Carbon emission reduction path of coal chemical industry

In the opening article of our series "China Accelerating towards Carbon Neutrality", we imagined a carbon-neutral world in 2050 dominated by new energy elements such as electric vehicles, hydrogen steelmaking, photovoltaic power generation, and green energy storage. Achieving this vision also means that the world needs to reduce net man-made carbon dioxide emissions by about 45% by 2030 compared with 2010. To achieve "net zero emissions" by 2050. In the face of the dual challenges of target and time, the road to carbon neutral transition needs to be started.

In the opening article of our series "China Accelerating towards Carbon Neutrality", we imagined a carbon-neutral world in 2050 dominated by new energy elements such as electric vehicles, hydrogen steelmaking, photovoltaic power generation, and green energy storage. Achieving this vision also means that the world needs to reduce net man-made carbon dioxide emissions by about 45% by 2030 compared with 2010. To achieve "net zero emissions" by 2050. In the face of the dual challenges of target and time, the road to carbon neutral transition needs to be started. While countries are competing to carry out specific research and implementation work, China also took the lead in proposing the goal of "carbon peak and carbon neutrality" in the general debate of the seventy-fifth session of the United Nations General Assembly. The United Nations Sustainable Development Goal 13 "Climate action" is also one of McKinsey's social responsibility priorities in China. At this key juncture, McKinsey officially launched China's large-scale carbon neutral transition research project in China. With the help of McKinsey's rich experience in global sustainable development research, combined with comprehensive understanding and profound insight into Chinese society, industries and enterprises, Mobilize the knowledge of more than 100 people around the world to carry out research on carbon neutral transition trends, countermeasures and technologies across major industrial sectors, hoping to make a small contribution to China's early achievement of carbon neutrality goals.

As the fourth article in this series, this paper will continue to study carbon neutral transition with coal chemical industry as a sample. Following this, we will publish a series of articles covering high-carbon emission industries such as oil and gas and power, covering many topics such as carbon emission reduction path analysis, emerging technology discussion, investment cost forecast, international practice sharing, and explore the latest trends in traditional carbon emission reduction process innovation, carbon capture, utilization and storage (CCUS), and new carbon emission reduction technologies such as hydrogen energy. In the process of continuing to promote this research, we are very welcome experts from all walks of life colleagues, you can put forward valuable comments in the message area, you can also directly contact the team. We look forward to working with all sectors of society to advance the path of carbon neutral transition in a green China.

Necessity of carbon emission reduction in coal chemical industry in China

The coal chemical industry has long been a major carbon emitter in the coal industry chain, contributing about 10% of China's total carbon emissions in 2015. Due to its resource endowment, China's chemical industry uses more high-carbon coal as feedstock than any other country. Taking synthetic ammonia and methanol as an example, natural gas is the main raw material for synthetic ammonia and methanol in most countries, while about 80% of synthetic ammonia and methanol in China is made from coal (Figure 1), which leads to the carbon intensity of China's coal chemical industry is higher than that of other countries. Coal to hydrogen 1 kg (synthetic ammonia and methanol feedstock gas) will emit about 11 kg of carbon dioxide, if natural gas to hydrogen, carbon emissions will be reduced by half. According to McKinsey's internal analysis, to meet the 1.5C target, the chemical industry needs to reduce carbon emissions by more than 90 per cent by 2050.

Synthetic ammonia carbon reduction path

Because the production process is similar and the emission reduction grips overlap, we will take synthetic ammonia as an example to further clarify each carbon reduction grips in this article.

Demand-side management: The main downstream use of synthetic ammonia is nitrogen fertilizer production, and about 90% of synthetic ammonia is processed into nitrogen fertilizer. Nitrogen fertilizer use in China is projected to have the potential to decline by 40 percent by 2050, driven by a combination of reduced arable land and more efficient fertilizer use.

a. Reduction of cultivated land: China's total cultivated land area is expected to continue the downward trend in the future, from 2 billion mu to nearly 1.8 billion mu, an estimated decline of 10%. Long-term over-cultivation has led to the decline of cultivated land quality, currently China's 2 billion mu of cultivated land has 4% of polluted land, 17.8% of low arable land and more than 80 million mu of unstable farmland, recuperation, return to forest and grass, rotation and fallow is imperative. At the same time, along with the process of urbanization, the rural population is expected to move out further in the future, resulting in some arable land wastage.