Executive Summary
Techno-economic modelling studies reveal the extent of the decarbonization required
The existing techno-economic modelling studies reviewed in this study, together with Sasol’s decarbonisation plans, reveal the shifts that will be required in the petrochemical value chain in the transition to a Paris aligned net-zero future, including:
UPSTREAM:
A shift to renewable energy and sustainable feedstocks as inputs into petrochemical and chemical production processes will be required, with coal rapidly declining in the early 2030s, gas coming off by the mid-2040s, and an almost full switch to renewable electricity, green hydrogen and sustainable carbon by 2050.
The existing SECUNDA AND SASOLBURG assets and infrastructure have a potentially important role to play in a net zero economy for production of green fuels for aviation and potentially shipping, and green chemicals; either inorganic (ammonia through the Haber Bosch processes) or organic (using sustainable carbon feedstocks in the Fischer-Tropsch process), providing the required feedstocks can be sourced at appropriate costs.
DOWNSTREAM:
Emissions from land-based transport needs to be close to zero by 2050, with a more than 90% reduction in demand for fossil-based liquid fuels being required to meet decarbonisation targets, with no more domestic production remaining in South Africa. This will be achieved by interventions including switching the private and public passenger vehicle fleet from ICEs to EVs (with the fastest disruption being between 2035 and 2040), and most of the freight fleet from ICEs to EVs and some green hydrogen-fuelled vehicles by the 2040s. The domestic auto-manufacturing sector’s fate will be determined by domestic policy-motivated demand support for the ICE to EV shift. A shift from private to public passenger and road to rail transport will also play a role. Liquid fuels demand will decline significantly over the period, with greatest declines correlated to the 2035-2040 disruptive period associated with the EV shift.
Shipping and aviation will see a switch to green fuels generated from green hydrogen. Whilst shipping can use inorganic ammonia, Sustainable Aviation Fuels also require sustainable carbon as feedstock for production.
Chemicals production will require green hydrogen as an energy source, with organic chemicals further requiring sustainable carbon as feedstock.
Whilst a powerful lever for decarbonization, a techno-economic view is but one way of understanding the decarbonization challenge, highlighting one ‘basket’ of uncertainties, risks and opportunities. Accessing different knowledge areas and stakeholder perspectives on the facilities and their value chains was found to provide a richer, broader view of the decarbonization challenge and its implications than those seen by solely focusing on the techno-economic.
