By Zhang Fuqin, PetroChina Planning & Engineering Institute
Bian Siying, China Huanqiu Contracting & Engineering Co., Ltd., Beijing Branch
New situation facing China’s petrochemical industry
China’s refining capacity reached 940 million t/a in 2021, and ethylene capacity was 41.53 million t/a, both ranking second in the world. In the first 10 months of 2021, processing volume of crude oil was down 4.8% YoY to 590 million tons, while ethylene output up 20.8% YoY to 23.2 million tons.
1. Targets of carbon emissions peak and carbon neutrality
On September 22, 2020, president Xi Jinping made an announcement at the UN General Assembly that as well as aiming to halt the rise of carbon emissions by 2030, China would strive for carbon neutrality by 2060. China would lower its carbon emissions per unit of GDP by over 65% during 2005-2030, increase the share of non-fossil fuels in primary energy consumption to around 25% by 2030, increase the forest stock volume by 6 billion cubic meters from 2005 to 2030, and bring its generating capacity of wind and solar power to over 1.2 billion kW, president Xi Jinping declared at Climate Ambition Summit on December 12, 2020.
2. More efforts to reduce energy consumption
On September 11, 2021, the National Development and Reform Commission issued Plan to Improve Rules on Lowering Intensity and Quantity of Energy Consumption, calling for improving related rules, distributing energy resources more reasonably and greatly increasing efficiency of energy use, all by 2025.
3. New document to save energy and cut carbon emissions
Five departments including the National Development and Reform Commission jointly issued Opinions on Propelling Key Industries to Save Energy and Reduce Carbon Emissions in October 2021. For oil refining enterprises, benchmark level of energy consumption per unit of energy factor will reach 8.5 kg standard oil/t. factor in 2025, when demonstration level will be 7.5 kg standard oil/t. factor; for ethylene firms, benchmark level of energy consumption per unit of product will be 640 kg standard oil/t, and demonstration level 590 kg standard oil/t.
4. China’s energy structure
China’s primary energy consumption totaled 3.51 billion tons of oil equivalent in 2020, accounting for 26.1% of the world’s total. Fossil energy resources took up a major part in primary energy consumption, although the proportion has decreased from 92% in 2011 to 84.3% in 2020, when coal made up around 56.6% of energy consumption, and natural gas 8.2%, slightly higher than in 2011 but far lower than levels in the US, Japan and Germany. Renewable energy sources played a bigger role in energy consumption, with proportion growing from 1% to 5.4%, lagging behind 18.2% of Germany but approaching to the world’s average 5.7%.
5. Great pressure on China’s refining and chemical industry
Comprehensive energy consumption of domestic refining and chemical industry (referring to crude oil processing, and manufacturing of oil products and organic chemical raw materials) totaled 293 million tons of standard coal in 2019, and carbon emissions reached 470 million tons, accounting for 6% and 5% of the nation’s total, respectively. Without more stringent policies to reduce carbon emissions, the refining and chemical industry is forecast to emit 50% more in 2030.
Transformation of China’s petrochemical industry
China is striving for halting the rise of carbon emissions by 2030, reaching carbon neutrality by 2060, lowering quantity and intensity of energy consumption, etc. To achieve low-carbon development and help the nation reach goals mentioned above, enterprises are advised to:
1. Keep expansion of refining and chemical capacity to reasonable levels
Domestic refining and chemical capacity will expand continually. In detail, refining capacity will reach 989 million t/a in 2025, ethylene capacity 63.32 million t/a, and PX capacity 54.11 million t/a, resulting in more carbon emissions. Hence, for new projects, stricter requirements are recommended, in aspects of safety, energy conservation, environmental protection, product structure, etc. Meanwhile, enterprises are required to accelerate the phasing-out of high energy-consuming, high-polluting and low-profit technologies.
2. Utilize low-carbon energy
China’s energy consumption totaled 4.86 billion tons of standard coal in 2019, with fossil energy accounting for 84.7%, lower than in the refining and chemical industry. Decreasing share of fossil energy but increasing that of electric energy could reduce carbon emissions effectively. In regions with abundant resources, wind and PV power plants could compete with coal power plants. Some big companies were in the vanguard of exploration, including companies like: 1) CNPC constructing pilot distributed gas station roof PV projects in 2017, and currently boasting PV power generating capacity of 35 MW; 2) Sinopec starting construction of distributed gas station roof PV power generation projects and concentrated PV power generation projects in 2016, and boasting PV power generating capacity of 85×103kW; 3) CNOOC in 2018 constructing its first wind power project – Zhugensha offshore wind power project generating 8.65×108kWh annually.
3. Propel electrification
Technology to produce hydrogen via water electrolysis, high temperature electric heating technology, etc. will get more exposure. Electrification could help improve terminal energy efficiency, and electric heating process furnace could lower carbon emissions effectively. At present, BASF, SABIC and Linde are jointly constructing the world’s first electrically heated steam cracking furnace. Cracking reaction generally occurs under 850℃, and requires a large quantity of energy – currently from fossil fuel burning – to decompose hydrocarbon to olefins and aromatics. But electrically heated steam cracking furnace will utilize electricity generated by renewable energy sources. This may decrease carbon emissions by 90%.
4. Conduct strategy transformation
Given the nation’s targets on reaching carbon emissions peak and carbon neutrality, enterprises should actively conduct strategy transformation. PetroChina and Sinopec Corp. have decided to develop into comprehensive energy enterprises, involving businesses related to petroleum, natural gas, hydrogen, electric energy, etc. CNOOC made “green oil field & offshore wind power” strategy.
5. Adjust industry structure
Enterprises are required to improve energy efficiency, phase out outdated capacity, lower energy consumption intensify and develop new products (e.g. high functional membrane materials, bio-based materials, etc.). Further, recycling renewable resources is an important way to reduce carbon emissions. Recycling one ton of plastic products could cut carbon emissions by 0.36 tons. In 2019, domestic waste plastics amounted to 63 million tons, and only 30% or 18.9 million tons were recycled. In 2050, it is forecast that recycled plastics will meet 52% of domestic demand for plastics.
6. Strengthen R&D of core low-carbon technologies
Carbon reduction technologies mainly include energy system optimization technology, efficient conversion synthesis technology, high-efficiency polymerization and material processing technology, efficient separation technology, efficient and low-cost waste petrochemical product and catalyst recycling technology, intelligent technologies, etc.
7. Develop chemical utilization of carbon dioxide
Chemical utilization of carbon dioxide refers to employing chemical methods to convert carbon dioxide to targets products, at present mainly methanol, urea, dimethyl carbonate, etc.
Making methanol via carbon dioxide hydrogenation is an efficient way to utilize carbon dioxide. ETL technology developed by Iceland Carbon Recycling International Company (CRI) is relatively mature. CRI and a Canadian enterprise jointly invested US$5 million to construct a methanol plant, which was put into production and increased its capacity from 13 million t/a in 2012 to 40 million t/a in 2014. China recently also made progress in researching related technologies.
Carbon dioxide, methanol and ethylene oxide are raw materials of dimethyl carbonate (DMC), which is used in production of many chemical products, and widely applied to the fields of solvents, gasoline additives, surfactants, antioxidants, etc. In recent years, researchers tried to synthesize DMC with only carbon dioxide and methanol – a way to directly use carbon dioxide and effectively reduce carbon emissions. Producing urea with carbon dioxide and ammonia is another method to cut carbon emissions.
Physical application of carbon dioxide mainly involves food additives, dry ice, etc. As for biological application, it is still in its infancy, with research focusing on air fertilizers, micro algae carbon sequestration, etc.
8. Produce hydrogen with green energy resources
Producing 1 kg of hydrogen with natural gas emits 10 kg of carbon dioxide. But if enterprises choose power generated by green energy resources and water electrolysis for hydrogen production, things are totally different – no carbon dioxide will be generated. In addition, hydrogen achieved in this way could replace fossil fuels (or raw materials) with high carbon emissions, and produce low-carbon fuels and chemicals, like synthetic ammonia, glycol, etc. – effective methods to help achieve net-zero emissions.
9. Develop technologies to produce hydrogen via ammonia decomposition
Ammonia is a rich hydrogen carrier, cheap and is environmentally friendly. With the help of nickel-based catalysts, liquid ammonia is decomposed under 800-850℃ to gas mixture, with hydrogen accounting for 75% and nitrogen 25%. No carbon dioxide is generated during the process.
10. Research CCUS technologies
Adopting CCUS technologies (carbon capture, utilization and storage) is recognized as an effective way to decrease carbon emissions, especially in areas where emissions reduction is hard to realize. However, most core CCUS technologies are currently in stages of theoretical research, laboratory investigation, industrial demonstration or small-scale commercial operation, and they face problems like high costs, high energy consumption, etc. Enterprises should invest more to solve these problems, improve existing technologies, make new breakthroughs in key CCUS technologies, etc.
