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    Getting the carbon out of India’s heavy industries

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    The world’s third largest carbon emitter after China and the United States, India ranks seventh in a major climate risk index. Unless India, along with the nearly 200 other signatory nations of the Paris Agreement, takes aggressive action to keep global warming well below 2 degrees Celsius relative to preindustrial levels, physical and financial losses from floods, droughts, and cyclones could become more severe than they are today. So, too, could health impacts associated with the hazardous air pollution levels now affecting more than 90 percent of its population.  

    To address both climate and air pollution risks and meet its population’s escalating demand for energy, India will need to dramatically decarbonize its energy system in the coming decades. To that end, its initial Paris Agreement climate policy pledge calls for a reduction in carbon dioxide intensity of GDP by 33-35 percent by 2030 from 2005 levels, and an increase in non-fossil-fuel-based power to about 40 percent of cumulative installed capacity in 2030. At the COP26 international climate change conference, India announced more aggressive targets, including the goal of achieving net-zero emissions by 2070.

    Meeting its climate targets will require emissions reductions in every economic sector, including those where emissions are particularly difficult to abate. In such sectors, which involve energy-intensive industrial processes (production of iron and steel; nonferrous metals such as copper, aluminum, and zinc; cement; and chemicals), decarbonization options are limited and more expensive than in other sectors. Whereas replacing coal and natural gas with solar and wind could lower carbon dioxide emissions in electric power generation and transportation, no easy substitutes can be deployed in many heavy industrial processes that release CO2 into the air as a byproduct.

    However, other methods could be used to lower the emissions associated with these processes, which draw upon roughly 50 percent of India’s natural gas, 25 percent of its coal, and 20 percent of its oil. Evaluating the potential effectiveness of such methods in the next 30 years, a new study in the journal Energy Economics led by researchers at the MIT Joint Program on the Science and Policy of Global Change is the first to explicitly explore emissions-reduction pathways for India’s hard-to-abate sectors.

    Using an enhanced version of the MIT Economic Projection and Policy Analysis (EPPA) model, the study assesses existing emissions levels in these sectors and projects how much they can be reduced by 2030 and 2050 under different policy scenarios. Aimed at decarbonizing industrial processes, the scenarios include the use of subsidies to increase electricity use, incentives to replace coal with natural gas, measures to improve industrial resource efficiency, policies to put a price on carbon, carbon capture and storage (CCS) technology, and hydrogen in steel production.

    The researchers find that India’s 2030 Paris Agreement pledge may still drive up fossil fuel use and associated greenhouse gas emissions, with projected carbon dioxide emissions from hard-to-abate sectors rising by about 2.6 times from 2020 to 2050. But scenarios that also promote electrification, natural gas support, and resource efficiency in hard-to-abate sectors can lower their CO2 emissions by 15-20 percent.

    While appearing to move the needle in the right direction, those reductions are ultimately canceled out by increased demand for the products that emerge from these sectors. So what’s the best path forward?

    The researchers conclude that only the incentive of carbon pricing or the advance of disruptive technology can move hard-to-abate sector emissions below their current levels. To achieve significant emissions reductions, they maintain, the price of carbon must be high enough to make CCS economically viable. In that case, reductions of 80 percent below current levels could be achieved by 2050.

    “Absent major support from the government, India will be unable to reduce carbon emissions in its hard-to-abate sectors in alignment with its climate targets,” says MIT Joint Program deputy director Sergey Paltsev, the study’s lead author. “A comprehensive government policy could provide robust incentives for the private sector in India and generate favorable conditions for foreign investments and technology advances. We encourage decision-makers to use our findings to design efficient pathways to reduce emissions in those sectors, and thereby help lower India’s climate and air pollution-related health risks.” More

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      Reducing emissions by decarbonizing industry

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      A critical challenge in meeting the Paris Agreement’s long-term goal of keeping global warming well below 2 degrees Celsius is to vastly reduce carbon dioxide (CO2) and other greenhouse gas emissions generated by the most energy-intensive industries. According to a recent report by the International Energy Agency, these industries — cement, iron and steel, chemicals — account for about 20 percent of global CO2 emissions. Emissions from these industries are notoriously difficult to abate because, in addition to emissions associated with energy use, a significant portion of industrial emissions come from the process itself.

      For example, in the cement industry, about half the emissions come from the decomposition of limestone into lime and CO2. While a shift to zero-carbon energy sources such as solar or wind-powered electricity could lower CO2 emissions in the power sector, there are no easy substitutes for emissions-intensive industrial processes.

      Enter industrial carbon capture and storage (CCS). This technology, which extracts point-source carbon emissions and sequesters them underground, has the potential to remove up to 90-99 percent of CO2 emissions from an industrial facility, including both energy-related and process emissions. And that begs the question: Might CCS alone enable hard-to-abate industries to continue to grow while eliminating nearly all of the CO2 emissions they generate from the atmosphere?

      The answer is an unequivocal yes in a new study in the journal Applied Energy co-authored by researchers at the MIT Joint Program on the Science and Policy of Global Change, MIT Energy Initiative, and ExxonMobil.

      Using an enhanced version of the MIT Economic Projection and Policy Analysis (EPPA) model that represents different industrial CCS technology choices — and assuming that CCS is the only greenhouse gas emissions mitigation option available to hard-to-abate industries — the study assesses the long-term economic and environmental impacts of CCS deployment under a climate policy aimed at capping the rise in average global surface temperature at 2 C above preindustrial levels.

      The researchers find that absent industrial CCS deployment, the global costs of implementing the 2 C policy are higher by 12 percent in 2075 and 71 percent in 2100, relative to policy costs with CCS. They conclude that industrial CCS enables continued growth in the production and consumption of energy-intensive goods from hard-to-abate industries, along with dramatic reductions in the CO2 emissions they generate. Their projections show that as industrial CCS gains traction mid-century, this growth occurs globally as well as within geographical regions (primarily in China, Europe, and the United States) and the cement, iron and steel, and chemical sectors.

      “Because it can enable deep reductions in industrial emissions, industrial CCS is an essential mitigation option in the successful implementation of policies aligned with the Paris Agreement’s long-term climate targets,” says Sergey Paltsev, the study’s lead author and a deputy director of the MIT Joint Program and senior research scientist at the MIT Energy Initiative. “As the technology advances, our modeling approach offers decision-makers a pathway for projecting the deployment of industrial CCS across industries and regions.”

      But such advances will not take place without substantial, ongoing funding.

      “Sustained government policy support across decades will be needed if CCS is to realize its potential to promote the growth of energy-intensive industries and a stable climate,” says Howard Herzog, a co-author of the study and senior research engineer at the MIT Energy Initiative.

      The researchers also find that advanced CCS options such as cryogenic carbon capture (CCC), in which extracted CO2 is cooled to solid form using far less power than conventional coal- and gas-fired CCS technologies, could help expand the use of CCS in industrial settings through further production cost and emissions reductions.

      The study was supported by sponsors of the MIT Joint Program and by ExxonMobil through its membership in the MIT Energy Initiative. More