The Road to Net Zero: How Manufacturers can Prepare for a Zero-Carbon future

Consensus can often be difficult to reach. Whether around public policy or business actions, there are usually differing views, priorities and objectives that need to be aligned to reach agreement. As we look towards the future of manufacturing, there is one area where all stakeholders in the sector are united: the critical importance of decarbonizing our industry.

The nature of manufacturing makes this goal ambitious. Manufacturing is one of the largest contributors to carbon emissions globally. In the US, the sector accounts for nearly a quarter of direct carbon emissions, and in Europe around 880 million tonnes of carbon dioxide equivalents can be attributed to manufacturing. Reaching the Paris Agreement target of net-zero carbon manufacturing by 2050 will involve concerted efforts at various levels on reducing emissions, increasing energy efficiency, and improving collaboration across the value chain.

Getting to Net-Zero

Within each manufacturing sub-sector there are processes that have long depended on fossil fuels to function. From large-scale chemical refineries and metal smelting facilities that require high-temperature processes, through to the use of feedstocks in food production and on-demand supply operations in consumer goods; these all contain carbon dependencies that cannot be transformed overnight.

Reducing the environmental impact will bring a different set of challenges for each manufacturing business. In turn, this will require some lateral thinking to replace embedded practices with new, creative approaches to production. Overcoming these challenges is an important part of future-proofing business models and creating positive change in the industry.

Fortunately, we have several tailwinds supporting this collective endeavor. The backing of governments and supranational bodies is one such example helping to drive change from the top down. Another is the bottom-up force in the form of digitalization. Rapid advances in digital technologies are helping executives to look at each microprocess and assess ways of making those incremental improvements that add up to big environmental gains.

The question many executives are seeking to answer is in which areas can digitalization produce the greatest impact. Here are three key areas where digital solutions can be applied to support a sustainable future.

1. Reducing existing carbon footprints

Energy efficiency remains a key objective for the sector in supporting efforts on minimizing greenhouse gas emissions. Within any business there are areas for improvement, with the potential for thousands of granular refinements that add up to significant efficiency gains over time. In particular, reducing requirements around heating and cooling require immediate focus, as they account for anywhere between 50 to 90% of the current energy consumption in processing plants.

More efficiency means less waste and lower energy costs, helping to drive businesses forward as well as reducing the carbon impact. A study by the Global Center on Adaptation (GCA) found that every dollar invested in building climate resilience could result in between $2 to $10 in net economic benefits. The adoption of digital tools can support targets around less wasteful or energy-intensive processes through improved visibility and measurability of machine and process performance, as well as helping to capture data from separate assets to create meaningful insights to inform longer-term carbon reduction strategies.

2. Innovating processes to enable a circular economy

While more efficient operation of current assets clearly presents an opportunity for improved plant performance, it must be matched with an ambition to adopt a more sustainable, less carbon-intensive future business model.

This transition requires investment in innovation to shift towards cleaner operating models. Such changes may include the use of efficient and circular infrastructures to turn waste into new products or business opportunities, measures to adopt inventive solutions that capture and neutralize fugitive emissions and unavoidable carbon products, alongside efforts to enable leaner supply chain operations, such as through greater use of local networks and resources.

3. Collaborating with partners and customers to reduce inefficiencies

Digital solutions present the foundation for a more collaborative environment, extending across the chain from material extraction, parts supply, and production through to distribution and interactions with technology partners and end-user customers. Developing trusted partnerships and interactions among these various stakeholders can help to identify new use cases and develop more economically and ecologically superior solutions. Through a more integrated, digitally enabled approach, manufacturing plants can design systems and processes that unlock substantial efficiencies and find clever ways of pushing down carbon requirements over time to achieve joint sustainability targets.