(511c) Energy Systems Perspective on Chemical Sector Decarbonization Pathways – Case Study of Ethylene

Decarbonization of the chemical industry, which ranks among the top three sub-sectors in terms of industrial GHG emissions globally, remains challenging, in part due to the heterogeneity and complexity of underlying processes as well as reliance on fossil fuels for energy and feedstock. For example, the production of ethylene, a key platform chemical, is primarily produced via the steam cracking process, which can be operated with alternative feedstocks- either naphtha, a byproduct of crude refining, or ethane, a byproduct of natural gas production – depending on their regional availability and cost. In addition, depending on the process configuration, the steam cracking process may either export or consume co-produced H₂ that affects its external natural gas consumption and process emissions. This variation in process configuration also extends to low-carbon production routes, which span different feedstocks (e.g., biomass, CO₂, fossil feeds), conversion technologies (e.g., steam cracking, syngas to olefins, ethanol conversion), and energy inputs (H₂, electricity, natural gas). The viability of alternative ethylene production routes under decarbonization scenarios is thus not only dependent on technology costs and yield but also intricately linked to the demand for the various feedstocks and energy inputs from other sectors.

Previous assessments of ethylene decarbonization technologies have focused on process-level techno-economic comparisons that do not account for the above-mentioned energy system interactions. Existing economy-wide energy system decarbonization studies that do account for the interaction between sectors for scarce feedstock and energy inputs tend to have rather abstract representations of the chemical industry and its interaction with the rest of the energy system. This makes it difficult to assess the impacts of industrial decarbonization on emissions reduction in other parts of the energy system and vice versa.

Here, we explore the energy system drivers affecting the viability of alternative ethylene production technologies as part of a cost-optimized, net-zero energy system. Our approach relies on implementing a detailed representation of various ethylene production technologies as part of a multi-sector, multi-commodity energy system model, MACRO, that is formulated as a large-scale linear program (LP). The model minimizes operating and capital costs associated with the supply chain of each commodity (electricity, CO₂, H₂, biomass, liquid and gaseous fuels, and ethylene) while considering spatial and temporal variations in resources, supply and demand balances for each energy vector, technological, operational constraints as well as investment and operational cost characterization. In addition, the model also includes constraints to model the geospatial availability and cost of scarce resources such as biomass, CO₂ sequestration, and variable renewable electricity (VRE).

We use the model to explore ethylene decarbonization pathways as part of net-zero energy system outcomes for the contiguous U.S. under various demand and technology assumptions. The results shed light on the competition between the following ethylene production technologies: a) biomass-based production technologies with and without CO₂ capture and storage (CCS), b) steam cracking-based ethylene production with and without CCS, c) electrified steam cracking in which electricity is used instead of fossil fuel combustion for process heat and d) various CO₂ to ethylene conversion technologies. We also find that electrified steam cracking, which is electricity-intensive (around 3 MWh/t-ethylene), has only a minor impact on the power sector generation mix since it co-produces H₂ that displaces additional electricity demand for water electrolysis-based H₂ production. In this way, electrified steam cracking, if it were to deploy, could have a more substantial impact on the H₂ production mix. Our scenarios also highlight that fuels and chemical production must compete for limited biomass feedstocks.