels

% Gaseous fuels

% Biomass

% Others

2010-2050

Process emissions

tCO2e /ton produced

2010-2050

tCO2e

2010-2050

Emissions

2010-2050

Fuel costs Capex costs

Chemical industry example

Action

Carbon intensity level 3

TWh /tons

Action CCS level 3

TWh /tons

tCO2e

Situation in 2050

26

Capacity

Tons

2010-2050

Page 27: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

Level 4 Level 3 Level 2

4 ambition levels are defined for each lever

27

Level 1

• Minimum effort (following current regulation)

• No additional decarbonisation efforts/policies

• What will become a « Reference scenario »

• Moderate effort easily reached according to most experts

• Equivalent to the development of recent programs for some sectors

• Significant effort requiring cultural change and/or important financial investments

• Significant technology progress

• Maximum effort to reach results close to technical and physical constraints

• Close to what’s considered reachable by the most optimistic observer

One of the key objectives of the consultation is to support the estimation of these levels based on existing expertise

Page 28: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

Activity classification in Ope²ra model

28

0

10

20

30

40

50

60

70

80

90

TWh

NE-Solids

NE-Naphta

NE-gas

Biomass

Electricity

Other fuels

Heat

Solids

Liquids

Gas

Energy consumption in the different categories in the Ope²ra model NE: non energetic use - In Olefin production NE–naphta does result in CO2 emissions. In ammonia and hydrogen production NE-gas result in CO2 process emissions

Sources: Aggregated data from Flemish and Walloon energy balances. Split in sub-sectors calculated by VITO based on literature data

Page 29: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

Content – Industry sector – chemicals

29

▪ Summary and references

▪ Context and historical trends

▪ Methodology

▪ Details of the ambition levels and costs per lever

▪ Olefin production ▪ Ammonia & Hydrogen production ▪ Chlorine production ▪ Other ETS activities ▪ Other non-ETS activities ▪ N20 emissions

▪ Resulting scenarios

▪ Most important barriers to decarbonisation

Page 30: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

30

Reduction potential Reduction levers are additional and applied in the following order

Product mix

•Augmenting the proportion of product which require less CO2 for production

Energy efficiency

•Reduce mechanical and thermal losses

•Recuperate thermal energy (CHP)

Process improvements

•Modification of processes

Fuel switching

•Towards fuels which emit less CO2

End of pipe

•Carbon capture and storage

Methodology

Energy efficiency

CHP

BAT application

Fuel vs. gas CCS

Biomass versus fossil fuels

Electrification of process

(e.g. electrolysis)

Substitution by carbon free

products (e.g. algae)

Page 31: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

31

Reduction potential 5 levers are being assessed in each chemical sub-sector

Levers assessed in the chemical sector and applicability across subsectors

Subsectors

Olefins Ammonia & Hydrogen

Chlorine Other ETS activities Other non-ETS activities

N2O emissions

Leve

rs

Product mix Green chemistry Modelled in demand Green chemistry /

Energy efficiency V V 100 % switch to membrane

V V

WKK

Process improvements

/ / /

SRC

(included in energy efficiency)

(included in energy efficiency)

(included in energy efficiency)

(included in energy efficiency)

Fuel switching Electrolysis ( level 4)

/ Natural gas or biomass /

CCS Yes On process emissions

N.R.

In function of installation size

None

N.R.

Page 32: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

Content – Industry sector – chemicals

32

▪ Summary and references

▪ Context and historical trends

▪ Methodology

▪ Details of the ambition levels and costs per lever

▪ Olefins ▪ Ammonia & Hydrogen production ▪ Chlorine production ▪ Other ETS activities ▪ Other non-ETS activities ▪ N2O emissions

▪ Resulting scenarios

▪ Most important barriers to decarbonisation

Page 33: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

33

Olefins 3 trajectories influencing energy demand will model growth prospects Belgium

Trajectory 1

Trajectory 2

Trajectory 3

Olefins

• High growth assumption • + 20% by 2050 • Increased demand by

construction sector

• Reference growth assumption • 0% growth

• -50 % by 2050 • Delocalisation (CO2 price) • Low growth assumption

Possible growth scenarios European population: 1% GNP: 1,6% (1)

SOURCE: (1) Federal Planning bureau

Page 34: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

Level 4 Level 3 Level 2

34

Level 1

• Minimum effort Status quo

• Moderate effort Moderate changes that have no implication for the use of olefins

• 10 % green chemistry

• Significant effort requiring cultural change and/or important financial investments

• 20% green chemistry

• Maximum effort to reach results close to technical and physical constraints

• 50 % green chemistry

Olefins Changing the product mix

SOURCE: SERPECCC study

Page 35: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

Level 4 Level 3 Level 2

35

Level 1

• Minimum effort Status quo

• Moderate effort Moderate changes that have no implication for the use of olefins

• 10 % improvement by moderate changes

• Significant effort requiring cultural change and/or important financial investments

• 20 % improvement by using state of the art technology – partly retrofit and new built

• Maximum effort to reach results close to technical and physical constraints

• 40 % reduction demolishing and rebuilt (by 2050) all installations – use of catalysts in crackers, recuperation of heat losses

Olefins Energy efficiency

SOURCE: SERPECCC study

Page 36: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

Level 4 Level 3 Level 2

36

Level 1

• Minimum effort Status quo

• Moderate effort Moderate changes that have no implication for the use of olefins

• Included in energy efficiency measures

• Significant effort requiring cultural change and/or important financial investments

• Included in energy efficiency measures

• Maximum effort to reach results close to technical and physical constraints

• Included in energy efficiency measures

Olefins Process improvements (not included in previous)

SOURCE: SERPECCC study

Page 37: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

Level 4 Level 3 Level 2

37

Level 1

• Minimum effort Status quo

• Moderate effort Moderate changes that have no implication for the use of fertilisers

• 0 % fuel switching

• Significant effort requiring cultural change and/or important financial investments

• 0 % fuel switching

• Maximum effort to reach results close to technical and physical constraints

• 0 % fuel switching

Olefins Fuel switching

SOURCE: SERPECCC study

Page 38: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

Level 4 Level 3 Level 2

38

Level 1

• Minimum effort Status quo

• Moderate effort Moderate changes that have no implication for the use of olefins

• No capturing

• Significant effort requiring cultural change and/or important financial investments

• No capturing

• Maximum effort to reach results close to technical and physical constraints

• CCS applied on crackers

Olefins CCS

SOURCE: SERPECCC study

Page 39: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

39

Olefins Reduction potential of the different levers, horizon 2050

NOTE: Assuming all regions of the world perform a similar effort

SOURCE: essenscia consultation

Lever Reduction potential (2050) in %

Cost Description 1 2 3 4

Product mix 10%

20%

40 %

Green chemistry replacing traditional plastics

Energy efficiency

10 % 20%

40%

Process improvements Included included included

Fuel switching N/A N/A N/A

CCS Applied

on 4 crackers

Reduction levers

Page 40: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

Content – Industry sector – chemicals

40

▪ Summary and references

▪ Context and historical trends

▪ Methodology

▪ Details of the ambition levels and costs per lever

▪ Olefins ▪ Ammonia & Hydrogen production ▪ Chlorine production ▪ Other ETS activities ▪ Other non-ETS activities ▪ N2O emissions

▪ Resulting scenarios

▪ Most important barriers to decarbonisation

Page 41: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

41

Ammonia 3 trajectories influencing energy demand model growth prospects Belgium

Trajectory 1

Trajectory 2

Trajectory 3

Ammonia (ton)

• High growth assumption • + 20% by 2050 (0.495% per year) • Increased needs for biomass

production

• Reference growth assumption • 0% growth

• -50 % by 2050 (-1,72% per year) • Substituting to natural fertilisers • Low growth assumption

Possible growth scenarios European population: 1% GNP: 1,6% (1)

The main use of ammonia is for fertilisers production. The price of fertilisers depends on the price of natural gas. A high price for natural gas might reduce demand for ammonia

SOURCE: (1) Federal Planning bureau

Page 42: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

Ammonia production Technical solutions (Serpec study )

Ammonia

− Standard technology 39 GJ/t NH3 - new BAT technology 28 GJ /t NH3 (1)

− Retrofit options for improvements of reformer section and CO2 removal section

− Low pressure (improved catalysts) and improved process control

− Current situation : 2/3 at 28 GJ /t NH3 and 1/3 at 39 GJ/t NH3 (2)

− Stochiometric : 19,8 GJ/t NH3 BAT 2050 : 24 GJ/t NH3 (3)

42

(1) Source : SERPEC study (2)Source : essenscia consultation (3) Source: Own calculations and assumption

Page 43: A Low-carbon roadmap for Belgium · A Low-carbon roadmap for Belgium Study realised for the FPS Health, Food Chain Safety and Environment Industry sector – chemicals document This

Level 4 Level 3 Level 2

43

Level 1

• Minimum effort Status quo

• Moderate effort Moderate changes that have no implication for the use of fertilisers

• 5 % ammonia/nitric acid substituted by carbon free alternative.

• Significant effort requiring cultural change and/or important financial investments

• 20% substituted by carbon free alternative.

• Maximum effort to reach results close to technical and physical constraints

• 50% substituted by carbon free alternative.

Ammonia Changing the composition of fertilisers

SOURCE: SERPECCC study

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Level 4 Level 3 Level 2

44

Level 1

• Minimum effort Status quo

• Moderate effort Moderate changes that have no implication for the use of fertilisers

• Small improvements in oldest installations saving 2.6 GJ/t NH3

• Significant effort requiring cultural change and/or important financial investments

• All installations at 28 GJ/t NH3

• Maximum effort to reach results close to technical and physical constraints

• New built reformers: all installations at 24 GJ/t NH3

Ammonia Energy efficiency

SOURCE: SERPECCC study

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Level 4 Level 3 Level 2

45

Level 1

• Minimum effort Status quo

• Moderate effort Moderate changes that have no implication

• 0 % fuel switching

• Significant effort requiring cultural change and/or important financial investments

• 0 % fuel switching

• Maximum effort to reach results close to technical and physical constraints

• Hydrogen production by electrolysis

Ammonia Fuel switching

SOURCE: SERPECCC study

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Level 4 Level 3 Level 2

46

Level 1

• Minimum effort Status quo

• Moderate effort Moderate changes that have no implication

• CO2 captured form process emissions ammonia (1 Mton)

• Significant effort requiring cultural change and/or important financial investments

• Idem level 2

• Maximum effort to reach results close to technical and physical constraints

• Idem level 2

Ammonia CCS

SOURCE: SERPECCC study

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47

Ammonia Reduction potential of the different levers, on a 2050 horizon

NOTE: Assuming all regions of the world perform a similar effort

SOURCE : consultation Essenscia

Lever Reduction potential (2050) in %

Cost Description 1 2 3 4

Product mix 5% 20% 50% Product mix in fertilisers

Energy efficiency 2.6 GJ/Ton NH3 in older plants

All installations at 28

GJ/t NH3

All installations

at 24 GJ/t NH3

Level 2 6€ ton/ Level 3

4.6 € ton

Level 2-3 – process improvements Level 4 is new plant

Fuel switch Electrolysis for H2 production

Fuel switching Electric H2 production

CCS Capturing

CO2 process

emissions

Capturing CO2

process emissions

Not compatible with fuel switching

Reduction levers

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Content – Industry sector – chemicals

48

▪ Summary and references

▪ Context and historical trends

▪ Methodology

▪ Details of the ambition levels and costs per lever

▪ Olefins ▪ Ammonia ▪ Chlorine production ▪ Other ETS activities ▪ Other non-ETS activities ▪ N2O emissions

▪ Resulting scenarios

▪ Most important barriers to decarbonisation

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49

Electric processes 3 trajectories influencing energy demand model growth prospects Belgium

Trajectory 1

Trajectory 2

Trajectory 3

Electric processes

• High growth assumption • + 20% by 2050 • Demand increase in various

sectors

• Reference growth assumption • 0% growth

• -50 % by 2050 • Low growth assumption

Possible growth scenarios European population: 1% GNP: 1,6% (1)

Chlorine has many different applications of which PVC is a major one. PVC is used in construction sector( windows), automobile , and many other sectors. Demand for PVC and hence chlorine is sensitive to fluctuations in construction and automotive sectors.

SOURCE: (1) Federal Planning bureau

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Level 4 Level 3 Level 2

50

Level 1

• Minimum effort Status quo

• Moderate effort Moderate changes that have no implication for the use

• All mercury cell production capacity replaced by membrane cell

• Significant effort requiring cultural change and/or important financial investments

• Maximum effort to reach results close to technical and physical constraints

Electrical processes energy efficiency

SOURCE: SERPECCC study

According to Serpec 20 % improvement for membrane process compared to amalgam process

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51

Electric processes Reduction potential of the different levers, on a 2050 horizon

NOTE: Assuming all regions of the world perform a similar effort

SOURCE: consultation Essenscia

Lever Reduction potential (2050) in %

Cost Description 1 2 3 4

Product mix NA NA NA NA

Energy efficiency 200 kton mercury

cap replaced

All mercury replaced

Idem level

3

Membrane process replacing older technologies

Process improvements Included

Included

Included

Fuel switching NA NA NA

CCS In

electricity sector

In

electricity sector

In

electricity sector

Reduction levers

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Content – Industry sector – chemicals

52

▪ Summary and references

▪ Context and historical trends

▪ Methodology

▪ Details of the ambition levels and costs per lever

▪ Olefins ▪ Ammonia and H2 ▪ Electric processes ▪ Other ETS activities ▪ Small and medium ▪ N2O emissions

▪ Resulting scenarios

▪ Most important barriers to decarbonisation

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53

Other ETS activities 3 trajectories influencing energy demand model Growth prospects Belgium

Trajectory 1

Trajectory 2

Trajectory 3

Other ETS activities

• High growth assumption • + 20% by 2050 • Increased demand by

construction sector

• Reference growth assumption • 0% growth

• -50 % by 2050 • Low growth assumption

Possible growth scenarios European population: 1% GNP: 1,6% (1)

Trajectories have been chosen to be consistent with Olefins production ( bas materials)

SOURCE: (1) Federal Planning bureau

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Level 4 Level 3 Level 2

54

Level 1

• Minimum effort Status quo

• Moderate effort Moderate changes that have no implication for the use of olefins

• 10 % green chemistry

• Significant effort requiring cultural change and/or important financial investments

• 20% green chemistry

• Maximum effort to reach results close to technical and physical constraints

• 40 % green chemistry

Other chemical activities under ETS Product mix change

SOURCE: SERPECCC study

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Level 4 Level 3 Level 2

55

Level 1

• Minimum effort Status quo

• Moderate effort Moderate changes that have no implication for the use of olefins

• 10 % improvement by moderate changes

• Significant effort requiring cultural change and/or important financial investments

• 20 % improvement by using state of the art technology

• Maximum effort to reach results close to technical and physical constraints

• 30 % reduction by new plant design

Other chemical activities under ETS Energy efficiency

SOURCE: SERPECCC study

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Level 4 Level 3 Level 2

56

Level 1

• Minimum effort Status quo

• Moderate effort Moderate changes that have no implication for the use of olefins

• Included in energy efficiency measures

• Significant effort requiring cultural change and/or important financial investments

• Included in energy efficiency measures

• Maximum effort to reach results close to technical and physical constraints

• Included in energy efficiency measures

Other chemical activities under ETS Process improvements (not included in previous)

SOURCE: SERPECCC study

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Level 4 Level 3 Level 2

57

Level 1

• Minimum effort Status quo

• Moderate effort Moderate changes that have no implication

• 100% natural gas

• Significant effort requiring cultural change and/or important financial investments

• 100% natural gas

• Maximum effort to reach results close to technical and physical constraints

• 100 % natural gas

Other chemical activities under ETS Fuel switching

SOURCE: SERPECCC study

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Level 4 Level 3 Level 2

58

Level 1

• Minimum effort Status quo

• Moderate effort Moderate changes that have no implication for the use of olefins

• No capturing

• Significant effort requiring cultural change and/or important financial investments

• CCS on all sites emitting more than 1 Mton/year

• Maximum effort to reach results close to technical and physical constraints

• CCS on all sites emitting more than 200 Kton/year

Other chemical activities under ETS CCS

SOURCE: SERPECCC study

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59

Other chemical activities under ETS Reduction potential of the different levers, on a 2050 horizon

NOTE: Assuming all regions of the world perform a similar effort

SOURCE : consultation Essenscia

Lever Reduction potential (2050) in %

Cost Description 1 2 3 4

Product mix 10% 20% 40% Bio chemicals (Algae..)

Energy efficiency

10 % 20%

30%

Process improvements Included Included Included

Fuel switching 100%

natural gas

100%

natural gas

100 % natural

gas

CCS

No capt. Sites > 1

Mton CO2/year

Sites > 200 kton CO2 /year

Reduction levers

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Content – Industry sector – chemicals

60

▪ Summary and references

▪ Context and historical trends

▪ Methodology

▪ Details of the ambition levels and costs per lever

▪ Olefins ▪ Ammonia & Hydrogen ▪ Electric processes ▪ Other ETS activities ▪ Other non-ETS activities ▪ N2O emissions

▪ Resulting scenarios

▪ Most important barriers to decarbonisation

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61

Other non-ETS activities 3 trajectories influencing energy demand model growth prospects Belgium

Trajectory 1

Trajectory 2

Trajectory 3

Small and medium sized companies

• High growth assumption • + 40% by 2050 • Increased demand by

construction sector

• Reference growth assumption • + 20 % growth

• -20 % by 2050 • Low growth assumption

Possible growth scenarios European population: 1% GNP: 1,6% (1)

This sector comprises high added value and low energy intensive activities

SOURCE: (1) Federal Planning bureau

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Level 4 Level 3 Level 2

62

Level 1

• Minimum effort Status quo

• Moderate effort Moderate changes that have no implication for the use of olefins

• 10 % improvement by moderate changes

• Significant effort requiring cultural change and/or important financial investments

• 20 % improvement by using state of the art technology

• Maximum effort to reach results close to technical and physical constraints

• 30 % reduction by new plant design

Small and medium energy efficiency

SOURCE: SERPECCC study

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63

Small and medium sized companies Reduction potential of the different levers, on a 2050 horizon

NOTE: Assuming all regions of the world perform a similar effort

SOURCE: consultation Essenscia

Lever Reduction potential (2050) in %

Cost Description 1 2 3 4

Product mix

Energy efficiency

10% 20%

30%

Process improvements

Fuel switching

CCS

Reduction levers

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64

N2O emissions 3 trajectories influencing energy demand model growth prospects Belgium

Trajectory 1

Trajectory 2

Trajectory 3

Small and medium sized companies

• High growth assumption • + 20% by 2050 • Increased demand by

construction sector

• Reference growth assumption • + 0 % growth

• -50 % by 2050 • Low growth assumption

Possible growth scenarios European population: 1% GNP: 1,6% (1)

These activities are related to the production of Nitric acid, Adipic acid, Caprolactam. Activities scenarios are consistent with Olefins and Ammonia production

SOURCE: (1) Federal Planning bureau

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Level 4 Level 3 Level 2

65

Level 1

• Minimum effort Status quo

• Moderate effort Moderate changes that have no implications

• Additional Selective catalytic reduction (SCR) on all nitric acid, adipic acid and caprolactam production plants

• Global 80 % reduction in N2O

• Significant effort requiring cultural change and/or important financial investments

• Improved control on SCR

• Global 90 % reduction on N2O

• Maximum effort to reach results close to technical and physical constraints

• Improved catalysts on SCR : 95 % reduction of N2O emissions

N2O emissions process improvements

SOURCE: SERPECCC study

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66

Reduction potential: CCS (1/2) Industrial costs

USD/tCO2e

SOURCE: IEA

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Content – Industry sector - chemicals

67

▪ Summary and references

▪ Context and historical trends

▪ Methodology

▪ Details of the ambition levels and costs per lever

▪ Resulting scenarios

▪ Most important barriers to decarbonisation

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68

Trajectory 1 (high growth) GHG emissions for different ambition levels (MtonCO2e)

0123456789

1011121314151617181920

2

4

3

1

2050 2045 2040 2035 2030 2025 2020 2015 2010

SOURCE: OPE²RA model

Reduction potential Emissions according to different trajectories

+21%

-26%

-43%

-76%

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69

Trajectory 2 (medium growth) GHG emissions for different ambition levels (MtonCO2e)

0123456789

1011121314151617181920

2015 2010

4

3

2

1

2050 2045 2040 2035 2030 2025 2020

SOURCE: OPE²RA model

Reduction potential Emissions according to different trajectories

Delta 10-50,%

+0%

-39%

-54%

-81%

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70

0123456789

1011121314151617181920

4 3 2

1

2050 2045 2040 2035 2030 2025 2020 2015 2010

Delta 10-50,%

-48%

-68% -75% -89%

Reduction potential Emissions according to different trajectories

Trajectory 3 (low growth), GHG emissions for different ambition levels (MtonCO2e)

SOURCE: OPE²RA model

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Content – Industry sector - chemicals

71

▪ Summary and references

▪ Context and historical trends

▪ Methodology

▪ Details of the ambition levels and costs per lever

▪ Resulting scenarios

▪ Most important barriers to decarbonisation

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Thank you.

Erik Laes – 014 335909 – [email protected]

Pieter Lodewijks – 014 335926 – [email protected]

Michel Cornet – 0486 92 06 37 – [email protected]