Petrochemicals and Climate Change : Tracing Globally Growing Emissions and Key Blind Spots in a Fossil-Based Industry

• With the risk of climate breakdown becoming ever more pressing as the world is on track for 2.7 degrees warming, pressure is increasing on all sectors of the economy to break with fossil fuel dependence and reduce greenhouse gas (GHG) emissions. In this context, the chemical industry and the production of important basic chemicals is a key sector to consider. Although historically a driver of economic development, the sector is highly dependent on fossil resources for use as both feedstock and fuel in the production of as well organic as inorganic chemicals. The chemical industry demands both petroleum fractions and natural gas. Petroleum fractions such as naphtha and petroleum gases are used as feedstocks for building block chemicals and polymers (e.g., benzene and polyethylene), while natural gas is used for methanol and ammonia. Indeed, the sector is associated with both large process emissions as well as energy related emissions. Our results demonstrate that in 2020 direct GHG emissions from the petrochemical sector amounted to 1.8 Gt CO2eq which is equivalent to 4% of global GHG emissions. Indirect GHG emissions resulting from the activities in other industries supplying inputs for the petrochemical industry accounted for another 3.8 Gt CO2eq. The petrochemical industry is thus associated with a total of 5.6Gt CO2eq of GHG emissions, equivalent to ~10% of global emissions. Over the past 25 years, emissions associated with petrochemicals have doubled and the sector is the third most GHG emitting industry. This increase is fueled by large growth of petrochemicals production as well as growth in regions with high indirect emissions, i.e., in energy systems with high dependence on coal and other fossil fuels. Over the past decades, the industry has grown rapidly in the Asia-Pacific region especially in China which in 2020 was the source for about 47% of global GHG emissions associated with petrochemicals. USA accounts for 6% of the emissions from the industry and Europe for 5%. The BRIC group of countries, which except for China also includes Brazil, India, and Russia, currently accounts for 57% of GHG emissions from petrochemicals, showing that the emissions from this sector are more geographically clustered in these countries than emissions from other sectors.Proper disaggregated and comparative analyses of key products is currently not possible. Data confidentiality and a high reliance on proxy data limit the reliability of LCA and stands in the way of mapping climate impacts. A strong demand of chemicals life cycle inventory (LCI) data for environmental footprinting has resulted in a general increase of chemicals data in many LCI databases, but the energy demands both for heat and electricity are typically not well-documented for production processes outside the main bulk chemicals. If incinerated at end-of-life plastics and other chemical products will emit embodied carbon as CO2 and if landfilled there is a risk of slow degradation with associated methane emissions. Global estimates based on most LCA datasets will thus significantly underestimate emissions from the chemical industry.The multitude of value chains dependent on the petrochemical industry makes it an important contribution to life cycle emissions in many sectors of the economy. Petrochemicals are used as an intermediate input in many industries and the emissions associated with them thus propagate through the economy, with final demand in manufacturing industries and services being associated with the largest shares of emissions from chemicals. The impacts and emissions downstream in value chains is however poorly understood and disclosure by petrochemical producers is lacking and insufficient. While disclosure of emissions in the industry has increased over the past decades, it remains partial and shows inconsistencies over time. This is due to issues such as different reporting standards, large discrepancies in the extent of disclosure as well as various other gaps and inconsistencies in reporting. This holds for all scopes, although Scope 1 emissions are better covered. Only some firms disclose information about downstream Scope 3 emissions including end-of-life for final products. Emission targets set by firms in the industry do not correspond to the challenge of large and rapid emission reductions. Many targets include only parts of operations and transparent, standardized target-setting is lacking. Reported emission reduction initiatives to achieve targets are far from sufficient focusing mainly on efficiency improvements or insubstantial parts of the operation. Shifting to renewable energy is a key for rapid emission reductions in the industry, yet few firms report strategic targets for this shift. As the industry has historically been closely linked to and integrated with the energy sector it holds a great potential for engaging with the deployment and adoption of renewable energy, although this implies a transformation of the knowledge base and resource allocation in the industry which is still focused on fossil fuels. Roadmaps and scenario analyses show that apart from a shift to renewable energy, a transformation of the industry relies on the deployment of key technologies which are not yet fully developed. This includes new technologies for hydrogen production, e.g., electrolytic (green) hydrogen or hydrogen produced with carbon capture and storage (CCS). New chemical synthesis pathways based on captured carbon, so called carbon capture and utilization (CCU) is also highlighted, but the massive demand for renewable energy associated with this pathway is a significant barrier to its adoption in the near term. The report shows how efficiency improvements continues to be the main focus for reducing the climate impact of petrochemicals, but that this is a completely inadequate approach for achieving the emissions reductions necessary in the coming decades. Breakthrough technologies are unlikely to be deployed at a rate consistent with international climate targets, and there is a great risk in relying on the promises of technologies which are yet to be proven at scale. The large knowledge gaps that remain are key barriers for effective governance of the transition.

Ämnesord

TEKNIK OCH TEKNOLOGIER  -- Naturresursteknik -- Energisystem (hsv//swe)

ENGINEERING AND TECHNOLOGY  -- Environmental Engineering -- Energy Systems (hsv//eng)

TEKNIK OCH TEKNOLOGIER  -- Naturresursteknik -- Miljöledning (hsv//swe)

ENGINEERING AND TECHNOLOGY  -- Environmental Engineering -- Environmental Management (hsv//eng)

SAMHÄLLSVETENSKAP  -- Annan samhällsvetenskap -- Tvärvetenskapliga studier inom samhällsvetenskap (hsv//swe)

SOCIAL SCIENCES  -- Other Social Sciences -- Social Sciences Interdisciplinary (hsv//eng)

Nyckelord

Petrochemical industry

Climate Change Mitigation

Life-cycle assessment (LCA)

Environmentally-Extended Multiregional Input-Output (EE-MRIO)

Climate-related disclosure

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