‘Fundamental transformation’: How light and heavy industries can chart their course towards net zero

‘Fundamental transformation’: How light and heavy industries can chart their course towards net zero

'Fundamental transformation': How light and heavy industries can chart their course towards net zero

The UN has set out challenging pathways for decarbonising steel, cement, chemicals, plastics, fashion and more – and they require urgent action in the 2020s

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Decarbonising the world’s hard-to-abate heavy industries and light consumer goods sectors is both technically and economically feasible by mid-century, but a major step-change in ambitious support and collaboration from global governments and businesses alike is urgently needed, according to the United Nations (UN).

In a raft of sectoral net zero pathways to 2050 last week, UN Climate Change (UNFCCC) presents the journey to net zero global industry as vastly complex, but one which is ultimately critical to the future of the global economy and – crucially – also achievable largely through harnessing many processes and technologies already available today, as long as concerted action is taken within the next decade.

It states that the world must broadly target a reduction in emissions by around 30-45 per cent across these diverse heavy and light industry sectors by as soon as the end of 2030 in order to reach net zero within 30 years and keep the goals of the Paris Agreement within reach.

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Sectors covered in the “living document” – which is intended to help inform policymakers, investors and businesses on the pathways to a net zero society – include carbon intensive manufacturing such as the world’s steel, cement and chemicals sectors, as well as lighter industries covering retail consumer goods, fashion, mobile phones and IT. Plastics, mining, aluminium and CCS are also covered in the report.

But while the pathways to net zero vary across different industries, supply chains and global regions, decarbonisation can broadly be achieved through a combination of cutting material and energy use, increasing efficiency, slashing CO2 from production processes and harnessing natural climate solutions, it concludes.

Digitisation can drive efficiencies and ease the costs of decarbonisation for industries, while stronger re-use and recycling can also help dampen demand for high-carbon and polluting virgin materials, it states.

However, the document makes clear that ambitious government policy must work hand-in-hand businesses and investors to unlock investment, development and innovation needed to deliver on the potential of net zero industries.

As such, it recommends policymakers help accelerate commercialisation of lower carbon materials and technologies by integrating climate considerations into every level of policy and regulations, including procurement, product standards, subsidies, carbon pricing and climate risk disclosure rules. Careful consideration and planning is also needed to aid workers and industries adversely affected by the quickening net zero transition in order to ensure as just and orderly a shift as possible, it adds.

“Given the short timeframe available, this collaboration must aim higher than incremental change,” it states. “Fundamental transformation of industrial systems by unpacking and redesigning them can make industry fit for purpose in the 21st century.”

The pathways set out sectoral visions for achieving a 1.5C resilient world in 2050, providing a roadmap to help countries and non-state actors alike to identify actions needed by 2021, 2025, 2030 and 2040 to deliver a zero carbon planet in line with the goals of the Paris Agreement.

The report forms part of the UNFCCC’s wider Climate Action Pathways initiative, which aims to provide a vision for achieving a 1.5C world across a raft of sectors and areas including transport, oceans, water, land-use, energy and a soon-to-be-released report on finance.

It comes amid increasing pressure on heavy, carbon intensive industrial processes such as steel, cement and mining in the run-up to the crucial COP26 climate summit in Glasgow later this year, with significant global reductions in emissions now needed each and every year in the coming decade in order to keep the Paris Agreement goals on track.

Indeed, just last week the influential Carbon Tracker and Planet Tracker think tanks launched a new venture alongside CDP specifically focused on helping investors spot the net zero and climate risks facing heavy and light industries, and to navigate the pathway to a greener future.

At the same time, however, many of these industries have crucial roles to play in building out the clean technologies needed to drive the broader net zero transition, such as metals needed for renewable energy technologies and electric vehicle batteries.

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For example, it highlights aluminium, the production of which is responsible for around 1.2 billion tonnes of carbon emissions each year – two per cent of all global emissions – while demand is expected to increase 80 per cent by 2050 as it is a crucial building block of the net zero economy. As such, around $0.5-1.5tr investment in the sector is needed by 2050 to advance low carbon smelters and build a market for low carbon aluminium within the next 10 years, it estimates, backed by a greater shift towards the use of recycled aluminium.

Steel is also forecast for long-term growth overall, but here carbon prices above $60 per tonne could help shift much-needed investment towards decarbonising production, it states. And encouragingly, that could well occur fairly rapidly in the EU, for example, where prices on the emissions trading system (ETS) are already rising towards similar levels.

It comes ahead of a much anticipated pathway report next month specifically focused on the global steel sector, which the UN said would bring industry together right across the entire value chain in order to offer scenarios and different options for delivering a net zero steel sector before 2050.

Elsewhere, the report also sets out specific goals for a number of sectors. Around a quarter of concrete and cement production should be low carbon by 2030, backed by a push to reduce demand for these materials, while increasing energy efficiency and technology development, it states. Demand for fresh concrete and cement production could also be slashed by 35 per cent by harnessing the circular economy potential for recycling and reusing such materials, it estimates.

Moreover, to keep net zero on track, around 60 per cent of global mining operations should be powered by renewable energy, by which point the world should aim to have around 20 major global green steelmaking projects off the ground, it said. Governments should also set clear national targets for carbon capture and storage capacity, it adds.

Focusing on lighter consumer goods, it calls for a greater focus from businesses is on decarbonising CO2 in supply chains through science-based Scope 3 emissions goals, backed by international policies and regulations governing deforestation, harmful refrigerants and plastic waste. Product design standards, consumer product labelling and innovation – such as through plant-based protein alternatives to meat – can further help drive urgent shifts away from high carbon products, it states.

By 2030, it said deforestation should be eradicated, food waste should be cut by 50 per cent, all plastic packaging should be 100 per cent recyclable, and logistics fleets should be 100 per cent zero emission.

Overall, the report offers a glimpse of the monumental changes to practically every product and raw material critical to both today’s and the future net zero economy, and argues much progress and action is needed right away, largely within the current decade.

Launching the latest sectoral pathways last week, Nigel Topping, UN High-Level Climate Champion for COP26, said the only way to deliver the promise of the Paris Agreement “is with immediate action”.

“The Climate Action Pathways light the way for actors across the global economy to take the urgent next steps to halve emissions by 2030,” he said.

Delivering a complete transformation of global economy and every product and service it provides within the space of a single investment cycle in order to put it on a pathway to net zero by 2050 remains, of course, a major challenge.

But the first step to meeting that challenge is setting out clear roadmaps for action that industry and policymakers alike can follow, and the UNFCCC’s latest intervention offers one such framework. In order to avoid a disorderly transition or even complete oblivion in the coming decade as, companies working in affected carbon-intensive industries would do well to take note, and begin drawing up ambitious transition plans accordingly.

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Read more: businessgreen.com

Ronald M. Robertson

Ronald M. Robertson started working for Korean News Feeds in 2019. Ronald grew up in a small town in northern Texas, but moved to New York for university. Before joining Five Three Footwear, Ronald briefly worked as an independent journalist for several news sites. He covers politics and economy stories.

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