World Economic Forum Report Anticipates $13.5 Trillion to Transition to a More Sustainable Future
The transportation sector in one of eight industries the World Economic Forum Net-Zero Tracker Report analyzes. Photo courtesy of the World Economic Forum.
According to the World Economic Forum Net-Zero Tracker 2023 report, transitioning to a more sustainable and carbon-neutral future, $13.5 trillion in investments will be needed by 2050, particularly in the production, energy, and transport sectors.
The Net-Zero Industry Tracker 2023, published in collaboration with Accenture, takes stock of progress towards net-zero emissions for eight industries: steel, cement, aluminum, ammonia, oil and gas, aviation, and shipping and trucking. These industries depend on fossil fuels for 90% of their energy demand and pose some of the most technological and capital-intensive decarbonization challenges.
The report outlines pathways to accelerate the decarbonization of emission-intensive industries. The pathway to net zero in these sectors will differ based on unique sectoral and regional factors. Even accounting for these differences, investments in clean power, clean hydrogen, and infrastructure for carbon capture, utilization, and storage (CCUS) will be needed to accelerate industrial decarbonization across most sectors.
“Decarbonizing these industrial and transport sectors, which emit 40% of global greenhouse gas emissions today, is essential to achieving net zero, especially as demand for industrial products and transport services will continue to be strong,” said Roberto Bocca, head of Centre for Energy and Materials, World Economic Forum. “Significant infrastructure investments are required, complemented by policies and stronger incentives so industries can switch to low-emission technologies while ensuring access to affordable and reliable resources critical for economic growth.”
According to the report, the $13.5 trillion in investments is derived from average clean power generation costs of solar, off-shore and on-shore wind, nuclear and geothermal, and electrolyzer costs for clean hydrogen and carbon transport, as well as storage costs.
“It is imperative that action is taken soon to both decarbonize and improve energy efficiency; otherwise, unabated fossil-fuel demand in the key industry sectors, which have grown 8% on average the past three years, will increase very significantly by 2050,” said Bocca. “But industrial leaders can respond through new collaborative ways of working and innovating, for example within industrial clusters and by fostering best practices, sharing infrastructure in important areas like clean hydrogen and CCUS and building demand for lower-emissions products.”
The report acknowledges that recent policy developments can push the industrial net-zero transformation in the right direction. While some advanced economies are enacting large-scale policy measures, emerging economies – which will account for a larger share of future demand for industrial products and transport services – will need help accessing low-emission technologies and solutions.
Click here to read the report.
To learn more about the World Economic Forum, visit www.weforum.org.
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