Climate Protection with Carbon Management

Climate protection is firmly embedded in our corporate purpose, “We create chemistry for a sustainable future,” and is a cornerstone of our strategy. We are committed to the Paris Climate Agreement and its goal of limiting global warming to below 2 degrees Celsius. Our innovative climate protection products, such as insulation materials for buildings or battery materials for electromobility play a role here. We are also continually working to reduce our own carbon emissions. We have already almost halved our carbon emissions since 1990 through improvements to processes and methods – while simultaneously doubling sales product volumes.

Development of the BASF Group’s CO2 emissions

Million metric tons of CO2 equivalents

Development of the BASF Group’s CO2 emissions

Reconciling climate protection and growth

Until 2030, we want to continue to grow our production without adding further CO2 emissions.1 Global activities to reach this climate protection target and reduce our greenhouse gas emissions over the the long term are bundled in our carbon management. We have adopted a three-pronged approach: We aim to increase production and process efficiency, purchase electricity from renewable sources, and develop completely new low-emission technologies and processes. We want to use these to significantly reduce CO2 emissions from 2030 onward.

1 The goal includes other greenhouse gas emissions according to the Greenhouse Gas Protocol, which are converted into CO2 equivalents.

Further improving process and energy efficiency

We aim to make our plants even more efficient and further optimize resource use in our processes. That is why we have increased our budget for operational excellence from €250 million to €400 million annually, among other measures. Part of this goes toward initiatives to reduce our greenhouse gas emissions. When constructing new plants or developing new sites, we draw on our expertise and innovative technologies to optimize the use of raw materials and in this way, reduce CO2 emissions. For example, our new acetylene plant in Ludwigshafen, Germany (annual capacity: 90,000 metric tons) uses around 10% less natural gas per metric ton of end product compared with the old plant.

CO2 prevented

by the Verbund and combined heat and power generation in 2019

6.4 million metric tons

BASF’s Verbund concept also plays a key role in increasing efficiency. It helps us to realize synergies across all segments and to efficiently steer value chains. Intelligently linking production and energy demand enables us to use fewer resources and reduce our emissions. Together, combined power and steam generation and our continuously enhanced Energy Verbund prevented a total of 6.4 million metric tons of carbon emissions in 2019 (see above). That is why we will continue to invest in the creation and optimization of Verbund structures and drive forward the consolidation of production at highly efficient sites.

Increasing use of renewable energy

As part of carbon management, we aim to increase the proportion of renewable energy in the electricity purchased for our production sites. Twenty-three sites in Europe, North America and Asia already source emission-free electricity from suppliers.

Number of sites

partially or fully powered by emission-free electricity in 2019

23

Together with our partners, we are also conducting a feasibility study to evaluate a pioneering supply concept for our planned chemical complex in Mundra, India. The aim is for the new site (scheduled production startup: 2024) to be entirely supplied with renewable energy, primarily from an attached wind and solar park. If realized, it would, to our knowledge, be the world’s first petrochemical site with carbon-neutral energy supply (see Products and Investments).

Pioneering research and development program

Most of our production processes and methods are already highly optimized, making further improvements to existing plants an increasingly difficult task. As a result, completely new technologies are needed to avoid greenhouse gas emissions over the long term and on a large scale. This is where our Carbon Management R&D Program comes in. The focus here is on the production of basic chemicals, which are used in many products and innovations and account for around 70% of the chemical industry’s greenhouse gas emissions.

As part of this R&D program, we are developing an innovative, climate-friendly production process for hydrogen (methane pyrolysis) together with partners from academia and industry in a joint project sponsored by the German Federal Ministry of Education and Research, to name one example. Hydrogen is used as a reactant in many chemical processes, such as ammonia synthesis. However, the processes currently used to produce hydrogen from natural gas, such as steam reforming, are extremely CO2 emission-intensive. In methane pyrolysis, by contrast, natural gas is split directly into its components hydrogen and carbon. The resulting ultra-pure solid carbon could be used to produce aluminum, for example. Methane pyrolysis requires less electricity than the alternative method of producing hydrogen using water electrolysis. If this energy comes from renewable sources, this could make the hydrogen production process carbon-free.

Methanol could also be produced without CO2 emissions in the future. Methanol is a starting material for the production of products such as formaldehyde or acetic acid and also serves as a source of energy. In 2019, an international patent (PCT) was filed for a climate-friendly production process for methanol that BASF developed as part of the Carbon Management R&D Program. In this new process, the waste gas streams from methanol synthesis are incinerated and the resulting CO2 isolated and fed back into the process as feedstock. The syngas needed is also produced CO2-free, for example through partial oxidation, and thus all of the carbon from the raw material ends up in the methanol. Unlike in conventional methods, this process does not produce any greenhouse gas emissions.

Share of emissions produced by the European chemical industry

attributable to the 10 most energy-intensive basic chemicals

~70%

Other examples from our Carbon Management R&D Program include dry reforming methane to produce syngas as the basis for the production of olefins with a significantly lower carbon footprint (see Innovations in the Segments), the development of an electrical heating concept for our steam crackers, or using CO2 to produce sodium acrylate (see Research Focus Areas). We are optimistic that these climate-friendly production processes can be implemented from 2030 onward.

Creating the framework for the transformation

The transition toward a climate-friendly society remains a fundamental challenge of the 21st century. There are many ways in which the chemical industry can be part of the solution. The political and regulatory environment is also crucial to the development and successful application of completely new production processes on an industrial scale. Demand for electricity from renewable sources will increase sharply with innovative, more climate-friendly technologies. At the Ludwigshafen site in Germany alone, we would need to roughly triple or quadruple our current electricity use (2019: 6.2 TWh) to fully implement new, low-carbon electricity-based production processes like the ones being developed in our Carbon Management R&D Program. As well as its availability, the price of green power is also a critical success factor. Sectors like the chemical industry, which compete in an international market, cannot pass on the additional costs caused by low-carbon technologies to their customers until a comparable carbon pricing mechanism exists globally – or at least at G20 level. Until then, governments must implement measures to ensure the competitiveness of climate-friendly processes.

Creating the framework for the transformation (Photo)