HLG Chemicals – Working Group Feedstock, Energy & Logistics
February 7, 2008 Brussels
Raw Material Change in the Chemical
Industry – The General Picture
Dr. Jörg Rothermel,
German Chemical Industry Association (VCI)
1
Content
Ø Raw materials in the chemical industry – a general overview
Ø Use of renewable raw materials in the European chemical
industry
Ø Motivation for the use of renewable raw materials
üEconomical advantages
üSecurity of supply
üClimate protection
Ø Competition in use of renewable raw materials
Ø Technical use concepts of renewable raw materials in the
chemical industry
Ø Summary of messages
2
Raw Materials in the Chemical
Industry
A General Overview
3
Basic Feedstock Demands in the
Chemical Industry
ØRaw Materials for the Chemical industry
must be available in a stable and good
quality
ØSecurity of supply must be garanteed
ØRaw materials must be available at
world market prices
Oil and gas meet the demands in an approved
way since a long time
4
Raw Materials in the Chemical
Industry- Alternatives
Renewable
Resources
Syngas
Olefins
Coal
Gas
Oil
Value
Added
Chains
Acetylene
Aromatics
5
Feedstock in the Chemical Industry (organic
chemicals)
Ø Carbon containing raw materials are the basis for the
production of organic chemicals:
üMineral oil derivatives
üNatural Gas
üCoal
üRenewable raw materials
Ø Biomass is the only renewable carbon based feedstock for the
chemical industry
Ø European chemical industry will increase the share of
biobased raw materials as only renewable source of carbon
where it is technically and economically useful and
sustainable
Ø European/world chemical industry needs a flexible feedstock
base also in the future to meet the demands of the customers
6
Use of Renewable Raw
Materials in the European
Chemical Industry
7
Present Use of Renewable Raw
Materials in the Chemical Industry
ØChemical Industry in Europe has been using a
variety of biobased renewable raw materials since a
long time
Ø8 to 10% of feedstock for the organic production of
the European chemical industry is biobased:
ü74,1 Mio t/y fossile raw materials
üAt least 6,4 Mio. t renewable raw materials
ØRenewable raw materials are already used
üif they are cheaper than fossile raw materials
üIf they offer technical advantages in comparison
to fossile raw materials (even if they are more
expensive than fossile raw materials)
8
EU-25 Industrial Use of RRM (2003)
Total industrial use of RRM: ~ 9 Mio. t/y
Starch
35%
Vegetable
Oil & Fats
31%
Other
4%
Cellulosics &
Fibers
16%
Sugar
14%
estimations based on data from:
EU, IENICA, EHGA, CIRFS, EIHA, EuropaBio, AAF, Röper, Kaup, EurObserv’ER, FAO
Slide 9
9
Motivation for the Use of
Renewable Raw Materials
10
Motivation for the Use of Renewable
Raw Materials
ØCompetitiveness
üEconomical advantages: raw materials with more
competitive prices
üTechnical advantages: improves processes and
products
üSustainability (ecological, economical and social
aspects)
ØInnovation – competitive edge for EU industry
ØSecurity of supply: fossile feedstock is limited,
biomass seems unlimited
ØClimate change: biomass is considered as „CO2neutral“ (biomass based products may have a better
carbon footprint)
11
Economical Advantages
12
Agricultural commodity prices are rocketing
13
Economical motivation: competitive
raw materials
ØThere was a bigger price difference between fossile and
renewable raw materials in the past
ØRaw material prices have been fluctuating a lot due to
multiple influences, e.g. weather climatic change, rising
demands for food feed and fiber, regional programs, …
ØResult of a study by IFEU for VCI: Raw materials cost are
the most significant cost part of production using
renewable raw materials
ØChemical industry needs renewable raw materials at
world market prices
Trade aspects: presentation of R. Quick
14
Political motivation: security of supply
Security of Supply
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Biomass Potentials
Ø Evaluation of future biomass potentials is very difficult
- many
factors which will influence the potentials e.g.:
üGrowth in population
üFood consumption
üClimate change
üFuture efficiency in techniques to produce and to convert
biomass
üWater availability
üOther ressource availibility….
Ø Uncertainty in the calculation of future biomass is very high
Ø Political target setting must be based on sustainability
Ø More efficient techniques for use are needed (biorefinery concept)
Ø More efficient techniques to produce biomass are needed (plant
biotechnology)
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Biomass Avalibility in 2050: Results
German IFEU-Study 2007
Oil Equivalents (bn tons)
22
20
18
16
14
12
10
8
6
4
2
0
* IEA 2006
Primary Energy demand in 2050*
Minimum
Maximum
Biomass availability for technical
Purpuses in 2050
ØBiomass availability will be
strongly limited in the future
ØPrimary energy need will not
be covered by biomass (best
case only 70%, worst case
only 30%)
ØMost efficient techniques for
the use of biomass must be
evaluated
ØOther renewable energy
sources especially for heat
and electricity production
must be developed
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Biomass Availability by Regions
Caribean and.
South America
Middle East and
Northern Africa
East Asia
Africa south of
Sahara
South East Asia
North America
Former Soviet
Union
Europe East
3%
è
Pacific
Europe West
4%
55 % of the biomass in 2050 will be harvested in Africa
South of Sahara, der Caribbean and South America and in
the former Soviet Union.
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Role of Green Biotechnology
Ø Plant biotechnology and conventional crop protection products are
two valuable and complementary tools to sustainably meet
increasing demand for higher agricultural productivity, food
security, feed availability as well as renewable resources.
Ø Plant biotechnology can assist in protecting plants from pests,
diseases, fungi and abiotic stresses (e.g. drought, heat, cold, and
soil salinity) and can lead to more effective weed and pest control
and more efficient use of crop protection products.
Ø Because of the rising demand for agricultural products, limited farm
land and availability of biomass we can keep only pace with the
prospective agricultural requirements if we use all the options
available for increasing yields and safeguarding harvests.
Ø Favorable harmonized conditions to use plant biotechnology are
needed
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Competition of Different Uses
of Renewable Raw Materials
20
Competition in the Use of Biomass and
Landuse
Ø Competition in biomass use:
üFood
üFeed
üElectricity and heat production
üTransport fuel
üBuilding materials
üFeedstock in the chemical industry
üPaper industry
üWood industry
Ø Severe competition in the use of biomass and also in the land
use to produce the biomass
Ø Economically, ecologically and socially most efficient use
must be evaluated
21
Worldwide Material Streams: Fossile
and Renewable Raw Materials
Oil, gas + coal
~ 10 billion t Oil Equivalents per year
97%
energy
3% chemistry
Agricultural products
6-7 billion t Dry Matter per year
95%
food
energy
living
5% chemistry like
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Use Competition
ØChemical sector is the smallest user of fossil raw
materials as feedstock in comparison to energy
production and transport fuels
ØChemical sector will also be the smallest user of
renewable raw materials in comparison to energy
production and transport fuels
ØBecause of the use competition chemical industry
risks to become the victim of the subsidisation of
renewable raw materials in energy and transport
sector
ØAlready today prices of already established
renewable raw materials are rising because of
increasing demand in other technical sectors, e.g.
tallow, vegetable oils
23
Climate Protection
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Political Motivation: Climate Protection
Ø In principle CO2 release during combustion of plant material or use
as feedstock in the chemical industry is counterbalanced by the CO2
that plants remove from the atmosphere during photosynthesis.
Thus the use of plant material has a favorable carbon balance.
recognize
Ø Carbon content is not the only parameter which must be considered
by calculating the climate protection importance of biomass
Ø Important is a sustainable production and use of biomass including
a comprehensive life cycle assessment
üAgricultural production
üHarvesting and transportation
üProcessing
üRecycling
Ø Biomass can be an attractive feedstock to prevent excessive
emission of green house gases as long as its production is
following certified sustainability criteria
25
Political Motivation: Climate Protection
- Example Biofuels
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Comparison of Efficiencies in Biomass
Use
Ø Technical use of biomass can be for energy production,
transport fuels and feedstock for chemical industry
Ø Highest saving potentials in fossil energy and CO2-emissions
by use of biomass in energy production
Ø Efficient processes for energy production are already known
and practically available
Ø Progress in research and development necessary to further
enhance the efficient use of biomass for the production of
transport fuels and as feedstock in the chemical industry.
Ø From a feasible point of view current focus on sustainable
energy and biofuel production is a reasonable way of
biomass use for a foreseeable future
Ø Sustainable use of biomass in other sectors must be
developed
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Technical Concepts for the Use of
Renewable Raw Materials in
the Chemical Industry
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3 „Generations“ of Use of Biomass in the
Chemical Industry
„Yesterday“
Use of naturally synthesized Molecules as they are
Main Part of Today Use – Further Potential: low
„Today“
Use of biomolecules in biotechnological Processes
Today very high dynamics – Potential: big
„Tomorrow“
Use of Biomass in Biorefineries to produce Basic Chemicals
Today: basic Research – Potential: very big
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1st Generation: Use of Naturally
Synthesized Molecules
ØExamples
üPlant oils and fats for tensides
üOils as Lubricants
üCellulose as an additive in paints and adhesives and
as fiber for textiles and compounds
üStarch as adhesive and as material for packaging
materials
üActive ingredients for pharmaceuticals
ØMarket for these raw materials is known and covered
ØGrowth with the general market growth
ØInefficient use of biomass because often not more than
30% of the total biomass can be used
30
2nd Generation: Biotechnology
Ø In principal most fine chemicals and intermediates can be
produced using renewable raw materials (carbohydrates,
proteins, oils and fats) in biotechnological processes
Ø Presently the market with the highest dynamic
Ø Potentials often overestimated
üMc Kinsey-Study 2000: „Between 25 and 30% of al
chemicals will be produced by biotechnological processes
in 2010“
Mc Kinsey 2005: „Only 5 to 10% will be possible until 2010“
üBREW-Study: under optimal conditions (70€/t price for
saccharose and 75 $/barrel oil price) until 2050 max. 1/3 of
the intermediates will be produced by biotechnological
processes
more: presentation of T. Jostman
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3rd Generation: Biorefineries – Production
of Basis Chemicals
Ø Concept of biorefineries: Extraction of useful plant
components (20%) and (chemical/biotechnological) treatment
of the rest (Lignin, Cellulose 80%) to produce basic chemicals
Ø Further Research and development is necessary to develop
the processes
Ø Possible advantages:
üPresent production structure can be maintained; no really
new investments are necessary
üProblem of competition in the use of biomass is smaller,
because unspecific biomass can be used completely
Ø Possible problems:
üEffectiveness of processes from the thermodynamic point
of view: process is very near to the burning of biomass
32
Biorefinery in a Nut Shell
Dry Matter
Energy-Production
Lignin
Plastics
Carbohydrates
Chemicals
Vegetable oils
Fuels
Proteins
Animal feed
33
Renewable Raw Materials in the
Polymer Sector
ØBeside fine/specialty chemicals renewable raw materials
get more and more importance in the polymer sector e.g.
ØNatural polymers:
üStarch
üCellulose
üothers
ØProcessed polymers (examples):
üPolylactid Acid (PLA)
üPolyhydroxybuturate (PHB)
ØOne important criteria: biodegradability
more: presentation of Plastics Europe
34
Hurdles in the Use of Biomass in the
Chemical Industry
Ø Technical hurdles
üA lot of R&D to optimize processes to increase efficiency
is still to be done
Ø Economical hurdles
üBiomass price is a major factor in the chemical production
based on renewable raw materials, future of biomass
prices are very uncertain.
üImports at world market prices
Ø Logistic hurdles
üInfrastructure must be developed
üWide spread of biomass limits development of large scale
production plants (economically and ecologically)
35
Summary of Messages (1)
ØChemical industry needs carbon as basic unit for
the production of organic chemicals:
üall carbon sources (fossil and renewable) can be
used
übut there are the same demands concerning
availability, quality and prices for all sources
ØUsing renewable raw materials is not a matter of
substituting feedstock basis but more of broadening
ØChemical industry needs also competitive prices for
renewable raw materials, at least access to world
market (prices)
36
Summary of Messages (2)
Ø There is a total and regional limited availability of biomass
üOnly a part of the world energy and feedstock demand can be
covered
üMost efficient technologies for using renewable raw materials for
energy supply and use in chemical industry must be developed:
support of governments for R&D is needed
üWe must be open to all technologies for increasing the amount of
available biomass, e. g. plant biotechnology: harmonised
political conditions for R&D and practical use of these
technologies must be set
Ø Renewable raw materials can contribute to improved sustainability
which has to be assessed case-by-case:
üWhole life cycle must be considered
üMost efficient technologies for the use must be applied
üPolitical target setting must be very careful and based on
sustainability criteria
37
Summary of Messages (3)
ØPresent use of renewable raw materials especially in
energy and transport sector can be further
improved
üNew technical concepts must be developed
üThis means for the chemical industry
§ increased use of white biotechnology and
§ evaluating the concept of biorefineries
üSupport in R&D is needed
38
Backup
39
EU-25 Industrial Use of RRM (2003)
Chemical Industry: ~6,4 Mio. t/y
Other Industries*: ~2,6 Mio. t/y
74,1 Mio. t petrochemical and about 6,4 Mio. t renewable
raw materials are used in the EU-25 chemical industry in
2003, i.e. roughly 8 % of the raw materials are RRM.
EU-25
10%
8%
EU-15
6%
4%
2%
6%
8%
0%
* paper industry, natural fibre using industry
1999
2003
Source: FNR, Germany
Slide 40
40
Oleochemical Use of Oils and Fats
in EU-25
Technical Use in EU:
2,8 Mio. t (2003)
Animal Fat
Fish Oil
37%
43%
Castor Oil
Palm und Soybean Oil
Coconut Oil
Slide 41
20%
Rape Oil
Sunflower Oil
Line Oil
Canola Oil
Source: based on data from EU, IENICA, Kaup
41
Industrial Use of Starch in EU-25
Food
47%
Feed
4%
Chemistry,
Pharma &
Industrial
14%
Paper
28%
Use of Starch in Europe:
9 Mio. t (2005)
Source: aAf, www.aac-eu.org ( percentage by value)
Slide 42
42
Carbohydrates in Fermentation in
EU-25
Saccharose
16%
Glucose
29%
Starch
24%
Molasses
31%
Starch & Sugar Fermentation Feedstocks in
Europe:
3,8 Mio. t
Source: EuropaBio
Slide 43
43
Technical Advantages: More Simple
Processing, Better products
ØUsing complex biomolecules (carbohydrates, fatty acids
from vegetable oils and fats, pigments, active
coumpounds …) as they are
ØBetter using the already done synthesis work of the
nature to start with complex molecules than to to built up
complex molecules from ethylene or propylene
ØExamples:
üTensides from vegetable oils and fats
üLubricants from vegetable oils and fats
üAdhesives from starch and cellulose
üPolymers from starch and cellulose
44
Economical Motivation: Competitive
Raw Materials
Production costs of ethanol from different sources
Ethanol EU (sugar beet)
Ethanol EU (wheat)
Ethanol USA (corn)
Ethanol Thai Tapioca
Ethanol Bazil (Cane)
Gasoline (fob Rotterdam)
US Cent/l
Gasoline (NY harbour)
0
10
20
30
40
50
Source: Christoph Berg, F.O.Licht‘s Sugar & Ethanol Brazil 2005
45
Availibility of Biomass in EU 27
The usable agricultural area of the EU-27 amounts to 183
Mio. ha. Thereof, about 108 Mio. ha is arable land.
Roughly 1/3 of the crop land will be globally available for
non-food crops by 2040. Just as much land will be available
EU-wide.
Hence, EU-27 will potentially have roughly 61 Mio.
ha of usable agricultural area including 36 Mio. ha
of arable land for RRM by 2040.
Assuming a current average yield of 10-15 t/ha the potential
amount of RRM sums up to about 360-540 Mio. tons.
Slide 46
46
Availibility of Biomass – Global
Estimates
Ø
arable land forecast (2040):
2,8 bn. ha
Using a scenario assuming a world population
of 9 billion by 2040 results in the following
supply:
Demand for Food: 1,8 bn. ha (65%)
Availability for Non-Food: 1,0 bn. ha (35%)
Folie 47
Source:
C.GESSA AND F.TRIFIRO, “THE GREEN REVOLUTION FOR CHEMISTRY”,
International South Europe Symposium on Non-Food Crops: From
Agriculture to Industry, Bologna, 15-16 May 2003
47
Regional Distribution of Biomass
Ø Only 10 to 16% of the expected primary energy consumption
in Europe will be covered by biomass produced in Europe
Ø Biomass will not solve the problem of energy imports into
Europe
Ø Europe will have to import the biomass which is needed to
meet the European biomass strategy
Ø The Chemical industry needs (renewable) raw materials at
competitive prices for the world market but is faced the strong
use competition of fuel and energy sector
Ø To reduce the fuel import dependency of Europe efficient
technologies for other alternative energy production must be
developed
48
World Chemical Sales in 2004 in Billion
Euro
600
586
507
500
Total: 1779 billion Euro
%
5
:
d
e
s
a
b
o
i
B
415
400
300
200
100
100
98
70
0
EU-25
Asia
USA
Latin
America
Other*
Rest of
Europe
49