Powered for change
Working as one to achieve growth and decarbonization for all
We’re at the halfway point between signing the Paris Agreement and its first major deadlines in 2030. While much has been achieved since 2015, heavy industry has made little progress.
Why is it so important to accelerate industrial decarbonization of heavy industry? The world relies on five energy intensive industries: steel, metals and mining, cement, chemicals and freight and logistics. Their products and services feed into the supply chains of virtually all others. But so do their emissions. Heavy industry’s Scope 1 and 2 emissions become their customers’ Scope 3 emissions. If heavy industry fails to decarbonize, all others fail.
If we understand the problem, we can develop a solution. At the heart of this problem lies a vicious cycle of inaction. If we can collectively flip this to a virtuous cycle of action, in just three years, we could set the foundations for a new economic pathway and an orderly transition to net zero.
Investment and innovation have the potential to reduce decarbonization costs, but these investments simply aren’t happening at the scale or pace net zero requires. The reason: the value chain is not collectively working together. The siloed approach we are currently seeing means leaders are focusing on their own organizations, rather than actively working across the wider value chain.
This has created an investment standoff, where all parties are waiting for others to move first. Delivering on net-zero goals must be a collective endeavor. It starts when there is cooperation between heavy industry and oil, gas and power and their customers down the supply chain.
of oil, gas, and power providers say they expect to shift from decarbonizing their own business to support the decarbonization of heavy industry before 2043.
of heavy industry executives do not see priority decarbonization measures to be economically attractive before 2030.
of heavy industry executives believe it will take more than 20 years to deliver net-zero products at close to price parity with high-carbon alternatives.
of heavy industry executives believe a price premium of +20% is necessary for low-carbon products and services to compete with high-carbon alternatives in the next 5 to 10 years.
There is a clear path to industrial decarbonization. By working together, industries can create the confidence that’s needed to unlock investment and innovation and bring down costs.
To do this they must focus on resolving a small number of the most difficult barriers to decarbonization.
Tackling these barriers in the next three years will set heavy industry on the right path to decarbonization and accelerate the world’s progress toward its net-zero targets.
Three interdependent imperatives can help all industry flip from a vicious cycle to a virtuous one.
This research has recommendations for multiple segments that are part of the industrial value chain:
To better understand the opportunities and the actions that will create impact, we conducted significant research:
Based on these imperatives, Powered for change lays out a bold, three-year action plan for accelerated industrial decarbonization. It demonstrates how, in a new era of collaboration, we can spark confidence across the value chain. Those who are successful will create a sustained source of competitive advantage for decades to come.