INTERNATIONAL
COUNCIL OF
CHEMICAL
ASSOCIATIONS
2 May 2000
ICCA STATEMENT ON
GLOBAL CLIMATE CHANGE, POST COP-5
EXECUTIVE SUMMARY
ICCA members are committed to the further development and implementation of
Responsible Care® worldwide.
ICCA members take global climate change very seriously and recognize that the
accumulation in the atmosphere of greenhouse gases resulting from human activities
(anthropogenic), including activities of the chemical industry, may impact the Earth’s
climate, ecological, social and economic systems.
ICCA believes it is essential that any policy response be global.
ICCA members plan to continue the chemical industry’s energy efficiency improvement,
greenhouse gas emissions reductions and technology improvement and transfer. They
believe that voluntary measures such as energy efficiency improvements and other
measures to reduce, avoid and sequester greenhouse gas emissions are the preferred
alternative to government mandates. In some countries the nature of the political and
legal environments indicates that unilateral voluntary efforts are the more feasible option.
In other countries political and legal environments better accommodate more formal
voluntary, but non-legally binding, long term negotiated agreements with national and/or
regional authorities.
ICCA members have already achieved major successes in reducing and avoiding
greenhouse gas emissions of particular concern to the chemical industry.
ICCA members and their products are part of the solution to the challenge of potential
climate change.
ICCA members are aware that the industrial, transportation, and residential/ commercial
sectors each account for about one-third of CO2 emissions (when electric utilities’
emissions are allocated to electricity consumers). Due to its relatively large efficiency
improvements and other changes, chemical industry CO2 emissions per unit of production
have generally improved significantly with the result that chemical industry CO2
emissions, historically a small share of global emissions, are a smaller share now than
before.
ICCA members believe that absolute greenhouse gas emissions reduction targets, energy
use caps, or similar limits are unacceptable because they are fundamentally inconsistent
with
economic
vitality
and
competitiveness.
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Any climate change mitigation costs imposed by an individual government on the
chemical industry in an individual country, whether it be through energy taxes or the
purchase of carbon permits, adds to the costs of production and has the direct effect of
reducing competitiveness of the chemical industry in that country, placing jobs and
economic growth in that country at risk.
At the sixth conference of the parties (COP-6), expected to be held in November 2000 at
The Hague, parties hope to agree on details of the Kyoto mechanisms. ICCA recognizes
that these Kyoto mechanisms (emissions trading, joint implementation and the clean
development mechanism) properly implemented may contribute to lowering the
aggregate economic cost of reducing, avoiding and sequestering greenhouse gas
emissions.
Emissions caps or other legally binding measures to reduce greenhouse gas emissions
raise difficult questions of compliance and enforcement.
Artificially imposed negotiating deadlines must not result in ill-advised agreements.
BACKGROUND
 In 1992 the U.N. Framework Convention on Climate Change (UNFCCC) was
agreed to. The ultimate objective of the UNFCCC is stabilization of greenhouse
gas concentrations in the atmosphere at a level that would prevent dangerous
anthropogenic interference with the climate system. This level should be achieved
in a time frame sufficient to allow ecosystems to adapt naturally to climate
change, to ensure that food production is not threatened and to enable economic
development to proceed in a sustainable manner. As a step towards this objective,
the UNFCCC establishes the voluntary goal that developed countries (parties
included in Annex I to the UNFCCC) should return their greenhouse gas
emissions to 1990 levels by the year 2000.
 At the third conference of the parties in Japan in December 1997 the Kyoto
Protocol was agreed to and once ratified, establishes binding commitments on
most developed countries to reduce their emissions of greenhouse gases to
specified percentages below 1990 levels during the period 2008 - 2012, without
introducing any new commitments for developing countries (parties not included
in Annex I).
 During the fourth conference of the parties to the UNFCCC at Buenos Aires in
November 1998, governments agreed to take the next two years (by late 2000) to
develop agreement on the rules and regulations associated with the so-called
"Kyoto mechanisms": emissions trading, joint implementation and clean
development mechanism, with a stated goal of completing work prior to the end
of the year 2000. Efforts will also continue to obtain additional developing
country participation in actions to address the climate change issue. Nationally,
governments will seek to define domestic programs by working with industry and
consumers to formulate appropriate responses.
 At the November 1999 Fifth Conference of the Parties (COP-5) no new
agreements were reached. Plans for attempting to frame issues for the Sixth
Conference of the Parties (The Hague, mid-November, 2000) include meetings in
June 2000 and September 2000. Contentious issues related to capping emissions
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reductions that can be satisfied through international trading ("supplementarity")
and sanctions for "non-compliance" were deferred.
In this context, the International Council of Chemical Associations (ICCA), which
is comprised of trade associations and their member companies in Asia, Europe,
and North and South America, holds the following common views.
ICCA VIEWS
1. ICCA members are committed to the further development and
implementation of Responsible Care® worldwide both to improve their health,
safety and environmental performance and as a major contribution by the
chemical industry to higher standards of economic, environmental and social
responsibilities among industries, generally. We will make continuous progress
toward the vision of no accidents, injuries or harm to the environment, including
consideration of the global climate change issue, and will publicly report our
health, safety and environmental performance. ICCA notes that forty-two
countries have already been approved by the ICCA Responsible Care®
Leadership Group to administer Responsible Care® under the international
Responsible Care® umbrella. The chemical industry supports the long term goal
of sustainable development. ICCA members will contribute to sustainable
development by fulfilling their primary role as a vital element of the global
economy in a way increasingly in harmony with the environmental, social and
economic interests of the societies in which they operate.
 ICCA members take global climate change very seriously and recognize that
the accumulation in the atmosphere of greenhouse gases resulting from
human activities (anthropogenic), including activities of the chemical
industry, may impact the Earth’s climate, ecological, social and economic
systems. Uncertainties in climate science exist and scientific debate continues in
an effort to resolve the timing and extent to which accumulations of such gases
may lead directly or indirectly to global or regional impacts. ICCA and its
members encourage and support public and private scientific and economic
research to achieve greater understanding of the possible causes and implications
of climate change including implications of possible response strategies.
 ICCA believes it is essential that any policy response be global as no single
nation or group of nations can equitably or effectively address conditions that may
contribute to climate change. ICCA therefore encourages all Parties to the
UNFCCC to develop national differentiated voluntary response strategies that
reduce the potential risk of "dangerous anthropogenic interference with the
climate system" while concurrently supporting healthy economies and
international competitiveness.
 ICCA members plan to continue the chemical industry’s energy efficiency
improvement, greenhouse gas emissions reductions and technology
improvement and transfer. They believe that voluntary measures such as
energy efficiency improvements and other measures to reduce, avoid and
sequester greenhouse gas emissions are the preferred alternative and more
economically efficient than energy or environmental taxes, emissions caps or
other legally binding measures or instruments to address climate change.
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Notwithstanding ICCA’s views, it is recognized that some countries in Europe
have proceeded with tax measures.
Members’ existing activities can and do take many useful and legitimate forms. In
some countries the nature of the political and legal environments indicates that
unilateral voluntary efforts are the more feasible option. In other countries
political and legal environments better accommodate more formal voluntary, but
non-legally binding, long term negotiated agreements with national and/or
regional authorities.
In the last few years several national federations/companies from different
countries have initiated voluntary programs including realistic domestic targets in
the context of long term voluntary agreements, and have successfully advocated
these agreements to governments as a means to avoid unnecessary and less
efficient regulations, taxes and caps imposed by governments. Similarly, energy
efficiency and greenhouse gas emissions improvement goals can be stated
generally (e.g., "continuous improvement") or in detail (e.g., "X percent during
the Y period of years"). To maximize voluntary efforts and achievements,
governments’ recognition is essential. This includes recognition of the avoided
greenhouse gas emissions through energy efficiency improvement.
ICCA members have already achieved major successes in reducing and
avoiding greenhouse gas emissions of particular concern to the chemical
industry.
Carbon dioxide. Emissions of carbon dioxide (CO2) are mainly energy-related
and their abatement clearly constitutes the single most important challenge. The
chemical industry has avoided large volumes of CO2 emissions through years of
sustained energy efficiency improvement, switching to less carbon-intensive fuels
and installation of high efficiency cogeneration (combined heat and power)
facilities.
Chlorofluorocarbons (CFCs). As part of its effort to protect the stratospheric
ozone layer the chemical industry has provided HCFCs and HFCs. Market use
analysis indicates that CFCs are being replaced by much lower amounts of the
alternative fluorochemicals. HCFCs and HFCs are being used at only the rate of
20-25% of the prior CFC consumption. Tightened systems, improved repair
practices, emissions reductions, recycling and where genuine alternatives exist
sectors in all developed countries have largely contributed to reduce the
emissions.
Nitrous oxide (N2O). In the chemical industry, substantial nitrous oxide (N2O)
emissions result from the manufacture of adipic acid, which is primarily used in
turn to produce nylon 6/6. The largest producers of adipic acid have taken and are
taking steps which will reduce N2O emissions related to adipic acid production by
up to ninety percent by the year 2000.
ICCA members and their products are part of the solution to the challenge of
potential climate change. The chemical industry creates numerous products that
are essential to other industries and consumers in improving their energy
efficiency and CO2 emissions performance. Insulation and plastics are among the
most common examples of the "enabling" nature of the chemical industry. In such
cases, the energy consumption and CO2 emissions savings resulting from use of
the product over its lifetime far exceed the energy consumption and CO2
emissions needed to produce the product, thus enabling a net benefit to the
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environment on a life cycle basis. Two recent studies demonstrate in convincing
detail the net life cycle energy savings and CO2 emissions reductions achieved
respectively by plastic foam insulation (polyurethane) in refrigerators and
freezers, and housewrap (polyolefin fiber films) applied to the exterior of single
family residential housing. [Additional information is in Appendices A and B.]
The chemical industry will continue to be called upon to boost production of
light-weight, high-performance materials required to meet society’s future
environmental goals.
ICCA members are aware that the industrial, transportation, and
residential/ commercial sectors each account for about one-third of CO2
emissions (when electric utilities’ emissions are allocated to electricity
consumers). Due to its relatively large efficiency improvements and other
changes, chemical industry CO2 emissions per unit of production have
generally improved significantly with the result that chemical industry CO2
emissions, historically a small share of global emissions, are a smaller share
now than before. On the other hand, some other sectors’ emissions continue to
rise strongly. ICCA supports the encouragement of voluntary measures by all
economic sectors that lead to emissions reductions, avoided emissions, improved
energy efficiency, enhancement of sinks and sequestration and the development
and deployment of advanced technologies that support these goals. In this regard,
developing countries (parties not included in Annex I) have a critical role to play.
ICCA members believe that absolute greenhouse gas emissions reduction
targets, energy use caps, or similar limits are unacceptable because they are
fundamentally inconsistent with economic vitality and competitiveness. The
methods used to address global climate change may have potentially large
impacts on national and global economies from mitigation and adaptation
measures. Substantive and publicly available economic analyses with realistic
assumptions indicate that substantial CO2 emissions reductions will be very
costly. This will continue to be the case until radically improved "breakthrough"
technology is available to lower greenhouse gas emissions and/or reduce energy
requirements.
In the meantime, metrics which allow for continued economic growth, such as
energy efficiency, carbon efficiency, and/or greenhouse gas efficiency, are the
appropriate means of assessing progress in reducing greenhouse gas emissions.
ICCA emphasizes it is not possible to understand past performance or future
potential of a particular chemical company or sector without taking fully into
account particular circumstances such as the company’s or sector’s energy
consumption patterns, process and product mix, greenhouse gas emissions mix
and historical growth (or contraction) trends. ICCA strongly cautions
governments against assuming that individual company or sector performance can
be generalized to establish sector or national performance standards. It is for the
above reasons that ICCA believes that for its members and member companies
voluntary measures to improve energy efficiency and to reduce, avoid, and
sequester greenhouse gas emission are the appropriate way to address, and to
measure progress in addressing, climate change concerns.
Any climate change mitigation costs imposed by an individual government
on the chemical industry in an individual country, whether it be through
energy taxes or the purchase of carbon permits, adds to the costs of
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production and has the direct effect of reducing competitiveness of the
chemical industry in that country, placing jobs and economic growth in that
country at risk. Because national chemical industries compete in a global
marketplace, higher costs imposed nationally will make it easier for competitors
in other countries who do not incur similar costs to manufacture the same
products and successfully penetrate global markets. Countries will be affected
differently by climate change mitigation measures, depending for instance on
their resource endowments, their legal and regulatory frameworks, and their
differentiated response strategies. However, mitigation measures should not have
the intent or the effect of shifting international competitive conditions achieved
through market forces under normal conditions of competition. Fair rules will be
needed to ensure this result. In this regard it is critical that adequate time be
allowed for necessary adjustment. An objective of utmost importance will be to
avoid national or global recession and, rather, to foster economic growth and
development in all countries. In the chemical industry, many high-volume
products are "commodities" characterized by low profit margins and differentiated
from competing products only by their delivered cost to consumers; energy is a
major cost of production; capital stock turnover is slow; key manufacturing
processes are near thermodynamic limits; and breakthrough technology is not
forecasted to be generally available by 2008-2012. These facts, coupled with the
fact the industry has already significantly reduced its energy intensity over the last
25 years, means low cost climate change mitigation options do not exist in the
time frame of the Kyoto Protocol. In some countries achievement of Kyoto targets
and timetables will be unlikely without plant shutdowns. [See Appendix C for
additional details regarding implications for chemical industries.]
At the sixth conference of the parties (COP-6), expected to be held in
November 2000 at The Hague, parties hope to agree on details of the Kyoto
mechanisms. ICCA recognizes that these Kyoto mechanisms (emissions
trading, joint implementation and the clean development mechanism)
properly implemented may contribute to lowering the aggregate economic
cost of reducing, avoiding and sequestering greenhouse gas emissions. There
is widespread recognition that many important and complex issues must be
explored and addressed before final agreement on the design of any mechanism is
possible. To date there is not a clear understanding of the elements or the costs
and benefits of the mechanisms, therefore ICCA has not established a clear
position at this time. Given the importance and complexities of the issues, ICCA
members intend to participate in the ongoing process to examine the issues related
to these mechanisms with particular attention to ensuring they are fully open to
participation by private entities, voluntary, and not rendered uneconomical
through emissions caps, taxes, additional regulations, "additionality"1 or
"supplementarity"2 criteria, or otherwise. On the other hand ICCA strongly
believes that voluntary activities and programs already successfully put into
practice by members in some countries, are the preferred alternative to
government mandates.
Emissions caps or other legally binding measures to reduce greenhouse gas
emissions raise difficult questions of compliance and enforcement. Among
these questions is the relation between any compliance and enforcement
mechanisms and other international regimes such those governing international
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trade and investment. Impacts of any compliance and enforcement measures at the
company level are also of concern, especially as they might impact
competitiveness. As previously stated, voluntary climate change mitigation
measures are the preferred alternative. This suggests that government policies
should be implemented to remove barriers to, and provide incentives for,
voluntary measures to reduce or avoid greenhouse gas emissions.
Artificially imposed negotiating deadlines must not result in ill-advised
agreements. Potential dangerous anthropogenic interference with the climate
system, and mitigation measures to avoid this eventuality, are long term issues
which require thoughtful, global long term responses. This is especially true given
the long lives of existing capital stock; the long time needed to research, develop
and globally disseminate the breakthrough technologies needed to address climate
change concerns; and, the long time needed to affect global greenhouse gas
emissions and concentrations trends. Any international agreements must reflect
these realities. Artificially imposed negotiating deadlines for further agreements
create pressures which are neither conducive to reasoned decision-making nor
commensurate with the long term nature of the climate change issue. As is already
evident, agreements reached under such circumstances are unlikely to gain the
necessary domestic, national and international support.
Notes.
1. "Additionality" in this context means that emissions reductions would have to be
"additional to any that would otherwise occur". See the Kyoto Protocol, Article 6.
For instance, it has been proposed that emissions reductions consistent with
historical trends should not be considered "additional to any that would otherwise
occur".
2. "Supplementarity" in this context means that emissions reductions would have to
be "supplemental to domestic actions". See the Kyoto Protocol, Articles 6 and 17.
For instance, it has been proposed that at least one half of a country’s total
emissions reductions would have to be achieved domestically. In such a case the
one half or less of a country’s total emissions reductions which were achieved
internationally through Kyoto mechanisms would be considered "supplemental to
domestic actions".
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APPENDIX A
REFRIGERATOR AND FREEZER INSULATION
In April 1999 FRANKLIN ASSOCIATES prepared for the American Plastics Council,
Washington, D.C. a report entitled "Plastics Energy and Greenhouse Gas Savings Using
Refrigerator and Freezer Insulation as a Case Study". The Executive Summary of that
study is reproduced below with a few minor editorial revisions.
"EXECUTIVE SUMMARY
"This analysis is a case study that examines the greenhouse gas emissions
implications of using plastic foam insulation in refrigerators and freezers.
The specific plastic foam used in this analysis is polyurethane. To give
these results perspective, they need to be placed in context with a baseline
where polyurethane foam is not used. At this time, only polyurethane
foam is used as insulation in household refrigerators and freezers in the
U.S., so there is no alternative with which to compare. One possible
context is to show the emissions that would be incurred if no insulation
were used in refrigerators. However, we have selected fiberglass
insulation as a baseline, because historically it was the insulation replaced
by polyurethane foam. For comparison purposes, we have assumed a
refrigerator and a freezer with physical dimensions identical to one using
polyurethane foam, but which instead have used the same thickness of
fiberglass. This is used only to establish a baseline for comparison. In
actual fact, if fiberglass were used, the dimensions and design of the
refrigerator or freezer would be different to allow substantially greater
thickness of insulation, thus creating appliances that would not be
equivalent to the ones studied here.
"The results of this analysis are based on a comparison of the cradle-tomanufacture energy requirements and greenhouse gas emissions for each
type of insulation, as well as those for the operation of refrigerators or
freezers using each type of insulation. The energy required to manufacture
the refrigerator or freezer and all equivalent materials in the appliances is
not included because they are identical for each, and so the results will not
differ.
"…[T]he total energy requirements for both the refrigerator and the
freezer with polyurethane insulation are 61 percent that of the appliances
with fiberglass insulation. The energy required during the use phase for
the appliances dominates the results. One percent or less of the energy
requirements come from the manufacture of either of the insulation
materials. A consumer saves 8,815 kwh of electricity, or 98 million Btu,
over the lifetime of the refrigerator by using the polyurethane-insulated
refrigerator. A consumer saves 5,400 kwh of electricity, or 60 million Btu,
over the lifetime of the freezer with the use of polyurethane insulation.
Using a U.S. average electricity cost of 6.97 cents/kwh (October, 1997),
this translates to a savings of approximately $600 for refrigerators and
$375 for freezers.
"…The total greenhouse gases for both the refrigerator and the freezer
with polyurethane insulation are 62-64 percent that of the appliances with
8
fiberglass insulation. As with the energy requirements, the greenhouse
gases produced during the use phase for the appliances dominate the
results. The reason this coincides with the difference in the amount of the
energy used is because most of these emissions are from fuel production
and combustion for the use of the appliances. The blowing agent HCFC141b from the polyurethane-insulated refrigerator makes up only one
percent of the greenhouse gas emissions, while the carbon dioxide is 94 to
95 percent of the total.
"It takes approximately 1.5 months of use of a polyurethane-insulated
refrigerator before the energy savings exceed the energy it takes to
manufacture the insulation. For the polyurethane-insulated freezer, it takes
approximately 2.2 months of use before the energy savings exceed the
energy it takes to manufacture the insulation.
"Clearly, at a time when energy use and greenhouse gases releases are
major concerns, the benefits of polyurethane insulation are very
significant. With 106 million refrigerators and 33.4 million freezers in use,
the greenhouse gas benefit is 34.9 million and 6.4 million tons of carbon
dioxide equivalents per year, respectively. To put this data in perspective,
34.9 million tons of carbon dioxide is equivalent to the amount of carbon
dioxide emitted by the gasoline produced and combusted to use 4.8
million cars per year. This same type of equivalent for the 6.4 million tons
of carbon dioxide equivalents per year is 0.88 million cars per year."
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APPENDIX B
HOUSEWRAP
In October 1999 Franklin Associates, A Service of McLaren/Hart prepared for the
American Plastics Council, Arlington, Virginia and Environment and Plastics Industry
Council of the Canadian Plastics Industry Association, Mississauga, Ontario, Canada a
report entitled "Plastics Energy and Greenhouse Gas Savings Using Housewrap Applied
to the Exterior of Single Family Residential Housing in the U.S. and Canada – A Case
Study". Excerpts from the Executive Summary of that study are reproduced below with a
few minor editorial revisions.
"This study is an analysis of the energy savings and related reduction in
greenhouse gas emissions resulting from the use of an exterior barrier to
airflow applied to single family houses in the U.S. These products are
commonly called housewraps and are quite effective at reducing air
infiltration. The U.S. Department of Energy (DOE) has determined that
about one-half of all energy used in heating and cooling homes results
from the air infiltrating from the outside of a house to the inside. Thus, the
blocking of that infiltration can produce significant reductions of energy
use and associated greenhouse gas (GHG) emissions. However, this must
be balanced against the energy and GHG emissions associated with the
manufacture and installation of the housewrap products. This study is a
"life cycle" inventory applied to put all of these issues into perspective.
"The results presented here are from a "cradle-to-grave" analysis of fuels
used for heating and cooling houses. The analysis begins with the
extraction of raw materials (fuels) from the earth, includes processing and
delivery of those fuels, and ends with the release of combustion products
into the environment. The life cycle results for the materials in the
production of housewraps are a "cradle-to-manufacture" analysis. They do
not include the process of applying wrap to houses nor the subsequent
end-of-life disposition that will occur at some future date.
***
"Air Infiltration comes from many sources of air leakage including
opening of doors and windows, fireplaces, and the many seams and
openings in exterior walls. There is a lack of publicly available data on
how much of the air leakage is blocked by housewrap. The evidence is
that it is highly variable and dependent on many factors but likely falls in
the range of 10% to 50% reduction of the infiltrated air. Given that most
houses today were built before use of housewrap was common, we have
estimated the effect of adding housewrap. The calculations for this study
assume that the reduction in heating and cooling for houses as a result of
application of housewrap falls somewhere in the range of a 10% to 50%
reduction in the amount of energy required to heat and cool infiltrated air.
"U.S. Results
"…[T]he reduction in energy consumption of a typical house in the U.S.
as a result of applying housewrap is estimated to be 12 to 60 million Btu
per year. Over a period of 30 years, these values become 360 to 1,800
million Btu.
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"These savings need to be contrasted with the energy to manufacture the
housewrap products. For several decades, plastic film vapor barriers have
been applied to the interior walls of houses to serve as a moisture barrier
and to enhance the effectiveness of insulation. Although not always
applied for that purpose, these films have significantly reduced air
infiltration even though the integrity of these films is often breached by
passage of wires, fasteners and careless tearing. Recently, polyolefin fiber
films have become available. These products, installed on the exterior of
walls, are much more effective at reducing infiltration. They also have the
advantage of reducing air leakage as well as providing for better control of
moisture migration through walls. Recent specifications for polyolefin
woven fabrics are used as the basis of these calculations, although 30
years ago most of the infiltration reduction would have been provided by
the vapor barriers. No data were found on the effectiveness of reducing
infiltration by films primarily designed as vapor barriers, but an
assumption that they reduce infiltration by at least 10% (the lower limit of
our range) seems a conservative assumption.
***
"The energy to manufacture housewrap for a single house is only 1.2 to
1.8 million Btu depending on the type of polyolefin used. Compared to the
energy savings resulting from the application of housewrap, the average
"pay back" period ranges from only 7 to 54 days.
"The reduction in GHG emissions resulting from the application of
housewrap is 1,600 pounds to 8,100 pounds [of CO2 equivalents]
annually, or 49,000 or 244,000 pounds over a period of 30 years. The pay
back period on GHG emissions resulting from the use of housewrap
ranges from 3 to 22 days.
"It is not known how many houses in the U.S. currently have either a
plastic film in place as a moisture and air penetration barrier or have the
newer plastic fiber housewraps. However, if we assume that all houses
built since 1980 have a plastic air infiltration barrier in place that would
reduce the infiltration in the range of 10% to 50%, the estimated energy
savings since 1980 is 1.8 to 8.9 Quad (one Quad = 1015 Btu), and the total
reduction in GHG emissions is 120 to 600 million tons. If, instead, we
assume that all houses built since 1990 (to correspond to the baseline year
specified by the Kyoto agreements) have some plastic air infiltration
barrier in place, the estimated energy savings since 1990 is 0.3 to 1.7 Quad
(one Quad = 1015 Btu), and the total reduction in GHG emissions is 23 to
113 million tons.
"It is clear that the use of plastics in this application results in significant
national savings in energy and reductions in GHG emissions. To put these
numbers in perspective, the total reductions in energy since 1980 has
resulted in a savings of 14.2 billion to 70 billion dollars. Reductions in
GHG emissions since 1980 are equivalent to the amount of CO2 from the
combustion of 12 to 60 billion gallons of gasoline in automobiles. If,
instead, we look at the time period of 1990 to 1997, the savings in reduced
energy costs would be 2.6 to 13 billion dollars, and the savings in GHG is
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equivalent to the combustion of 2.3 to 11 billion gallons of gasoline in
automobiles.
"Canadian Results
"…[T]he reduction in energy consumption of a typical house in Canada as
a result of applying housewrap is estimated to be 8.0 to 40 million Btu per
year. Over a period of 30 years, these values become 240 to 1,200 million
Btu. The energy to manufacture housewrap for a single house is only 1.1
to 1.6 million Btu in Canada depending on the type of polyolefin used.
Compared to the energy savings resulting from the application of
housewrap, the average pay back period ranges from only 10 to 75 days.
"…The reduction in GHG emissions resulting from the application of
housewrap is 790 pounds to 4,000 pounds [of CO2 equivalents] annually,
or 23,700 to 119,000 pounds over a period of 30 years. The pay back
period on GHG emissions resulting from the use of housewrap ranges
from 8 to 54 days.
"It is not known how many houses in Canada currently have either a
plastic film in place as a moisture and air penetration barrier or have the
newer plastic fiber housewraps. However, if we assume that all houses
built from 1981 to 1995 have some plastic air infiltration barrier in place,
the estimated energy savings since 1981 is 0.24 to 1.2 Quad (one Quad =
1015 Btu), and the total reduction in GHG emission is 12 to 60 million
tons. If we use a 1991 to 1995 time period, the estimated energy savings is
0.04 Quad to 0.18 Quad, and the total reduction in GHG emissions ranges
from 2 to 9 million tons.
"It is clear that the use of plastics in this application results in significant
national savings in energy and reductions in GHG emissions. To put these
numbers in perspective, the total reductions in energy from 1981 to 1995
have resulted in a savings of 1.6 billion to 8.0 billion Canadian dollars.
Reductions in GHG emissions from 1981 to 1985 is equivalent to the
amount of CO2 from the combustion of 1.2 to 6.0 gallons of gasoline in
automobiles. Also, the savings between 1991 and 1995 accounts to 0.2 to
1.1 billion Canadian dollars in reduced energy costs, and a reduction in
GHG equivalent to the combustion of 200 million to 900 million gallons
of gasoline."
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APPENDIX B1
Examples of concrete measures by companies to increase energy efficiency and
reduce green house gas emissions (not exhaustive)
Example 1 - Energy-efficient biological waste water treatment
Aerobic biological sewage plants are modelled on natural purification processes in rivers
- under optimized technical conditions: Bacteria and other microorganisms break down
substances dissolved in water, converting them into carbonic acid, water and endogenic
cell substance.
Building up on 20 years of experience in waste water treatment, some companies have
developed the BIOHOCH® reactor. The reactor has all the features of technical progress:
Higher performance on less space, energy-savings, environmental soundness, safe
operation.
Savings in energy: - 61%
Further advantages:
 Savings in building space: 68%
 Reductions in waste air: 87%
 Minimal noise emissions
 Practically no odour emissions
 Because of enclosed construction and low air throughput no risk to groundwater
So far 36 plants of this type have been built in Europe, America and Asia, mainly for the
purification of industrial waste water but in some cases also combined with municipal
waste water treatment.
Example 2 - Recovery of nitrogen, oxygen and argon
Nitrogen, oxygen and argon are needed in welding and cutting, cooling systems,
electrical engineering, safety and environmental technologies, chemistry and medicine.
Air consists of the following components: Nitrogen (78% approx.), oxygen (21%
approx.), rare gases (1% approx.), the latter being mainly argon. By way of air separation
these gases are recovered in their high-purity form.
Air separation plants require almost exclusively electricity for measuring and control
processes and to operate air compressors, cooling water pumps, decanting pumps and
product compressors.
Air separation techniques are being constantly further developed. At a given production
site two older plants were replaced by just one new plant with the same capacities. The
energy demand has been considerably lowered with the help of optimized process
planning, pressure coefficients, heat exchangers, rectification columns and the use of
expansion turbines with magnetic bearings and downstream recompression.
Savings in electricity: - 40%
Further advantages:
 for nitrogen and argon: < 0.1 ppm product impurity attributable to oxygen
 for oxygen: < 0.1 ppm product impurity attributable to hydrocarbons
 lower consumption of lubricants because of magnetic bearings
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Example 3 - Energy savings and production-integrated environment protection
Aromatic amides are intermediates in the production of drugs, flameproof fibres and
colour pigments. A huge variety of amines are available. They are produced in the
reduction of nitro compounds.
Building up on the progress in catalysis research, an environmentally sound catalytic
reduction process was developed: With the help of a rare metal catalyst, nitro compounds
are reduced with hydrogen. Subsequently, the catalyst is recovered and used again.
In the new production plant the primary energy consumption per ton/product has been cut
by more than 50%. The plant consists of two enclosed, fully automated lines which leads
to a major reduction in emissions into the atmosphere. Furthermore, the pollution load in
effluents is much lower, no iron oxide sludges are generated, and the yield has improved.
A change in product types takes only a few hours as compared with two or three days in
the past.
Savings in energy:
> 50% (Electricity and steam mathematically converted into primary
energy; not taking into account further energy savings in the upstream
product chain because of lower quantities of raw materials required as a
result of higher yield.)
Further advantages:
 no generation of iron oxide sludges reduction of the pollution load in effluents by
99%
 reduction of emission into the atmosphere by more than 99%
 swift change in product types
Example 4 - Over 80% energy savings in big scale oxo synthesis
N-butanol is a base material for various products of the chemical industry, e.g. softeners
used in plastics. It is produced in the so-called oxo synthesis. Starting materials are
propylene and synthesis gas.
Companies have improved the production process in many ways. The new RCH/RP oxo
process focuses on a novel, stationary catalytic system: The highly active and highly
selective rhodium catalyst is water-soluble, but water is not soluble in the product.
Consequently, after the synthesis the biphasic catalyst can be easily separated and
returned into the reaction system.
Savings in energy:
> 80% (Electricity and steam mathematically converted into primary
energy; not taking into account further energy savings in the upstream
product chain because of lower quantities of raw materials required as a
result of higher yield.)
Further advantages:
 practically no emissions
 almost all by-products recyclable
 largely simplified plant engineering
Example 5 - Propylene: Energy savings and production-integrated protection of the
environment
Polypropylene is one of the mass produced thermoplastics suitable for a wide range of
applications, for example in the automobile industry. As polypropylene is safe in terms of
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foodstuff chemistry and at the same time resistant to hot water, it is frequently used in
injection moulded parts of household appliances, films, etc.
In the new Modern process polymerization takes place in monomeric propylene. These
processes have only become possible after the development of new, highly effective
catalysts. In addition to obvious advantages where emissions and residues are concerned,
energy quantities required for polymerization in monomeric propylene are much lower.
Furthermore, specific investment costs have decreased, because reprocessing and
recovery are no longer necessary.
Savings in energy:
 steam: > 90%
 electricity: 25% approx.
Further advantages: 90% less waste water and pollution load in effluents reduced water
consumption lower investment costs
Example 6 Rational use of energy and process heat
Reduced demand for primary fuels and lower CO2 emissions
Following the principle of power-heat-coupling, chemical companies operate at many
locations their own power stations to provide production plants with process steam and
heating steam. Together with the waste heat steam recovered from process waste heat,
these power plants fully cover the operation's total steam demand, whilst internal
electricity generation is supplemented by supplies from public networks.
In addition to primary fuels (coal, fuel oil, natural gas), power stations use residues from
production processes, lean gas, and polluted waste air.
Within the expansion of production and power plants, the utilization of waste heat and
fuels has been further optimized:
 A closed air system in process gas cooling and the lower temperature of feedwater when let into the waste heat boiler raise this production plant's waste heat
utilization by further 25%. Thus the input of natural gas in steam generation is
reduced by some 9,500 MWh/a which corresponds to some 2,000 t CO2/a.
 Using a flue gas/air pre-heater lowering the waste heat temperature from some
200 oC to 120 oC, boiler efficiency has been optimized and is now at well over
92%.
 Power-heat-coupling has been improved by the use of a turbine with additional
7 bar bleeding (substituting 13 bar steam) and high-pressure pre-heaters for inlet
water. Substituting the 13 bar steam, own electricity generation has gone up by
some 20 kW/ton 7 bar steam/h.
Example 7 - Evolution of polyethylene processes to the modern low energy phase
process design
Prior to Gas Phase
The first polyethylene process involved feeding ethylene at very high pressures (about
2000 bar typically) into autoclave or tubular reactors in the presence of free-radical
initiators.
The second generation processes moved to polymerisation carried out either in solution
(cyclohexane) or a slurry (isobutane). As a result of using complex metal catalysts,
reaction pressures could be lowered to 50-100 bar and the energy input reduced by 25%.
Gas Phase
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More recently the innovation of fluidised bed technology has cut energy input by a
further 10%. By operating under mild conditions (20 bar, 85 deg C) in the gas phase, the
process eliminates the use of liquid hydrocarbons and thereby associated solvent recovery
and recycle steps.
The growing polymer particles are maintained in a fluidised condition by means of a high
velocity gas stream containing ethylene and in some cases other comonomers. The
polyethylene powder leaving the reactor is degassed and conveyed to an extruder, while
the gas stream is recycled.
Example 8 - Chlorine: replacing Mercury/Diaphragm technology by Membrane
Description
Chlorine was produced by a first section based on Mercury technology (75.000 tons/y
C12 capacity) and a second line based on Diaphragm technology (another 75.000 tons/y).
In the years 1986 - 1990 both sections where converted to Membrane resulting in cleaner
and safer conditions, no impact on the environment, pure Hydrogen Dyproduct (on its
better recovery - the work is still in progress) and substantial reduction of Energy
consumption.
Results
Energy savings
 Electricity - 67 GWh/y (13,8%)
 Steam - 180.000 t/y (57%)
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APPENDIX C
IMPLICATIONS FOR CHEMICAL INDUSTRIES
Australia
The implications of the Kyoto Protocol for Australia are rather different to those of the
North America and the EU. First and foremost Australia is allowed an increase of 8% in
emissions between 1990 and 2010 - although it must be noted that Australia's GDP is
more energy intensive than most other countries, its
spatial population distribution also has implications for high energy consumption and, for
a developed country, Australia has a high rate of population growth. The 8% increase
only accounts for the population growth and meeting the target will be quite a stretch. As
a result, studies have shown that the cost of emission reductions in Australia is, together
with Japan's, among the highest in the world. The chemical industry in Australia is
energy intensive and will be adversely affected by the measures designed to reduce
emissions (Japan, Australia and New Zealand are the only Annex 1 countries in the Asian
region with emission commitments). The only offsetting feature is that the aluminium
industry in Australia is even more energy intensive and will be more affected by the
measures and there is an element of substitution between some
chemical products and aluminium (although again one must be mindful of the location of
these industries and of the possibility of other countries benefiting form the market
opportunities).
In terms of measures taken by the industry to reduce emissions, there is a joint
industry/government program called the Greenhouse Challenge which is voluntary and
whose purpose is to have industry implement cost effective measures to improve energy
efficiency. Four PACIA members (accounting for approximately 40% of the industry's
emissions) are signatories to the program and have reduced their
greenhouse emissions by 8% between 1995 and 1997. Another two companies are
signatories to the program but their emissions in the chemical industry are small. A
further 14 PACIA members (the combined 20 companies account for two thirds of the
industry's emissions) have signed letters of intent to join the program and third party
audits of the measures identified (covering half of the sites owned by the 14 companies)
indicate that emissions should be reduced by 15%.
The Australian Government is also currently drafting legislation that will require large
electricity retailers to source an additional 2% of their energy from renewable sources by
2010. Energy users will have to bear the cost of such an increase - the alternatives are not
cost efficient.
The Government is also considering the establishment of an emission trading system.
Energy intensive industries are arguing for an international emission trading system
(given the high national cost of emission reduction) with all greenhouse emissions
available for trading and for the inclusion of developing countries in the emission trading
system.
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Canada
Over the past seven years, the Canadian Industrial Chemical and Synthetic Resins (ICSR)
sector has increased production, and hence energy use, while at the same time it has been
able to reduce carbon dioxide emissions per unit of product. Since 1993 the sector has
improved its energy efficiency by 35% compared with the Canadian industrial average of
26%.
The ICSR sector in 2010 is expected to have reduced Global Warming Potential based on
CO2, CH4, and N2O to be 21% to 27% below the 1992 base year. This mainly results
from one company having developed and applied a breakthrough technology for one
operation to dramatically reduce N2O emissions. This kind of process technology
improvement cannot be easily duplicated in other sub-sectors of the chemical industry
with different processes and products. However, in addition, there is expected to be
continuous efficiency improvement across the sector.
Emissions of CO2 only are expected to continue to increase by 31 to 42% above 1992
levels by 2010 based on expected output growth. Emissions of CO2 per unit of output are
expected to decrease by 29 to 32% through continued efforts to improve energy
efficiency.
Carbon Taxes or their equivalent, if not applied globally, including to non-Annex1
countries, would render the ICSR sector non-competitive on a global basis.
Europe
The European chemical industry is strongly committed to the aim of sustainable
development, and in particular to the efficient management of scarce resources for a
prosperous economy. In the area of energy, it considers the increasingly efficient use of
energy as the most promising route to serve this objective, particularly since this
contributes simultaneously to the reduction of carbon dioxide emissions per unit of output
and to the improvement of its international competitiveness. Furthermore, this approach
is fully in line with the Responsible Care programme, whereby industry takes its own
responsibility for continuous performance improvement, amongst others in the field of
energy efficiency.
A steady flow of investments has historically permitted decoupling of output growth and
energy consumption (excluding feedstocks) in the European chemical industry. Over the
years 1990-1997, in particular, fuel and power consumption hardly increased at all, in
spite of a chemicals growth output totalling 22%, thereby achieving a 15% decline in
specific energy consumption.
The European chemical industry has elaborated a Voluntary Energy Efficiency
Programme. VEEP 2005 is a unilateral commitment to reduce its specific energy
consumption by 20% between 1990 and 2005, provided that no additional energy taxes
are introduced. Such improvements in energy efficiency can only be achieved at
increasingly higher unit costs and investments. To undertake these investments,
companies need a long-term stability of the business environment in which they operate.
CEFIC assures a proper monitoring of the VEEP programme by providing yearly updates
of aggregated European data on energy consumption by the chemical industry. The latest
data show that the European chemical industry is well on track to fulfil its commitment.
In spite of the anticipated progress in energy efficiency in future years, the pure
imposition of absolute CO2 emission caps on the EU chemical industry would be
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tantamount to rationing energy consumption and to constraining future growth. By
contrast, the concomitant use of the Kyoto flexible mechanisms would allow for
unchecked growth. However, the price of fossil energy sources would be inflated by the
additional costs incurred to comply with targets: purchase of tradeable permits, cost
incurred to get JI or CDM credits. Such higher energy costs would in turn impair
international competitiveness and encourage the relocation of chemicals business to capfree countries.
In a recent study assuming a 8% CO2 absolute reduction target in 2008-2012 on 1990
levels, CEFIC predicted that energy costs in the EU chemical industry would rise by up
to 25%, and that annual growth rates of chemicals output in volume would consequently
be cut by up to 1% points compared to the baseline. Actual outcomes will in fact depend
on a number of elements, including the scope for low-cost domestic actions, the future
availability of economical CO2 abatement technologies, the price of tradeable permits, the
cost of JI and CDM credits, and the possible restrictions imposed on the use of the Kyoto
flexible mechanisms. It goes without saying that the more energy-intensive basic
chemicals are much more vulnerable than suggested by these average figures.
Japan
In November 1997, The Japan Chemical Industry Association (JCIA) worked out "the
voluntary action plan on environmental protection for prevention of global warming". It
was announced that JCIA aimed at the following 3 items and had begun to implement
them voluntarily.
1. The chemical industry endeavors to make its energy consumption rate per unit to
be 90% of the 1990 base year by 2010.
2. The chemical industry tries to develop environmental friendly and energy saving
process technology, utilizing effectively catalyst technology, biotechnology,
petrochemical technology, gasification technology etc.
3. The chemical industry transfers energy conservation and environmental protection
technology cultivated until now to the developing countries in overseas business
in order to contribute to the abatement of CO2 emissions.
Since 1997, JCIA has been eagerly cooperating with its member companies in improving
the energy consumption rate per unit. According to last finding, the energy consumption
rate per unit is improved by 4 % in comparison with the 1990 base year. The Industrial
Council of the government follows up this action.
JCIA works out the voluntary action plan to cope with emission abatement of other
greenhouse gases, such as HFCs, PFCs, SF6, as well. The Chemical Council of the
government follows it up.
In Japan, the private sector and the government cooperate with actions to prevent global
warming.
United States
Implications for the chemical industry. In 1998 an outside consultant prepared a report on
the impact on the U.S. chemical industry of carbon emissions trading intended to achieve
the target and timetable set forth in the Kyoto Protocol (1990 minus 7% during 20082012). This study indicated the cost to the chemical industry of achieving the Kyoto
target in 2010 would range from $274/metric ton in the case of internal U.S. trading but
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no international trading, to $36/metric ton with unrestricted global trading. The aggregate
annual cost to the U.S. chemical industry in these scenarios would respectively be $21
billion and $3 billion. The impact on chemical industry production would respectively be
minus 11% from the baseline to minus 1% from the baseline. The impact on chemical
industry exports would respectively be minus 27% from the baseline to negligible.
Energy Efficiency and Greenhouse Gas Emissions Achievements. Since the mid-1970s,
U.S. chemical industry energy consumption and carbon dioxide emissions from fuel
combustion have been reduced more than 40 percent per unit of chemical output.
According to ACC’s annual Energy Efficiency and Greenhouse Gas Emissions Survey,
ACC companies voluntarily reporting their energy consumption and CO2 emissions data
to ACC from 1992 through 1998, inclusive, achieved an average annual improvement in
energy efficiency of 2.4% during this period, for a total improvement of 13.5%, and an
average annual improvement in carbon intensity of 2.8%, for a total of 15.5% during this
period. ACC companies voluntarily reporting in 1997-98, inclusive, achieved 0.7%
improvement in energy efficiency during this period and a 2.0% improvement in CO2
intensity.
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