Decarbonizing the Middle East’s hard to abate industries won’t be easy but we can do it
By Dietmar Siersdorfer, Managing Director Middle East and UAE, Siemens Energy
The Middle East is undertaking mega projects that will transform the region but will also require significant quantities of carbon intensive products like cement, steel, hydrocarbons, and petrochemicals.
Demand and supply of petrochemicals is forecast to increase over the next few years, and the Middle East is home to some of the largest and most competitive petrochemical companies. This is an industry that produces the key ingredients for numerous goods that we use every day. These are also, in many instances, the hard to abate industries that we cannot live without, but which strongly contribute to greenhouse gas emissions.
We don’t want to constrain growth, nor harm the environment, but we need to find solutions to decarbonize these processes and industries to achieve our ambitious goals while safeguarding our planet at the same time.
Hard-to-abate
To reduce carbon emissions, we must work through alliances, innovation, and existing technology. In the race to avoid climate disasters we often focus on how to reduce emissions, particularly CO2. But what about the areas where emissions are unavoidable? These industries account for a large portion of our global emissions and finding ways to reduce them is the key to a greener future.
Hard-to-abate industries include steel, cement, petrochemicals, and together, these industries are responsible for nearly 30% of global greenhouse gases. Carbon is often a crucial component of each of their processes. For instance, clinker, one of the primary components of cement, is created by heating limestone to extremely high temperatures. The procedure releases the carbon stored in the stone, which reacts with the oxygen in the air to create CO2. It is processes like that that we need to address. So, how should we tackle the problem? It’s doable but it will not be easy.
In many of the manufacturing steps hydrogen can be used as a fuel to reduce emissions. We can redesign plants to utilize residual process gas along with hydrogen. This is happening in Brazil with Braskem, one of the largest makers of thermoplastic polymers, to drastically reduce CO2 emissions.
Other technologies can be implemented in the short term for hard-to-abate industries, to increase the efficiency of industrial processes and therefore reduce direct and indirect emissions, like steam balance optimization and the use of heat pumps for waste heat recovery.
Saudi Arabia has plans to neutralize greenhouse gas emissions by 2060 by developing facilities that will capture and store carbon emissions. The technology, known as Carbon Capture, Utilization and Storage (CCUS) is designed to mitigate the impact of emissions by capturing them before they reach the atmosphere.
Saudi Aramco is currently testing technology that captures 800,000 tons of CO2 per year, compressing it and injecting it into an oil field. Taking it further, Aramco’s conversion technology uses the captured CO2 to create useful polymers, such as plastics, with just one-third the carbon footprint of conventional polymers. Such innovative technologies are key to decarbonizing hard to abate industries.
Hydrogen as a solution
For the deep decarbonization of the industry, hydrogen can be used in two ways, as an alternative fuel as well as an alternative raw material. The steel industry, which is heavily dependent on fossil fuels for its energy generation, can be retrofitted to utilize green hydrogen instead. Green hydrogen can also be used as a raw material to produce green ammonia, green methanol, and other e-fuels and chemicals.
While hydrogen can be used as a heat source, direct use of waste and process heat for electrification in the industry is another lever to further decarbonize the processes, provided zero-carbon electricity is available from renewable sources.
The technologies are available today, but with an increase of availability of renewable energy, we need to invest in further developing technologies such as heat pumps to electrify processes, particularly where high temperatures are required, instead of burning hydrocarbons.
In Europe big players in the chemical industry, along with SABIC here in the Middle East, have teamed up and started with electrification of reformers to avoid fossil fuels to produce steam. BASF, SABIC and Linde have started construction of the world’s first demonstration plant for large-scale electrically heated steam cracker furnaces. The demonstration plant will be fully integrated into one of the existing steam crackers at BASF’s Verbund site in Ludwigshafen, Germany. In those cases, the electricity will have to come from renewable power generation like wind and solar.
So, one key to decarbonization and accelerating the process is innovation, especially in areas where we can replace carbon-intensive materials with alternatives.
Innovating decarbonization
With accelerating development of renewable energies and new industries centered around hydrogen, innovation and co-creation will be required to synergize and create efficiency and reduce costs along these new value chains.
However, innovation on its own is not enough. To really tackle the problem, we need collaboration and alliances. If we continue working in silos, we might be able to individually reduce emissions in spots, but only by working together and sharing knowledge will we be able to scale those innovations up to where they can make a difference.
Accelerating together
A recent such example is the recently formed Alliance for Industry Decarbonization, with the International Renewable Energy Agency (IRENA), which continues to grow and now includes over 30 companies across a variety of industry sectors. The alliance’s aim is to decarbonize processes, accelerate renewables, and develop green hydrogen technologies further, while promoting the technologies to the rest of the industry to create cleaner industrial processes.
Both efforts – the technological innovations and alliances – will need a proper political framework. The energy transition will require investments of about €50 trillion globally. Government and industry need to work together to make these technologies affordable.
Currently one of the biggest obstacles in the production of green hydrogen is its price. Switching to green hydrogen for making steel roughly doubles the cost of the material. For cement, greener options to clinker can increase the price three-fold. In the US the Inflation Reduction Act is tackling this an attracting a lot of investments into hydrogen.
Only by making these greener options economically viable will they ever be used at scale. By encouraging investment into them, governments can help industries bring the cost down. Each project brings us a step closer to our climate goals.
As we tackle climate change, we can’t avoid the tough parts. The only way to meet our emission targets is by decarbonizing hard-to-abate industries. We have less than 10 years until our 2030 targets, so we’ll need to use a lot of the same infrastructure we have now to meet them. That calls for speedy decision-making and swift action. If we manage that, we can solve one of the biggest problems in our fight for a greener future.
Dietmar Siesrdorf, MD, Siemens Energy Middle East, will participate in a leadership dialogue entitled ‘Pathways for transformation and the transition to net-zero’ as part of the 3rd GPCA Leaders Forum being held on 1 March 2023 in Oman.
