Promotion of Low-Carbon Economy through Efficiency Analysis: A Case Study of a Petrochemical Plant

Over the past few decades, industrial development has caused a dramatic increment in greenhouse gas (GHG) emissions, as a leading cause of climate change. Modifying the industrial plants' environmental performance is the main pillar of improving efficiency that can reduce the waste of resources and make achieving lower-cost global emission reduction targets of the Kyoto protocol's clean development mechanism (CDM) possible. Considering the essentiality of knowledge-based research in increasing the awareness of policymakers by providing better access to accurate and reliable information, an analytical survey on efficiency in oil, gas, and petrochemical industries has been conducted by applying data envelopment analysis (DEA). For this purpose, comprehensive evaluations were elaborated on monthly data for Zagros Petrochemical Company (ZPC), from 2011 to 2017, as a case study. The CO(2)equivalent emissions of fuel combustion in the petrochemical plant's furnaces were calculated according to standard guidelines for calculation and reporting GHG to be used for environmental efficiency estimations. The data envelopment analysis program (DEAP) was applied to estimate efficiencies through the data envelopment analysis-materials balance principle (DEA-MBP) approach, which is a robust approach employed in this study to provide practical solutions to both economic and environmental concerns. Since DEA-MBP is based on the materials balance principle and incorporates by-products, it can reliably explain the best relationship between product quantities, carbon emissions, and external costs. The outcomes revealed that the lower heating value of natural gas and CO(2)emission factor and CO(2)equivalent emissions were 32.87 x 10(-3) GJ/Sm-3, 55.73 x 10(-3) ton/GJ, and 2,376,449 tons, respectively. DEAP analysis also exhibited the technical, environmental, and environmental allocative efficiency scores as 0.976, 0.861, and 0.881, respectively, and estimated distances to efficiency frontiers were 0.024, 0.139, and 0.119, respectively. Ultimately, the carbon prices were found to be about US$83,175,715 and US$71,531,110 under two scenarios (A and B).

Automated summary

Industrial development has led to a significant increase in greenhouse gas emissions, with improving plant environmental performance being key to efficiency. Data envelopment analysis has been applied in the petrochemical industry, revealing technical, environmental, and environmental allocative efficiency.