Synthesizing sustainability for the chemical industry

Intro: The chemical industry's unique environmental footprint:

The chemical industry's energy consumption sets it apart: unlike other sectors, 25-50% of its energy is used as raw material for its products, not just for operational power. This transforms energy-rich materials into fundamental building blocks for the final products.

However, most of the raw materials, which are referred to as feedstocks, are fossil fuels. For instance, crude oil is used as a feedstock for producing gasoline and plastics. Naturally, this results in a substantial carbon footprint, driven by:

• Energy-intensive reactions: When producing ammonia for making plastics, each ton of ammonia produced releases roughly 2 tons of CO2.

• Carbon incorporation: The carbon from fossil feedstocks becomes part of the final products during the reactions.

Consequently, the industry's footprint extends beyond its operations to the entire product lifecycle, affecting downstream industries and consumers. This high footprint is compounded by emissions from standard practices like waste disposal and electricity use.

Therefore, simply transitioning to renewable energy for operational power is insufficient. A holistic approach is necessary that encompasses all practices, such as Zero Liquid Discharge (ZLD) that reduces energy and emissions by minimizing liquid waste.

Shifting away from fossil fuels

To effectively transition away from fossil fuels, the chemical industry must adopt a multi-pronged approach, focusing on both operational optimization and material transformation to robustly manage emissions. Operational optimization can involve improving processes to use less energy through advanced catalysis, chemical reactions that minimize waste, and sustainable catalysts. Similarly, material transformation can involve replacing traditional plastic packaging with biodegradable options, implementing solvent recycling to reduce virgin solvent needs, and switching to safer, bio-based solvents like ethanol.

Crucially, a shift towards sustainable materials, such as plant-based ingredients, advanced recycling technologies, and biodegradable product design, is essential. These changes, when effectively employed, will significantly reduce the industry’s environmental impact.

However, implementing these changes presents significant challenges:

• Product lifecycle complexity: Tracking the environmental impact of long-lived chemical products is complex. For example, manufacturing Teflon coating - used for cookware and vehicles - involves harmful perfluorinated chemicals, and its degradation releases fluorocarbons that contribute to global warming. Coupled with global supply chains, this makes monitoring emissions and managing end-of-life impacts exceptionally challenging, highlighting the difficulty in accurately assessing chemical product footprints.

• Data challenges: The chemical industry's numerous data points, ranging from 50-50,000 per raw material to 50-150 per customer, makes data management exceedingly difficult. This sheer volume, compounded by security concerns and absence of uniform data standards, significantly hinders timely and accurate data analysis and reporting.

• Supply chain overhaul: Even a single chemical refinery has a highly complex supply chain, from intricate sourcing processes to worldwide product distribution. As such, a transition towards sustainability demands entirely new, equally complex supply chains, disrupting production processes and causing significant delays.

Further complicating these challenges is the constantly evolving regulatory landscape. All this puts into perspective how the chemical industry’s complexity and presence in everyday life requires greater recognition to fully understand the immense effort required for sustainable transitions.

Regulations and Consumer Pressure

Historically, chemical regulations focused on factory safety and hazardous materials. However, climate change has broadened their scope, including specific mandates on emissions reductions and supply chain sustainability. For instance, the EU Deforestation Regulation mandates deforestation-free supply chains. This regulation particularly impacts manufacturers of cosmetics and cleaning products, who heavily rely on commodities like palm oil and soy, which are often sourced from regions experiencing significant deforestation.

To comply with these evolving regulations, the industry is compelled to move away from fossil fuel infrastructure and invest heavily in sustainable alternatives. This transition extends beyond renewable energy investments, necessitating the adoption of entirely new operational practices. Specifically, extensive employee retraining is required to implement new procedures related to sustainable sourcing, auditing, and compliance. These regulatory changes impose substantial financial and logistical burdens, particularly on Small and Medium-sized Enterprises (SMEs) which often lack the resources of larger corporations.

Adding to the regulatory pressure, growing awareness among investors and consumers is driving market demand for sustainable products. Companies that proactively adapt to these evolving expectations, by integrating sustainable practices and transparently communicating their efforts, are poised to gain a competitive edge and secure long-term success.

Data-driven ESG: The key to sustainable chemical operations

The chemical industry's transition to sustainable operations and proactive emissions prevention hinges on strategic investments in advanced monitoring and robust data collection frameworks. These data-driven systems are not just tools for operational efficiency; they form the bedrock of a robust ESG strategy, as this can enable:

• Real-time process optimization: Continuous monitoring is essential to optimize chemical operations and achieve ESG goals. Advanced Process Controllers (APCs) utilize real-time data for precise variable control, stabilizing operations, and this stability empowers Real-Time Optimizers (RTOs) to further optimize plant performance.

• Effective emissions management: Accurate carbon footprint calculations facilitate targeted reduction strategies, which are crucial for minimizing emissions. For instance, replacing flaring, which releases over 350 million tons of CO2e annually, with gas recovery and repurposing as fuel or feedstocks significantly reduces waste and emissions.

• Raw material efficiency: Supply chain transparency and optimized material flow are vital for minimizing waste and maximizing resource utilization. A specialty manufacturer can enhance raw material efficiency by using real-time tracking and digital tools to reuse solvents and carefully control ingredients. This reduces waste, improves product quality, and optimizes resource use through timely deliveries and precise inventory management.

• Innovation in sustainable practices: Data sharing and predictive modeling drive the development of technologies and processes that can be aligned with long-term sustainability goals. For example, syngas can be produced by extracting carbon from waste gases like CO2 and methane. This reduces emissions and provides a green alternative for fuel and hydrogen.

• Continuous compliance monitoring: Regulatory bodies like India's Ministry of Environment, Forest and Climate Change (MoEFCC) are continuously tightening emission limits, necessitating proactive compliance. This can be achieved by implementing systems that provide continuous monitoring, real-time violation alerts, and constant updates to reflect the growing regulatory landscape.

Crucially, the full potential of these data-driven ESG systems, like what we at Impactree have with RUBICR, is realized only when ESG is viewed as a growth strategy, not merely a compliance measure. By shifting the mindset from reactive adherence to proactive value creation, the chemical industry can:

• Optimize resource utilization and reduce operational costs: A structured data analysis framework facilitates informed decisions related to energy consumption, waste reduction, and raw material efficiency, directly impacting the bottom line through cost savings and resource optimization.

• Gain a distinct competitive edge: A data-driven approach to sustainable practices, backed by robust data collection, differentiates companies: attracting eco-conscious talent, customers, partners, and strengthens their brand, unlocking sustainable investment and premium market access.

• Develop innovative, low-carbon products and processes: Translating operational data into concrete, measurable ESG initiatives drives innovation in low-carbon technologies and sustainable product development, positioning companies as industry leaders.

This proactive approach allows the chemical industry to capitalize on emerging market trends, drive sustainable product development aligned with evolving consumer demands, and build stronger, more resilient stakeholder relationships, ensuring long-term success and cementing its role in a sustainable future.

Conclusion

The chemical industry's sustainable future requires a radical transformation, embedding ESG principles through data-driven solutions across all business facets. To achieve this, continuous, real-time monitoring of chemical processes is needed, which optimizes operations, thereby minimizing energy use and waste. ESG platforms further enhance this by integrating sustainability data, automating reporting, and ensuring transparent supply chains, ultimately improving efficiency and reducing the carbon footprint.

DM us @impactree.ai to learn more.