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Hard to abate industries are sectors of our economy that have few low carbon alternatives. Unlike sectors which are more adaptable to sustainable practices, these industries, such as cement, steel, and freight, are trickier to decarbonise due to the central role played by high carbon processes. This article focuses on these sectors, briefly outlining the obstacles, before looking at potential alternatives which offer not only hope but viable solutions. As will become evident, hydrogen emerges as a consistent winner. Is it a silver bullet? It’s difficult to say, but the analysis here only underlines the importance in investing in the technology.
A recent study by the Center for Climate Research in Norway (CICERO) revealed that the total volume of CO2 emissions released during cement production have more than doubled over the past 20 years. In 2021, cement emissions accounted for over 7% of global emissions, equivalent to 2.6 billion tons. Kilns have to be heated to over 1500 degrees Celsius, combining limestone and clay to create concrete. This process also uses 10% of the global water supply, and is depleting sand resources at the same time. According to Statista, in the last 10 years cement production created 44.71 billion metric tons of concrete - enough to build the Burj Khalifa 61,839.5 times.
The table below offers a brief insight into some of the alternatives to Portland cement, the most commonly used type. The alternatives range from those like GBBS, which incorporates Portland cement (what we would label simply ‘doing less harm’), to Ferrock, which uses waste products from steel and glass, and Hempcrete or Mycelium, which use biological materials. We would label these latter products as solutions, and potential contributors to a regenerative economy. At this stage, choosing simply to improve current practices can be the next logical choice in such a hard-to-abate industry, although it’s not acceptable to just stop there. Lasting solutions should ideally have carbon sink properties, moving to carbon negative if possible. This industry is one of few which may never undertake monumental change and possibly will rely on carbon credits and offsets to compensate for emissions if viable alternatives are not scaled within a reasonable time horizon. This, however, is in reality likely to lead to overshoot.
It is estimated that 240kg of steel is produced for every person in the world each year! That adds up to 1800 million tons in total. Every ton of steel that was produced in 2018 led to 1.85 tons of CO2, or about 8% of global emissions
There seem to be few viable low carbon alternatives to steel. There have been some suggestions of a wood or even plastic blend which could be similar in some structures, but nothing close to the strength and composition of steel. Additionally, steel is arguably a better option than plastic anyway as steel can be perpetually recycled. While CO2 emissions are high, they can be brought down with the introduction of green hydrogen into the steel manufacturing process, and according to Mckinsey, reduce carbon emissions by up to 20%. It seems that steel will be one of those industries which will have to use offsets in order to reach Net Zero, without much possibility to be totally CO2 free.
The freight industry includes the transportation of goods by plane, truck, train, or ship. For the sake of this article, we will focus on trucking, shipping and aviation, as rail is more easily electrified. The table below from the OECD International Transport Forum, depicts the importance of freight being tackled, the sector's emissions being significantly higher than other industries, no doubt fuelled by increases in globalisation and global consumption.
Source: OECD
According to the OECD, the freight industry’s emissions will have nearly quadrupled from 2010 levels by 2050, from 2108mt per year to 8132mt per year. Freight now amounts to over 7% of global CO2 emissions. The chart below shows the emissions produced by and projected for different types of transport from the IEA. APS stands for announced pledges while NZ is the Net Zero pathway. Notably in the 2030 category, the difference is unfortunately significant, signalling that we as a whole are not doing enough. Arguably the transformation of light duty vehicles is already underway with the amount of BEV and PHEV commercial vehicles available, however heavy trucking, shipping and aviation remain huge sectors in which the path seems less clear and established.
Source: IEA
Tesla’s Semi, an electric truck due to be released in 2023, promises to have a range of 300-500 miles. But at a cost of at least $120,000 USD, it’s hardly cheap, nor scalable for many companies. By contrast, a diesel-powered truck can do 1000 miles on a single refuel, and while not environmentally friendly or necessarily cheap (in the current climate diesel is £2 a litre) it’s going to be extremely costly to replace a fleet of trucks with electric ones. As seen with other renewable energy products such as solar panels, the more of them there are, the cheaper and therefore easier to implement and buy the product becomes. Although this would be a large cost many smaller businesses cannot afford, hopefully as electric trucks become more prevalent they will follow a similar path of reduced prices.
The truck manufacturer DAF received the truck innovation award for 2022 for its new DAF XF H2 Innovation truck, powered by hydrogen using an internal combustion engine. While the focus has been on moving away from ICE vehicles, this innovation could result in an easier transition to clean energy, and one that is more suitable for heavy duty trucking. The technology differs from using a hydrogen fuel cell for an electric vehicle, which requires large capacity for storage as well as higher purity hydrogen which is expensive.
The obvious downfall of such a vehicle is the need for hydrogen pumps throughout the UK. As of June 2022, there are only 15 hydrogen fuel pumps in the UK, compared to 15,500 electric charging sites!
The biggest barriers to this, aside from vehicles, is the cost of hydrogen. At £12 per kilogram, it is still is way off from the target price of £2 per kg. While it is likely that we will see a two pronged approach using hydrogen as well as batteries, the hydrogen technology won’t reach fruition for at least a decade. The table below visualises the path to a larger market share for plug in hybrid and electric vehicles form 2010-2015, with the current market share in 2022 being 4.5% according to government data.
Alternative fuels will play a large part in the transition to clean, renewable energy, for all sectors of transport. There is, however, arguably a greater focus on the shipping industry at this time due to the lifespan of the ships themselves. The average life of a freight-ship is 25-30 years – meaning that by 2050 (the year by which most countries have pledged to reach Net Zero) a large proportion of ships will have been built in the 2020s’s. Time is therefore of the upmost importance.
One of these alternative fuels is ammonia. You may have heard of ammonia, so toxic that if the atmosphere was comprised of just 0.5% of the gas humans would not be able to survive. So how could this be used as a carbon free fuel?
Ammonia is already used in a variety of industries, in products, or as a fertilizer for agriculture, and can be made from hydrogen using a variety of methods which encompass brown, blue, and green production.
As we know, ‘brown’ production uses fossil fuels, while ‘blue’ production is the same process with the addition of carbon capture to offset the emissions produced. Many, however, see this as problematic, as it entrenches fossil fuel production and relies on unproven and expensive technology. We have explored this debate in previous articles, arguing that we cannot rely on CCS technologies, and any sequestration that is used should be nature based.
‘Green’ ammonia production is the only form which contributes to a credible Net Zero pathway and is created using hydrogen from water electrolysis and nitrogen separated from the air. Additional benefits of using ammonia include the ease with which it is stored, and the fact that its only by-products are water and nitrogen, and even without using ammonia specifically for fuel it can be used as a hydrogen carrier, as the gas can be expensive to store.
MAN Energy Solutions aims to have a two-stroke ammonia engine for large-scale container ships available by 2024, a year and a half away. This is an ambitious target, but if successful could change the maritime industry. Interestingly, and vitally, this technology would mean that engines could be restructured to take ammonia fuel instead of creating new engines from scratch, making important use of existing infrastructure.
In the government’s ‘Future of Freight’ report, £206 million was allocated through the UK Shipping Office for Reducing Emissions (UKSHORE) to accelerate research and development through clean maritime competition, although it does appear scant on detail.
The future of aviation looks uncertain. While electric and hydrogen planes are currently being engineered, with some nearing manufacture, they are mostly small commercial planes capable of carrying a few passengers rather than large commercial planes, and they are worlds away from the huge commodity transporters like the Airbus Beluga Super Transporter also being developed. The simple reason is that the necessary batteries are currently too heavy to support larger aircraft.
So what options are being investigated? The International Air Transport Association (IATA) set out in their commitment to Net Zero by 2050, their plan for reaching this target, as shown in this pie chart.
Interestingly new technologies are only forecast to account for 13% of their strategy. The largest portion is Sustainable Aviation Fuel (SAF), which is any fuel that is not derived from fossil based sources like coal, oil, and gas. Many, at least in theory, can be used in existing planes. Many players are currently working on developing the technology. In Jan 2021 Boeing pledged to use 100% biofuels in their aircraft by 2030. SAF’s, according to IRENA, are constrained by high costs compared to their fossil-fuel counterparts. Here, the agency lays out in detail the possible alternative fuels that could be implemented on a wider scale.
Despite the hoped-for technological advances, 19% of IATA’s emissions reductions efforts are based on offsets and carbon capture. While we think that only nature-based-solutions (NBS) such as reforestation (check out our other articles and insights on NBS and carbon markets) should be utilised for carbon sequestration, offsets can be a useful tool if used properly: i.e., to cancel out unavoidable emissions. The most important use of offsets will be in these hard to abate industries, where the sequestration of carbon and use of carbon markets is expected to reduce residual emissions -the key word being residual. 19% seems a large percentage to be deemed truly unavoidable, but other reports find similar – it really is difficult to decarbonise aviation. This point was underlined in 2016 with the formation of the UN convened CORSIA (Carbon Offsetting and Reduction Scheme for International Aviation) programme, in which members agreed to use offsets to keep emissions to 2020 levels.
While batteries may never be applicable for large flights, hydrogen is one SAF that just might be. Airbus for one has an ambitious plan for hydrogen, with 3 different types of hydrogen-powered aircraft suggested and the promise that the first passenger hydrogen-plane will hit the skies by 2035. This may offer a solution which could apply to freight as well as passenger aircraft, however the same infrastructural issues remain as with the trucking industry, including costs and issues with the transportation of hydrogen. Hopefully these aircraft will be a success and able to secure a larger percentage in IATA’s strategy for Net Zero.
The prospects of hard to abate industries are brighter than is often portrayed. Innovation is already happening at scale, and the tight deadlines are, if anything, enhancing this push, which will hopefully result in adoption at scale. Of course, it is difficult to envisage some of these changes, in some industries that have remained largely unchanged for the best part of 50 years, but it clearly can be done. While strategies are in place now, we need to be ambitious, because the real winners of this generation will be those who get ahead of the curve and make the change to regenerative business models, ultimately serving the planet as well as themselves in the process.