668d4b762f0c1807fc5c3391 Navigating Sustainability Complexity

Navigating sustainability complexity

July 9, 2024
For sustainability projects, the objective is more than gaining the biggest return on investment
Consider a common situation in a refinery or chemical plant: an old, natural gas-fired heater is the focus of a possible upgrade, replacing its combustion control system and burners. The new equipment promises to reduce fuel consumption by 15%. Traditionally, the decision to make such a change would hinge on the cost of buying the new hardware and installing it compared to the fuel cost saved. There might be some additional benefits if nitrogen oxide (NOx) emissions are tightly regulated, but it’s probably a minor factor.
These days, sustainability questions likely enter the discussion, too. Let’s say the facility has a reliable supply of natural gas at a good price, but the new equipment is expensive. Yes, it will achieve the promised gas consumption reduction, but it will take 10 years or more to realize the full payoff. Based strictly on a cost/benefit analysis, such a project likely gets passed over in favor of something with a more aggressive return on investment (ROI). Sustainability considerations can change this picture.

Carbon neutrality costs

The traditional question is, “How much money can we make or save from a project against the cost?” Now, an added question is, “How much carbon emissions can we eliminate against the cost?” This question has its own analytical tool and representation: the marginal abatement cost curve graph (MACC), which helps rank projects based on the amount of carbon dioxide (CO2) or equivalent (CO2e) avoided or reduced against the cost (net present value) per ton. Looking at the graph, let’s think about what it illustrates (Figure 1).
Each rectangle on the graph represents a project. The width of the rectangle indicates the amount of CO2e reduction. The height is the cost per ton. For example, carbon capture and storage (CCS) by large process furnaces can eliminate a large amount of CO2e at a relatively low cost. On the other hand, electrification of large recycle compressors has a small reduction effect, but a high cost. 
Digging deeper into the analysis by looking at the left end of the graph, some projects (blue rectangles) more than pay for themselves, while also reducing emissions, though, the reduction for most is modest. Nonetheless, since they offer positive capital effects, they merit serious examination. At the opposite end of the graph (green rectangles), deciding to start producing green hydrogen has a high cost and results in limited CO2e reduction.
For most facilities, looking at projects close to where the green rectangles first break north of the horizontal axis is inexpensive and practical, although with limited effectiveness in terms of emissions reduction. Examples shown include:
  • Tank heater and heat tracing electrification (replacing steam);
  • Column reboiler electrification (replacing steam and conventional fired heaters);
  • Process modifications for increased heat integration and recovery (improving overall efficiency);
  • Flare gas recovery (reducing energy waste); and
  • High-efficiency lighting (reducing energy waste).
CCS projects that typically pump carbon dioxide into the ground rather than release it to atmosphere have a modest cost, but provide a sizeable reduction, and may be practical for further study.

Selecting projects

The challenge for companies when implementing a sustainability initiative is to look at individual projects that improve resource use, reduce energy consumption, expand use of green energy and reduce carbon emissions. Compiling a potential project list related to carbon emissions starts with brainstorming sessions involving operations management, operators, process engineers, information technology, production planning and reliability representatives, with guidance from industry subject matter experts.
Participants must consider all associated effects for improving operational efficiency, reliability, yields, energy efficiency, waste, off-spec product reduction, flaring, regulated emissions control, electrification and other areas. Ideas should be consolidated and ranked based on cost, impact, difficulty and timeframe. The result is an extensive project list that serves as the input to the next step in the process—project analysis.
Ultimately, projects can be placed on the MACC graph to compare their effect in the larger picture of the facility. In many cases, a project that improves energy usage, yields, production or reliability can be justified on its own merits, and has a positive net present value. In some cases, projects won’t show a positive net present value, but are justified based on CO2e emissions reductions. A CCS project is a prime example since it doesn’t affect production—positively or negatively—because its cost solely reduces emissions. 

Validity of analysis

An analytical tool is only as good as the data it’s evaluating, and estimating the CO2e reduction of some projects is more challenging than others. Projects that reduce fuel or steam consumption, and CCS implementations, are relatively easy to quantify. However, electrifying fuel-burning equipment requires a plant model to estimate new steam and fuel balances, develop project cost estimates, and gauge the impact on CO2e emissions. There’s also the potential to move pollution somewhere else if the utility serving a facility is generating electricity by burning natural gas, or worse, coal. Reducing CO2e at the facility by increasing coal consumption somewhere else is false sustainability.
If we define net-zero as complete elimination of fossil fuel use, the concept really isn’t practical for a facility of any size or complexity because it requires the use of technologies and green power sources that aren’t available in sufficient quantities in most areas. Greater investments in wind farms and solar power to support net-zero plant sites will be necessary throughout the world. Such projects need time to consider approvals, permitting, engineering and building before they’ll make significant contributions. Many such projects are underway, but their full effect is some time away.
In the meantime, adding a CCS system to a furnace exhaust, for example, can still make major sustainability contributions. Implementation must begin with sophisticated engineering analysis to define their cost and design parameters. At the same time, projects shown on the MACC graph at the cost break line, such as flare gas recovery, energy management systems, high-efficiency lighting and combustion optimization, can be self-financing and implemented in the short term.
While the MACC graph is an excellent tool for defining and prioritizing likely projects, it ignores many factors, including:
  • Prioritization of multiple projects across a multi-year timeframe;
  • Risks associated with various technology options;
  • Capital budget constraints, competition among multiple projects, approval snags and other obstacles; and
  • Cooperation of third parties, such as utilities, to provide additional green-power options. 
Clearly, more sophisticated project evaluation tools are necessary. 

More effective analysis

Aspen Fidelis is a strategic planning tool that helps define a plant’s performance over its lifetime. Using probabilistic modeling techniques, new strategic planning tools blend historical production data to identify connections among process units, utilities, flares and emissions streams. They determine sustainable operating conditions, along with common upsets or constraints that prevent a unit from operating optimally.
Using this type of tool, a planning team can analyze MACC graphs for one or multiple facilities, either in-house or in collaboration with partners. Working with process manufacturers in a variety of industries, Emerson has used these types of tools to provide projections of the financial and emissions impact of various sustainability projects. With these capabilities, companies can develop practical paths to net-zero using today’s technologies, with opportunities looking forward.
About the Author

Marcelo Carugo | Emerson Automation Solutions

Marcelo Carugo is VP of industry programs and alliances at Emerson, working with downstream manufacturers on digital transformation through automation technologies.

About the Author

Pete Sharpe | Emerson

Pete Sharpe is a principal consultant with Emerson’s industrial software business, focusing on the petrochemical and chemical industries.

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