Transcript Industrial Gas User Focus

Industrial Gas
User Focus
Shahrzad Rahbar, PhD, ICD.D
President, Industrial Gas Users Association
October 2016
1
Industrial Gas Users Association
• Founded 43 years ago
o Intervention in regulatory hearings
o Coherent voice on natural gas issues
• Members in Québec and Ontario
o Mining, steel, aluminum, petrochemicals,
pulp & paper and manufacturing sectors
o Cyclic international commodity business
o Aggregate use > I48 PJ per year
o Employment numbers: 24,000 in Canada,
and 750,000 world wide
o Large employers in rural and remote communities
• Québec Member Profile
o 8 companies, 23 facilities, over a quarter of Québec gas volumes
o 14,000 direct jobs, 8,000 suppliers, engines of regional development
o Contribute $7 billion to the Québec economy
2
Industrial Gas Use in Québec
(Statistics Canada CANSIM Table 128-0016)
•
60% of the total natural gas volume in Québec (2014)
•
Largest growing demand sector, 50 TJ
of natural gas demand since 2010
•
Different demand elasticity than
commercial and residential sectors
•
Different uses, different load profiles
o Feed stock: high uniform base load
o Process heat: uniform load
o Back-up Fuel: ‘Peaky’ load, demand could quadruple from base
•
Different locations, different supply, capacity and service options
•
Different risk tolerance, contractual commitments & production
schedules drive gas choices
One Size Does Not Fit All
3
Energy Enables Industrial
Development
•
Québec uses its electricity advantage to attract industrial investment
o Aluminum, forest products
•
Québec should also leverage access to natural gas to attract
industrial investments
o Mining, petrochemical, fertilizer, bio-chemical
•
Economic development and carbon management are
complementary, not mutually exclusive
•
Québec is well positioned to be a low carbon industrial power house
o
o
o
o
o
o
o
Clean power
Natural resources
Energy resources
Stringent climate and environmental regulations
Trained workforce
Competitive taxation
Progressive policy
4
De-Carbonization is NOT
De-Industrialization
•
The world will need material ‘stuff’ even in a carbon free future
o Traditional commodities: minerals, metals, chemicals, wood products, cement
o New renewable bulk commodities: bio-fuels, hydrogen, synthetic materials
o Production of materials is energy intensive
•
Discourse on climate change has largely focused residential and
commercial sectors and on personal transportation
•
Industry has different options than homes and institutions
•
Industry can transition to a low carbon future
•
Development of de-carbonized heavy industry (including energy
industry) should be a priority
•
Development of lower carbon options for freight should be
considered
5
Technical Potential Study
•
IGUA partnered with a prominent researcher on the Deep Decarbonization initiative under the UN (Dr. Bataille)
•
To explore the technical potential for de-carbonizing heavy
industry
o Iron and steel, metal processing, mining,
o Refineries, chemicals, pulp and paper, cement and glass
•
To inform IGUA members of industry de-carbonization initiatives
underway in other jurisdictions.
•
To surface opportunities for research and investment to retain
industry in Québec and Ontario
•
To sensitize thought leaders to the role of heavy industry in a decarbonized future
6
Technical Potential Study Findings
•
More minerals, steel, cement, chemicals and glass will be needed in a low
carbon economy even with half today’s material intensity
•
There will be demand for new bulk commodities: zero GHG electricity,
hydrogen, bio-liquids and gases, chemicals, synthetic hydrocarbon, emissionsfree hydrocarbons
•
It is technically possible to de-carbonize all heavy industry
•
•
o
Developing wholly new industrial processes
o
Using lower carbon energy source (Electrification, Fuel substitution, Hydrogen combustion, etc.)
o
Post process carbon capture utilization and storage
Technically feasible options exist for every sector; none are commercially
available
o
New technologies cannot be retrofitted to existing facilities
o
Most need 1-2 investment cycles to be able to use existing sites
Canada can have a competitive advantage in low carbon heavy industry
o
•
Energy resources, clean power, natural resources, industry expertise
Well planned transition phase is necessary
7
Industry is Part of the Solution
• Without climate policy, competitive pressure has driven heavy
industry to Best Available Technology (BAT) and Biomass
o Pet chem uses gas as feedstock, the rest of the world uses oil
o Pulp and paper has gone from 100% fossil to 75% biomass
• Commercially viable options for de-carbonization need
additional research and innovation
o No cookie-cutter solutions,
o Facility specific de-carbonization pathways based on specific conditions
• Managing the transition to a low carbon future is important
o Respect capital investment cycles
o Factor competitiveness and avoid stranding assets
8
IGUA & Québec Natural Gas
•
Large gas users value having options for supply, path and services
•
Optimistic about Québec Energy Policy 2016-2030
•
o
Sets the framework for transitioning to a low carbon future
o
Combines economic development
with environmental protection
o
Recognizes the role of industry in Québec
economy, and the importance of energy
to attract industrial investment
o
Permits responsible energy development
o
Recognizes the role of natural gas and RNG
in the transition to lower carbon future
Developing natural gas resources in a manner consistent with Québec’s
carbon and environmental objectives should be possible
o
Statoil has had CCS attached to its gas production facilities in Norway since 1996
o
Using natural gas in transportation and for power generation in remote areas
reduces emissions
9
Thank You.
10