CEFC invests to abate nitrous oxide emissions in manufacturing

CEFC

Image credit: CEFC.

CEFC is investing $25 million to upgrade Orica’s processing plants used to produce ammonium nitrate, by deploying technology that has been proven to abate nitrous oxide emissions in an Australian industry first. 

It is the first major direct investment by the CEFC in the manufacturing sector and represents one of the largest single abatement projects financed by the CEFC. It will eliminate over 567,000 tonnes per annum of CO2 emissions through the abatement of nitrous oxide, a greenhouse gas that is 265 times more potent than carbon dioxide. 

Tertiary nitrous oxide abatement technology will be installed in three nitric acid plants at Orica’s Kooragang Island facility in NSW from 2022 – the first time the technology has been used in Australia. The technology is highlighted in the federal government’s Technology Investment Roadmap discussion paper. 

“The global warming potential of nitrous oxide emissions are much more potent than carbon dioxide emissions. An investment which curtails these emissions to this extent can have a significant impact on our national emissions,” CEFC CEO Ian Learmonth said. 

“Working with a leading manufacturer such as Orica enables the CEFC to help spearhead emissions reduction measures across a sector that has proven difficult to abate. 

“This investment will also provide valuable insights into how sustainability can complement profitability. The project is commercially underpinned by carbon credit contracts with the Australian government, further catalysing investment in sustainability outcomes.” 

The CEFC has been instrumental in facilitating the Kooragang Island Decarbonisation Project funding, according to Orica managing director and chief executive officer, Sanjeev Gandhi. 

“Having effective emissions reduction technology available is important, but it’s the support and financing from our partners, including the CEFC, that’s critical in allowing us to effectively and efficiently implement this technology across our operations,” Gandhi said. 

“This project marks an important step towards our medium-term target and long-term net zero ambition, and we welcome the CEFC’s support to facilitate the project.” 

Orica is an Australian manufacturer and the world’s largest provider of commercial explosives and blasting systems to the mining and infrastructure sectors. It supports the Paris Climate Agreement goals and has committed to reducing scope 1 and scope 2 emissions by at least 40 per cent by 2030 (from 2019 levels). It has also announced its ambition to achieve net zero emissions by 2050, which covers scope 1 and 2 greenhouse gas emissions and its most material scope 3 GHG emission sources. The Kooragang Island Decarbonisation Project is an important initiative in Orica realising its 2030 emissions reduction target. 

In April, Orica was awarded a contract by the Clean Energy Regulator (CER) to purchase up to about 3.4 million Australian Carbon Credit Units (ACCUs) for a fixed price over seven years. 

Orica is also a founding partner of the Australian Industry Energy Transition Initiative, which brings together industry and finance companies working towards emissions reduction in hard-to-abate supply chains. Orica is confident that the sustainability measures at the Kooragang Island facility will serve as a demonstration case for the opportunities to reduce nitrous oxide emissions in the manufacturing industry. 

The manufacturing sector is responsible for 11 per cent of Australia’s carbon emissions. Globally, industry accounts for 23 per cent of greenhouse gas emissions, with emissions from the sector rising nearly 70 per cent between 1990 and 2014. 

“While innovation and cost reduction have helped drive the decarbonisation of sectors like property, transport and energy, the pathway to lower emissions in manufacturing has proved more challenging,” CEFC executive director Wind Energy and Manufacturing Andrew Gardner said. 

“Hurdles including a lack of technological solutions, financial incentives and customer willingness to pay a premium for green products have slowed meaningful progress. 

“As new advances come to market, manufacturers who are alert to the need to reduce their carbon footprint can take advantage of such technological developments. Orica’s foresight in adopting this innovative equipment and processes to help meet their sustainability goals will lead the way to a much cleaner manufacturing sector.”