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Mass balance systems are transforming the industry by enabling real-time tracking of sustainable materials, ensuring compliance & unlocking revenues.
The chemical sector is the largest industrial energy consumer and the third largest industry subsector in terms of direct CO2 emissions due to significant energy consumption as feedstock. Demand for various chemical products, including plastics, is rising, with primary chemicals demand showing strong growth, reflecting sector abicctivity.
This concerning fact and growing regulatory pressure mean the market just needs more green products, and this has made the chemical industry turn to digital tools to meet their sustainability targets.
These companies struggle to track and verify green practices throughout their complex supply chains. Digital technologies are changing how chemical companies handle their mass balance calculations and sustainability certifications. Companies can now track, measure and improve their effect on the environment while meeting the growing market's need for green chemicals.
This piece shows how digital solutions are changing the chemical industry's path to sustainability. Readers will find how going digital creates new ways to protect the environment and grow business in the chemical sector. The content covers everything from today's challenges to setting up advanced mass balance systems.
Deloitte’s industry outlook report shares that in 2025, the chemical industry is expected to focus on innovation, sustainability, and resiliency to drive efficiency and growth.
The global chemical industry will grow from USD 6.182 billion in 2024 to USD 6,324 billion by 2025 at a YoY increase of 2.3%, Markets and Markets shared in its Chemistry Outlook brief.
In its mid-year report, The American Chemistry Council (ACC) predicts global chemical production will increase possibly up to 3.5% in 2025. Even so, with both outlooks, the increase in production will be welcome.
The rising demand for various chemical products significantly impacts the environment, putting pressure on chemical manufacturers to minimize their environmental footprint.
While the industry accounts for approximately 2% of global CO2 emissions, its impact is far-reaching. It consumes a significant portion of fossil fuels - 14% of oil and 8% of gas - as both raw materials and energy sources, making it one of the largest users of fossil carbon for material production.
Three primary factors contribute significantly to this environmental impact:
The influence of the chemical sector extends beyond its direct emissions. Over 95% of manufactured goods involve chemical products, highlighting the industry's pervasive impact across various sectors. To address these challenges, the chemical industry has been pursuing a multi-pronged approach to decarbonization:
One promising development in the chemicals industry is the creation of the Global Impact Coalition (GIC) during the COP28 and the World Economic Forum’s 2024 Annual Meeting in Davos. GIC serves as a platform for working together and trying out low-carbon solutions. It has the potential to become a hub for forming partnerships, encouraging unique collaborations, and leading the way in developing solutions through practical projects that reduce CO2 emissions in the future.
These strategies aim to reduce the industry's carbon footprint and contribute to global sustainability efforts.
Chemical industries face numerous challenges while trying to become sustainable. Complex value chains (intricately linked to 95% of all manufactured goods), environmental effects, and growing needs for sustainable products create major obstacles. Companies must guide themselves through changing regulations, market pressures, and tech advances to work effectively.
Supply chain visibility presents unique challenges in the chemical industry. Companies find it hard to track and verify sustainable feedstock amounts in their products. Modern products combine complex materials that are tough to identify and track. Various Chain of Custody Models (COC) now help tackle these issues and support chemical industry's journey toward sustainability. It documents and tracks raw materials, processed materials, and products from their source to end consumers. The chemical sector uses COC to verify product sustainability claims and ensure supply chain transparency.
As a key milestone towards a circular economy and bioeconomy, mass balance enables tracing materials through complex value chains. It's particularly valuable when physical segregation of recycled content is impractical or expensive. By tracking the amount and sustainability characteristics of circular and bio-based materials, the mass balance approach facilitates proper attribution based on verifiable bookkeeping, benefiting chemical companies in their sustainability efforts and regulatory compliance.
The mass balance approach stands out among five common COC models. Segregated chain of custody cost too much. While these systems track sustainable materials precisely, they need big investments in production lines, storage, and transport. On the other hand, mass balance method boosts trust throughout the value chain by identifying specific properties of goods and materials without changing your existing infrastructure.
Mass balance offers clear advantages over segregated approaches:
The chemical industry, crucial to modern life, plays a vital role in advancing carbon-neutral targets and circular society solutions. The mass balance approach, widely used in chemical recycling, food and extends to sustainable fuels and various industrial applications across the supply chain.
Mass balance frameworks, aligned with standardized models like ISCC, simplify of sustainable material percentages, enhance transparency, and foster trust among stakeholders. This approach encourages the use of recycled or renewable feedstocks and streamlines accounting processes.
Digital mass balance systems bring big chemical business advantages beyond better operations. Chemical manufacturers can enter premium markets, especially those with strict environmental rules. Companies can also charge premium prices for eco-friendly products, which helps cover setup costs while meeting market needs for verified sustainable options.
Companies that use digital mass balance solutions spend less on regulatory compliance. They benefit from:
SABIC's Circular Feedstock Experience
As a chemicals industry leader, SABIC has become the first in its sector to achieve batch-level traceability from waste to packaging for its TRUCIRCLE products using MARCO Track & Trace; it supports end-to-end digital traceability of circular feedstock in customer products. SABIC's TRUCIRCLE™ portfolio is a major milestone in circular economy adoption. Their work with Plastic Energy and Intraplás shows how mass balance certification builds profitable partnerships in circular economy markets:
Digital traceability ecosystems powered by our blockchain-based technology helped SABIC maintain its position as a global leader in environmentally responsible chemicals.
MOEVE: Ensuring Transparency in Sustainable Cleaning Products
Committed to sustainability, Moeve leads in developing cleaner energy solutions, biodegradable products, and eco-friendly technologies. It is also the world's largest LAB producer.
MOEVE provides batch-level traceability and automates Mass Balance processes for sustainable chemicals through MARCO Track & Trace.
Moeve uses mass balance to track sustainability credits and ensure environmental standards, linking raw materials and product output.
These examples demonstrate how using mass balance methods along with advanced digital tools can lead to profitable ways to achieve sustainability in the chemical industry. This shows that by investing in eco-friendly practices, a company can meet its environmental responsibilities and gain significant business benefits by enhancing efficiency and standing out in the market.
Digital technologies have changed how the chemical industry handles data gathering and sharing. Manual data entry and spreadsheets lead to errors and lack live updates. These outdated methods can't handle today's complex chemical supply chains well enough to track sustainability features across products and processes.
State-of-the-art blockchain technology brings special benefits to mass balance in chemicals. It tracks sustainable materials more accurately and compare volumes faster. They also help maintain product quality and use infrastructure better. Automated systems reduce errors and provide live performance insights.
Automated tracking through advanced Chain of Custody (COC) systems tracks sustainable materials movement in inventory more accurately and compare volumes faster and provides direct product traceability. This approach gives a full picture at every step and enables better sustainability decisions. Digital platforms also remove double-spending risks by monitoring materials inventory carefully and checking each sustainability credit's authenticity and usage. It also help maintain product quality and use infrastructure better and provide live performance insights.
For aditional segurity and data reliability of mass balance information, it can be added to blockchain, which creates an unchangeable database where unauthorized changes become clear to everyone in the network right away. This feature protects sustainability records stored on the blockchain ledger.
MARCO Track & Trace leads the chemical industry in mass balance optimization. This platform uses advanced digital solutions to track sustainability credits and carbon emissions from source to product. It sets new standards for supply chain transparency.
The platform tracks products automatically through an advanced Chain of Custody (COC) system. It monitors credit movement in inventory systems and shows where credits come from at the product level. Chemical manufacturers can now control their sustainability initiatives better.
MARCO Track & Trace goes beyond simple tracking by carefully monitoring credits to prevent double-spending. Each sustainability credit goes through thorough verification to show a company's dedication to environmental care. The platform's reporting tools encourage accountability and help create positive changes in the industry.
The system offers more than traditional mass balancing with:
As the regulatory landscape evolves, various certification schemes have emerged to help businesses demonstrate compliance and make credible sustainability claims. Many of these schemes incorporate mass balance principles, recognising their value in tracking sustainable materials through complex supply chains.
Let's explore some of them:
By utilizing MARCO Track & Trace, businesses can showcase compliance with regulatory requirements and enhance communication of their sustainability initiatives to stakeholders. Through our solution, deploying a mass balance approach, chemicals can adhere to these certification schemes.
As we've explored throughout this comprehensive ebook, mass balance go beyond compliance, serving as a path to a sustainable and transparent global economy. Tracking sustainable material use in supply chains accurately is vital amid climate change, resource depletion, and social inequality challenges. Embracing mass balance helps businesses comply, support sustainability, build consumer trust, enhance brand reputation, and foster a sustainable future.
Digital transformation is the life-blood of sustainability goals in the chemical industry. Digital solutions tackles key challenges and creates new opportunities for environmental stewardship and business growth.
Modern digital platforms have eliminated old tracking limitations. They make regulatory compliance easier and allow precise monitoring of sustainability credits. Chemical manufacturers can now tap into premium markets. The automatization of mass balance trouth digital ecosystem help chemmical companies implement affordable certification processes and support circular economy initiatives.
SABIC and MOEVE's success stories show how digital mass balance systems create positive change. Their achievements reveal what a world of chemical companies leading environmental innovation looks like. These companies stay profitable while setting new standards for green manufacturing in global supply chains.
Chemical industry leaders who want to learn about mass balance optimization can book a demo of ourFINBOOT's MARCO Track & Trace platform at www.finboot.com/contactus.
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