Industrial smoke pollution. Source: Adina Voicu / CC0.
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The industrial sector accounts for almost a third of energy consumption in the United States (EPA, 2019) and upwards of 50% globally (EIA, 2019). The industrial sector also accounts for 22% of emissions in the U.S. (approximately 2 GtCO2e in 2019), and a third of global emissions (approximately 11 GtCO2 in 2019). A large portion of these emissions comes from industrial production processes such as iron and steel production, chemical production, petroleum refining and other manufacturing and non-manufacturing activities which are vital to most nations’ economic well-being. Accordingly, advancing industrial energy efficiency can have positive economic benefits.

Over 90% of global GHG emissions from the industry sector come from a dozen industries, including iron and steel manufacturing, chemicals, and cement. Source: Infographic based on AGCI’s 2018 Workshop on Technologies and Policies to Decarbonize the Industry Sector and its subsequent publication by Rissman et al., 2020.

Industrial processes are mostly thermal-based and require the use of large amounts of fossil energy. Decarbonizing the industrial sector is a massive challenge but reducing energy consumption is possible through process streamlining. Installing variable-speed drive motors, process and equipment sensors, energy efficient lighting, and waste heat recovery systems can have significant energy, economic, and emissions savings. For example, it is estimated that fixing leakages in the compressed air systems that most industrial processes rely on would result in over $3 billion in collective savings across manufacturing centers (CAGI). Exelon Energy identifies additional crucial steps industrial facilities can take to ensure efficient operation.

There are several barriers to industrial energy efficiency adoption including internal competition for capital, lack of in-house expertise, and environmental permitting restrictions. The 2015 Congressional report on Industrial Energy Efficiency details these barriers in additional detail.

Nevertheless, there are policy measures and other mechanisms that can help fast-track industrial energy efficiency measures. These include regulations or standards, fiscal incentive schemes such as tax breaks, and state and federal funding to further research and development (R&D). This Lawrence Berkeley National Lab (LBNL) report offers multiple options and success stories. Aside from greenhouse gas reductions, retooling industrial facilities can also reduce other pollutants that cause local environmental harm. This is particularly relevant from an environmental justice standpoint because low income communities and communities of color often live the closest to polluting industrial facilities (Bravo et al., 2016).