A Clean Energy Ministerial coalition designed to stimulate global demand for low carbon industrial materials. Credit: UNIDO
By Rana Ghoneim
VIENNA, Nov 7 2022 – Ahead of this year’s COP27 in Egypt, industry and government representatives from 15 developing countries across Asia, Latin America and Africa met in a series of consultations about the challenges and opportunities they face in decarbonizing some of their most energy intensive industries like steel, cement and concrete.
A report from these consultations – which were organized by the UN Industrial Development Organization (UNIDO), where I work – will be released during COP27’s Decarbonisation Day (Friday 11 November) and should be widely-read by decision-makers across energy, environment and industrial sectors.
During these meetings, it was evident that the pace of progress so far is too slow and that puts us at real risk of not meeting global climate commitments. It simply won’t be sufficient for industrialized countries to lower emissions within their boundaries and enforce restrictions for products entering their markets. This must happen everywhere.
Global action and new forms of inter-sectoral cooperation are urgently needed to address critical questions including: what are the opportunities for emissions reductions, and what is needed to deliver these reductions in the fastest and most economical way?
How do we speed up the development and implementation of new carbon-cutting technologies – and ensure that they are widely accessible and affordable, including to small and medium sized enterprises?
Currently, many developing country governments do not have reliable and up-to-date data on the emissions of their different industries and how they compare internationally. Relatively little has been established so far in the way of infrastructure to facilitate the widespread introduction of new and emerging technologies for industrial decarbonization.
Access to and know-how about low-carbon technologies is largely concentrated within industrialized countries and large multinational companies.
This must change. For industrial decarbonization efforts to succeed, we need to see significantly increased investments in research and development into new technologies – but we also need to scale up the deployment of technologies that exist but are not yet widely available, including those for carbon capture, utilisation and storage (CCUS).
We also need to much more widely implement strategies and technologies that are already available and affordable – including on energy efficiency, which lowers the demand for energy including from renewable sources.
This likely requires new funding for technical assistance to help make markets in developing countries ready and able to implement low-carbon technologies. It’s not just about funding individual projects, but about really coming up with more meaningful ways to partner around spreading technology our planet urgently needs. Industrialized countries cannot leave developing ones to ‘do this on their own’.
Some of the steel and cement (which is also used to make concrete) businesses working in developing countries are multinational companies which are bringing decarbonizing technologies into their operations from abroad. This is a good thing.
But there are also local companies – including within the supply chains of these multinationals – which need to be involved in order to make decarbonization succeed.
In India, for example, more than half of the steel manufacturing industry is small and medium sized enterprises without the same access to these technologies. Does this local market currently have the technical capacity to adopt and service new hydrogen fuel installations, for example?
Unfortunately, the answer is: Not really.
In many cases, these local companies will likely be unaware of the need to actually change their practices to move towards something that’s low-carbon – let alone how to do this and what technology options exist to help them. The speed of change needed means that the world cannot wait for them to do this alone.
Governments everywhere have a role to play here, in ensuring that their policy frameworks drive decarbonization, promote the right technologies and prevent the proliferation of production processes that aren’t low-carbon.
Imagine: If construction products are in demand in a developing country and they’re not already or sufficiently available on the market, a company or investor may see an opportunity to set up a new business – and if stringent regulations aren’t in place, they might do this using outdated technology with higher emissions.
Decarbonization is not the mandate of small steel and cement manufacturers, as participants noted in the pre-COP27 Asia consultation, or their area of expertise.
It is an area that requires collaboration across different sectors – including to get better and more detailed data, and measurement, reporting and verification frameworks on emissions that can help guide government, and industry, decision-making.
Steel and cement companies might often be seen by some of the public as ‘bad guys’. Globally, these sectors do currently contribute about 50% of industrial greenhouse gas emissions.
But they produce essential materials to build our houses, schools and cities and are needed for our growing communities. The demand should not be to stop production today, but to make it low-carbon today.
Without more meaningful global partnerships on industrial decarbonization, there’s a big risk that we won’t be able to deliver on our climate commitments. We cannot afford this.
Countries and industries globally need to move all together towards the same climate goals at the same time. Cooperation – including on policy, infrastructure development, and technology – will be key to doing this.
Rana Ghoneim is the Chief of the Energy Systems and Infrastructure Division, United Nations Industrial Development Organization (UNIDO) in Vienna.
Country consultations mentioned in this op-ed, which will be released during COP27’s Decarbonization Day (Friday 11 November), will be available on the website of UNIDO’s Industrial Decarbonization Accelerator.
IPS UN Bureau
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