In the first installment of this series, I discussed the relationship between additive manufacturing (AM) and energy return on energy invested (ERoEI). The gist of this article was that the recent boom in the AM sector should be viewed primarily as part of the end of the era of cheap energy. To start zooming in on more specific issues that illustrate this, the most striking and significant current example concerns the skyrocketing price of natural gas and the relationship between that and the chemical sector.
Increase in natural gas prices
Crude oil product prices, primarily gasoline, have received the bulk of the attention in all media inflation talk over the past year. At the same time, however, natural gas prices have seen an even larger increase and appear even more resilient to downward pressure than the price of the world’s two most important oil benchmarks, the West Texas Intermediate (WTI ) and Brent Crude. Aside from general supply chain issues related to the pandemic and Russia’s invasion of Ukraine, the rising cost of liquefied natural gas (LNG) is arguably more responsible than any other factor for sustaining prices. high at all levels of the economy for the past two years.
As volatile as US energy prices are, EU countries have seen much worse, a situation that predated the war in Ukraine, but was of course severely exacerbated by it. This is notably due to the frequent supply disruptions of the Nord Stream 1 gas pipeline, as well as the indefinite postponement of Nord Stream 2 operations. The two gas pipelines connect Russia, under the Baltic Sea, to Germany.
The price of plastics will rise
Germany is the center of the global chemical industry and home to many of the largest producers of polymers for the AM sector, including the largest, BASF (also the largest chemical manufacturer in the world). ‘era). By far, the chemical industry uses more natural gas than any other sector: in Germany, the chemical industry uses 14% of the country’s natural gas, while all other sectors combined use around 22%. The relative numbers for the United States are more or less the same. But, to reiterate, Germany is in a rather different geopolitical situation than the United States, and its benchmark electricity price has risen more than 500% in the past year.
Mainly, the chemical industry uses such an abundance of natural gas because it is the main feedstock for the production of ammonia and methanol, among others. So the higher the price of natural gas, the higher the price of polymers – which, since plastic is used for just about everything sold, affects the price of almost everything.
The relationship between 3D printing and natural gas
This is where FA comes in. Assuming natural gas prices remain at their historically high levels for the foreseeable future, polymers, too, will only grow more and more expensive. Now, it cannot yet be said that when using AM, fewer hydrocarbon inputs per item are required, compared to traditional manufacturing processes. On the other hand, AM already has the potential to dramatically reduce the amount of manufactured goods that end up unsold, which for companies making end-use polymer-based products could ultimately offset the perpetually higher price. high plastics. Nonetheless, in a shorter time frame, high prices could simply add volatility to a sector that is trying to take off amid seemingly constant economic turbulence.
Recently, there was a news story about warnings from the German chemical sector about the economic fallout from the ban on Russian energy suppliers. The week after the story broke illustrating that the link between higher natural gas prices and AM materials is far from merely academic or theoretical, Covestro, a German subsidiary of Bayer, sold its materials division. AM at Stratasys, an Israeli company. According to Bloomberg, Israel’s natural gas production increased by 22% in the first half of 2022.
To sum up, AM could eventually be an indispensable tool, not only to waste as little plastic as possible, but also, hopefully, to create as little new plastic as possible. Until that happens, rising energy prices are likely to drive further significant changes in AM materials markets. In my next article, I will focus on the specific ways AM is changing the way fossil fuels are mined and refined.
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