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ResearchResearch04-04-2025

Defossilising the petrochemical industry: what a switch from fossil to renewable feedstocks may imply for current and future value chains

Madeleine LuckMadeleine Luck
Leonardo BuizzaLeonardo Buizza
François de Rochette

The petrochemical industry is the largest energy consumer and is the third highest emitter of greenhouse gases. Already a highly optimised industry, this is a ‘hard to abate’ sector, for which complete decarbonisation solutions are neither mature nor straightforward.

But decarbonising this sector poses real challenges: the potential solutions are still undeveloped and are complex. What’s more, this industry is already highly optimised for efficiency, which means we can expect resistance to change.

While most chemicals are almost exclusively derived from fossil fuels, the manufacture of petrochemicals currently represents a small proportion of global demand for petroleum and gas (at 18% and 10%, respectively).

But as the energy transition advances, and as the demand for fossil fuels declines, oil companies are expected to turn their sights on maximising the production of chemicals instead as a route to maintain their revenue.

Ways to decarbonise the chemical industry, such as improved efficiency, electrification or carbon capture and storage, may help to partially reduce its climate impacts. But as carbon will remain an integral component – or ‘feedstock’ – of these chemicals, it is now important to defossilise their production.  This paper looks at how the sector could source carbon from the atmosphere or from biomass materials instead of unearthing new sources of oil or gas from the ground.  

The paper focusses on the six carbon-containing primary chemicals: methanol (MeOH), light olefins (ethene, propene) and BTX aromatics (benzene, toluene, xylenes).

Such a shift to renewable sources of carbon presents challenges: it will require a substantial re-tooling of the chemical industry. Processes will need to be tailored to the composition of biogenic molecules, to different storage and transport requirements, and be able to adapt to seasonal and daily variations.

Both bio-based and CO2-based pathways are resource-intensive, and demand would be difficult to meet sustainably. But this paper suggests that a combination of the two, coupled with demand reduction strategies, is likely to increase the overall feasibility and sustainability of chemical defossilisation.

The paper also calls for a focus on developing the chemicals with the greatest potential to become catalysers for defossilising the industry (such as polyurethane) and asks if this could offer a powerful way to boost progress.

Download the Defossilising the petrochemical industry report