Targeting emissions and inefficiencies 

According to IEA data, the manufacturing sector’s direct carbon emissions accounted for 25 percent of global emissions in 2022—or about 9 Gt CO₂. These figures highlight the significant role of manufacturing industries in the green transition. 

Globally, direct emissions in manufacturing come from various sources. Machines used in the manufacturing process often run on coal, oil or gas. Some materials, such as plastics, are made from fossil-based chemicals, and chemical reactions in production processes also contribute to emissions. Additional emissions and energy losses may result from leakages in industrial equipment and inefficient waste treatment. 

Add to this the indirect emissions from the sourcing of fossil energy, along with other resources and services beyond the companies’ own production and control, and it becomes clear that manufacturing companies have their work cut out. However, sizeable value gains can be achieved by addressing inefficiencies and unsustainable business models. 

By adopting cost-effective energy efficiency measures—as described in the IEA’s Efficient World Scenario (EWS)—manufacturing industries could almost double the gross value added from each unit of energy used by 2040 globally. 

Danish experience shows potential

In Denmark, the manufacturing industry has achieved a 50 percent CO₂ reduction from 1990 to 2023, while increasing its output by 250 percent. Energy and resource efficiency has been a key driver in this decoupling of growth and emissions. 

The Danish experience shows that large efficiency improvements can be achieved through optimised production equipment, buildings and workflows, by realising the full potential of digitalisation, behavioural changes and strong managerial focus. Further gains are achieved by switching to greener energy supplies and tapping into surplus energy and water resources that would otherwise be wasted. 

Looking ahead, the Danish manufacturing industry is projected to reach a 72 percent reduction in emissions by 2030, aligning with Denmark’s overall 2030 emissions target. The main drivers of this expected development are the introduction of a CO₂ tax, adopted in 2022, and the transition of pipeline gas to 100 percent biogas. 

Additionally, investments in energy-saving initiatives in manufacturing are increasing, and the Danish government has also allocated resources to support the adoption of energy-efficient technologies. In total, although the manufacturing sector is expected to grow in the coming years, total energy consumption and emissions are not, underlining the feasibility of green growth in the sector.