Global Leaders in Renewables and Net-Zero Electricity Sign on to the Carbon Management Challenge

Carbon management is gaining momentum. It was great to see the attention on carbon management at COP28, including the high-level Carbon Management Challenge event with the COP28 Presidency, the Atlantic Council Carbon Management Challenge panel, the side event on the Cement Sector and Carbon Management, and the Carbon Management Challenge Roundtable. The Carbon Management Challenge is a joint effort and call to action by countries worldwide to accelerate the deployment of carbon capture, removal, use, and storage technologies. Participating countries recognize that limiting warming to 1.5°C with minimal overshoot requires a dramatic increase in the pace and scale of deployment of carbon management technologies and infrastructure.     

Nineteen countries plus the European Commission joined the Carbon Management Challenge to date. Many of these countries already derive over 50% of their electricity from net-zero sources (renewables, biomass, waste, nuclear) and are better known for leading in renewables and net-zero electricity^[1] than carbon capture and storage, such as Iceland, Sweden, Denmark, Romania, and the UK, which have reached 100%, 99%, 81%, 65% and 57%^[2] shares, respectively, of net-zero sources in their electricity mix. Denmark plans to have 90% of its electricity from wind and solar by 2030.^[3] Outside of China, the UK has the largest offshore wind capacity installed in the world. None of these countries are net-exporters of fossil energy. The European Commission, which also joined the Carbon Management Challenge, indicated that all new cars and vans registered in Europe will be zero-emission by 2035and raised its binding target for renewables in 2030 to 42.5%, with the goal of reaching 45% in the energy mix (almost doubling the existing share of renewable energy in the EU).^[4] 

There is an important difference between electricity mix and energy mix. Globally, electricity makes up approximately 20% of the energy mix.^[5] Markets are progressing to net-zero electricity and not only in Europe. For example, South Dakota achieved 81% and California achieved 52% net-zero electricity in 2022. As the grid gets cleaner, so will transport and other applications powered from the grid. 

However, high-pressure, high-temperature processes in industries such as cement, lime, blast furnace steel, glass, pulp and paper, ethanol production, and chemicals cannot be easily electrified. Although there are now electric alternatives for some industrial applications, like electric kilns, electric arc furnaces, and resistance heating solutions, transitioning to electric power requires investing large amounts of capital, significantly increasing electricity import capacity, and changing production processes that can be technically complex and disruptive. Also, many kilns and furnaces have decades of useful life remaining. There are similar challenges with the economics, process complexity, and stranded assets when switching to hydrogen. Biomass waste streams are increasingly being used in existing kilns and furnaces, either co-firing or replacing fossil energy to reduce carbon dioxide emissions, and the carbon dioxide from the combustion of biomass can also be captured. Additionally, in industries like cement, carbon dioxide is produced as a byproduct of the calcination reaction part of the process and/or feedstock, meaning that fuel switching is not a solution for addressing the process emissions associated with cement production. 

Electricity Mix vs. Energy Mix 
Even countries who reach 100% net-zero electricity will still have parts of their energy mix, e.g., transport, hard-to-abate industry, and commercial and residential heat, that cannot be easily electrified or switched to green hydrogen.

^{Source: IEA, *only 2020 data available from the IEA}

Industry accounts for more than a quarter of global emissions, and the hard-to-abate sectors make up a significant share of industry emissions. Deploying carbon capture, removal, use, and storage technologies is an important lever in managing emissions from these challenging sectors. Carbon management plays a small role in addressing emissions today but scaling up these approaches, along with dramatically expanding clean energy and energy efficiency, is essential to achieving net-zero emissions in the U.S. and globally. 

The 20 members of the Carbon Management Challenge are diverse, from the most progressed in their transitions to net-zero to those just starting the journey. Participants include Australia, Brazil, Canada, Denmark, Egypt, the European Commission, Iceland, Indonesia, Japan, Kenya, Kingdom of Saudi Arabia, Mozambique, Netherlands, Norway, Romania, Senegal, Sweden, United Arab Emirates, United Kingdom, and the United States. While many participants aim for wider applications of carbon capture, removal, use, and storage technologies (e.g., as a feedstock e-fuels and chemicals), at a minimum, carbon management will be an important solution for hard-to-abate industries in all of these countries. 
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^{[1] Net-zero sources of electricity include hydro, geothermal, wind, solar, tidal, bio energy, waste, and nuclear
[2] IEA
[3] System Value Analysis (weforum.org)
[4] REPowerEU (europa.eu)
[5] IEA}