Chemicals and plastics manufacturing


The chemicals and plastics sub-sector accounts for almost 18% of energy use within the Australian manufacturing sector. 

A higher level of energy efficiency can improve profitability and market competitiveness by:

  • capturing and reusing heat generated in the chemicals and plastic production process
  • equipment upgrades
  • process innovation.

Existing equipment

Multiple technologies are used in the chemicals and plastics manufacturing sector, including:

Many plants have equipment that is used sub-optimally or is left on when not in use.

Analysing energy use in terms of throughput allows plants to determine if energy use per unit produced (for example, kWh per tonne) is broadly consistent during the day, week or month. This process can help identify areas for improved energy performance.

The extensive use of motor systems in the chemicals sector means they provide excellent opportunities for energy savings. The use of variable speed drives can in some cases result in up to 50% energy savings with a 3 year payback.

Optimising the use of boilers, HVAC and other technical systems, coupled with best practice motor management, can yield energy savings for little cost.

Operating temperatures and pressures

The percentage yield and rate of chemical reactions is highly dependent on temperature and pressure. Energy savings can be found by reviewing optimal temperatures and pressures for specific chemical processes.

Ongoing innovations in catalysts can lower the activation energy barrier for chemical reactions. This reduces the temperatures and pressures required.

Ensure chemical distillation is being carried out under the best conditions and that products are not being over-purified. To do this, you can:

  • decrease processing temperature
  • optimise cooling temperature
  • set thermostats to an appropriate temperature.

A 1ºC drop in average space temperature can cut fuel use by about 8%. Be mindful of what happens when storing polymer granules at low temperatures. Condensation can form when the granules are moved into a warmer factory space. This can result in greater drying requirements before processing.

Monitor and adjust the pressure of equipment. For example, a boiler feedwater pump may produce higher pressure than is needed to supply water to the boiler. Slowing the pump down requires no capital investment and will reduce steam use while still having adequate supply pressure for boiler feedwater.

Steam generation and distillation

One of the most common processes in industrial chemical plants is distillation to separate chemical mixtures. This requires large quantities of steam to be generated. The production and distribution of steam can cause substantial heat loss, requiring more energy to maintain boiler temperatures.

Most of the external energy and heat loss in distillation units occurs in condensers which are usually cooled by water or air. Inefficient distillation and steam generation systems can also increase air-conditioning cooling loads.

Boiler systems should have effective steam traps and condensate return. This saves water and helps conserve the heat of water in the boiler due to returned condensate being hotter than feedwater and not requiring treatment.

Heat losses can be further minimised by:

  • thermal insulation of boiler valves, pipes, taps and storage units
  • replacement of defective steam traps
  • cooling condensers with other process streams
  • using waste heat for steam production (see the section below on heat and power recovery).

Another approach is to use alternative separation technologies such as reactive distillation and membrane separation.

To read more, see the Process heat and steam guide.

Heat and power recovery

Many processes used in the chemicals industry require extreme temperatures and often need rapid changes in temperature. Heat and power recovery technologies can offer significant energy efficiency improvement.

Innovations in heat exchangers have enabled heat recovery from very high temperatures and pressures, and chemically hazardous environments. This has allowed more effective heat capture for use in processes such as the manufacture of nitric acid or caustic soda. 

Co-generation has potential for significant energy savings in the chemicals sector. Studies in the US have found that combined heat and power systems, such as co-generation, can enable a 45% reduction in greenhouse gas emissions.

To read more, see the Waste heat recovery guide.

Equipment upgrades

Replacing equipment provides an opportunity for greater energy efficiency, along with redesigning outdated production processes and ensuring new equipment is correctly sized.

Steam cracking for olefin production is the most energy-consuming process in the chemicals industry. Significant energy reductions are possible through improved furnace and cracking tube materials. The remainder of energy use is for separation of the ethylene product, typically by low-temperature distillation and compression. An energy saving of up to 15% can be achieved by improved separation and compression techniques, such as absorption technologies.

Plastic product manufacturers can achieve savings of more than 25% by upgrading equipment such as extrusion and moulding machines, heating elements and ovens. Newer moulding machines require significantly less steam than other technologies.

Replacing factory high bay lighting with LEDs can also bring substantial savings.

Advanced process control

Chemical and plastic process plants are complex and present an opportunity to minimise energy usage and maximise energy recovery through advanced process control (APC). APC is a systematic approach to enable dynamic optimisation of plant operations.

APC involves installing hardware and software for capturing process operating data, analysing trends and developing strategies to optimise control of all relevant variables.

To read more, see the Industry 4.0 guide.

Solar thermal technologies

Solar water heating can save energy by preheating boiler feedwater in steam boilers for a wide range of chemical and plastic manufacturing operations. Boiler feed can be heated in solar panels up to 80ºC before going to the boiler.

Larger combined solar thermal generators can concentrate enough energy to produce steam and electricity.

Circular economy and waste management

The plastics industry is at the centre of waste management concerns and will play a pivotal role in the transition towards a circular economy. Companies are recognising the shift in consumer preferences towards environmentally responsible products and packaging.

The concept of the circular economy reimagines waste as a valuable resource, rather than just as an impact to be minimised. Adopting a circular economy approach can reduce energy use and emissions and improve business bottom line.

The CSIRO has developed a circular economy roadmap for the plastics, tyres, glass and paper industries.


Key areas of innovation that can improve energy efficiency in these industries include:

  • developing more efficient forms of chemical separation and processing, including improvements in catalysts, to reduce need for high temperatures and pressure
  • improving the conversion efficiency of heat recovery and combined heat and power technologies, including sequential heat pumps to produce high-temperature water
  • using combined solar thermal generation to produce steam, pre-heated water and electricity
  • application of ‘green chemistry’ and green chemical engineering principles
  • using renewable feedstocks to power the production process
  • disassembly, recovery and recycling of chemicals and plastics.

Read more

Equipment and technology guides

Plastics and chemicals case studies Victorian Government

An Overview of Energy Efficiency Opportunities in Chemical Engineering (PDF 1.2MB) The University of Adelaide and Queensland University of Technology 

Chemistry Australia