The net-zero industry will need exponential growth from carbon capture, hydrogen, and clean power technologies, a recent report by BloombergNEF (BNEF) said.
The report singled out carbon capture technologies to play a crucial role in the decarbonizing industry. However, it noted that transitioning to the net-zero industry would require significant investments in new technologies and infrastructure.
Industrial production is responsible for a significant portion of global greenhouse gas emissions, making decarbonization of industry a crucial component of any effective climate change mitigation strategy.
The report added that carbon capture will play a major role in decarbonizing the cement industry, which is responsible for significant emissions due to the chemical process of converting limestone to lime.
Hydrogen technologies will likely play a central role in decarbonizing steel and petrochemical industries as feedstock and heat sources.
The report said that while electrification and hydrogen pathways are the most likely technologies to compete with existing production routes on cost, hydrogen will only become widely available around 2035.
The report also said that fuel switching, bioenergy, recycling, and carbon capture can deliver emissions reductions today and are deployed earlier in BNEF’s least-cost modeling, helping to keep global warming below two degrees.
As the producer of half of the world’s steel, aluminum, and cement, China is currently the most important factor in the push toward the net-zero industry.
While the country still needs to publish a definitive technology roadmap, its scaling power could change the economics of hydrogen or carbon capture for the rest of the world.
After exponential growth in materials production, output cuts and a focus on quality rather than quantity will give the country a start on its net-zero pathway, reducing emissions through declining production.
The United States is also well-positioned for decarbonization. Its steel sector is mostly electrified, and its petrochemical sector already has hydrogen and carbon capture expertise. The recently passed Inflation Reduction Act will make these technologies viable for industry through generous tax credits.
The global role of the US and Europe will be as a laboratory for net-zero production routes. Most early pilot projects for low-carbon production are in these regions and will be used as a model globally.
In the future, India will be the focus of the net-zero industry, as its industrial emissions are due to more than double by 2050.
The World Economic Forum (WEF) recently launched a fundraising vehicle to unlock $3 trillion of financing needed each year to reach net zero, reverse nature loss, and restore biodiversity by 2050. The vehicle would focus on attracting philanthropic resources toward the net-zero targets.
The United Nations Climate Change Conference COP27 highlighted the need for global investments of $4 trillion per year in renewable energy until 2030 to achieve net zero emissions by 2050.
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