An Introduction to the Chemistry Using Industries

1. An Introduction to the Chemistry Using Industries

2. Learning Outcomes • To highlight how chemistry impacts on our everyday lives • To highlight the economic position of the U.K.’s chemistry using industries both at home, in the E.U and within the global economy • To highlight the current and future challenges which face the chemistry using industries • To show where chemistry research is making a difference to solve some of the global challenges which face this industry, contributing to the “green economy”

3. Why is Chemistry Important? Chemistry is an “enabling science” i.e. chemistry facilitates other sciences, research and manufacturing The chemicals industry is at the heart of manufacturing It converts raw materials (e.g. oil and gas) into a host of products and resources for use by both industrial and household consumers

4. Why is Chemistry Important? Chemistry impacts on our everyday lives through: • Soaps, shampoos and detergents to keep us clean • Disinfectants and pharmaceuticals to safeguard health • Additives to foods to keep them fresher longer • Paints to protect and extend the life of metal and timber • Insulation materials to save energy in buildings • The fuel we put in our cars Chemistry is all around us and is involved in everything we need, do and interact with in our everyday lives!

5. The History of the U.K. Chemistry Using Industries The U.K. chemicals industry grew up using locally occurring resources such as salt, coal, limestone, vegetable matter and animal fats Today it is part of a global industry primarily using natural gas and oil fractions such as naphtha as its dominant raw materials

6. The U.K. Chemical Economy 4% - Glass, ceramics, etc. 8% - Rubber and plastic • Chemicals and pharmaceuticals represent 12% of total U.K. manufacturing output, equivalent to 1.5% of GDP • Everyday the chemicals industry contributes £70 million to the U.K. economy 15% - Food, beverages, etc. 8% - Mechanical Engineering 10% - Electrical and optical 12% - Transport equipment 11% - Metals 4% - Paper and printing 11% - Other 12% - Chemicals

7. The chemicals industry manufactures a diverse range of materials and products

8. The chemicals industry in the U.K. invests over £5 billion per year in R&D – one third of the total U.K. R&D spend • This investment in innovation drives sector growth • The U.K. (and E.U.) chemicals industry has shown continued output growth and has out performed other manufacturing businesses, especially in the current economic climate

9. The chemicals industry is the U.K.’s no. 1 manufacturing exporter • The U.K. chemicals industry has maintained a surplus in trade • Every working day the U.K.’s chemicals industry adds £30 million to our country’s balance of trade. In the same period the rest of manufacturing achieved a £300 million daily loss!

10. The jobs of 600,000 people in the U.K. depend upon the chemicals industry – these workers are highly skilled and earn on average 40% more than employees in other areas of manufacturing These facts demonstrate that the chemicals industry is at the heart of the U.K.’s economy

11. The Global Chemical Economy • China was the biggest producer of chemicals in 2010 • The U.K. made sales of approximately € 45 billion in 2010

12. Between 2000 – 2010, Asia and particularly China have dominated world chemicals sales taking over from the E.U. and North America • During this period, total global chemicals sales have risen by 60%

13. Asia’s dominance in the chemicals market is shown by the output of chemicals produced over the last 5 years • Note that all regions showed negative chemical production growth for 2008/9, but are recovering at present

14. This trend can be explained by the significant investment in the chemicals industry that China has received in the last 10 years

15. However the E.U. has continued to invest in it’s chemicals industry with the sector receiving the second highest manufacturing investment in 2007

16. The U.K. contributed 9% of the total E.U. chemicals sales in 2010 • The total chemicals market value in the E.U. was € 491 billion • These sales cover a range of products, with 75% of the E.U. market made up of petrochemicals, polymers and specialities

17. The E.U. dominates the world chemicals export market • The majority of these exports are to other E.U. countries

18. Other important E.U. chemical trade partners are North America and Asia (inc. China and Japan)

19. Where does this leave the U.K. in the Global Market? • Since the chemistry using industries are one of the largest manufacturing sectors in the U.K., it is positioned at the heart of the U.K.’s economy • Asia and China are now dominating the global chemicals market, lead by heavy investment over the last 10 years • The chemicals market is still very strong in the U.K. • This is lead by strong chemicals exports mostly to other E.U. nations, North America and Asia

20. Current Challenges for theChemistry Using Industries Chemistry using industries convert energy & raw materials into useful products which impact upon our everyday lives Energy • The future price and availability of energy resources is a key issue • The chemicals industry is one of the most energy intensive sectors • It consumes 22% of U.K.’s total industrial use of energy at a cost of £4 billion per year • It can represent up to 30% of a businesses total costs

21. Supply of Raw Materials • The future price and availability of the raw materials used in the manufacturing processes (i.e. gas and oil) is also a key issue • Oil and gas supplies are beginning to run low • Global competition through the new petrochemical capacity in the Middle East threatens the supply and availability of these raw materials at an affordable price • In addition, the supply of other resources (e.g. metals) is also drying up • This all impacts the future sustainability of the chemistry using industries

22. Climate change • Being a highly energy intensive industry, the chemicals industry is in part contributing to the emission of greenhouse gases • This contribution is either direct through burning of raw materials (e.g. oil and gas) or indirect through the use of energy supply and transport of raw materials around the world • However, the industry was an ‘early starter’ in setting aggressive targets for efficiency and reduction of harmful emissions • It is also a provider of solutions to this problem and is investing into R&D for many new products and processes aimed at cutting greenhouse gas emissions

23. Waste management and environmental impact • For environmental and economic reasons industry strives for efficiency to minimise waste production and emissions into the environment i.e. the less waste you produce the less it costs get rid of/store ….There are many other issues and challenges facing the chemicals industry over the coming years – these are just a few examples…. These challenges offer opportunities for innovationto address and solve the key issues. Since chemistry is an enabling science, it is well placed to make a direct impact through investment, innovation and R&D

24. Where is Chemistry Making a Difference? Saving energy and reducing environmental impact • There has been a strong focus on maximising cost effective use of energy resulting in an improved energy efficiency of 35% from 1990 – 2006 (27% for E.U. from 1990 – 2009) • The E.U. is a long way ahead of the U.S.A. on this issue

25. Reduced emission of greenhouse gases • Being a highly energy intensive industry, the chemicals industry is contributing to the emission of greenhouse gases • However, the industry was an ‘early starter’ in setting aggressive targets for efficiency and reduction of harmful emissions • Greenhouse gas emissions have fallen 49% since 1990

26. Can chemistry offer further solutions to these problems? • Chemistry is a provider of solutions • Since chemistry is an ‘enabling science’ it allows for the development of new processes and technologies to address these issues through R&D • The top products which achieve carbon savings are: • Improved building insulation materials • More efficient lighting • Lightweight yet strong plastics for more fuel efficient modes of transport • Development of low-temperature detergents to save energy • Improved fuel and engine efficiency….etc….

27. It has been estimated that for each 1 unit of greenhouse gas which the chemistry using industry emits in production processes, the resulting new products save 2-3 units of greenhouse gas emission This positions the chemistry using industries at the heart of the ‘green economy’

28. Conclusions • Chemistry is an enabling science – it is all around us and is involved in everything we need, do and interact with in our everyday lives • The chemistry using industries are one of the largest manufacturing sectors in the U.K. making a varied range of products • This industry is positioned at the heart of the U.K.’s manufacturing economy • Asia and China are now dominating the global chemicals market, but the chemicals market is still very strong in the U.K. lead by strong exports • There are many challenges which face the chemistry using industries, however this industry is making a difference and is key to the U.K.’s ‘Green Economy’

29. References & Further Reading Chemical Industries Association • www.cia.org.uk • Chemical and Pharmaceutical Businesses in the UK, Our Campaigns, Sept. 2010 • Annual Review, 2009 CEFIC – The European Chemical Industry Council • www.cefic.org • Facts and Figures 2011 – The European chemical industry in a worldwide perspective

30. Authors Dr. Trevor Farren, Dr. Simon Mosey, Dr. William Drewe & Prof. Barry Stickings Organisation School of Chemistry, University of Nottingham, U.K. Supported by: