Renewables for Industry

Industry is responsible for 30% of global energy consumption, most of which is supplied by fossil fuels. The focus of industrial decarbonisation has largely been on the steel and cement sectors, but significant potential also exists in less energy-intensive sectors such as food and beverages, textiles, chemicals, paper, and other manufacturing activities. These sectors offer some of the most immediate and cost-effective opportunities for industrial decarbonisation and diversification of energy sources. Commercially available electric technologies – including heat pumps, electric boilers and resistance heaters – can meet most heat demand in these subsectors.

Widespread electrification of low-temperature heat and steam in industry, coupled with increasing deployment of renewable electricity supply, can deliver multiple benefits. In addition to reducing fossil fuel use and associated emissions, it can improve energy security by lowering exposure to volatile gas and oil prices and, when integrated with thermal storage, it can create demand flexibility that helps ensure a higher share of variable renewable generation.

This report explores how to expand the role of renewables in the industrial energy mix through electrification of low-temperature heat and steam. It focuses on the European Union, China and the Association of Southeast Asian Nations (ASEAN), examining their techno-economic potential and existing policy environments. Finally, the report proposes priority action areas for accelerating industrial heat electrification.