The UK chemicals sector is playing a critical role in the delivery of a successfully decarbonised economy.
As the nation’s largest manufacturing exporter, the UK chemicals industry is well placed to help deliver the government’s clean growth agenda. The sector underpins virtually all manufacturing, including the production of:
- commodity and bulk chemicals
- speciality chemicals
- consumer chemicals
Opportunities to invest in now
Teesside Freeport is the UK’s largest Freeport, driving growth in renewables, advanced manufacturing and the chemicals and process sectors.
Humber Freeport builds on the region's existing strengths in renewable energy, clean growth, and advanced manufacturing, offering excellent connectivity to the UK's manufacturing supply chain.
Significant opportunities exist across several areas.
Low carbon solutions
Providing low carbon solutions that serve as a catalyst to improve energy efficiency and reduce carbon emissions across multiple sectors.
Growing the UK’s hydrogen economy by developing new technologies that can efficiently and inexpensively derive and process hydrogen.
Supplying the necessary chemicals for battery technologies. The UK chemicals industry is in a strong position to capitalise on the rapidly growing market for Lithium-ion (Li-ion) batteries for electric vehicles.
Replacing fossil fuel feedstocks with renewable ones, switching to bio-based chemicals, and developing bio-based polymers.
Supplying chemical recycling and sustainable packaging, both crucial to tackling the plastic waste problem. Digitalisation is also vital to increase efficiency and quality and reduce waste.
The UK is the first major economy in the world to pass laws to bring all greenhouse gas emissions to net zero by 2050, and the chemicals sector is playing a critical role in delivering this.
The sector already enables green growth directly, by improving the sector’s own emissions, and indirectly, by providing products and solutions to industries; enabling them to save at least 2 tonnes of greenhouse gases for every 1 tonne the chemicals sector directly emits.
Key UK assets
Chemical production in the UK is concentrated in 4 main clusters, connected by a pipeline to the key input feedstock, ethylene. The clusters are:
The North West
This region has all the elements required to deliver a low carbon industrial cluster by 2030. This includes:
- carbon capture usage and storage
- nuclear facilities
- smart grids
This is a world-class centre for industries such as:
- advanced manufacturing
The region is pioneering several opportunities for the sector, including industrial carbon capture, utilisation and storage, and the hydrogen economy.
The Humber is the UK’s second largest chemical cluster. New decarbonisation and renewable energy projects, including Humber Zero and Gigastack, are transforming the region.
This region covers all areas of chemical sciences, from basic chemicals such as ethylene and commodity polymers, to intermediates and specialties, through to pharma and agri-chem active ingredients.
The UK chemicals sector is a natural innovator, spending more than £5.4 billion in 2019 on research and development. This accounts for more than 20% of the UK’s R&D expenditure. The sector is well placed to deliver decarbonisation technologies for the hydrogen economy and carbon capture, use and storage (CCUS). Leading R&D organisations in the sector are:
- The Centre for Process Innovation, which works with their partners to develop products that protect and improve the environment, and increase productivity across chemical industries
- The National Formulation Centre, which provides the tools and expertise that are needed to guide companies through the commercialisation of their next generation formulated products
- The Advanced Propulsion Centre, which facilitates funding, provides expertise, and enables collaboration to create chemical technologies for clean automotive products
- The Industrial Biotechnology Innovation Centre, a networking and support organisation in Scotland
Business and government support
Innovate UK provides funding of between £25,000 and £10 million through open grant funding competitions.
The Knowledge Transfer Network (KTN) provides support by linking new ideas and opportunities with expertise, markets and finance through a network of businesses, universities funds and investors. The KTN works with all sectors that use chemicals or chemistry in their business, including UK chemical manufacturers.
The government also offers support for investment through the Chemistry Council, the UK Catalysis Hub, and several Knowledge Transfer Partnerships.
Incentives are also offered for research and development including R&D tax credits and R&D expenditure credits.
AkzoNobel is a global company specialising in sustainable paints and coatings. It has increased its sustainability by building the world’s most advanced plant in Ashington in North East England.
The €100 million plant, which will house Dulux’s new centre of production, uses a variety of renewable energy sources as well as a highly automated manufacturing process which saves water, waste and energy. It is estimated that the carbon footprint per litre of paint will be reduced by 50% compared with its previous production facilities.
AkzoNobel’s targets include 100% renewable electricity use in Europe by 2022 (already achieved in the UK), and a 50% reduction in carbon emissions across the full value chain by 2030.