NEFI - New Energy for Industry developed scenarios for climate neutrality in industry

·  Study uses three scenarios to show how the transformation to a climate-neutral Austrian industry can succeed  

The domestic manufacturing industry emitted about 28 million tonnes of CO₂ into the atmosphere in 2021 and is thus responsible for more than one third of the total emissions in Austria. In their current study, the experts of the NEFI innovation network have developed three scenarios that provide important impulses for a climate-neutral future of Austrian industry. The study shows in which areas projects should be implemented and which strategies and measures could be taken to achieve climate neutrality in the industrial energy system. The goal is to sustainably change industrial production in Austria through the use of existing and new technologies as well as efficiency improvements. The greatest lever for this lies in the favourable availability of renewable electricity and gas and the corresponding energy infrastructure.

Wolfgang Hribernik, NEFI Network Coordinator and Head of Center for Energy at the AIT Austrian Institute of Technology: ´The energy transition in industry requires the commitment of all actors - thanks to this study and the cooperation with industrial lead companies, we now know the path to actively shape the transformation to a climate-neutral Austrian industry. In addition to the technological challenges, the NEFI scenarios also show the regulatory hurdles. These must be overcome in order to be able to implement the industrial energy transition in Austria.´

Thomas Kienberger, head of the NEFI_Lab and head of the Chair of Energy Verbund Technology at Montanuniversität Leoben: ´With the NEFI scenarios, pioneering work has been done for the development of concrete paths for the transformation of the industrial energy system. Research, development and demonstration are the keys to rapid implementation of new technologies in industry. The results show that we can make the transition in Austria. However, efforts in these areas need to be intensified and accelerated.´

Three scenarios for a climate-neutral Austrian industry

For the development of the scenarios, the manufacturing industry was divided into thirteen sub-sectors, which include construction and mining as well as manufacturing. In several steps, industrial data on energy consumption, fuels and potentials for increasing efficiency were collected and recorded in three scenarios. To achieve climate neutrality, industry must switch from fossil fuels such as coal, natural gas or oil to carbon-free and renewable energy sources as quickly as possible.

The first scenario, Business-As-Usual (BAU), describes a broad continuation of current trends and technologies and serves as a reference for the two more progressive scenarios. Here, energy demand will increase by up to 29 TWh to a total of 161 TWh by 2050 and Austrian industry will continue to use large amounts of fossil fuels, such as coal, naphtha and oil. This would lead to total emissions of 23 million tonnes of CO₂ in 2050.

The second scenario, Pathway of Industry (POI), was developed in cooperation with the industrial lead companies of the individual subsectors. For this, the companies provided an estimate of which climate-friendly technologies could be used in the industrial energy system by 2030 under the given framework conditions. Based on technologies available in the short to medium term, this estimate was then extrapolated to 2050. The POI scenario thus outlines a realistic perspective for industry and also provides information on the techno-economic or regulatory hurdles for the transformation of industry. In this scenario, total energy demand increases to 168 TWh by 2050 (including electricity demand for the production of the required hydrogen), while CO₂ emissions decrease by 31 million tonnes to 0.6 million tonnes.

The third scenario, Zero Emissions (ZEM), shows how comprehensive and ambitious measures can achieve complete climate neutrality for Austrian industry by 2050. The backcasting method was used to show a possible transformation path that takes into account not only technological, but also socio-economic and infrastructural parameters. In this scenario, the total energy demand increases to 172 TWh by 2050. The increase is due in particular to the increased use of hydrogen in the iron and steel industry and in basic chemical production. Plastics would then not be produced from fossil petroleum products, but on the basis of hydrogen and CO₂. In this way, unavoidable CO₂ emissions from the cement industry could also be put to good use in a cross-sectoral cooperation.

Technological measures of the scenarios: Electricity plays a key role

The basis for the transformation is formed by production technologies of the respective industrial sectors and four technological levers: the use of renewable gases and biomass, electrification and increased general energy efficiency, CO₂ capture and the circular economy. In the transformation of the industrial sector, electrification based on renewable electricity will play a key role. Currently, 20% of the total energy demand of Austrian industry is covered by electrical energy - which corresponds to about 27 TWh.

The study shows that in both the POI and ZEM scenarios, about 49 TWh of electricity are needed for final energy applications (without additional electricity demand for hydrogen electrolysis) to achieve industrial climate neutrality. In addition to general electrification such as the use of heat pumps, this increase is mainly due to electric arc furnaces and carbon capture plants in the iron and steel and non-metallic minerals sectors. If all hydrogen demand in Austria is also covered by electrolysis, the total electricity demand for industrial production in the ZEM scenario increases to 116 TWh. For gas supply, the POI and ZEM scenarios are based on different technological applications: While POI relies more on methane and biomass, ZEM mainly uses hydrogen.

In addition, targeted research, development and demonstration projects together with industrial companies will be necessary for a rapid implementation of the new technologies. For the provision of the high energy demand of 172 TWh in the ZEM scenario, primarily for electricity, hydrogen, biofuels and natural gases, the expansion of the energy infrastructure is essential. This includes efficient electricity and gas grids (including hydrogen and its derivatives) for both domestic and cross-border transport.

NEFI project OxySteel: Climate neutrality in steel production

The OxySteel project deals with energy efficiency and CO₂ reduction measures in steel production. The results show that annual energy savings of 12 GWh are possible through the innovative process design, which corresponds to approximately 10% of the annual natural gas consumption of the city of Leoben. With a corresponding technology rollout, the savings are many times higher - clear proof of the great leverage effect of the NEFI projects.

The NEFI decarbonisation scenarios are available for download here.