IIR Chemical Processing Webinar: ESG Plays Key Role in Industry Development and Activity

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Researched by Industrial Info Resources (Sugar Land, Texas)--The global Chemical Processing Industry faces challenges both this year and next in the form of inflationary pressures, the Russia-Ukraine conflict and environmental initiatives driven by stakeholders. Nevertheless, the outlook for planned spending in the Chemical Industry remains strong. Industrial Info has seen a 17% uptick in global chemical project spending this year over the same period of 2022. While not all of these projects will move forward as planned, IIR expects about $177 billion worth to break ground this year, an 18% increase over 2022. In Industrial Info's recent webinar on the outlook for Chemical Processing Industry, Trey Hamblet, IIR's vice president of research for Chemical Processing and Refining, discussed the spending trends being seen.

Key to the discussion on industry spending was the rapid growth of environmental, social and governance (ESG) initiatives into chemical projects. The energy transition and its associated ESG projects are adding a new layer of spending on top of existing outlays related to long-term demand fundamentals, which have been strengthened by increasing demand for consumer end-products. Now, there are about $380 billion worth of projects throughout the world that include some sort of ESG component. This trend has occurred very rapidly, and now it's not uncommon to see green initiatives incorporated into the initial planning of a project.

A large majority of these of these ESG-motivated projects are for "green" or "blue" chemical commodities. There are approximately $62.2 billion worth of active green or blue projects in the U.S., centered around hydrogen, methanol, ammonia and recycled plastics. Green products use emissions-free renewable energy in their manufacture, while blue products capture the carbon produced in the process. Carbon capture is one of the fastest ways companies can achieve their environmental goals, and tax credits are helping to justify these projects for approval.

Power-to-X initiatives that incorporate renewable energy account for about $148.4 billion in projects globally and $16.9 billion in the U.S. and Canada. A constraint on these projects is the availability of renewable power; these projects are dependent on the pace of development for wind, solar and similar renewable resources.

Industrial Info is tracking 78 ethylene units planned throughout the world. Of these, 19 units will use methanol as feedstock, opening the door for the use of green or blue methanol. The pursuit of methanol-to-olefins is particularly strong in East Asia, while South Asia continues to rely on traditional naphtha feedstock for ethylene production, with fewer ESG initiatives in place.

If you missed this webinar or would like more in-depth analysis of Chemical Processing spending, this webinar will soon be available in Industrial Info's On-Demand Webinar Library.

Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 trillion (USD).