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Industry leaders sign up for decarbonisation in steel, ammonia and aluminium

© Shutterstock / zhang shengPost Thumbnail

At NY Climate Week over 200 industry leaders signed up for decarbonisation strategies from the Mission Possible Partnership (MPP) to decarbonise some of world’s hardest-to-abate, carbon-intensive industries in this decade.

  • More than 200 industry leaders signed up to decarbonisation strategies for ammonia, aluminium and updated steel.
  • The strategies published by the MPP contain requirements for decarbonisation – although much remains predicated on policy shift.
  • The move signals growing awareness that industry must be seen to take action – whether it is significant or successful remains to be seen and may be dependent on collaborative action.

Each Sector Transition Strategy (STS) is based on the deployment of available technologies by 2030, a date that is increasingly challenging for for industry incumbents operating old-economy assets.

The new reports were for ammonia, aluminium and steelmaking, which together account for around 17% of global emissions. They join aviation, shipping and trucking with strategies for concrete and cement, and the chemicals sector, planned for release later in 2022.

Each report details specific requirements – with real-economy milestones – for clean energy, new or retrofitted industrial plants, and policy reform to meet sectoral carbon budgets aligned to the 1.5° 2050 Paris Agreement.

What will be interesting to watch will be the process by which signatories start to implement their own decarbonisation actions. It is becoming increasingly clear that effective decarbonisation by 2050 is going to require rapid and proactive cooperation with other sectors, from developing more renewables to designing final products that are easily recyclable.

Decarbonisation strategies for aluminium, ammonia and steel

MPP’s STS for primary aluminium would mobilise clean power, improve material efficiency and recycling at a cost of up to $1 trillion. This would be expected to reduce carbon emissions by 95%. In a business-as-usual scenario, the sector will emit a cumulative 37 gigatons of carbon by 2050, an overshoot of more than double the Paris-aligned carbon budget of 15 gigatons. Interestingly Alcoa, Rio Tinto and EGA signed up to support implementation.

The ammonia sector is particularly interesting, as it is becoming a factor for green ammonia for marine fuel, and for the transportation of green hydrogen. The MPP forecast demand for ammonia could increase six-fold by 2050, with the shipping sector having the potential to make or break demand for near-zero emissions ammonia.  CF Industries, BASF, SABIC and Yara have signed up, as well as renewable energy providers Orsted, Iberdrola and ACWA Power.

Amongst steelmakers signatories include ArcelorMittal, Companhia Siderurgica Nacional (CSN), Liberty Steel, SSAB, Rio Tinto, Tata Steel, thyssenkrupp and Vale. What stood out in the steel STS was the importance of early progress in breakthrough projects and increased supply of near-zero primary steel are essential to remain within a Paris-aligned sectoral carbon budget.

MPP estimates that commercialisation of net-zero technologies would cost up to $200 billion per year, implying significantly higher demand for hydrogen, clean electricity and natural gas, but a stark decline in coal power.

Transition plans are critical for change but could be overly reliant on future technologies and policy shifts

Matt Rogers, CEO of MPP said: “These transition plans are operationally relevant and industry-backed, not wishful thinking or pie in the sky. We know how to reduce emissions, initially deploying resources and technology available today. The imperative is to act now, in this decade: we’re working with industry, supply chains and finance to deliver the clear thinking and asset-by-asset plans to make net zero viable”.

The MPP is an alliance of leading organisations working to decarbonise hard-to-abate industries. It presented two transition strategies, one for  aluminium and for ammonia, as well an updated steel strategy at the World Economic Forum’s Sustainable Development Impact Meetings at Climate Week.

Faustine Delasalle, vice-chair of the Energy Transitions Commission (ETC), a founding partner of MPP, said: “Support for these strategies from more than 200 industry leaders sends a signal of hope. The data developed by ETC with MPP partners will inform targets and actions from companies in key value chains, as well as financial institutions and governments – and helps all of us to keep decision-makers accountable”.

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