Chemicals in transition

The three pillars for transforming chemical value chains

  • Impulse
The three pillars for transforming chemical value chains

As the largest industrial consumer of fossil gas in Germany, the chemical sector has been hit severely by the scarcity of fossil gas and the high prices caused by the fossil energy crisis following Russia’s invasion of Ukraine. At the same time, this has opened a window in which to speed up the transformation necessary for achieving the climate targets for industry in 2030 and 2045 and to stay competitive in the global race for climate-neutral products and technologies.

So the chemical industry stands at a crossroads: It needs to develop a common pathway that takes into account the climate targets, limited domestic re­sources and the resilience of value chains, while maintainng the industry’s economic strength. At the same time, Germany and the EU must create an environment that fosters investment in the techno­logies of the future in order to maintain the innovative energy that is crucial for the economic strength of the sector and for delivering the key materials for ­a climate-neutral society.

This project contributes to developing such a transition pathway for a chemical industry that uses ­materials and resources efficiently, a pathway based on three key complementary strategies: direct electrifi­cation and flexibility, a circular economy and renew­able feedstocks. Our study shows that an integrated approach can create cross-sectoral synergies for this transition and can eventually result in CO2 sinks – a climate-positive chemical value chain.


Project management



Core results

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    A policy mix of supply-side and demand-side measures for the chemical industry is needed to complement the ETS reform.

    Investment support, technology standards and compulsory quotas for recycled content are needed to incentivise electrification and circular economy strategies. A regulatory framework that prioritises high-value uses of limited biomass resources aligned with a cascading use hierarchy can additionally generate CO₂ sinks.

  4. 4

    To ensure the competitiveness of the chemical industry in a climate-neutral economy, a detailed roadmap must be developed over the next 18 months.

    A special focus must be placed on the transition of the particularly energy-intensive production of basic chemicals, not least due to esca­lating geopolitical conflicts. Databases and monitoring methodologies must also be developed to track waste streams, the true carbon footprint of chemicals, and biomass potentials.

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Bibliographical Data

  • Authors

    Paul Münnich, Julian Somers, Julia Metz (all Agora Industry); Ronja Hermanns, Aline Kalousdian, Raoul Meys (all Carbon Minds); André Bardow, Benedikt Winter (all ETH Zürich)

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  • Citation

    Agora Industry (2023): Chemicals in transition. The three pillars for transforming chemical value chains.

All Content

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    Electrification, recycling, and renewable feedstocks – three ...


    Electrification, recycling, and renewable feedstocks – three ...


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