Petrochemical boom seen spurring U.S. emissions

Source: Amanda Reilly, E&E reporter • Posted: Tuesday, March 1, 2016

U.S. petrochemical manufacturing spurred by the shale revolution and low natural gas prices could have big greenhouse gas impacts, environmentalists today warned in a report.

The Environmental Integrity Project highlighted dozens of petrochemical projects proposed in response to low oil and gas prices.

The 140 petrochemical projects proposed or approved in the last five years are permitted to produce 179 million metric tons of carbon dioxide equivalent each year, the report found.

“You have this bulge that is going to start to show up in the greenhouse gas inventory,” said Eric Schaeffer, executive director of the Environmental Integrity Project. “All of a sudden, boom, you have 200 million tons of carbon that you didn’t build into functions about where carbon trends are going in the U.S.”

In a statement provided to Greenwire, the chemical industry said that shale drilling has made possible a “historic expansion” in the sector and that increased manufacturing in the United States would help reduce global greenhouse gas emissions. The American Chemistry Council highlighted achievements in increasing the efficiency of manufacturing processes.

“The new shale-related U.S. chemical industry production is advanced, state-of-the-art and energy-efficient,” the American Chemistry Council said in the statement.

The Environmental Integrity Project calculated greenhouse gas emissions of proposed projects through Clean Air Act New Source Review permitting data kept by states and U.S. EPA. The data represents the first wave of manufacturing projects that are supposed to have enforceable greenhouse gas limits.

The group found that, in 2015, 44 petrochemical construction and expansion projects that were either proposed or permitted are likely to pump 86 million metric tons of carbon dioxide equivalent into the atmosphere. That’s equivalent to the emissions from 19 coal-fired power plants, the environmentalists said.

In 2014, 45 projects were expected to release up to 53 million metric tons of carbon dioxide equivalent, the report found.

Louisiana was home to nearly half the proposed projects in 2015. The state could see its greenhouse gas emissions grow by a third if all the projects are completed, the Environmental Integrity Project report found.

Schaeffer said the report is meant to highlight a sector that’s often ignored in calculations of the carbon footprint of the natural gas industry.

“If 19 baseload coal plants went in, that would be news. Here you have the equivalent, and it’s getting very little attention,” Schaeffer said, adding, “The focus is upstream and on power plants. This sector, this sort of mid- and downstream stuff, gets less attention.”

Schaeffer called the estimates “conservative” because they only include permitting data for large projects that was available online. The estimates also don’t include many projects that are permitted in stages, he said. Policymakers will have to take these increased emissions into account, he said, and may have to require larger emissions reductions elsewhere to make up for them.

The Environmental Integrity Project, though, acknowledged that not all the proposed projects will be built, including some of the largest liquefied natural gas plants that are projected to release the most emissions.

Greg Bertelsen, senior director of energy and resources policy at the National Association of Manufacturers, today agreed that shale drilling has had a “huge impact” on the manufacturing sector.

“For many manufacturers, energy is one of the biggest, if not the biggest, input costs,” Bertelsen said. “So when we have access to ample supplies of affordable energy, and those energy costs are stable, we find ourselves in a competitive advantage with manufacturers around the world.”

According to the American Chemistry Council, in the last few years during the expansion in hydraulic fracturing, 266 projects valued at $164 billion have been completed, are under construction or are in the planning phase.

The industry group said that, since 1992, its members have reduced their greenhouse gas intensity by 42 percent. ACC said the chemistry industry was key in creating innovative new products, such as high-performance insulation for buildings and lightweight packing, that are helping many sectors reduce their greenhouse gas emissions.

“Chemistry solutions play an important role in helping society save energy and reduce greenhouse gas emissions,” the group said.

NAM’s Bertelsen pushed back against the Environmental Integrity Project’s premise that emissions from new and proposed petrochemical manufacturing projects are not being taken into account.

He also said that, even if manufacturing projects cause a bump in domestic emissions, making products in the United States will lower greenhouse gas emissions globally.

“If that manufacturing is not taking place here, it’s likely that it’s taking place in some other country,” he said. “As know from the data, we are more efficient on a greenhouse gas basis than other competitors.”