High-energy-intensive industries and the challenge of carbon neutrality

Several avenues are being explored to reduce energy consumption and greenhouse gas emissions. The first of these is integrating other, lower-emitting sources of energies into manufacturing processes. As the International Energy Agency has noted, processes requiring relatively low temperatures (such as agro-food) lend themselves well to electrification⁶.

The use of biomass – waste from the wood, agriculture or livestock sectors – is another path being explored by industry, via industrial combustion but mostly through gasification or liquefaction. This makes it possible, for example, to use wood derivatives to produce biogas or biofuels that, in one way or another, can be used as alternatives to fossil fuels. However, the use of biomass faces many challenges, such as installing supply chains, processing that can produce on an industrial scale, and the cost of these alternatives⁷. Industrial competitiveness is indeed a key issue here. Hence, the need for innovation to provide alternatives whose prices are as close to possible to fossil fuel prices.

The use of hydrogen in industry faces the same challenges, not to mention the issue of where the hydrogen itself comes from. Traditional methods of producing hydrogen are heavy emitters of CO₂ and hydrogen’s decarbonation value hinges entirely on the ability to produce “clean” hydrogen from renewable energies or nuclear power.

On paper, however, hydrogen does have lots to offer industry. First of all, it can be used to store and, hence, to stabilise renewable energy output, which, in turn, promotes its use by many sectors. Second, it can be used to decarbonate certain manufacturing processes, including those used in steelmaking, for example, as a reducing agent in the process of direct reduction of iron ore, an essential step in steelmaking. In this process, hydrogen reacts with the oxygen from iron ore to produce steam instead of CO², as happens with coking coal, the traditional reduction agent⁸ . Likewise, when used as a raw material in chemical processes, hydrogen is a promising avenue to decarbonating the chemicals industry.

Industry’s other major approach to carbon neutrality targets energy consumption. This includes investing in renovation of industrial facilities, implementing energy-savings plans based on monitoring of consumption, and renovating buildings.

Here’s another way to approach energy consumption and industrial production: the development of the circular economy. From steelmaking to plastics to textiles and chemicals, all industrial sectors can develop production processes that facilitate reuse, refabrication or recycling⁹.

The circular economy also involves the carbon capture and use. Once it has been concentrated, captured CO₂ can also be used to produce synthetic fuels via a process called CO₂ electrolysis, which is used by the agro-food industry (to produce carbonated beverages) and by the chemicals and aquaculture sectors. Here again, developing these solutions requires rolling out well-organised supply chains and massive investments. For example, the Oil and Gas Climate Initiative, which brings together 12 of the world’s largest oil & gas companies, has targeted CO2 capture and reuse in its decarbonisation policy, backed by an investment plan of more than 1 billion dollars¹⁰ .

In addition to the aforementioned possibilities, the most promising carbon neutrality projects are based on clusters, which combine several solutions and various actors (in particular, manufacturers, decarbonisation specialists and public authorities). The Transitioning Industrial Clusters towards Net Zero initiative, which has been rolled out in Europe, the US and Asia, aims to created 100 industrial clusters worldwide, to reduce CO₂ emissions by 1.6 billion tonnes, to maintain and create 18 million jobs, and to contribute 2,500 billion dollars to global GDP¹¹ .

The Humberside, England industrial cluster, which is targeting carbon neutrality by 2040, is a good example of what these clusters can do. It brings together steel, chemicals, cement and refinery industries. Within this cluster, the Zero Carbon Humber programme includes the development of a pooled carbon capture infrastructure with offshore storage. The cluster also provides hydrogen production facilities with a pooled distribution infrastructure. In the longer term, the project will include the production of green hydrogen using offshore wind power and electrolysers. And, lastly, project partners are counting on energy efficiency and circularity to reduce their CO₂¹² emissions.

The development of these clusters illustrates perfectly how high-energy-intensive industries can manage their path towards carbon neutrality – by working together, leveraging public-private partnerships, pooling infrastructures, and promoting innovation to get solutions to achieve industrial scale. The goal: to build the future of sustainable industry, environmentally, socially and economically.

1. https://www.iea.org/energy-system/industry
2. https://www.weforum.org/reports/the-net-zero-industry-tracker/in-full/steel-industry/
3. https://european-aluminium.eu/blog/vision2050/
4. https://www.energy.gov/articles/biden-harris-administration-announces-135-million-reduce-emissions-across-americas
5. https://commission.europa.eu/strategy-and-policy/priorities-2019-2024/europe-fit-digital-age/european-industrial-strategy_en
6. https://www.iea.org/energy-system/electricity/electrification
7. https://www.ieabioenergy.com/wp-content/uploads/2022/02/Role-of-biomass-in-industrial-heat.pdf
8. https://www.europarl.europa.eu/RegData/etudes/BRIE/2020/641552/EPRS_BRI(2020)641552_EN.pdf
9. https://worldsteel.org/circular-economy/
10. https://www.ogci.com
11. https://www.weforum.org/press/2023/01/decarbonization-of-industrial-clusters-initiative-gains-global-momentum
12. https://www.zerocarbonhumber.co.uk/