Using waste carbon from industrial emissions as a feedstock for chemical manufacture appears to be a viable complement to ongoing abatement efforts. For one thing, such processes can reduce the amounts of CO2 emitted to the atmosphere, helping industry and national economies meet sustainability goals. IEA says that CCU strategies could result in \u201cnear-zero steel production and emissions\u201d and \u201cnew economic opportunities.\u201d An April 2019 report from Members of Parliament on the Business, Energy, and Industrial Strategy Committee mentions that, for the UK, CCU technologies \u201cwill be necessary to meet the UK\u2019s existing climate change targets at least cost, and that the country could not credibly adopt a \u2018net zero\u2019 target, in line with the aspirations of the Paris Agreement, without the technology.\u201d The UK report report also says that a failure to develop CCU technologies \u201c. . . could force many heavy industries to close in the coming decades, if the UK sticks to its climate change targets.\u201d Customers are also increasingly seeking \u201cgreen\u201d products, further driving adoption of many of these technologies.<\/p>\n
On a geographical basis, European chemical firms have reportedly been among the first to adopt circular economy principles. The EU is also considered a likely location for such projects given its published goals to reduce emissions; proactive government policies such as RED II and its biofuels mandates; large industrial sector; its renewable energy resource base; and its goal to increase renewable power to 20 percent of EU energy use in 2020 and become \u201cthe world\u2019s first climate-neutral continent by 2050.\u201d Also, funding in Europe is reportedly becoming more available as pension funds and investment funds move away from fossil-fuel investments. One source, speaking of the European chemical industry, notes that CCU would allow the industry to reduce its reliance on fossil fuels (which can undergo substantial pricing swings and supply volatility) and \u201cat the same time create a new source for European competitiveness versus raw material rich regions.\u201d Another source states that European leadership in development and deployment of clean-energy technologies translates to a global competitive advantage.<\/p>\n
Firms in other regions are also said to be focusing on building such principles into their operating models. China is considered a likely location for chemical projects using waste carbon, given its efforts to keep its economy growing by focusing on manufacturing and the related growth in its steel and cement industries.
\nMany things are in flux: technologies are still being developed and scaled up; government policies are being implemented; business models are being established; funding is still being sought; the costs of installing the new technologies; and the supply and pricing of fossil fuels remain volatile. But steel companies, refineries, and chemical companies are increasingly starting to use waste carbon emissions as feedstocks for chemicals and there are significant supplies of waste carbon from global industrial emissions worldwide for companies to use. A report from CO2 Sciences and The Global CO2 Initiative estimates that seven billion metric tons of CO2 emissions per year\u2014about 15 percent of global\u00a0 CO2 emissions\u2014are likely to be available for use by 2030. Although estimates are not available of the potential number of projects that may become viable, the timeframe of commercial development of the projects, or the value of products derived from the CO2 emissions, the sampling of projects listed in table 1 in the working paper reflects the interest of manufacturing firms, particularly those in the steel and chemical sectors, in CCU projects.<\/p>\n
On a sectoral basis, chemical producers using waste carbon as a feedstock instead of fossil-fuel based feedstocks are said to be less subject to the volatility in price and supply of fossil-fuel feedstocks. They also appear to be able to derive a competitive advantage in regard to the pricing of many of the products produced from the waste carbon feedstocks and, to the extent that they are partners in JVs with other industrial emitters, they may also be able to increase market share and\/or market coverage. Moreover, use of the waste carbon feedstocks is likely to allow them to respond to carbon pricing programs and renewable energy mandates.<\/p>\n
Steel companies that can gain revenues from byproduct sales derived from their industrial emissions and offset emissions taxes and\/or reduce other obligations under new mandates may be able to avoid reducing production in an increasingly competitive and oversupplied global market for steel with thin profit margins. Steel industries that adopt these sustainable technologies might be able to better survive oversupply conditions, carbon pricing programs, and renewable energy mandates than those that do not.<\/p>\n
New Carbon Capture Utilization Technologies Enable Conversion of Industrial Emissions into Carbon-based Chemicals
\nA major goal of most stakeholders, particularly in the chemical industry, is continued development of a \u201ccircular economy,\u201d an industrial system in which waste is eliminated and resources are reused. As abatement efforts for industry emissions reach optimal use and become more expensive, novel CCU technologies are emerging that use waste products as feedstocks for chemicals instead of sequestering the carbon or using it for enhanced oil recovery (EOR). The new processes include conversion of waste carbon in industrial emissions to liquid transportation fuels (such as ethanol and methanol) and chemicals (including building blocks such as formic acid, acetic acid, polyols, and acetone). These processes, which are becoming more prevalent because of continuing scientific advances in fields such as industrial biotechnology and electrolysis, not only reduce the amount of CO2 that would otherwise be emitted to the atmosphere but also reduce the overall carbon footprint of the chemical process.<\/p>\n
Technology providers such as LanzaTech and Avantium, among others, have developed a variety of new processes that use industrial emissions from sources such as steel plants, chemical plants, and refineries, to name a few. The emissions have varying concentrations of CO and CO2 as feedstocks to produce value-added biofuels and chemicals. Diverse solutions are available, often depending on a project\u2019s specific conditions. The new processes reflect a variety of technologies (e.g., ranging from fermentation using proprietary microorganisms to new catalysts to electrocatalysis); are at varying stages of development (e.g., research scale to full commercialization); and produce a variety of chemicals.<\/p>\n
In one CCU technology\u2014fermentation\u2014proprietary microorganisms convert (or digest) carbon-based emissions to produce bioethanol and\/or various chemicals through a process that involves gas collection, fermentation in a bioreactor, and recovery of the end products. As discussed further below, the individual microorganisms used in a given fermentation process have the potential to be switched out as market conditions change and replaced by other microorganisms that produce different products (e.g., replacing a microorganism that produces biofuels with one that produces chemicals, and vice versa, if market changes make one product more advantageous than the other).\u00a0See LanzaTech\u2019s process in figure 2 in the working paper as an example of a process using fermentation.<\/p>\n
Alternatively, in CCU solutions utilizing electrolysis, electricity\u2014sometimes in combination with a catalyst\u2014is used to convert emissions to bioethanol or various chemicals; the process and\/or the catalyst may be proprietary. See Avantium\u2019s ReCode process in figure 3 of the working\u00a0 paper as an example of a process using electrolysis.<\/p>\n
Companies also cite the potential of using waste emissions from non-chemical sources. For example, noting that steel mills worldwide produce about 30 billion gallons of waste gas per year, LanzaTech, one of the first companies to start commercial production of bioethanol using waste emissions, says its process can be used on about 65 percent of global steel mills, potentially producing 30 billion gallons of ethanol annually. The ethanol, in turn, can be turned into about 15 billion gallons of jet fuel per year, or about 20 percent of the aviation fuel used annually.\u201d<\/p>\n
Factors that Determine Investments to Use Waste Carbon as Chemical Feedstocks
\nProximity
\nProduction Costs and Tradeoffs
\nEnergy Costs
\nOverall Impact on Production Costs
\nGovernment Policies
\nGovernment policies play an important role in the evolving expansion of CCU projects. The geographical concentration of the waste carbon projects generally reflects the location of sources of public funding and other policy measures, particularly regarding the production of biofuels, whereas chemical production is often based on market demand. Many governments\u2019 biobased products policies have historically addressed biofuels rather than biobased chemicals. However, such biofuels policies generally do not recognize feedstocks other than biomass. In the United States, for example, since current federal regulations largely define biofuels as being made from plant-based feedstocks, ethanol and other biofuels made from industrial emissions haven\u2019t qualified for the federal renewable fuels mandate, thereby limiting their use. However, new policies are being developed\/implemented (e.g., in the EU and the United States) that include biofuels made from waste carbon from industrial emissions. Moreover, many world regions have (or are implementing) incentives and\/or mandates to reduce emissions; increase use of biofuels such as ethanol; or increase CCU projects.<\/p>\n
Conclusions
\nIn closing, early adopters of these technologies could gain world market shares and increase export flows, potentially edging out industries worldwide that focus on them later. Industrial organization economists note that any cost reduction due to improved technology will lead to a price reduction\u2014 and, therefore, more competitive performance\u2014regardless of market structure (i.e., whether the market is perfectly competitive, monopolized, or somewhere in between).<\/p>\n
The full working paper is:<\/p>\n
Using Waste Carbon Feedstocks to Produce Chemicals
\nUSITC, Office of Industries, Working Paper ID-065, April 2020<\/p>\n
Disclaimer: Office of Industries working papers are the result of the ongoing professional research of USITC staff and solely represent the opinions and professional research of individual authors. These papers do not necessarily represent the views of the U.S. International Trade Commission or any of its individual Commissioners.<\/p>\n
The USITC working paper can be accessed here.<\/p>\n","protected":false},"excerpt":{"rendered":"
Using waste carbon from industrial emissions as a feedstock for chemical manufacture appears to be a viable complement to ongoing abatement efforts. For one thing, such processes can reduce the amounts of CO2 emitted to the atmosphere, helping industry and national economies meet sustainability goals. IEA says that CCU strategies could result in \u201cnear-zero steel […]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_seopress_robots_primary_cat":"","nova_meta_subtitle":"","footnotes":""},"categories":[5572],"tags":[],"supplier":[8390,3872],"class_list":["post-74381","post","type-post","status-publish","format-standard","hentry","category-bio-based","supplier-biofuels-digest","supplier-us-international-trade-commission"],"_links":{"self":[{"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/posts\/74381","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/comments?post=74381"}],"version-history":[{"count":0,"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/posts\/74381\/revisions"}],"wp:attachment":[{"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/media?parent=74381"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/categories?post=74381"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/tags?post=74381"},{"taxonomy":"supplier","embeddable":true,"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/supplier?post=74381"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}