The time is now for industrial decarbonization

With war in Europe, energy markets in turmoil and international supply chains under stress, looking to the long-term has rarely been so challenging. But even amid uncertainty, it is clear that business leaders must act decisively now to drive the process of significant industrial decarbonization – and the current crisis could provide a following wind.

The Intergovernmental Panel on Climate Change warned that we have a “brief and rapidly closing window of opportunity” to ensure a liveable future for humanity. Yet, in a world with high and volatile energy prices, low- or zero-carbon industrial products are increasingly cheaper and lower risk than traditional supplies in many markets around the world. New industrial decarbonization innovations are reaching scale. And, most importantly, the technologies exist today to start driving down industrial emissions significantly before 2030. The time is now.

Addressing the global climate emergency will take everyone: governments, individuals, investors, and the business community. At the Mission Possible Partnership, we are focusing on seven hard-to-abate industry sectors. These sectors – concrete and cement, steel, aluminum, chemicals, trucking, shipping and aviation – account for around 30% of total carbon emissions. As other parts of the economy, notably power generation, shift away from fossil fuels, these seven sectors could consume 60% of the global carbon budget unless we take action soon.

Crucially, these sectors will also dictate the ability of the wider economy to continue to support economic growth and decarbonize. The construction sector needs zero-carbon concrete and cement; auto makers need net-zero steel and aluminum; the entire global economy needs to be able to move goods and people at low cost without impacting the climate.

The best news is that the business community is already taking action – ambitious business leaders are leading the way. Companies are responding to their customers’ demands and their shareholders expectations with speed and agility, defining detailed, operational decarbonization plans.

But those key stakeholders are less interested in long-term commitments on paper, and more in near-term action. Today, business demand for low- or zero-carbon inputs greatly outpaces supply in several sectors. Investors are looking for evidence of near-term project commitments that matches long-term corporate targets – and that evidence remains too limited.