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Yao Yuangen: Problems and Development Directions of Ethylene Glycol Produced from Coal. Author/Source: Huahua Net – Coal Chemical Industry. Date: 2019-07-01. Clicks: 26. On June 28, 2019, the China (Shanxi) International Clean Energy Expo and the 2019 China (Shanxi) International Clean Energy Summit were held at the Shanxi (Taiyuan) Coal Trading Center. Yao Yuangen, director of the Applied Chemistry Research Center at the Fujian Institute of Research on the Structure of Matter, Chinese Academy of Sciences, a researcher and doctoral supervisor, delivered a keynote speech titled “Development Trends of Coal-based Ethylene Glycol Technology” at the forum. The following is the verbatim transcript of Yao Yuangen’s speech: Yao Yuangen: First of all, I would like to thank this conference for inviting me, giving me the opportunity to share my thoughts with everyone here. I think the central government chose Shanxi as the site for the pilot program related to comprehensive reforms in the energy sector. The reason for choosing Shanxi is that it is a major energy-producing province in our country. And it is a major energy producer precisely because of coal – not for any other reason. Therefore, we need to focus on developing the coal industry properly. Therefore, the clean, efficient, and green utilization of coal is an important aspect of modern coal chemical industry, and it represents a crucial chapter in making the best use of coal. So my speech today will mainly focus on new coal chemical technologies, specifically the technology for producing ethylene glycol from coal, and I would like to share some insights on this topic with you. Next, I will address my remarks from several aspects: Ethylene glycol is a very important strategic bulk chemical raw material. Its market size ranks only after ethylene and propylene. China accounts for over 50% of the world’s consumption; in 2018, this figure exceeded 13 million tons. We have a very large consumer base, yet our domestic production capacity remains limited. For a long time, our dependence on imports has been at 67%. The current price of ethylene glycol is also something that deserves attention; it is currently only 4,500 yuan per ton. Those familiar with ethylene glycol understand why the price has dropped from 8,000 yuan to 4,500 yuan The main production routes for ethylene glycol. The first route involves crude oil, naphtha, and ethylene, while the second route includes associated gas, ethane, ethylene, ethylene oxide, and ethylene glycol ； The third route is coal (natural gas, syngas, methanol, olefins). Among all the routes, currently only the petroleum route and the coal-to-ethylene glycol route are used in industrial production. So how was this route determined? The first is the transformation and separation of coal; it differs from synthetic oils and methanol. All those other methods involve the use of methanol, whereas coal-based processes do not use methanol. In 2015, Orient Securities conducted a comparison of the costs associated with the oil route and coal-based ethylene glycol. In terms of production costs, coal-based ethylene glycol has a clear advantage over the petroleum-based route. Compared to oil-based routes, coal-based ethylene glycol can be compared with other coal chemical routes; among the options for producing natural gas, methanol, ethylene glycol, and olefins, it offers good economic benefits, and it also results in the lowest carbon dioxide emissions per ton of product produced. We have **long been focusing on the development of technologies for producing ethylene glycol from coal**; by utilizing our **relatively abundant coal resources**, we produce ethylene glycol, which is in high demand. Over the past few years, the State Council, the National Development and Reform Commission, and the Ministry of Industry and Information Technology have issued a series of documents aimed at encouraging and promoting the development of coal-based ethylene glycol technology. In the context of coal chemical industry, we **advocate the use of advanced technologies and processing methods to produce products that can replace petrochemical products as well as clean fuels, thereby fostering the coordinated development of modern coal chemistry; coal-based ethylene glycol technology is in line with the characteristics of our **development strategy. I summarize the characteristics of coal-based ethylene glycol; the first characteristic is that it was the first to be industrialized internationally. Second, coal-based ethylene glycol is in line with China’s resource characteristics. Third, there is high demand; 40 new production units can be added within 5 years to cover the 8 million-ton demand gap. Secondly, the development history of our technology and industry. This technology was patented in the United States in 1965; it involves the synthesis of ethylene glycol and carbon monoxide, and it represents a revolutionary advancement as it is a reaction that results in an increase in carbon content. This reaction takes place under high pressure. Later, the Japanese developed a liquid form of nitrogen oxides called MeONO, which enabled reactions between carbon monoxide and ethanol at normal pressure, thus taking this technology to a new level – this idea was put forward by the Japanese. Currently, coal-based ethylene glycol production follows a two-step process. In the first step, carbon monoxide, methanol, and oxygen are used. In the second stage, hydrogen reacts; this is also the main supply route at present. This technical principle is based on a approach proposed in the 1990s, involving catalysts such as oxalate synthesis catalysts and methanol catalysts. In the 1980s, we conducted small-scale and pilot tests. In 2005, we started collaborating with enterprises, and in 2008 we carried out industrial tests on a scale of 10,000 tons. After completing the pilot tests, we built a facility with a capacity of 200,000 tons in Tongliao. From 2010 to the present, we have constructed five such facilities in Henan. This is the situation as of the end of 2016; our facility had already reached a capacity of 1.2 million tons. Our technology has sparked enthusiasm for the research and industrialization of coal-based ethylene glycol around the world. There are various technologies for producing coal-based ethylene glycol on the market, but we were the first to achieve industrialization; it was after we began industrial production that this technology for coal-based ethylene glycol was truly developed. In existing industrialized projects, we also accounted for the highest share of the production capacity generated. By 2017, all six of our key production units were operating at full capacity, and all of them were producing ethylene glycol. However, technology can only maintain our current lead by continuing to advance. We also see that the first generation of diversified technologies still has many problems, and there are areas in these technologies that need improvement. After 2008, we resolved a series of key scientific and technical challenges, continued to steer the direction of technological development, and achieved coal-based ethylene glycol technology with full intellectual property rights. Therefore, we conducted durability tests on the new catalysts, especially the three core catalysts, for a minimum of 1,000 hours and up to nearly 5,000 hours. Subsequently, in 2013, we noted that Shanghai held competitive and commercial promotion potential, and recommended accelerating the pilot testing and industrialization of this technology. Subsequently, Feike organized the necessary evaluations; in 2015 a project design was developed at the Luoyang Institute. In October 2016, Guizhou Xinchun Energy Technology Development Co., Ltd. was established, with technology contributing as an investment component while the investors contributed in cash. We held 40% stake through our technology, and the investors held 60%, thus forming this company. Subsequently, in 2017, construction began on our pilot project. In September of that year, in September 2017, the project was handed over, and in September 2018, the technical calibration was completed. This image shows the pilot plant we built in Guizhou; it was taken in November 2017. The total investment amounted to 210 million yuan. By September 2018, we had completed the pilot testing and passed the relevant validation processes. The new generation of technology has several advantages: the first one is the three types of catalysts. These three catalysts are the dehydrogenation purification catalyst, the synthesis catalyst, and the hydrogenation catalyst, which enable the cost to drop from 300 yuan per ton to less than 100 yuan per ton. The second is our “distillation + adsorption” technology. In the new generation of technologies, we can achieve the desired results using distillation alone. In the third area, thanks to our new-generation technology, we can now reduce the production cost of ethylene glycol to 4,900 yuan per ton. Although international market forces have driven down prices, there is still room for profit under our technological framework. Compared with similar technologies at home and abroad, the advantages of the new generation of technology are as follows: Firstly, the catalysts—three types of them—are highly efficient and stable, have a lower content of precious metals, exhibit better performance, and the production cost is reduced by 60%. The second aspect is the process: unique oxidation-esterification technology and dilute nitric acid reduction technology enable the efficient utilization of substances such as nitrogen oxides. The third aspect is separation technology, which effectively improves the efficiency of ethylene glycol separation by utilizing separation techniques. The fourth aspect is cost efficiency; thanks to the technical advantages, the production process is more rational, and the reaction materials are utilized fully. This has enabled us to achieve significant savings in energy consumption and waste reduction, while also enhancing technical improvements in terms of safety and environmental protection ； In terms of resource advantages, Xingren County in Guizhou Province, where the project is located, boasts abundant coal and water resources. The calorific value of the coal is high (an average of 5500 kcal), and the electricity price there is one of the lowest in the country, at around 0.35 yuan per kilowatt-hour. Taking all these aspects into consideration, along with Guizhou’s local coal resources, it is clear that the amount of coal resources in Guizhou is not as large as that in Shanxi. By leveraging these advantages, our new generation of technologies has greater competitiveness in the market. Current problems and challenges facing coal-based ethylene glycol technology. After 2009, industrialization technologies gradually matured. In line with the 2018 standards for industrial ethylene glycol, coal-based ethylene glycol has been widely used in the PET polyester industry, giving rise to a range of supporting technologies for its production. We also see many problems with coal-based ethylene glycol: the first one is ultraviolet transmittance. After a decade, this problem has been largely resolved; good technologies allow for the direct production of products with high ultraviolet transmittance through distillation. Such products are certainly those that have been registered under separate distillation processes, and they possess a greater competitive advantage. The second aspect is the price of ethylene glycol. In 2017, the selling price of ethylene glycol was still 8,500 yuan per ton. There were indeed some international factors at play, which certainly had an impact; these factors led to higher requirements for this technology. When the selling price of ethylene glycol hovered around 8,000 yuan, all coal-based ethylene glycol production methods could be utilized. However, under current circumstances, we must ask: if the selling price of ethylene glycol drops to 4,500 yuan, what technologies can still be employed? What technologies can’t be implemented? This is an issue we must consider. Thirdly, our production capacity is expanding at a very rapid pace. According to statistics from the Petrochemical Federation, we have already approved projects totaling over 15 million tons – a truly enormous figure. In the coal chemical industry, an investment of at least 10,000 tons is required to generate 100 million yuan in revenue; therefore, we need to invest 150 billion yuan over these years to build all these facilities. Yet, as we can see, in 2018 the utilization rate of our ethylene glycol production facilities, especially those that use coal as raw material, was only 51%. Everyone can try to analyze why this utilization rate is so low The reasons behind this are probably quite clear to everyone. Fourthly, the application of coal-based ethylene glycol technology in the downstream polyester industry; the manufacturers of coal-based ethylene glycol are also very responsible. We have addressed these issues one by one and solved them. At present, the technology providers have accepted our coal-based ethylene glycol technology, but companies in the upstream and downstream sectors still have different levels of awareness regarding our new standards. To this end, at the beginning of this year and last week, our Ministry of Industry and Information Technology organized a special seminar to discuss coal-based ethylene glycol technology as well as the applications of coal-derived ethylene glycol products. In the near future, enterprises in both the upstream and downstream sectors will work together to resolve this issue; after all, making good use of coal-based ethylene glycol technology is in our **interests. This allows us to use coal as a substitute for oil, so we don’t need to import as much oil. Finally, focusing on these issues, I would like to invite everyone to discuss together the development direction of our coal-based ethylene glycol technology and industry. First is the technical aspect. At the technical level, as our technology developers, we must strive for excellence in technology; we need to continuously optimize catalysts, particularly those that present significant issues. This is relevant to our product output, yield, and quality, and further research on hydrogenation catalysts is necessary. The second aspect is our process technology; deaths have occurred in many facilities after they were put into operation, which indicates that our separation technology and product supply technology are not yet sufficient. The third product is separation technology; our distillation technology and related systems – are they the most energy-efficient? Is the energy efficiency the lowest? These aspects are worth further exploration by us. The fourth aspect is our unit technology. (Oxidation esterification tower, exhaust gas N-oxide recovery tower, DMO absorption tower, radial reactor). The second aspect is the market level; in particular, when the selling price of ethylene glycol is low, we must take into account the costs of raw materials – such as the local coal price and the cost of using water resources – as well as the distance required to transport them to the manufacturers. These are all important factors to consider. The third aspect relates to issues faced by manufacturers. Initially, there was resistance; later, acceptance gradually occurred under certain conditions, followed by acceptance at reduced prices. Now, price participation has been introduced. Upstream and downstream players are collaborating to conduct further trials, aiming to ensure the application of coal-to-ethylene glycol technology in the polyester industry. The goal is to establish application trials and product testing as a benchmark or hallmark for the industry. Impurities in ethylene glycol are being analyzed one by one to determine which specific impurity is affecting the product’s quality. We will establish new **standards** suitable for our coal-to-ethylene glycol process upstream and downstream, or refine the **standards** set in 2018. Example: The technology for producing ethylene glycol from coal. One is distillation; last September, our products met the 9999 standard. We can work together to carry out targeted efforts, and these are the products resulting from distillation. There are roughly a few hundred compounds before and after ethylene glycol, and it is more complex than petroleum ethylene glycol technology when compared to distillation techniques. The second aspect relates to energy consumption. We analyzed it, and there are two types of energy consumption: one is for power, and the other is for steam. The largest portion of energy consumption relates to the separation of methanol; during the production of ethylene glycol, methanol remains in the system without being consumed, continuing to circulate there. Therefore, for every ton of ethylene glycol produced, several tons of methanol are also present in the system. It’s obviously better to have 2 tons rather than 3 tons, so we must **reduce the amount of methanol in the system. A high volume of methanol circulation, combined with distillation, leads to high energy consumption. The second aspect is power consumption: compressors, specifically synthetic compressors, account for 40% of the power usage, while our refrigerators consume 46% of the power; there are other factors as well. This has led us to reconsider whether the absorption and utilization of exhaust gases is indeed the most cost-effective approach. Because nitrogen oxides are completely absorbed, the higher the absorption rate, the lower the temperature; however, there are also **environmental regulations regarding emissions that must be met. Therefore, this is a factor that we must take into consideration, in terms of steam and power consumption. Below is the reactor. In places where there is an abundance of such resources, the operation is simple and easy to control; the reactors are operated in parallel. In the future, we will definitely use better reactors in order to further improve the efficiency of our reactors. In terms of equipment investment, starting from the blue section, 36% is allocated to our reactors, 24% to compressors; the purple portion representing 16% is for refrigerators. The remaining amount is used for other types of equipment. Reactors account for the largest share of our investments, and by replacing four reactors with one, we can significantly reduce our investment costs.