The latest Net Zero Industry Tracker report indicates that progress has been made in reducing greenhouse gas emissions across eight hard-to-abate industrial sectors. But the data shows that the speed of reduction will need to increase if the target of net-zero by 2050 is to be achieved.
Making up 40% of global greenhouse gas emissions, the eight hard-to-abate industrial sectors covered are primary chemicals (3%), cement (6%), steel (7%), aluminium (2%), aviation (3%), oil and gas (10%) , shipping (2%), and haulage (5%).
Across these eight sectors the Net Zero Industry Tracker 2024, compiled by the World Economic Forum with Accenture, recorded a 0.9% reduction in absolute emissions from 2022 to 2023. This fall came as global energy-related emissions rose by 1.3% in the same period. The fall in emissions also came as demand across the eight sectors increased at an average of 9.2% between 2019 and 2023.
While welcoming the positive development, the report warns that some $30 trillion of additional investment is required by 2050 if net-zero emission targets are to be met. “While there is a long way to go, it is encouraging to see hard-to-abate sectors are making strides in emissions reductions indicating that they are investing in the energy transition,” said Roberto Bocca, Head of the Centre for Energy and Materials at the WEF.
Barriers to reducing emissions noted in the tracker include high interest rates, political uncertainties, trade restrictions, and limited availability of new clean energy technologies. The tracker calls for a focus on developing infrastructure for low-carbon power, hydrogen, and carbon capture, utilisation and storage (CCUS). Existing infrastructure for hydrogen use and CCUS currently stands at less than 1% of what is needed to reach 2050 targets. Infrastructure for low carbon power has fared better.
Looking specifically at primary chemicals, the report said emission intensity has been stable at approximately 1.3 Mt CO2e/Mt chemicals for the last five years, mainly due to industry focusing on supply chain disruptions and commodity price volatility.
Previous editions of the report included ammonia as one of the eight industries. This year, the report has expanded to include a set of primary chemicals - ethylene, propylene, benzene, toluene, mixed xylenes, ammonia and methanol - which together contribute to 2.5% of global greenhouse gas emissions. This has also increased the overall volume of emissions being tracked.
The absolute emissions for primary chemicals has seen 6% rise in the 2019-2023 period, driven by an increase in demand for ammonia by 4%, methanol by 19% and high-value chemicals by 9%. However, primary chemicals recorded a 0.1% decrease in absolute CO2 emissions and 2% decrease in emissions intensity between 2022 and 2023 despite a 2% increase in demand. The report said that CCUS, chemicals recycling and electrification could reduce half of the emissions on sector by 2050.
Only 8% of current plastic production is through recycling the report said, noting that in 2022, the energy mix for primary chemicals was made up of 55% natural gas, 36% coal, 7% electricity, 1% oil and 0.6% biofuels.
“Achieving net-zero by 2050 will require unprecedented collaboration and financial innovation across sectors to raise capital needed. However, we already possess many of the technologies and policy frameworks to act now,” Bocca added.
The tracker notes the potential for AI to drive further emissions reductions in the hard-to-abate industries: “By enhancing productivity, streamlining operations and optimizing energy use, generative AI could improve capital efficiency by 5-7%, reducing net-zero investment needs by up to $2 trillion,” the report says.
A UK-based project, Flue2Chem, which is focused on taking carbon dioxide and using it as feedstock to produce materials such cleaning products has progressed with researchers having produced ethanol from carbon dioxide captured from papermills in Cumbria and Scotland.
Flue2Chem is a two-year demonstration project supported by Innovate UK. Its aim is redesign and validate a UK value chain to convert valuable carbon emissions into sustainable materials for consumer products. Academic and industry specialists are assessing the environmental and socio-economic implications of this new potential raw material source. The collaborative project, which include SCI, was launched during 2022.
Further reading:
• IEA database indicates that the pace of CCUS deployment is increasing
• Green hydrogen: 11 projects get big funding boost
• WEF calls for net-zero transformation in household and personal care sector
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