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The Sustainable Energy for All initiative was launched by the United Nations Secretary-General Ban Ki-moon to mobilize action and partnerships focused on sustainably meeting the increasing energy requirements of businesses and society. The initiative has set three primary objectives, to be met by 2030: ensuring universal access to modern energy services; doubling the global rate of improvement in energy efficiency; and doubling the share of renewable energy in the global energy mix.
This report looks at the chemical industry and identifies seven priority actions it can take to reduce its energy use while simultaneously driving high performance.
The chemical industry is highly energy-intensive, and can account for more than 5 percent of total annual energy consumption and close to 20 percent of all industrial energy consumption.
Of the chemicals industry’s total energy consumption, energy inputs used for raw materials accounted for approximately 54 percent by volume (72 percent by value) in 2010, with the rest used for fuel and power. For manufacturers of some products such as petrochemicals, energy consumption for both fuel and raw materials accounts for the majority of the total cost of production.
Although chemical companies are significant consumers of energy, many also produce electricity through on-site generation. This electricity is primarily used for operational purposes, but there are instances where excess power is sold back to the grid. This operational profile demonstrates the importance of energy to the chemical industry, and the significance that sustainable energy opportunities can have with regard to decreasing costs and increasing business value.
The chemical industry is a principal supplier of materials that make the global economy more energy-efficient, and enables the development of a new, renewable energy-generation market.
Chemical companies have significant opportunities to improve the efficiency of core operations. For example, Europe’s chemicals industry reduced overall greenhouse gas emissions by almost 30 percent between 1990 and 2005, even as production rose by 60 percent, while the Japanese chemicals industry reduced unit energy consumption by 83 percent from 1990 to 2010.
The chemical industry also has an important role to play in global sustainable energy transformation, and the sustainable energy market represents a new and expanding business opportunity for chemical companies.
More than 96 percent of all manufactured goods are directly touched by the business of chemistry. If products of all types are going to be more energy-efficient in design, and produced in a more energy-efficient manner using more renewable energy, the chemical industry is going to play a significant role. Thus, the chemical industry’s business opportunity in sustainable energy is expansive as new markets develop and existing markets transform. This opportunity, if proactively and strategically addressed, could enable chemical companies to drive significant value not only in terms of cost reductions, but also revenue growth, brand enhancement, and enhanced risk management capabilities.
The chemical industry can take seven priority actions to become more energy efficient and to advance its business opportunities in the sustainable energy market:
Improve the energy efficiency of production processes.
Use more energy-efficient techniques to generate electricity and steam in operations.
Develop products and services that drive consumer energy efficiency and enable increased renewable energy uptake.
Establish an integrated, enterprise energy management function within the organization.
Beneficially reuse waste streams as process inputs or to generate energy.
Develop more renewable and bio-based feedstocks.
Use more renewable energy for operational energy needs.
October 2, 2012
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