Managing the multi-million megawatts

Energy consumption is a key challenge for BASF. The company is working to manage its own energy use and to develop energy saving products, reports Bea Perks

BASF, the world’s biggest chemicals company in terms of sales, faces unprecedented challenges in energy management. The power requirements of its headquarters in Ludwigshafen, Germany, amounted to 6.2 million megawatt hours (MWh) in 2003 - enough to supply two million households over the same period.

’Energy is essential for chemical products, accounting for 10-15 per cent of manufacturing costs on average,’ says Horst-Heinrich Bieling, the company’s energy director. This can rise to 50 per cent of manufacturing costs in the case of electrolysis, he adds, underlining the company’s urgent need for efficient energy management.

BASF posted sales of € 33.4 billion (?23 billion) in 2003, with products ranging from natural gas, oil, petrochemicals and innovative intermediates, to value-added chemicals, plastics and agricultural products. Just a few feedstocks - including natural gas, crude oil, ores and minerals - are converted at BASF into about 200 major basic products and intermediates. These chemical ’evergreens’, reports the company, form the basis of the 8000 or so products it sells.

BASF’s ’verbund’ philosophy focuses on energy conservation. It involves a strict integrated system of production originally developed in the 19th century at the company’s Ludwigshafen site. Separate manufacturing plants on one site are linked together, with the intention that one plant’s by-product or waste serves as the raw material for another. About 37 000 of the company’s 87 000-strong global workforce are employed on the 7km² Ludwigshafen site, which supports 250 interlinked plants.

Alongside the verbund philosophy, BASF continues to look for ways to cut production costs - notably energy costs. The company produces ’a mere 15 per cent’ of the electricity needs of the Ludwigshafen site, says Bieling. But this is to change. Generating energy on site avoids the losses incurred by overhead power lines, he says, which is why the company is setting up a power plant there.

The gas-fired plant, a combined heat and power plant (CHP), will generate relatively cheap electricity, says Bieling, costing between € 400 and € 450 per kilowatt (kW). Electricity generated by coal-fired power stations, by comparison, costs up to twice that. The new plant will reduce the need to buy in electricity, and is designed to produce 650 tonnes of process steam per hour alongside 450MW of electricity.

The demand for steam as a heat source at Ludwigshafen is massive, with 180km of pipes transporting enough steam around the site to heat a further 500 000 homes each year. From 2006, the amount of steam generated at the site will increase from 80 to 83 per cent of its requirements, and the electricity supply from 15 to 63 per cent.

Improving energy efficiency is good for BASF, good for the environment, and good for publicity and marketing. But there are limits to how green the company is prepared to go. Wind power, for instance, is out of the question. The company looks at innovative power generating systems carefully, says Bieling, but will always need mature technologies to ensure a stable, reliable energy supply.

’To cover BASF’s power requirements in Ludwigshafen using wind energy, we would need to erect 240 wind turbines of the newest 3MW type,’ says Bieling. ’We would then be able to secure the supply for the site for 58 days per year.so this is impossible for us.’

BASF also develops technologies aimed at reducing its customers’ energy needs. Among these are innovative plastics providing low-weight components for use in the automobile industry (which have been linked to reduced fuel consumption) and a range of insulating materials to reduce heating and/or cooling costs.

Many of the company’s energy-saving novelties have been integrated into an on-site housing scheme. A handful of Ludwigshafen staff has the opportunity to live in either the ’3-litre house’ or, coming soon, the ’1-litre house’ designed and built by BASF. These houses, claim the company, require only three litres, or even one litre, of heating oil per m² of floor area each year. The estimated annual heating bill for a three bedroom 1-litre house, say the building’s developers, would be about € 50 a year.

Dramatically reduced heating bills, however, do not compensate for the initial building costs. These have not been released, but the company says the point of these buildings is to hint at what could one day be possible. The houses are not for sale.

The 1-litre house is a precisely engineered sealed unit. Window opening is strictly forbidden outside the summer months, but the rooms aren’t stuffy. They are served by a ventilation system that doubles as an air conditioner and heater. You won’t find any radiators in here, said a company spokesman, ignoring the one on display in the kitchen during a guided tour of the facility. ’It’s for visitors,’ explained the guide, incongruously. To be fair, builders were still adding finishing touches to the house in late 2004.

One innovation underlying construction of the 1-litre and 3-litre houses is latent heat storage. Effective insulation keeps out the cold, but it can also lock in unwanted heat when the weather gets warmer. Latent heat storage smoothes out heat fluctuations, say its developers.

BASF polymer scientists have encapsulated droplets of paraffin wax 2-20?m in diameter in hard plastic beads. The microencapsulated wax melts as it heats up and sets as it cools. Just as ice cools a drink when it melts, so melting wax cools its surroundings. The wax capsules can be mixed with plaster (10-25 per cent capsules in the mix), and such a mixture lines the rooms of the energy saving houses. Similarly, the external walls of the houses are insulated with BASF’s Neopor, a polystyrene-based board containing microscopically small flakes of graphite that reflect heat and make the boards, according to BASF, virtually impermeable to thermal radiation.

Unlike Neopor, the latent heat technology remains a prototype and, according to technical services manager Marco Schmidt, ’faces the same conservative barriers as insulation used to face’. Nevertheless, Schmidt says the product has no current competitors, and there are plans for its commercialisation. It took five years to develop the technology at a cost of € 2.5 million. BASF hopes to produce 500 tonnes of the microencapsulated wax in the next five to 10 years, by which point the production plant will need to be expanded.

The investment in these technologies raises alarm bells with environmentalists. Money and energy might be saved by the residents of the 1- and 3-litre houses, but both commodities will have been lavished on the construction of the buildings. Environmental lobby group Greenpeace views the buildings and BASF’s other energy saving schemes with some suspicion, but is focusing its campaigning efforts on an investigation into the company’s position on the EU chemicals policy, Reach (registration, evaluation and authorisation of chemicals: ’the implementation of Reach in its current form will be impossible,’ concludes a BASF report on the subject).

BASF is well aware of its responsibilities, say company executives, but current renewable energy technologies could never supply all the company’s needs. ’We must treat fossil energy sources as responsibly as possible,’ says Stefan Marcinowski, member of BASF’s board of executive directors and research executive director. ’Here, the chemical industry is making an important contribution in two ways: on the one hand it is continuing to restrict its own consumption of fossil fuels, and on the other hand its products play a significant role in saving energy.’

Oil remains the primary source of raw materials for the chemical industry, and gas is the main source of energy. BASF reduces its dependency on the price of crude oil by conducting its own oil and gas activities via its subsidiary Wintershall. The company explores for and produces oil and gas in Europe, North Africa, South America as well as Russia and the Caspian region. With an annual production of about 104 million barrels of oil, it is Germany’s largest company operating in this sector.

Gas accounts for about 70 per cent of BASF’s primary energy needs for generating electricity and steam in its CHP plants. The plants have a fuel efficiency of 85 per cent and lie, says Marcinowski, at the forefront of energy conversion methods for use on an industrial scale. BASF currently operates nine CHP plants worldwide, and a further three are under construction.

CHP plants generate the necessary steam and electricity at nearly all BASF’s major production sites worldwide, says energy director Bieling. ’In the chemical industry the focus is on cogeneration, as this sector requires process steam and electricity,’ he says. ’We are monitoring and analysing innovations in the area of steam and electricity production to see to what extent they can be used for industrial applications...efficiency and economic viability are crucial.’