The world is "on a highway to climate hell", warned UN Secretary General António Guterres at November’s COP27 climate change conference in Sharm El-Sheikh, Egypt.
While more than 120 countries are now committed to pursuing net zero targets, aimed at limiting global warming to 1.5°C above pre-industrial levels, speaker after speaker at the conference warned that urgent action is required if the global community is to meet the targets of 2015’s Paris Agreement.
The decarbonisation of industry is imperative if we are to find an alternative route and tackle the climate crisis. With the nations signed up to these net zero targets accounting for over 90% of global gross domestic product (GDP) and representing some 85% of the world’s population, the potential impact of translating these net zero promises into successful action is enormous.
The price of industrial emissions
A number of policy incentives, regulatory tools and technologies can be employed to accelerate industrial decarbonisation. Carbon pricing is one key measure aimed at reducing emissions of greenhouse gases (GHGs) by directly pushing the costs of emissions back onto emitters. Those operators may then choose to continue to emit GHGs and pay for it through carbon pricing or, taking a longer-term business approach, invest in transforming their operations to mitigate emissions and cut their future cost of carbon.
Approaches to carbon pricing vary, from carbon tax credits – as used in the USA – to cap-and-trade schemes, such as the European Union Emissions Trading Scheme. While these operate differently, when used alongside policy and regulations, they can help move funds from the biggest emitters towards innovation in clean technology and its deployment at scale – critical in driving down costs of such solutions.
This is particularly important to some of the heaviest contributors to GHG emissions – including the steel, cement, chemical and petrochemical sectors – where they typically have hard-to-abate CO2 in their processes (which is technically challenging and costly to reduce). The adoption of cost-effective decarbonisation solutions to drive down emissions is critical to their future success, with new catalyst and process technology at the heart of these decarbonisation solutions.
Measure and report
As companies embark on their net zero strategy, a crucial early step is to understand where they stand today in existing operations. Only by knowing the baseline can a company commit to their future GHG emissions reductions and define a pathway to achieving those commitments.
Following the definition of baseline and setting of strategy, the assessment of pathways to reduce GHG emissions can begin. These decisions on decarbonisation are complex as there are a large number of alternative options now available at varying levels of technical and commercial readiness. These can be segmented into three types:
- Low capital expenditure (CAPEX): easy to implement solutions that can be executed at pace, such as changing raw materials or shifting to renewable energy
- Retrofit: addressing hard-to-abate emissions through deployment of proven and cost-effective solutions, such as carbon capture and storage (CCS)
- Transformational technology: demonstration and scaling of new 'blue' and 'green' technologies.
Reduce and replace
In each of these three areas listed above, companies need to define their execution plans to replace or reduce carbon.
Replace: options could include replacing fuel and process heat with electrified heating (using renewable energy), or replacing fossil-fuel feedstocks with renewables, such as recycled plastics, bio-based materials and municipal solid waste for conversion to sustainable fuels and chemicals. With electrolytic (green) hydrogen, for instance, water and renewable energy are the new feedstocks and, when combined with CO2 captured from the air, these can be used in the production of green methanol (such as in the Haru Oni project in Chile), and sustainable synthetic fuels using JM’s HyCOgenTM and FT CANSTM technology.
Reduce: it is also possible to switch to a catalyst that reduces the overall carbon intensity of a product, such as CATACEL SSRTM for the production of hydrogen. However, to maximise carbon reduction versus the baseline of today’s operations, capital investment may be required, and this is where retrofitting enhanced carbon capture solutions, such as JM’s CLEANPACETM technology is being evaluated across the industrial space. Finally, there are also options for CCS-enabled (blue) hydrogen, which provides a long-term, scalable and cost-effective replacement for fossil fuels.
Companies will need to evaluate the potential of process improvements, calculate the reduction in carbon intensity, and identify the technology readiness level and availability of proposed solutions. With the options now available, industrials are well positioned to take big steps towards decarbonisation targets of the next decade.
Article first published in the Johnson Matthey Technology Review