Yes we can: full decarbonisation is feasible by mid-century say industry experts

State of Green
By State of Green, November 26, 2018

To limit global warming to well below 2˚C and as close as possible to 1.5˚C, the world must reach net-zero CO2 emissions by the mid-century. A new report from the Energy Transitions Commission outlines how decarbonisation in the problematic sectors of heavy industry and heavy-duty transport will be both technically and economically feasible by 2050.

The Paris climate agreement committed the world to limit global warming to well below 2°C and keep it as close as possible to 1.5°C above preindustrial levels. The recent IPCC report stressed the major negative impacts on humanity and the planet that would arise from an increase in global temperatures of 1.5°C and the even more dramatic consequences of 2°C global warming. It therefore urges the world to aim for 1.5°C and recommends achieving net zero CO2 emissions globally by 2050.

Dramatic reductions in the cost of renewable electricity generation and energy storage options means it is now possible to plan for cost competitive power systems that are powered almost entirely by wind and solar power alone. However, to reach a fully decarbonised economy, emissions from heavy industry (in particular cement, steel and chemicals) and heavy-duty transport (heavy-duty road transport, shipping and aviation) require urgent attention. These sectors currently account for 10Gt (30 percent) of total global CO2 emissions. Furthermore, based on current trends, their emissions could account for 16Gt by 2050 and a growing share of remaining emissions as the rest of the economy decarbonises. To date, many national strategies – as set out in Nationally Determined Contributions (NDCs) to the Paris agreement – focus little attention on these sectors.

A new report published by the Energy Transitions Commission (ETC) examines the road to decarbonising these problematic, ‘harder-to-abate’ sectors.  Titled Mission Possible: Reaching net-zero carbon emissions from harder-to-abate sectors by mid-century, the report outlines the possible routes to fully decarbonise cement, steel, plastics, trucking, shipping and aviation – which together represent 30% of energy emissions today and could increase to 60% by mid-century as other sectors lower their emissions.

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The path to net-zero: managing the transition to net-zero-CO2-emissions industry and transport

The “Mission Possible” report was developed with contributions from over 200 industry experts over a 6-month consultation process. Its findings show that full decarbonisation is technically feasible with technologies that already exist, although several still need further investment to reach commercial readiness.

The total cost to the global economy would be less than 0.5% of GDP by mid-century and the cost of running a net-zero-CO2-emissions economy would be well less than 1% of GDP. Costs could be improved even further by improving energy efficiency, making better use of carbon-intensive materials (through greater materials efficiency and recycling) and limiting demand growth for carbon-intensive transport (through greater logistics efficiency and modal shift). The report shows that these measures would have only a minor impact on the cost of end consumer products.

In heavy-duty transport, electric trucks and buses (either battery or hydrogen fuel cells) are likely to become cost-competitive by 2030, while, in shipping and aviation, liquid fuels are likely to remain the preferred option for long distances but can be made zero carbon by using bio or synthetic fuels. Improved energy efficiency, greater logistics efficiency and some level of modal shift for both freight and passenger transport could reduce the size of the transition challenge.

In industry, more efficient use of materials and greatly increased recycling and reuse within a more circular economy could reduce primary production and emissions by as much as 40 percent globally – and more in developed economies – with the greatest opportunities in plastics and metals.

Reaching full decarbonisation will require a portfolio of decarbonisation technologies, and the optimal route to net-zero carbon will vary across location depending on local resources. Commonalities across all sectors of the economy include:

  • Direct and indirect electrification (through hydrogen) will likely play a significant role in most sectors of industry and transport, leading to a sharp increase in power demand – growing 4-6 times from today’s 20,000 TWh to reach around 100,000 TWh by mid-century).
  • Hydrogen use will almost certainly increase dramatically (7-11 times by mid-century), with two routes to zero-carbon hydrogen: electrolysis, which will likely dominate in the long term, and steam methane reforming plus carbon capture and storage.
  • Bioenergy and biomass will be required in several sectors, but will need to be tightly regulated to avoid adverse environmental impact (such as deforestation), and its use should be focused on priority sectors where alternatives are least available or more costly, such as aviation and plastics feedstocks.
  • Carbon capture (combined with use or storage) will likely be required to capture process emissions from cement and may also be the most cost-competitive decarbonisation option for other sectors in several geographies. However, it does not need to play a major role in power generation, with the storage needs required could be less than many scenarios suggest. Tight regulation of storage is essential to ensure safety and permanence.

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What policymakers, investors, businesses and consumers can (and should) do

The report underlines that while possible, the transition will not be achieved unless policymakers, investors and businesses jointly take immediate and forceful action to transform economic systems.  Key policy levers to accelerate the decarbonisation of harder-to-abate sectors include:

  • Tightening carbon-intensity mandates on industrial processes, heavy-duty transport and the carbon content of consumer products.
  • Introducing adequate carbon pricing, strongly pursuing the ideal objective of internationally agreed and comprehensive pricing systems, but recognising the potential also to use prices which are differentiated by sector, applied to downstream consumer products and defined in advance.
  • Encouraging the shift from a linear to a circular economy through appropriate regulation on materials efficiency and recycling.
  • Investing in the green industry, through R&D support, deployment support, and the use of public procurement to create initial demand for “green” products and services.
  • Accelerating public-private collaboration to build necessary energy and transport infrastructure.

The “Mission Possible” report concludes that the most challenging sectors to decarbonise are plastics, due to end-of-life emissions, cement, due to process emissions, and shipping, given the high cost of decarbonisation and the fragmented structure of the industry.

The Energy Transmissions Commission (ETC)
The ETC is a coalition of business, finance and civil society leaders from across the spectrum of energy producing and using industries, who work to identify pathways for change in our energy systems to ensure both better growth and a better climate.

The report can be downloaded in full here

-Source: Energy Transmissions Commission

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