Chairman and Chief Executive Officer at DOW
Thank you, Howard. Now turning to slide 7. We have a clear road map to advance our decarbonize and grow strategy, which we expect will deliver greater than $3 billion in additional run rate EBITDA, while reducing carbon emissions by 30% by 2030. This begins with our continued investment in renewable energy, asset efficiency improvements and innovative carbon-efficient technologies like electric cracking and carbon capture.
Licensing our technologies will further expand our value pools, decarbonizing our assets and the industry. For example, our FCDh unit will reduce CO2 emissions by as much as 20% compared to other leading PDH technologies. And as we advance our electric cracking project in collaboration with Shell, we will incorporate even more renewable energy into our network.
In Alberta, we're progressing engineering and development activities for the world's first net zero carbon emissions, ethylene and derivatives cracker complex. This year, we plan to complete our partner agreements, which will put us on track for regulatory approval and a final investment decision in 2023.
We're also advancing plans to reduce CO2 emissions at sites in both Europe and in the Americas. A key part of our decision to advance profitable projects will be ensuring competitive subsidies and commercial contracts before final investment decision. These projects will provide the low to zero emission products that our customers increasingly demand to reduce their own carbon footprint. This is another demonstration of Dow's leadership in the transition to a sustainable world while driving earnings growth.
Turning to slide 8. To that end, our near-term actions to decarbonize, grow the company and continue to improve our return on capital are well underway. In 2022, our in-flight growth programs remain on track to deliver a run rate of more than $300 million in underlying EBITDA with a focus on targeting downstream and sustainability-led applications across all operating segments that will generate strong returns.
In Packaging & Specialty Plastics, our FCDh unit in Louisiana is on track to start up in the fourth quarter of this year and will contribute more than $75 million in run rate EBITDA with a return on invested capital greater than 15%, giving us the key proof point to accelerate the licensing of our technology.
In Industrial Intermediates & Infrastructure, our alkoxylates capacity and other efficiency investments are also on track to start up this year and in total, are expected to generate more than $50 million in run rate EBITDA with returns greater than 20%. In order to support the accelerating demand growth across pharma, cleaning and energy sectors, today, we're proud to announce another series of alkoxylate investments in the United States and Europe.
These expansions maintain our current carbon emissions levels and are backed by supply agreements with leading consumer brands across fast-growing end markets. All combined, these investments represent a 70% increase in our industry-leading downstream alkoxylates capacity over the next several years, targeting high-value applications where we're delivering 10% to 15% annual growth rates.
Lastly, in Performance Materials & Coatings, we're also executing a series of incremental downstream debottlenecking projects with more than 20 projects expected to be completed this year, collectively contributing approximately $100 million in run rate EBITDA with return on invested capital of more than 20%.
All in all, by 2025, we're projecting a cumulative underlying EBITDA improvement of approximately $2 billion, driven by projects like incremental high-margin polyethylene and functional polymers capacity to serve growing demand for flexible packaging, debottlenecking projects to enhance our mix toward polyurethane systems serving mobility and consumer applications, and new capabilities to formulate differentiated silicones, including silicone adhesives for next-gen electronics, mobility and infrastructure applications.
At the same time, we continue to decarbonize and deliver on our sustainability commitments by increasing our use of renewable energy, optimizing our assets to be more carbon efficient and driving continuous emissions reductions throughout our global asset base. Just one example, we will reduce our CO2 emissions by more than 350,000 tons, which is more than 15% of our 2025 emissions reduction target when we replace end-of-life steam and gas turbines at our Plaquemine, Louisiana site, with less capital intensive, higher efficiency and lower operating cost systems.
Overall, we expect these near-term actions to deliver $2 billion in additional underlying earnings while reducing carbon emissions by approximately 2 million metric tons by the year 2025. And importantly, we'll do this while maintaining capex within D&A and continuing to target a return on capital of greater than 13% across the economic cycle as we invest in higher-return, lower-risk projects across the enterprise.
Turning to slide 9. Dow has unique and resilient competitive advantages, a clear strategy to decarbonize and grow earnings, cash flow and return on capital combined with top quartile operational and financial performance. Our annual benchmarking update is published in the appendix of this presentation and demonstrates once again that we continue to deliver better results relative to our peers across many key financial performance metrics, including top quartile EBITDA margins, return on capital, free cash flow yield, shareholder remuneration and debt reduction.
Our commitment to industry-leading cash generation and shareholder remuneration have resulted in an attractive free cash flow and dividend yield above both our benchmarking peers as well as the broader S&P 500. Furthermore, strong execution against our higher return growth projects over the past several years has resulted in 3-year EBITDA growth and return on invested capital that is well above the peer median. And as we've outlined, our in-flight growth investments will deliver additional incremental earnings and cash flow upside with high-quality return on invested capital across the economic cycle.
To close on slide 10, Dow continues to be well positioned to deliver higher mid-cycle earnings and cash flow above pre-pandemic levels in both the near term and over the economic cycle. With our flexible and advantaged operating model, we're also able to effectively manage in a wide range of macro environments.
We continue to deploy our industry-leading cash flow in a disciplined and balanced way to maximize long-term value creation. Case in point, our new share repurchase program reflects the strength of our performance and confidence in our ability to continue delivering industry-leading cash flow.
We're making good progress on our decarbonized growth strategy, delivering incremental earnings by capitalizing on fast-growing demand for more sustainable solutions. Our in-flight actions are elevating our underlying mid-cycle EBITDA above pre-pandemic levels, all as we advance our return on capital.
Over the past 125 years, Dow has transformed from a small science start-up to the company that we are today, an industry leader with global scale, a differentiated portfolio and sustainable solutions that enable us to tackle some of the world's greatest challenges. Our ambition, purpose and capabilities continue to make Dow a great place to work for PhDs, engineers, chemists and leading talent from many different disciplines.
For the second year in a row, Dow has been recognized as the only material science company on the Great Place to Work and Fortune 100 Best Companies to Work For list. These advantages enable us to capture value growth while continuing to focus on delivering for our customers advancing our ambition and creating value for all stakeholders.
With that, I'll turn it over to Pankaj to open the Q&A.