Why transforming industries is key to meeting global climate targets

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Did you know that the industrial sector alone produces a quarter of all global emissions?

Hard-to-abate heavy industries, such as steel, cement and chemicals are responsible for the bulk of this. Not only are they heavily reliant on fossil fuels, but they often involve wasteful processes built on outdated technology — leading to inefficient and often expensive operations.

It’s patently clear that this cannot continue if we are to take climate change seriously. The latest report from the Intergovernmental Panel on Climate Change (IPCC) warned that, if we stay on our current trajectory, we’re likely to “overshoot” the Paris Agreement’s target of keeping global warming to 1.5°C above pre-industrial times in the upcoming decades.

No wonder industry decarbonization dominated the conversation this year at Hannover Messe. We all know it: if we’re to build a more sustainable industrial future — and address the current energy crisis at the same time — industries need to do more to reduce their energy consumption and emissions. They must eliminate energy waste, embrace electrification and use digital technologies to manage this change.

Fortunately, we have the tools and know-how. What’s missing is the speed and scale at which we deploy it. Here’s what needs to happen.

Digitalization and electric are key to industry decarbonization

First, we need to fully embrace digital technologies. This can help industries in multiple ways: It allows for automating processes, simulating production scenarios, and training people remotely, for example. And by enabling effective analysis of operational data, it empowers businesses to increase end-to-end efficiency.

Second, more electrification of industry’s energy use is vital. Today, just 21% of industry’s energy is currently electrified. Transitioning more activity to electric-powered equipment — heat pumps instead of reboilers or condensers, electric heating in place of steam or fossil-fuel-powered heat, and electric motors instead of steam turbines — would drive both significant efficiency gains and help drive industry decarbonization.

To give you a sense of the potential savings involved, an industrial heat pump can reduce energy intensity for steam production by up to 90%.

Upgrading industrial infrastructure

The industrial built environment can also be digitalized, connected and integrated into energy management software systems so that energy-intensive electrical loads are measured and controlled, and scope 1 and 2 carbon emissions cut.

Take one facility of the world’s biggest steelmaker, ArcelorMittal, for example. At the company’s Belval production facility in Luxembourg, Schneider Electric software and sensors upgraded switchgear and transformers, ensuring that both energy use and critical electrical equipment are monitored 24/7. This has since helped avoid 170 metric tons of CO₂ emissions and reduced capital costs by 20%, thanks to a unique approach to modernizing existing equipment.

Reducing industrial energy waste

Within industrial plants, approximately two-thirds of energy is lost or wasted before its intended use. Digitalizing industrial processes and leveraging digital twin technologies throughout supply chains, alongside software and analytics, can prevent such inefficiencies.

Digital twins capture the operational data of industrial plants to create virtual, real-time models of their processes. They reveal how factories might perform with different operational scenarios built within the software. Users can see how these changes might affect production, profitability and carbon emissions, uncovering better ways to use resources and energy and avoid waste.

Experts from the UK’s Engineering and Physical Sciences Research Council predict that by 2030, digital twins will unlock $1.3 trillion of economic value globally. Such technologies are already being successfully deployed worldwide. Sanning Chemical, for example, used digital twins alongside enhanced automation and electrification technologies when building a new smart factory in Hubei Province, China.

This resulted in workforce efficiency improvements, a 5% reduction in energy consumption, as well as increases in the safety and stability of their operations. 

The fastest path to industry decarbonization

Public attention around decarbonizing the global economy and reaching net zero by 2050 is turning towards critical conversations around reducing demand. Given the sheer size of the industrial sector, and its relative inefficiencies, industry has a responsibility to be a leader in demand-side change.

This is an enormous opportunity for the industrial sector. It has the power to unleash a massive untapped energy efficiency potential and deliver significant savings, too. The means to do so? Electrifying industrial processes, upgrading industrial buildings and infrastructure, reducing energy waste, and partnering with digital automation and energy management experts.

The tools are readily available. Now, it’s up to industries around the world to use them.