methodological extension of geopolitical supply … · methodological extension of geopolitical...

METHODOLOGICAL EXTENSION OF GEOPOLITICAL SUPPLY RISK INDICATOR UNDER LCSA FRAMEWORK:

APPLICATION TO THE PETROCHEMICAL SUPPLY CHAIN OF PAN-BASED CARBON FIBERS

1

Guido Sonnemann

Professor, University of Bordeaux

Head, The Life Cycle Group CyViInstitute of Molecular Sciences ISM

2

Outline

Motivation : LCSA and SSCM for Criticality

Geopolitical related supply risk

Methodological extension

Case Study: Petrochemical SC for Carbon Fibers

Results

Summary

Authors: C. Helbig1 , E.D. Gemechu2, S.B. Young³,A. Thorenz1, A. Tuma1,

G. Sonnemann2

1: Resource Lab, University of Augsburg, Germany2: ISM-CyVi, University of Bordeaux, France3: SEED, University of Waterloo, Canada

3

The concept of criticality

Increased resource

demand

Need of special

materials for clean

technologies

Price fluctuation

Supply security issue

↓

Criticality

Graedel et al., 2012

Motivation: LCSA and SSCM for Criticality

Geological,

Technological,

Economic

Considerations

Social & Regulatory

Considerations

Geopolitical

Considerations

Importance

Substitutability

Susceptibility

Damage to Human

Health

Damage to Ecosystem

4

Criticality Assessment

Importance

Susceptibility

Geopolitically

Related Availability

Geological Supply

Risk Implications

Substitution

Vulnerability to

Supply Restriction

Environmental

Dimension

Damage to

Human Health

Damage to

Ecosystem Quality

Inventory Midpoints Endpoints Criticality

Economic

DimensionGeopolitical Supply

Risk Implications

Social Implications Social Circumstances

Environmental

Implications

(multiple midpoints)

Geological Resource

Depletion

LCI

LCSA

Social

Dimension

Gemechu et al., 2015Sonnemann et al., 2015

Motivation: LCSA and SSCM for Criticality

Framework

5

Gemechu et al., 2015

Geopolitical related supply risk

• Sk is the share of country k in the global production

(mining or refining) of the commodity c.

• gk is the political instability indicator of country k.

• fi,k is the import share of country k in the supply-

chain of country i.

Integrating geopolitical supply risk in LSCA

6

Requirements towards Geopolitical Supply Risks Indicator

Market concentration (Herfindahl-Hirschman-Index of production)

Trading partners (import shares)

Political stability of partner countries (Worldwide Governance Indicators)

Domestic production as a “safe harbor”

Single supply level Geopolitical Supply Risk factor

𝐺𝑃𝑆𝑅𝑐 =

𝑖

𝑝𝑖2

σ𝑗 𝑝𝑗2 ∗

𝑖

𝑔𝑖 ∗𝑓𝑖𝑐

σ𝑗 𝑓𝑗𝑐 + 𝑝𝑐


Domestic

production

Trade

patternsPolitical

instability

(0 to 1 scale)

Production

concentration

Helbig et al. (2016)

7


Multilevel Supply Chain

B

B

B

B

A

A

A

A

P

1st Level

Geopolitical Supply Risk

from intermediate A

in country FRA

FRA

GER

USA

CHN

Reactant Intermediate Product

Domestic


8


Multilevel Supply Chain

B

B

B

B

A

A

A

A

P

2nd level


from reactant B

≙ aggregation of 1st level


in countries FRA+GER+USA+CHN

1st level


from intermediate A

in country FRA

FRA

GER

USA

CHN

Reactant Intermediate Product

Domestic


9


Carbon Fibers as future technology materials

high tensile strength, low density, high moduli

aerospace, automotive, industrial, sporting goods

production doubled within a decade (16.6 Mt in 1999 to 34.2 Mt in 2010)

Main supply chain is polyacrylonitrile (PAN) based

Petroleum (crude)

Propene AcrylonitrilePAN

(Precursor)Carbon Fiber

Refinery processes

(Steam cracking,

Propane)SOHIO-Process

(+NH3)

Radical polymerization

Prestabilization,

Carbonization,

Graphitization

Expert talks (2015), Park (2015), Buchmeiser et al. (2012)

System Border

10


Data Country-specific

production

Political Stability Trade Data

Petroleum (crude) BP statistical

handbook

WGI-PV UN comtrade

HS 27 09 00

Propene (C3H6) company reports WGI-PV UN comtrade

HS 29 01 22

Acrylonitrile (AN) PCI report WGI-PV UN comtrade

HS 29 26 10

Petroleum (crude)

Propene

(C3H6)

Acrylonitrile

(AN)

Polyacrylonitrile(Precursor)

Oil imports C3H6 imports AN imports


11

Results

Country concentrations for

production

Petroleum HHI 630

Propene HHI 999

Acrylonitrile HHI 1321

Wide range of countries covered

54 countries with all six risk

values

Highest single score Nigeria AN

(0.135)

Lowest scores for full domestic

production (0)

Low GTR High GTRHelbig et al. (2016)

12

Results

Peru’s case

AN imports mainly

from USA

high GTR for AN

USA is a major

propene producing

very low GTR

for C3H6-AN

USA both produces

and imports

crude petroleum,

some of that from

instable countries

slightly higher GTR

for Petroleum-C3H6-ANAcrylonitrilePropene

Peru

Mexico 9%

Canada 2%

USA 98%

USA 91%

Brazil 77%

RoAsia 13%

PANPetroleum

USA 57%

Nigeria 8%

Others Others

Brazil 85%

Canada 12%

Saudi Arabia

8%

Others


13

Results

Japan’s case

Strong chemical

industry provides

mainly domestic

production for

propene and

acrylonitrile

very low GPSR for

AN and C3H6-AN

However, Japan relies

on oil imports from

the Middle East states

high GPSR for

Petroleum-C3H6-AN


AcrylonitrilePropene

Japan

South Korea

1%

Japan

100%

Japan

99%

PANPetroleum

Saudi Arabia

32%

United Arab

Emirates 22%

Qatar 8%

Others

14

Summary

Geopolitical Supply Risks as Sustainability Indicator for LCSA

Method including three data sets

National production, trade patterns, political stability

PAN supply chain (precursor material for carbon fibers)

Petroleum Propene Acrylonitrile

Different risk patterns for resource-rich or industrialized countries

Identify risk mitigation strategies for countries and companies

Results to be compared with environmental LCA results

Characterization factor for LCIA to be developed

15

Related publications

Based on:

Gemechu ED, Helbig C, Sonnemann G, Thorenz A and Tuma A, Journal

of Industrial Ecology (2016). 20: 154-165

Gemechu, ED, Sonnemann G, Young SB, Int J Life Cycle Assess (2015).

doi:10.1007/s11367-015-0917-4

Sonnemann G, Gemechu ED, Adibi N, De Bruille V and Bulle C, Journal

of Cleaner Production (2015). 94: 20-34

Journal of Cleaner Production

Volume 137, 20 November 2016, Pages 1170–1178

Extending the geopolitical supply risk indicator: Application of

life cycle sustainability assessment to the petrochemical supply

chain of polyacrylonitrile-based carbon fibers

Christoph Helbiga, Eskinder D. Gemechub, Baptiste Pillainb, Steven B. Youngc, Andrea Thorenza, Axel

Tumaa, Guido Sonnemannb, ,

a Resource Lab, University of Augsburg, Universitaetsstr. 16, 86159, Augsburg, Germanyb The Life Cycle Group, Institute of Molecular Sciences, Université de Bordeaux, Bordeaux, Francec School of Environment, Enterprise and Development (SEED), University of Waterloo, Waterloo, Canada

Received 7 April 2016, Revised 6 July 2016, Accepted 31 July 2016, Available online 2 August 2016

Extending the geopolitical supply risk indicator: Application of life... http://www.sciencedirect.com/science/article/pii/S0959652616311192

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Guido [email protected]

The Life Cycle Group CyViInstitute of Molecular Sciences ISM

University of Bordeaux – UMR 5255 CNRS351 Cours de la libération – Bât A12

33405 TALENCE cedex – France

www.ism.u-bordeaux.fr

Thank you for your attention!

methodological extension of geopolitical supply … · methodological extension of geopolitical...

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