Naphtha storage fraction & GHG emissions in the Korean - PowerPoint PPT Presentation

Naphtha storage fraction & GHG emissions in the Korean petrochemical sector th IAEE European Conference 2017 15 th September 2017, Hofburg Congress Center, Vienna, Austria 6 Hi-chun Park Department of Economics, Inha University, Korea Martin K Patel Institute of Environmental Sciences and Forel Institute University of Geneva, Switzerland 1

Content 1. Research background & aims 2. Carbon storage & release from non-energy use 3. Research review 4. Estimating naphtha storage fraction 5. Naphtha storage fraction for Korea 6. Policy implications 2

1. Research background & aims  Demonstrates for a Korean case study how to estimate the naphtha storage fraction and CO 2 emissions from naphtha use in the petrochemical industry  Carbon contained in non-energy is partly converted into CO 2 emissions during use and is partly stored in products unless these are incinerated  Important to know carbon storage factors as to estimate carbon emissions related to non-energy use  IPCC default storage fraction for naphtha is 75%(Vol. 3: Energy, p. 1.28, IPCC 1996 Guidelines for National GHG emissions)  Korea has been a large consumer of naphtha as feedstock for petrochemicals. The petrochemical industry processed naphtha in the amount of 39 Mt (million tonnes) to produce various chemicals in 2015 (IEA, 2016).  Park (2005) estimated the naphtha storage fraction for the year 2000 in Korea at 87% by using a NEAT model  A study commissioned by the Korean government (Ecosian, 2015) came to a naphtha storage fraction of 77%  This study is designed to estimate the Korean naphtha storage fraction for the 2011 to 2015 period as to revise the fraction to be used for the estimation of the annual GHG inventories by the Korean government  IPCC allows countries to revise their fractions: “Whenever possible, countries should substitute assumptions that represent more accurately the practices within their countries and provide documentation for these assumptions.” ( IPCC guidelines: Vol. 3, Energy, p. 1.27,) 3

2. Carbon storage & release 2.1 Non-energy use & carbon storage  Non-energy use: - Petroleum products: bitumen, petroleum coke, lubricants etc - Petrochemicals: ethylene, propylene, benzene etc - Coal products: pitch, creosote oil, naphthalene, carbon black etc  100% stored: bitumen, carbon black, synthetic resins & fibers etc  0% stored (wholly converted into CO 2 ): petroleum coke, pitch, ethanol etc  Partly stored: benzene, ethylene, toluene etc   Carbon storage & release related to non-energy use  Carbon storage: E storage = ∑ i { Q NEU i * EF i * P i } (1) Carbon release: E release = ∑ i { Q NEUi * EF i * (1 - P i )} (2) where Q NEUi means non-energy use (in Joule); Ef i is carbon emission factor (in t CO2/GJ); P i is carbon storage fraction  Non-energy use, carbon emission factors and storage fractions have to be known as to estimate carbon emissions related to non-energy use 4

[Table 1] Carbon emission factors % storage fractions by energy source Emission factor Emission factor (Korea) Storage fraction Storage fraction Korea 1996 IPCC 2012 ∼ 2013 IPCC [t C/TJ] [t C/TJ] [%] [%] 0.75 1) Naphtha 20.0 19.2 0.75 Lubricants 20.0 19.9 0.50 0.50 Bitumen 22.0 21.6 1.00 1.00 Tar 25.6 - 0.75 0.75 Natural gas 15.3 15.3 0.33 0.33 Diesel 19.9 20.2 0.50 0.50 Butane 17.2 18.1 0.80 0.80 Propane 17.2 17.6 0.80 0.80 Coal / Peat 26.4 26.2 0.75 0.75 Cokes (Petcok) 27.5 27.2 0.75 0.75 Solvent / Light producrs 19.9 20.0 0.80 - Kerosene 19.6 19.6 0.80 - Paraffin wax 19.6 - 0.80 - Sources: IPCC/IEA/OECD/UNEP, 1997; GHG Inventory & Research Center of Korea. Notes: 1) Vol. 2, Energy, p. 1.37: 80%; Vol. 3, Energy, p. 1.28: 75%. 5

2.2 Naphtha storage fraction  Marland and Rotty(1984), Marland and Marland(2003) estimated 80% as naphtha storage fraction for the 1950 ∼ 1982 period. CO 2 emissions comprise of combustion, waste incineration and autonomous product oxidation and the naphtha storage fraction is the rate of carbon stored to the global naphtha consumption  Although the IPCC naphtha default storage fraction originates from the study of Marland and Rotty study, IPCC excludes waste incineration and autonomous product oxidation in their CO 2 emission estimation. As Marland & Rotty and IPCC determine storage fractions based on energy statistics which do not contain information on petrochemical trade, they are unable to estimate consumption based CO 2 emissions.  Following OECD countries used their own naphtha storage fractions in preparing their National Inventory Report (NIR) submitted to UNFCCC (2014) 100% : Belgium, Finland, France 80% : Spain, Turkey 78% : Netherlands 75% : Germany, Japan, GB 70% : USA 64% : Italy  UNFCCC seems to accept NIR without any verification 6

3. Research review 3.1 Park’s study (2005)  Park (2005) estimated the naphtha storage fraction by applying the so-called Non- Energy use Emission Accounting Tables (NEAT) model for the year 2000.  NEAT model distinguishes products between ODU (Oxidized during use) and NODU (Not oxidized during use); This distinction is similar to IPCC’s short-lived and long-lived products, respectively.  According to the study, the Korean petrochemical industry produces NODU products (48.1 Mt CO 2 ) and ODU products (10.4 Mt CO 2 ). ODU products in the amount of 2.8 Mt CO 2 (about 4.7% of the total) were net exported.  The naphtha storage fraction was 82.2% (= 48.1/58.5) on the production basis.  Consumption basis naphtha fraction increases to 87% as the net export amount of 2.8 Mt CO 2 can be considered as stored. Production basis estimates Consumption basis estimates Production Net exports Storage Release NODU ODU Sum ODU ( A ) ( B ) (C = A + B) ( H ) (A + H) ( E ) [Mt CO 2 ] [Mt CO 2 ] [Mt CO 2 ] [Mt CO 2 ] [Mt CO 2 ] [Mt CO 2 ] 2000 48.076 10.395 58.471 2.771 50.847 7.624 82.2% 17.8% 100.0% 4.7% 87.0% 13.0% Notes: NODU means not oxidized during use or long-lived products according to the IPCC terminolo ODU means oxidized during use or short-lived products according to the IPCC terminology. 7

3.2 Ecosian’s report of 2012 3.2.1 Content  Ecosian tried to estimate the naphtha storage fraction jointly with the Korea Association of Petrochemical Industries and the Korea Petroleum Industry Association in a study commissioned by the GHG Inventory & Research Center of Korea (GIR). However, it estimated the share of non-energy in the naphtha use in the industry rather than the naphtha fraction.  The object of the estimation were reports submitted by six NCC (naphtha cracking centers) to get refunded import duties on naphtha which were 16 won per liter. These reports contained steam cracking material flows. Four refineries which operated BTX plants were omitted.  Naphtha storage fraction = - Fuel type byproduct sale: Amounts sold to consumers or returned to refineries - Gross deliveries : Naphtha deliveries from refineries to the petrochemical sector - Recycled input : Byproducts in the cracking process which return to the cracking process. These byproducts are not supplied from the refineries.  The study estimated the share of non-energy use at 79 to 81% for the 2007 to 2011 8 period, instead of estimating the naphtha storage fraction.

3.2.2 Evaluation of the 2012 report  NCC operations use only 58% of naphtha in Korea  BTX operations are different from those of NCC.  Recycled input is not supplied input from the refineries  Non-energy use in the petrochemical industry  Gross deliveries (100%) : Feedstock use, process heat, backflows to the refineries  Feedstock (non energy) use : Chemicals + feedstock type byproducts (15.532 Mt: 73.5%)  (Feedstock use according to ECOSIAN : 25.707 Mt)  Process heat : 4.283 ton (20.3%)  Backflows to the refinery : Fuel type byproducts (1.209 ton: 5.7%)  The object of the estimation not clear  The report tried to estimate the naphtha storage fraction but tried to estimate the share of feedstock in the naphtha input. Moreover, recycled input of feedstock type byproducts was falsely considered as the part of the net naphtha input to the petrochemical processes. Thus, the result did not lead to corrected values for the naphtha storage fraction. 9