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The establishment of the Leveraging a Climate-neutral Society–strategic Research Network (LCS–RNet) (then named the International Research Network for Low Carbon Societies) was proposed at the Group of Eight (G8) Environment Ministers’ Meeting in 2008. Its 12th annual meeting in December 2021 focused on the discussion on how to transition into a just and sustainable society and how to reduce the risks associated with the transition. This requires comprehensive studies including on the concept of transition, pathways to net-zero societies and how to realise the pathways by collaborating with various stakeholders. This Special Feature provides new insights into sustainability science by linking the scientific knowledge with practical science for the transition through the exploration of studies presented at the annual meeting. Following the opening paper, "A challenge for sustainability science: can we halt climate change?", a wide range of topics were discussed, including practices for sustainable transformation in the Erasmus University, practices in industry, energy transition and international cooperation.
To combat climate change, it is anticipated that in the coming years countries around the world will adopt more stringent policies to reduce greenhouse gas emissions and increase the use of clean energy sources. These policies will also affect the industry sector, which means that industrial production is likely to progressively shift from CO2-emitting fossil fuel sources to renewable energy sources. As a result, a region's renewable energy resources could become an increasingly important factor in determining where energy-intensive industries locate their production. We refer to this pull factor as the "renewables pull" effect. Renewables pull could lead to the relocation of some industrial production as a consequence of regional differences in the marginal cost of renewable energy sources. In this paper, we introduce the concept of renewables pull and explain why its importance is likely to increase in the future. Using the examples of direct reduced iron (DRI) and ammonia production, we find that the future costs of climate-neutral production of certain products is likely to vary considerably between regions with different renewable energy resources. However, we also identify the fact that many other factors in addition to energy costs determine the decisions that companies make in term of location, leaving room for further research to better understand the future relevance of renewables pull.
The EU aims to become the first climate neutral continent. To achieve this goal, the industry sector needs to reduce its GHG emissions to net zero or at least close to net zero. This is a particularly challenging task due to the high energy demand especially of primary materials production and the little potential to reduce this energy intensity when switching to other production processes based on electricity or hydrogen. In order to identify robust strategies for achieving a net-zero-compatible industry sector, the paper at hand analyses the transformation of the industry sector as described by a number of recent climate neutrality scenarios for Germany. Apart from overall industry, a focus is set on the sectors of steel, chemicals and cement. The analysed scenarios show very deep GHG emission reductions in industry and they appear to be techno-economically feasible by the mid of the century, without relying on offsets or on shifts from domestic production to imports. The scenarios agree on a suite of core strategies to achieve this, such as direct and indirect electrification, energy efficiency and recycling as well as new technological routes in steel making and cement. The scenarios differ, however, regarding the future mix of electricity, hydrogen and biomass and regarding the future relevance of domestic production of basic chemicals.
This report was prepared by the Wuppertal Institute in cooperation with the German Economic Institute as part of the SCI4climate.NRW project. The report aims to shed light on the possible phenomenon that the availability and costs of "green" energy sources may become a relevant location factor for basic materials produced in a climate-neutral manner in the future.
For this purpose, we introduce the term "Renewables Pull". We define Renewables Pull as the initially hypothetical phenomenon of a shift of industrial production from one region to another as a result of different marginal costs of renewable energies (or of secondary energy sources or feedstocks based on renewable energies).
Shifts in industrial production in the sense of Renewables Pull can in principle be caused by differences in the stringency of climate policies in different countries, as in the case of Carbon Leakage. Unlike Carbon Leakage, however, Renewables Pull can also occur if similarly ambitious climate policies are implemented in different countries. This is because Renewables Pull is primarily determined by differences in the costs and availability of renewable energies. In addition, Renewables Pull can also be triggered by cost reductions of renewable energies and by changing preferences on the demand side towards climate-friendly products. Another important difference to Carbon Leakage is that the Renewables Pull effect does not necessarily counteract climate policy.
Similar to Carbon Leakage, it is to be expected that Renewables Pull could become relevant primarily for very energy-intensive products in basic materials industries. In these sectors (e.g. in the steel or chemical industry), there is also the possibility that relocations of specific energy-intensive parts of the production process could trigger domino effects. As a result, large parts of the value chains previously existing in a country or region could also be subjected to an (indirect) Renewables Pull effect.
For the federal state of NRW, in which the basic materials industry plays an important role, the possible emergence of Renewables Pull is associated with significant challenges as climate policy in Germany, the EU and also worldwide is expected to become more ambitious in the future.
This report aims to enable and initiate a deeper analysis of the potential future developments and challenges associated with the Renewables Pull effect. Thus, in the final chapter of the report, several research questions are formulated that can be answered in the further course of the SCI4climate.NRW project as well as in other research projects.
The target of zero emissions sets a new standard for industry and industrial policy. Industrial policy in the twenty-first century must aim to achieve zero emissions in the energy and emissions intensive industries. Sectors such as steel, cement, and chemicals have so far largely been sheltered from the effects of climate policy. A major shift is needed, from contemporary industrial policy that mainly protects industry to policy strategies that transform the industry. For this purpose, we draw on a wide range of literatures including engineering, economics, policy, governance, and innovation studies to propose a comprehensive industrial policy framework. The policy framework relies on six pillars: directionality, knowledge creation and innovation, creating and reshaping markets, building capacity for governance and change, international coherence, and sensitivity to socio-economic implications of phase-outs. Complementary solutions relying on technological, organizational, and behavioural change must be pursued in parallel and throughout whole value chains. Current policy is limited to supporting mainly some options, e.g. energy efficiency and recycling, with some regions also adopting carbon pricing, although most often exempting the energy and emissions intensive industries. An extended range of options, such as demand management, materials efficiency, and electrification, must also be pursued to reach zero emissions. New policy research and evaluation approaches are needed to support and assess progress as these industries have hitherto largely been overlooked in domestic climate policy as well as international negotiations.
The basic materials industries are a cornerstone of Europe's economic prosperity, increasing gross value added and providing around 2 million high-quality jobs. But they are also a major source of greenhouse gas emissions. Despite efficiency improvements, emissions from these industries were mostly constant for several years prior to the Covid-19 crisis and today account for 20 per cent of the EU's total greenhouse gas emissions.
A central question is therefore: How can the basic material industries in the EU become climate-neutral by 2050 while maintaining a strong position in a highly competitive global market? And how can these industries help the EU reach the higher 2030 climate target - a reduction of greenhouse gas emissions of at least 55 per cent relative to 1990 levels?
In the EU policy debate on the European Green Deal, many suppose that the basic materials industries can do little to achieve deep cuts in emissions by 2030. Beyond improvements to the efficiency of existing technologies, they assume that no further innovations will be feasible within that period. This study takes a different view. It shows that a more ambitious approach involving the early implementation of key low-carbon technologies and a Clean Industry Package is not just possible, but in fact necessary to safeguard global competitiveness.
The Port of Rotterdam is an important industrial cluster, comprising mainly oil refining, chemical production and power generation. In 2016, the port's industry accounted for 19% of the Netherlands' total CO2 emissions. The Port of Rotterdam Authority is aware that the cluster is heavily exposed to future decarbonisation policies, as most of its activities focus on trading, handling, converting and using fossil fuels. Based on a study for the Port Authority using a mixture of qualitative and quantitative methods, our article explores three pathways whereby the port's industry can maintain its strong position while significantly reducing its CO2 emissions and related risks by 2050. The pathways differ in terms of the EU's assumed climate change mitigation ambitions and the key technological choices made by the cluster's companies. The focus of the paper is on identifying key risks associated with each scenario and ways in which these could be mitigated.