1. Electrification of energy consumptionIncreasing the share of electrical energy in energy consumption in industry, buildings and transportation can improve the level of system intelligence and decarbonization quickly and cost-effectively.
In 2021, the proportion of electricity in the country's final energy consumption was about 269%, and it is expected that by 2025, the proportion of national electricity in final energy consumption will increase to 312%, by 2030, China's electrification process will enter the medium-term transformation stage, driving the proportion of electric energy in final energy consumption to reach about 35%. Driven by the continuous growth of renewable electricity, the combination of thermal storage technology and electric heating units can participate in the electricity market as a "demand-side energy storage unit" that is both economical and flexible. New energy vehicle technology will also accelerate the reduction of gasoline and diesel consumption. China's coal, oil and natural gas consumption is expected to be higher thanPeaks in 2023, 2024 and 2029. By 2050, China's coal consumption will return to the level before 2000, almost all oil consumption is used for chemical raw materials, oil consumption is 60% lower than the 2022 level, and natural gas will be used to meet some industrial, construction, transportation and power scenarios, and the consumption will be 73% higher than the 2022 level, returning to the pre-2010 level. During the 14th and 15th Five-Year Plan periods, the key areas of electrification of various industries will focus on heavy-duty transportation vehicles and heat demand. The food production, machining, equipment manufacturing, construction and mining industries all have a wide range of heat needs, including processes such as melting raw materials and drying products. Since 2022, mature technologies such as electric heating, heat storage, and heat pumps can meet the demand for low- and medium-temperature thermal electrification (less than 400) in most manufacturing industries, and are expected to replace 90% of the fossil fuel heating needs of these industries. According to the IEA**, under the zero-carbon transition scenario, heat pump units are expected to provide about 7% of low- and medium-temperature heat demand by 2030, and 40% of high-temperature heat demand can be electrified.
Under this pathway, typical actions of the enterprise usually include:
Sufficient** medium and low temperaturesResidual heat, using solar thermal, heat pump, regenerative steam system to form a medium and low temperature electrified heating systemPlasma heating furnace and other technologies are used to meet the high-temperature heating needs of kilnsNew energy vehicles are used in commercial vehicles, commuter vehicles and logistics and transportation fleetsConstruction machinery and vehicles are driven by hydrogen fuel cells or pure electric vehiclesGround power is provided at airports and shore power is provided at terminals as an alternative to fuel for aircraft or shipsElectrification of energy production processes, such as electricity to hydrogen instead of fossil fuels. 2. Decarbonization of fuelsZero-carbon fuels such as biomass, green hydrogen and hydrogen-derived synthetic fuels (green ammonia, green methanol) will provide a decarbonization pathway for industries such as heavy road transport, shipping and aviation, as well as heavy industries such as steel and chemicals.
During the "14th Five-Year Plan" period, China will initially establish a hydrogen energy system based on the nearby utilization of industrial by-product hydrogen and renewable energy hydrogen production, with about 50,000 fuel cell vehicles, and the deployment and construction of a number of hydrogen refueling stations, with renewable energy hydrogen production reaching 100,000-200,000 tons per year, and achieving carbon dioxide emission reduction of 1 million to 2 million tons per year. Under the "dual carbon" scenario, by 2060, China's hydrogen production is expected to account for more than 30% of the world's total, bio-natural gas production will reach 30% of the world's total, and the proportion of green hydrogen and hydrogen-based fuels in China's final energy consumption will be close to 10%. Industry is the main driver of hydrogen demand growth, accounting for 40% of total hydrogen production by 2060. In addition, the transport sector accounts for about 25 per cent, and the other 20 per cent is converted into other fuels (mainly ammonia for shipping and synthetic kerosene for aviation). In the "dual carbon" target scenario, ammonia will be increasingly used as a low-carbon fuel for maritime transportation, and 67% of ammonia is expected to be used in the shipping industry by 2060. For the aviation industry, the use of hydrogen-derived synthetic kerosene will increase rapidly after 2030, and will meet China's total aviation fuel demand by 206014. Since the beginning of 2022, there has been a significant increase in hydrogen and ammonia integration projects. According to statistics, in 2022, there will be at least 20 projects related to hydrogen and ammonia integration, with a total investment of nearly 150 billion yuan, and an annual production capacity of more than 2.6 million tons of green ammonia.
Under this pathway, typical actions of the enterprise usually include:
Replace coal burning with biomass waste as fuelReplace diesel and kerosene with biomass, green ammonia, green methanol and other green hydrogen-derived synthetic fuels (e.g., SAF instead of jet fuel).Green hydrogen and biomass gas are used to replace traditional natural gas or coal gas as fuelSolar energy is used to heat a mixture of carbon dioxide and water vapor as fuel. 3. Decarbonization of raw materialsAt present, the decarbonization of raw materials such as metals and cement mainly relies on low-carbon production, and basically meets the demand for continuous recycling of scrap steel by 2050.
Metals (steel and aluminum), petrochemicals (e.g. plastics, fibers, rubber) and cement clinker all have high embodied energy consumption and carbon emissions. Through the circular economy model, it is possible to reduce the carbon emissions of processes and the embodied carbon footprint of raw materials in several industrial sectors. Increasing the proportion of renewable resources will improve the low-carbon level of basic raw material production. By increasing the proportion of scrap and aluminium scrap in steel and aluminium production, or reducing the clinker-cement ratio, energy consumption per unit of added value can be reduced by 32% between 2020 and 2030. For general manufacturing and commercial consumption, improving the recycling rate of packaging materials through circular economy will also significantly reduce the carbon footprint caused by end consumption. As China's industrialization continues, local renewable resource reserves will continue to accumulate. In the case of steel, for example, in order to achieve short-process electric furnace steelmaking in developed countries, a restructured scrap supply is required. In 2020, China can count about 2 scraps600 million tons, compared with China's current crude steel output of 1 billion tons, scrap resources are far from reaching the level that can support a high proportion of short-process steelmaking. The Metallurgical Industry Planning and Research Institute predicts that by 2050, the supply of scrap steel in the steel industry is expected to be 5000 million tons, at this time, the consumption of scrap steel in recycled steel production accounts for more than 80% of the total scrap supply, in order to basically meet the demand for continuous recycling of scrap steel.
New synthesis processes and recycling are the main decarbonization pathways for plastics.
Under the "double carbon" goal, the reuse value and potential of plastics will be enhanced. Before 2030, the release of the utilization potential of plastics mainly comes from the improvement of physical levels, while chemistry is expected to be applied on a larger scale after 2030. At present, BASF, Covestro, Dow and other leading companies have made a series of layouts in the field of plastic chemical recycling, and in China, PetroChina and Sinopec have also been paying close attention to related fields. During the "14th Five-Year Plan" period, PetroChina has comprehensively laid out relevant research, including the utilization technology of single plastic materials, the optimization technology of new waste plastics, etc., and Sinopec has also fully launched the development of complete sets of technologies and industrial applications, and at the same time started the research of relevant product standards. In addition, the synthesis of plastics and other materials based on carbon dioxide and green hydrogen on the raw material side can reduce the demand for fossil raw materials. Renewable energy to produce green hydrogen from water electrolysis will become the main hydrogen in China**.
China is leading the way in increasing electrolyzer capacity, with a cumulative installed capacity of nearly 220 MW in 2022 and 750 MW under construction, which is expected to come online this year. Under the net-zero transition scenario of BNEF, China's hydrogen production after 2040 will mainly rely on renewable electricity and nuclear electrolysis. Hydrogen production from water electrolysis from renewable energy will become the main hydrogen production in China, with an estimated production capacity of 97 million tonnes in 2050, meeting 90% of demand, and will consume 4,345TWh of electricity, accounting for about 25% of electricity demand. Under this pathway, typical actions of the enterprise usually include:
The first battery is used to produce electrode materials, and the first metal raw materials and ** non-metallic materials are used to achieve "closed-loop manufacturing".Packaged in a plant-based package, with plant-based dyes and with plant-based fibersBio-based materials instead of fossil-based raw materialsCapture CO is used as raw material to synthesize chemical raw materialsWe use recycled plastic raw materials such as PETSlag is used instead of clinker or raw mealGreen hydrogen or green electricity metal raw materials are usedGreen hydrogen is used as a feedstockRecycled raw materials are used for packagingUse of plant-based protein raw materials (The content of this article is an excerpt of the author's "2023 Report on Low-Carbon Transformation and High-quality Development of Chinese Enterprises" by SynTao and the author's personal views during the reading process. ）