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To Support Decarbonization, Carbon Intensive Industries Call For Increased Financing | |
| Sumita Pawar |
Executives from "hard-to-abate" industries have called for increased financing to support decarbonization efforts, following the release of a landmark report.
According to the report, less than a third believe they have adequate budgets to do so, and more than half have yet to set net-zero targets.
According to the report, reducing emissions in the hard-to-abate industries—cement, steel, aluminum, petrochemicals, shipping, aviation, heavy industry, and manufacturing—is vital in the effort to combat climate change, with industry and transport accounting for almost half of global emissions.
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The findings from 'Hard to Abate, Ready to Start', published today by Masdar, the host of Abu Dhabi Sustainability Week (ADSW), in partnership with FT Longitude, further the discussion on decarbonization by identifying the biggest hurdles and what is needed to drive greater action in the lead up to the 2023 United Nations Climate Change Conference (COP28) in the UAE.
Although challenging, the report finds that half of senior industry leaders are more confident that achieving net zero in their businesses is more achievable today compared to a few years ago.
HE "COP28 will see the conclusion of the Global Stocktake, offering a review of progress against the Paris Agreement," said Dr Sultan Al Jaber, UAE Minister of Industry and Advanced Technology, COP28 President-Designate, and Chairman of Masdar.We know that the results will show a significant gap between where we are and where we need to be. The UAE is committed to addressing this, to reigniting momentum, and to bringing the goal of 1.5 within reach. In that regard, addressing carbon emissions in hard-to-abate sectors is a priority. There is simply no path to net zero that does not include decarbonizing these essential industries."
Despite the optimism that exists across the industry and the emergence of innovative new technologies to capture and store carbon, reliable finance remains a major barrier to accelerating progress for many senior executives.
As further mentioned in the report, ahead of COP28, the UAE Presidency has made it clear that access to finance and capital will be a priority, noting that both governments and private sector partners require the resources needed to commit to transformative action. This includes investing in the breakthrough technologies and innovations needed to drive ambition, such as carbon capture and storage and other forms of decarbonization.
The report also talks about the different technologies that are available to speed up the process of decarbonization.Despite recent progress, the research highlights a gap in "frontier" technologies that are commercially available, delaying energy-intensive industries in ramping up decarbonization efforts.
Mohamed Jameel Al Ramahi, Chief Executive Officer of Masdar, said, "Building on the important momentum gained during ADSW 2023, this report is a vital tool to drive forward decarbonization in hard-to-abate industries. Masdar, a global clean energy powerhouse, will continue to play a leading role by fostering global collaboration amongst governments and private sector partners. We intend to seize the opportunity of utility-scale renewable energy and focus our investments in frontier technologies like sustainable aviation fuel and green hydrogen to help accelerate global progress ahead of COP28 and beyond.
In addition to calling for more collaboration between industries, the report emphasises the importance of more support from the public sector and asks governments around the world to come up with new ways to support national net-zero goals through funding, legislation, and taxation.
As highlighted in the report, only 24 percent of senior executives expect to receive funding from government funds or incentives, and 41 percent believe that without greater incentives and funding they will be unable to meet their domestic market's net-zero targets.
Today's report comes before the UAE starts getting ready to host COP28 in the fall of this year.This global event will act as a major milestone in progressing conversations and inclusive solutions across all sectors, including those hard-to-abate industries. In convening key players from this sector, COP28 will aim to accelerate climate action and deliver concrete outcomes and solutions for climate change.
In his role as COP President-Designate, Dr. Al Jaber has emphasised the need to address gaps by bringing public and private partners together in a "COP of Action and a COP for All". The UAE is firmly committed to an inclusive approach to climate action that includes industry leaders, civil society, academics, women, youth, and indigenous peoples.
In addition to COP28, 'Hard to Abate, Ready to Start' will help frame discussions at the upcoming International Energy Week in London and S&P CERA Week in Houston, Texas.