Energy Efficiency through a Sustainability Lens

The topics of energy efficiency and sustainability have dominated the news agenda in recent years, with many countries setting ambitious goals. Examples include the U.K. and Scotland , which set goals to reduce CO₂ emissions to be net zero by 2050 and 2045, respectively.

A recent report [1] highlights how integrating energy systems, including oil and gas, renewables, hydrogen and carbon capture and storage (CCS), could contribute to deliver nearly a third (30%) of the U.K.’s total carbon reduction requirements needed to meet the 2050 net zero target.

While these sorts of roadmaps have been in place for a couple of years, 2020 marked a radical cultural shift. Accelerated by the Covid-19 pandemic and low oil prices, 2020 was the year that organizations stopped talking and started acting. Companies across many industrial sectors created aggressive corporate goals, taking ownership of their own carbon footprint to support the wider industry, in alliance with economic and societal demands.

There are several elements that are key to industries building a more sustainable future, and these create a wonderful new lens to look at solution development. In addition to devising a strong methodology for reducing carbon footprint, a cultural shake-up is also required to ensure that all levels of the industry, from operator to supply chain, are aligned with a common goal. It is only when attitudes change that a real energy transformation happens.

The value of ESG investment

Society is increasingly focused on corporate responsibility, and industries are responding accordingly. Headlines continue to highlight corporations’ environmental performance. Investors are taking notice, making decisions based on Environmental, Social and Governance (ESG) ratings that assess, among other things, sustainability performance and responsible operations. As a result, there has been a significant transferal of investment from companies with poor, or no ESG ratings, to those with a more attractive standing. Companies with favorable ESG ratings typically create increased value for their shareholders compared to their peers [2].

At its simplest, a sustainability focus is about identifying and mitigating risks that are made more transparent when the business is viewed through ESG lenses. This in turn can lead to the identification of opportunities for continued growth and areas for improvement. Delivering on a clear sustainability strategy ultimately creates many benefits, including the following:

• Increases customer value
• Drives business performance
• Boosts shareholder confidence
• Increases employee engagement

 

Calculating the cost of carbon footprints

When businesses carry out cost-cutting exercises, expenditure is reviewed in detail so that opportunities for cost reductions can be identified and their impact minimized. Reducing carbon footprint should follow the same approach. A business must have an accurate picture of its total impact before it can devise a plan to improve.

As a simple example, we can look at a cup of coffee. Milk represents 60 to 70% of the carbon footprint of a cup of coffee that contains a few tablespoons of milk. For a latte, it is closer to 80 or 90%. Per cup, a standard black coffee produces 21 grams of CO₂, while a latte is 340 grams [3]. This is calculated based on the energy used across the raw ingredients manufacturing process, in addition to the energy required to make the coffee.

A similar methodology can be applied to much larger productions. For a business that creates chemical products, there are three major contributors to the carbon footprint of the finished product. One stems from suppliers and the raw materials that are purchased. Then, there are the complex manufacturing processes in which the raw materials are converted into final products. Finally, the products must be delivered to a client’s facility, whether that be onshore or offshore, which also contributes to the overall carbon count (Figure 1). By fully understanding which elements add to a product’s carbon footprint, from the outset to the end user, we can start to work out not only how to reduce these impacts, but how to safely and sustainably offset them through energy-efficient solutions.

For chemical manufacturers, calculating each carbon footstep gives transparency and clarity for customers and end-product consumers. However, to assess the total impact, the product’s impact on downstream production processes should also be factored in. This step-by-step carbon-counting journey is now more commonly requested by customers as businesses look to gain a greater understanding of their impact on the environment.

There is also work to be done in pushing energy efficiency goals down the supply chain. While we often hear of net-zero targets from major operators, the carbon footprint must be analyzed at all stages of the supply chain. In the U.K. for instance, industry associations are already working on initiatives to link this together into an overarching industry program, as opposed to individual goals set by each company. The government also plays a huge role by offering incentives to encourage this work and drive businesses to evaluate their carbon footprint.

 

The digital age

Digital technology is intrinsically linked with creating a more sustainable future and can significantly reduce CO₂ emissions across upstream, midstream and downstream operations through specific applications.

The ‘race to be second’ is a common phrase and an inherent behavior in many established or aging industry sectors. Many businesses can be reluctant to take the gamble on novel or enhanced digital technologies, fearing potentially costly risk or consequences of failure. However, time has run out for unnecessary reticence.

Digital applications are essential to create more energy-efficient operations. Therefore, the industry must be willing and eager to adopt new ways of working. There are already great examples of how digital technology can have a positive impact across the whole lifecycle of the industry. As part of this process, we must also break down the myth of reputational shame when considering sharing negative or unwanted experiences or outcomes when trialing new solutions (Figure 2). As an industry, we are always eager to shout out about successes, but often, more is to be learned from failures. By having more open dialogues about this, industries can have a greater collective understanding of how to improve and deliver solutions that work.

Operations within the energy and chemicals industries are often siloed, and greater collaboration can also garner significant benefits. Where functionalities of multiple chemical products can be combined, or more concentrated products applied, this can result in a lower carbon footprint. Operational costs are also improved through this practice, as logistical requirements are less complex, resulting in fewer transportation movements and an associated decrease in CO₂ footprint for the application.

Embracing the cultural shift

While a plant can measure its carbon footprint and adopt technology to support an energy-efficient future, a cultural shift is essential to accelerate this change.

Sustainability must be embedded into day-to-day operations and not just be seen as a message from top-level executives. There is often a degree of uncertainty around the future, so it is important that the people in the sector right now are passionate and open to this push toward net-zero carbon footprints.

Part of this culture shift will be individuals in the workforce understanding how their skills, expertise and versatility can be successfully transferred to support the transition to more sustainable and energy-efficient operations. The entrenched abilities and knowledge gleaned from working on complex international projects, for example, are highly transferrable and valuable for the renewable-energy sectors, such as wind, hydrogen and tidal. Leaders and decision-makers need to present the opportunities to re-skill the energy transition to alleviate concern and strengthen commitment to the business.

When discussing a cultural shift, the next generation of workers also needs to be considered and informed of the sector’s role in the energy mix and its efforts to be cleaner and greener. Already, we are seeing a change in how the younger generation views the oil and gas industry, with environmental efforts high on their agenda. We must ensure that we are creating roles and opportunities for this next wave of cyber-savvy personnel to choose a career in industrial sectors, such as energy or chemical manufacturing.

Leading the low-carbon future

Opportunities for impactful new discoveries surface when today’s challenges are reframed through a sustainability lens. Helping to sustainably meet the world’s growing demands will require a more holistic approach to innovation. It will demand combining chemical, digital, and equipment technologies with deep scientific expertise to improve operational efficiencies and minimize waste.

A sustainability-centered culture can help companies, whether new or well-established, look at the value they create for their customers, investors, employees and society in a new way.

The journey toward sustainability is not something that can be achieved overnight, but organizations need to step up the pace if we’re to arrive at a net-zero destination. Through creating a more transparent, agile and caring team, we are empowering our workers today to take action and deliver a more energy-efficient and sustainable future for the next generation.  ♦

Edited by Mary Page Bailey

References

1. The Oil & Gas Authority, UKCS Energy Integration Final Report, August 2020.
2. Darbyshire, M., ESG Funds Continue to Outperform Wider Market, Financial Times, April 3, 2020.
3. McColl, S., Coffee’s Invisible Carbon Footprint, EcoWatch, Feb. 17, 2016.

Author

David Horsup is vice president, external technology & strategy at ChampionX (Phone: +1 (833) 396-0006). He holds a Ph.D. in emulsion and surfactant science and a B.S. degree in chemistry from the University of Hull, U.K. He has 28 years of experience in the energy industry and has held various senior technical roles in the chemical technology space, most recently leading the global Research, Development and Engineering operation of ChampionX.  He has held the position of vice president, external technology and strategy since January 2020.