Embed Size (px)
Citation preview
Renewable diesel: a key contributor to West Coast low-carbon markets
Presented at PRIMA/ISCC ConferenceSan Francisco, California April 6, 2017
Safe Harbor Statement
The following information contains, or may be deemed to contain, ´IRUZDUG-lookingVWDWHPHQWVµ. These statements relate to future events or our future financialperformance, including, but not limited to, strategic plans, potential growth, plannedoperational changes, expected capital expenditures, future cash sources and requirements,liquidity and cost savings that involve known and unknown risks, uncertainties and otherfactors that may cause Neste &RUSRUDWLRQ·V or its EXVLQHVVHV· actual results, levels ofactivity, performance or achievements to be materially different from those expressed orimplied by any forward looking statements. In some cases, such forward-lookingstatements can be identified by terminology such as ´PD\�µ ´ZLOO�µ ´FRXOG�µ ´ZRXOG�µ´VKRXOG�µ ´H[SHFW�µ ´SODQ�µ ´DQWLFLSDWH�µ ´LQWHQG�µ ´EHOLHYH�µ ´HVWLPDWH�µ ´SUHGLFW�µ´SRWHQWLDO�µ or ´FRQWLQXH�µ or the negative of those terms or other comparableterminology. By their nature, forward-looking statements involve risks and uncertaintiesbecause they relate to events and depend on circumstances that may or may not occur inthe future. Future results may vary from the results expressed in, or implied by, thefollowing forward-looking statements, possibly to a material degree. All forward-lookingstatements made in this presentation based on information presently available tomanagement and Neste Corporation assumes no obligation to update any forward-lookingstatements. Nothing in this presentation constitutes investment advice and thispresentation shall not constitute an offer to sell or the solicitation of an offer to buy anysecurities or otherwise to engage in any investment activity.
Neste in brief
4
Revenue
$12.7 billion
7KH�ZRUOG·V�largest producer
of renewable diesel
Production capacity of
renewable diesel: over 900 million gallons per year
employeesin 15 countries
~ 5,000
Several years in the Global 100 list RI�WKH�ZRUOG·V
most sustainablecompanies
Neste in numbers
Lead-freeand
sulfur-free fuels
1980 ±2005 2007 2011 2013 2014 2015
Low-sulfurmarine fuel
Renewable Diesel
Renewable Jet Fuel Renewable
Propane
Neste has been a leader in cleaner solutions throughout the years
2016
Renewable products refineries~ 900 million gallons per year
Porvoo, Finland� 7KH�ZRUOG·V�ILUVW�
renewable diesel refinery
� ~3 MMbbl/yr
Rotterdam, The Netherlands� 7KH�ZRUOG·V�ODUJHVW�
renewable diesel refinery alongside Singapore
� Biopropane will be available on the market during the year 2017
� ~8 MMbbl/yr
Singapore� 7KH�ZRUOG·V�ODUJHVW�
renewable diesel refinery
� ~8 MMbbl/yr
� Production based on 1HVWH·Vproprietary NEXBTL technology
� Annual production capacity 2.6 million tons = 900 million gallons
� Meets ASTM D975 and CARB diesel specifications
� Fully fungible ² can use the existing petroleum diesel infrastructure
� Flexible and sustainable raw material base ² over 10 different feedstocks in use
1HVWH�LV�WKH�ZRUOG·V�largest producer of renewable diesel
Diverse demand for Neste MY Renewable Diesel, as blending component and 100% use
Commercial and municipal bus
fleets
Truck fleets Construction; Mining
Agricultural machinery
Marine Emergency generators
Aviation
Dump and garbage trucks
11
Low-carbon Neste MY Renewable Diesel is ideal for fleetoperations and also a cost competitive fuel
Lower maintenance and operating costsLonger service and maintenance intervals than for other alternative fuels.
Smaller environmental footprintReduces greenhouse gas emissions by up to 80%
in addition to sizable reductions in tailpipe emissions.
High performanceConsistent quality, free of sulphur, oxygen, and aromatics. Together with a high cetane number of 75-85 the fuel ensures an efficient and clean combustion.
Superior cold weather performanceSuitable for very cold weather conditions. No matter the raw material, Neste guarantees its fuel will exceed cold temperature requirements.
Long shelf lifeCan be stored over long periods of time with no deterioration in quality or water accumulation.
Easy switch; no additional investmentsFleets can switch to renewable diesel overnight
without any conversion of vehicles or to logistics systems.
A low-carbon, clean-burning premium diesel fuel
Based on several scientific studies with different engines and after-treatment system, Neste MY Renewable Diesel provides significant reductions in major air pollutants:
� Particulate matter (PM) -33%
� Nitrogen oxides (NOx) -9%
� Carbon monoxide (CO) -24%
� Hydrocarbons (HC) -30%
13This material is confidential and intended for Neste internal use only
Neste MY Renewable Diesel is being used by cities, municipalities and corporations around the world; the number of neat users is growing steadilyRenewable Fuel Endorsement
San Francisco Bay Area Super Bowl 50
Host Committee
*
*
*) User of Neste Renewable Jet Fuel
)LUVW�)LOO�E\�´7KH�*UHHQ�/DG\´��Mary Nichols, CARB Chairman
� Californian based Propel Fuels was the first retail chain in the world to sell neat 1HVWH·VRenewable Diesel to consumers
� Stations across California
� Neste MY Renewable Diesel is being used by UPS fleets operating in the USA since mid-2015
� UPS is planning to use up to 46 million gallons equivalents of renewable fuels over the next three years
16
� Google's gBuses in Silicon Valley, California are running on neat renewable diesel
� gBuses shuttle employees from their homes in San Francisco and Oakland WR�*RRJOH·V�FRUSRUDWH�campuses
17
� The City of San Francisco leapfrogged its efforts to protect the climate from harmful effects of diesel emissions by phasing out the use of petroleum diesel in their municipal fleet and replaced it with 1HVWH·V renewable diesel at the end of 2015
� The City of Oakland began filling its vehicles with 1HVWH·V renewable diesel in order to reduce the emissions of their municipal fleet
� Oakland operates 250 diesel-powered vehicles and equipment
� Oakland has used 230,000 gallons of renewable diesel per year
� The City of Walnut Creek is the first city in the US to convert its municipal fleet to renewable diesel
� The switch to 1HVWH·Vrenewable diesel in August �����UHGXFHV�WKH�FLW\·V�*+*�emission by more than 60%
� They operate around 60 diesel powered vehicles and equipment
� The City of San Diego has converted its municipal fleet to Neste MY Renewable Diesel
� Over 1,100 vehicles and equipment, representing approximately 25% of the city's fleet, run on 1HVWH·Vrenewable diesel
� The City of Carlsbad has converted its municipal fleet to 1HVWH·Vrenewable diesel
� Carlsbad runs renewable diesel in a range heavy-duty vehicles including fire trucks, dump trucks and vacuum trucks
� The County of Sacramento has converted its municipal fleet to renewable diesel; reducing greenhouses gases by approx. 8,000 tons annually
� 1HVWH·V renewable diesel is used in a range of heavy-duty vehicles including more than 400 municipal public works and specialty vehicles
Sustainability, raw materials and R&D
We work continuously to offer cleaner solutions for our customers, reduce the environmental impact of our operations, and improve the sustainability of our supply chain.
Five California pathways ² can reduce carbon intensity up to 83%
GHG Emission Reduction
Carbon Intensities of different raw materials under CARB LCFS:
Currently Used Raw Materials in California
� Neste can produce high-quality renewable hydrocarbon diesel from more than ten different feedstocks on an industrial scale.
� Neste MY Renewable Diesel used in California may be produced produced from:
� Animal Fat � Fish Fat� Used Cooking Oil� Technical Corn Oil
� Additional pathways are pending
1733 34 37 39
102
-83%
Global Animal Fat
Technical Corn Oil
North American
Tallow
Fish FatUsed Cooking Oil
CARB Diesel
Units are all gCO2e/MJ
Broad range of renewable raw materials
Neste uses bio-based ethanol from the global market as a bio-component in gasoline.The company also uses tall oil pitch at its refinery in Naantali, Finland.
Animal fat from food industry waste
Fish fat from fish processing waste
Vegetable oil processingwaste and residues(e.g. PFAD, PES, SBEO)
Technicalcorn oil
Used cooking oil
Crude palm oil Camelina oil Jatropha oilRapeseed oil Soybean oil
79%
21 %
Waste and residues form nearly 80% of our renewable raw material inputs
Waste and residues(e.g. waste and residue fats from food processing, technical corn oil)
Other vegetable oils
In 2015, we achieved
capability to use solely waste and residues as raw materials in our
processing.
Renewable raw material mix 2016
Our approach to sustainability
Neste Sustainable Way includes:
� Cleaner solutions� Safety� Our people� Society� Climate and resource efficiency� Sustainable supply chain
Neste has been chosen for the Global 100 list RI�WKH�ZRUOG¶V�PRVW�VXVWDLQDEOH�FRPSDQLHV�and the Dow Jones Sustainability Index for many years.
All renewable raw materials sustainably produced
Taking leadership in sustainability
practices is essential to growing
acceptability of renewable feedstocks
All renewable raw materials used by Neste are traced
back to the land or production plants
Traceability ensuresrenewable raw
materials are sustainablyproduced and productionKDV�QRW�LQIULQJHG�DQ\RQH¶V
human rights or endangeredrainforests or
carbon-rich areas
Cutting-edge research� Continuous research to expand renewable raw material
base and further develop NEXBTL technology
� 70% approx. euro 41 million of R&D costs in 2015
� Cooperation with over 20 research institutions around the world
� Approx. 1,000 people working with research and engineering
Expanding our raw material portfolio
Waste animal fats, waste oils, residue and
side streams
Biological pathways
Thermo-catalytic pathways
Photo-synthesis
Short term Long term
Renewable Jet Fuel:A Solution for Sustainable Aviation
� Aviation is a significant source of GHG emissions¾ Aviation accounts for 2% of global GHG emissions and 10% of all
transportation emissions
� The aviation industry will continue to growڹ Air traffic is expected to double in 15 years
� The industry realizes that continued growth must be sustainable¾ Potential benefits include approvals to grow, improved brand image,
new revenue streams, price diversification, incentives
� Airlines, airports and OEMs are pulling all levers to lower theircarbon and emission footprintڹ Improvements in aircraft technology, operations, air traffic
management
� Renewable jet fuel must be part of the solution¾ Renewable diesel assets can be utilized to produce renewable jet fuel
The case for renewable jet fuel
Neste Renewable Jet Fuel� Offers airlines an easy way to cut their
emissions
� Compatible with existing jet engines
� High energy content (MJ/kg), no aromatics, reduces CO2 and sulphur emissions
� Complies with ASTM D7566 specification (Annex A2 ² HEFA)
� Already available at industrial scale
1,187Lufthansa
flights
1,600tonnes
of blended fuel
1,500tonnesreduction in
GHG emissions
0quality issues
1%better fuel
consumption
Neste Renewable Jet; proven high-level performance that has been used on over 1,000 Lufthansa flights
In January 2016, Oslo Airport offered Neste MY RenewableJet Fuel via the hydrant system
� Neste has produced renewable jet fuel to be used by airlinesLufthansa, KLM and SAS at Oslo airport
� The fuel is transferred to Oslo as a 50% blend with conventionaljet fuel
� For the first time, renewable jet fuel is delivered into-plane via the airport's hydrant system
� The fuel was produced in Porvoo, Finland, as part of the EU-funded ITAKA* project
� The feedstock is 100% certified camelina oil
* http://www.itaka-project.eu/default.aspx
The next development of HEFA: HEFA+ renewable jet fuel should accelerate use
´The airplane performed as designed with the green diesel blend, just as it does with conventional jet fuel. This is exactly what wewant to see in flight tests with a new type of fuel."
Captain Mike Carriker, Chief Pilot Boeing Product Development and 777X describing test flight with 15% HEFA+ supplied by Neste, Dec 2014
� HEFA+ is HEFA with a slightly higher freezing point
� Supply should increase as more efficient to produce
� Will be used at lower blend levels: likely max 15% HEFA+ vs. max 50% HEFA.
� Boeing is leading the effort for HEFA+ specification
� Neste is supporting with supply of fuel and testing
� Research report was issued in November 2016 and Version 3 is being issued for review
Renewable plastics
What are the goals?� IKEA is committed to using 100% renewable or recycled
plastics in home furnishing by 2020� We aim to produce plastics and other materials by replacing
virgin fossil feedstock with renewable or recycled waste and residue raw materials
How are Bioplastics produced?� IKEA and Neste will work with a number of partners in the
supply chain
When will we hear more?� We aim to produce the first proof-of-concept during 2017
Bioplastics cooperation with IKEA
Pre-order the Future� Project to investigate the future of renewable
materials and use of technology through productdevelopment.
� Engage audiences in finding bold and innovative solutions to create new kind of renewable products and services for more sustainable future.
Future of � Public Space� Entertainment� Travel� Mobility� Education
39
The Winning Concept: EduCycle
40
� EduCycle is an augmented reality game for educating school children about the carbon cycle and the effects of their choices on the environment.
� A prototype has already been developed and tested and launched in San Francisco on March 30, 2017
41
The Stone Age did not end for a lack of VWRQHV«��
The world is not running out of fossil fuel anytime soon.
But the environmental impact of GHG emissions means we cannot burn it all.
CO2 emissions potential of fossil fuel reserves compared to the 2ºC global carbon budget until 2050
Source: IEA, World energy-related CO2 emissions, 2016; Carbon Tracker Initiative, Unburnable Carbon ² $UH�WKH�ZRUOG·V�ILQDQFLDO�markets carrying a carbon bubble?, 2014
2,800 Gt CO2
670 Gt CO2 420 Gt CO2
Emissions caused by fossil fuel use 1990²2015 Emission potential of
proven global fossil fuel reserves
The maximum amount of fossil fuel emissions until 2050 before reaching 2ºCcarbon budget
