Decarbonizing oil refineries is essential — even in an electrified future
Electrifying Transport Alone Won’t Cut It
The global electric vehicle (EV) market is growing rapidly, accelerated in the United States by a combination of incentives like the Inflation Reduction Act’s $7,500 EV tax credit and international policy decisions like the European Union’s planned phaseout of gas-powered cars by 2035. Global oil demand may soon peak, but we still have a long way to go in reducing oil use. Passenger vehicles — the easiest segment to electrify — only account for a quarter of total oil demand. Even if we succeed in backing oil out of most transport, including trucking, aviation, and shipping, net-zero scenarios show petrochemical demand continuing to grow. Many petrochemical products are essential for daily life, and a low-carbon energy transition will see growth in new uses.
Taking immediate action to cut emissions from oil refineries and petrochemical plants holds the potential for major climate wins, with a 1 percent reduction equivalent to taking 3 million gasoline-powered cars off the road. RMI’s latest report, Oil Refining Emissions Cut Points, outlines a full value chain approach to decarbonize an industry whose products are expected to play a role in the global economy for the foreseeable future.
Tracking Oil Refining’s Complicated Climate Footprint
The scale of the decarbonization challenge often correlates to the potential size of the win in the global race to cut greenhouse gas (GHG) emissions. Oil refining is a prime example where swift action to implement decarbonization measures could significantly accelerate progress toward the 50 percent cut in global emissions required by 2030 to avoid climate disaster. The refining and petrochemicals sector is a top emitter, with operational (Scope 1 and 2) emissions totaling 3 gigatons (Gt) of CO2 equivalent (CO2e) in 2019, equivalent to almost the entire emissions of the European Union that year. Combined with their products’ end-use, refining and petrochemical production can influence emissions nearly as much as global coal combustion.
Decarbonizing this sector is crucial for long-term climate stability but must be done in a manner that allows refineries to continue meeting near-term societal demand. Petrochemical products are currently completely interwoven with daily life, think clothing, plastic, cosmetics, and even toothpaste. And then there is the complexity of operating requirements to unfurl. The refineries in a single region can vary wildly in configuration, with complex refineries usually generating higher emissions. Sending crude oil to a poorly matched refinery by complexity or unit design can also create excess emissions. Whichever way we approach this challenge, it is clear that cutting refining emissions will require extensive planning and solid implementation.
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