Recently published in Decarbonization Technology
As the energy industry continues to embrace the energy transition and rationalize the impacts on their operations and viability, the major focus has been on examining and investing in diversification investments, such as renewable processing, sustainable aviation fuel (SAF), blue / green / turquoise / pink hydrogen, wind, and solar. These investments help provide lower carbon intensity energy carriers to a growing population and meet rising energy demand requirements, thereby impacting Scope 3 emissions. However, to achieve corporate and/or governmental GHG reduction mandates, energy producing entities should also examine opportunities to improve energy efficiency and reduce carbon footprint of their existing assets (i.e. the Scope 1 and 2 emissions). The outcomes of the COP 26 climate summit in Glasgow in 2021, along with rising natural gas prices, tighter energy supply, shrinking margins, and shifts in available financing sources, are adding layers of complexity to an already challenging situation of reducing energy usage and GHG emissions.
Based on IEA’s Net Zero by 20501, energy efficiency improvements account for 10% of the total CO2 emission reductions in order to achieve net zero targets by 2050 and are an early enabler of achieving these targets. In addition, energy consumption accounts for about 5 to 15% of many refining and petrochemical facility’s margin, such that improving efficiency also drives profitability. To begin the process of reducing Scope 1 and 2 emissions, we must first understand the basis for these emission allocations, outline methodologies to improve, evaluate, and implement changes within energy production facilities, and highlight practical examples of energy reduction opportunities.
What are Scope 1 and 2 Emissions?
To understand these definitions, let’s first start with outlining which emissions are included2. As expected, CO2 is at the core of carbon emissions, but other greenhouse gases like methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFCs), perfluorocarbons (PFCs), and others are also within the boundary. Therefore, when preparing balances for a given entity or looking for improvement opportunities, each of these areas should be explored.
The following graphic summarizes the definition and boundaries for Scope 1, 2, and 3 emissions.
Scope 1 and 2 are the emissions that most entities have a clearer understanding of and accounting on, as they are often required for tracking and filing by regulatory entities and corporate mandates. These are the emissions that are created by the fuel and power that is consumed or purchased by a given entity to convert their raw materials to a final product for either processing by another entity or use by the final consumer. Therefore, whether it be the purchased electricity from the local power grid, use of natural gas or coal for steam and power generation by the plant directly, or the gasoline and diesel used by the vehicles associated with the entity, all these combine into the Scope 1 and 2 emissions. Scope 3 emissions are more challenging to account for, as they relate to the entire energy required to produce and transport the raw material, as well as the raw material itself, and then the emissions created by the next processing entity through to the final product. Hence, these are left for a future discussion.
How does one start to reduce Scope 1 and 2 Emissions?
As with most journeys, one must start with a plan and a pathway to achieve the targeted improvement. The following figure outlines an approach used within Becht to engage in energy optimization activities, and the reader is encouraged to create their own approach that fits the specific needs of their site and improvement goals.
A few key learnings and considerations when preparing and executing this methodology:
- An accurate set of energy balances for the existing asset is absolutely critical. Given that the utilities systems are often the “forgotten” part of the overall asset (until a problem arises or an energy optimization study is completed), getting this information on an individual user and producer basis can be challenging. To close data gaps, consider adding measurement devices on key consumers or producers, using original design information to provide an initial estimate, and leveraging process simulations and chemical engineering basics to generate synthetic data on a given piece of equipment’s performance. As the adage goes, one cannot control what is not measured.
- Field measurements and evaluations of equipment condition are just as important as completing the engineering analysis. Often, a field walk-through can identify opportunities that an energy balance may not make apparent. For instance, how many of the steam traps are leaking or putting quality condensate to the slab? What do the flame patterns look like within the firebox, both from a visual and a thermal scan basis? Have heater/boiler excess oxygen targets been set at reasonable values and optimized to the same? Are manual spillbacks open on pumps and compressors, thereby wasting energy?
- Opportunities will exist within both the energy and process side, so make sure to examine the impact of a change of energy usage on the process implications. Fundamentally, the overall asset must still achieve profitable, safe, and reliable operation, so complete a holistic review to evaluate the impact of a shift in energy on these key elements. Benchmarking is important and gives one the measuring stick of current status and future progress, but one has to get down to the technical level to identify specific opportunities, rationalize them, and determine the right disposition for those changes.
- A high level of on-stream reliability of the utility infrastructure is critical for asset integrity, so when looking at major shifts within the steam, fuel, and power systems, consider the redundancy implications and requirements. As an example, many facilities will progress to a higher degree of electrification of drivers and heating sources, but doing so will require significant electrical infrastructure, generation or supply redundancy, and a clear understanding of operating and abnormal operating scenarios.
Where are the best opportunities to lower Scope 1 and 2 Emissions?
With the evaluation and implementation pathway framed out and a clear Baseline defined, the next step is to identify potential improvement opportunities. To begin the process, a multi-layer and bi-directional process is recommended (see graphic). As highlighted above, underlying performance starts at the equipment level, such that balances for each individual consumer and producer are needed. Once this element is in place, one can move out several levels to the unit, intra-unit, and site-wide levels. For some organizations, these distinct levels may not exist, but within the modern refinery, petrochemical plant, or factory, multiple units must work together to produce the final product slate. By defining a clear understanding of their integration, both in process and energy, will illuminate improvement areas. Each of these areas should be examined, as focusing on just a few of these areas will result in an incomplete picture of the asset’s potential improvement opportunities.
For each of these layers, the following examples are listed – though not exhaustive, these areas should be the primary focal areas to brainstorm opportunities3. For each element, a holistic review of the energy, process, reliability, and process safety considerations must be completed to first define if an opportunity is technically feasible. From that point, the capital cost estimates can be generated and project economics reviewed to determine economic feasibility.
This last step is one of the most critical in the feasibility phase of the overall Front End Loading (FEL) process, as one is trying to avoid regret capital by making the right investment decision to meet production targets, reliability, safety, and reduce carbon footprint. While traditional economic analysis will be the core of this decision point, a broader view is needed to provide the right information to the decision makers, not only those within the enterprise but also external investors and social stakeholders. To this point, the following graphic summarizes a broader approach to capital investment decision making that involves incorporating elements around technology risk, ESG considerations, and ability to exploit the asset under varying operating and pricing scenarios, as some examples. By combining traditional return on investment with non-economic metrics, the entity can make a more informed decision on the strategic options to meet the objectives and mandates of decarbonization.
What are some real world examples of Scope 1 and 2 reductions?
To help demonstrate the elements discussed above, the following 3 case studies are provided with particular focus on tangible and practical solutions.
Case Study #1
Becht’s Fired Heater division was asked to help a North American refiner address excess oxygen in their fired heater circuit to not only improve energy efficiency but also maintain equipment integrity and processing capability. An internal assessment by the client identified over $300k/yr in potential energy savings if the heaters could repeatably achieve target oxygen values.
Becht collaborated with the client to complete field walkdowns of the heaters to identify the root causes of non-optimal oxygen levels as well as addressing “bad actor” conditions on some of the heaters. The collective team completed deep dive reviews of design and actual performance. By applying Becht’s industry leading Advanced Infrared (IR) technology, the team was able to identify burner and tube coking issues that helped identify and implement mitigations to improve overall heater performance. Through a combination of technical analysis, field experience, operator training, and focused mechanical changes, the team was able to reliably lower excess oxygen in all the targeted heaters, providing not only $500k/yr of reduced energy but also another $500k/yr of margin capture through optimization and decoke avoidance.
Case Study #2
Becht leveraged the Bundle Technology Upgrade (BTU) methodology to support a client in improving heat integration. Within most facilities, when heat exchanger bundles reach end-of-life, the exchangers are typically replaced with the existing design, due to incremental cost considerations, perceived challenges with alternate arrangements, or complexity and timing of management of change implications. However, these situations are ideal opportunities to examine the impact of alternate heat exchange technologies to improve heat recovery that can be used to either reduce energy usage from incremental fired assets or steam heating or improve process performance to increase product recovery, adjust unit operating conditions, and reduce fouling potential.
As an example of BTU, a client was considering replacement of a crude preheat exchanger that was at end of life. The team completed the technical, mechanical, and performance analysis to review alternate bundle technologies and compared them to the “do nothing” replacement-in-kind option. The application of helical baffles, along with upgraded metallurgy to allow for thinner tubes, resulted in a CO2 reduction of 930 tpy, a net energy improvement of 2 MMBtu/hr to the Crude preheat train, a reduction in overall system pressure drop, and a benefit-to-cost ratio of over 25. Application of this methodology help achieve heat recovery targets as well as enhancing processing capabilities, all while ensuring reliable operation.
Case Study #3
Becht worked with a US refiner who was facing a gas containment issues which forced them to flare a high hydrogen content off-gas, especially during turnarounds. Becht worked with the refiner and owner of an adjacent Combined Cycle Cogeneration Facility to qualify gas turbine hardware capable of firing a blend of up to 40% hydrogen, thereby allowing the Cogen gas turbines to consume the excess refinery off-gas. This retrofit eliminates turnaround flaring and reduces the carbon footprint at both the refinery and Cogeneration Facility.
Where do we go from here?
The energy transition is providing the impetus for the energy industry to evolve in how they provide the valuable energy carriers we all rely upon for our economic, social, and health wellbeing. Though energy optimization is often a priority within most organizations, this current set of market and regulatory conditions is driving the firm commitment to reduce Scope 1 and 2 emissions to achieve GHG reduction targets. By application of a rigorous and holistic methodology, completing multi-layer performance reviews, addressing the technical + economic + non-economic metrics of technical and financial feasibility, and focusing on practical and novel solutions, the Energy Industry can achieve these targets while maintaining safe, reliable, and profitable operation.
- “Net Zero by 2050 – Analysis.” IEA
- “We Set the Standards to Measure and Manage Emissions.” Greenhouse Gas Protocol
- “Decarbonisation Technology – November Issue.” DigitalRefining
Like to learn more about energy transition and lowering your emissions while maintaining reliability? Contact Becht to speak with an expert.