Chart: Which sectors are the biggest industrial emitters in the US?

As the United States works to slash planet-warming emissions from heavy industry, two subsectors in particular will require the biggest lift: chemical production and oil and gas systems.

In 2023, the process of making chemicals — for plastics, fertilizers, cosmetics, and more — accounted for over 27 percent of direct U.S. industrial emissions, according to Rhodium Group. Another 28 percent of industrial emissions came from extracting petroleum and fossil gas and then refining the hydrocarbons into fuel.

Those numbers reflect only the emissions from producing these materials, not the carbon dioxide that comes from actually burning the fossil fuels in power plants, vehicles, and heating systems — a whole other source of greenhouse gases.

Overall, the U.S. industrial sector is now the country’s second-largest source of CO₂ emissions, after transportation. In a recent report, Rhodium Group analysts estimated that heavy industry is on track to be the highest emitter in the next decade, driven largely by rising emissions from chemicals and oil and gas refining.

While cement manufacturing and steelmaking are also notoriously carbon-intensive processes, they are comparatively smaller sources of direct U.S. industrial emissions. A simple reason why is that the United States churns out staggering volumes of chemicals and fuels every year, more than other industrial products — and more than most other nations, for that matter.

Curbing emissions from those two subsectors is vastly complicated, though entirely possible. Consider, for example, ethylene production.

Ethylene is a key building block for many of the chemicals that go into everyday items, including diapers, fabrics, mattresses, plastic bags, and PVC pipes. Today, making ethylene involves ​“cracking” apart the molecules in hydrocarbons, which involves burning huge amounts of fossil gas to heat giant furnaces to scorching temperatures.

A handful of high-profile initiatives are underway worldwide to electrify the ethylene cracking process, including a project in Houston. Among the many technical hurdles facing engineers is the fact that ethylene plants are enormously energy-intensive. A full-scale electric cracker’s rate of average energy consumption could be as much as 350 to 400 megawatts, experts say.

Other, broader challenges for chemical producers and oil refiners include the sheer size and complexity of their facilities, and the fact that companies are producing low-cost commodities in highly competitive global markets. On top of that, many products are made using specialized methods, which means it’s harder to design a one-size-fits-all solution for slashing emissions.

“Making methanol is different than making ethylene is different than making all of these other products,” said Ben King, an associate director with Rhodium Group’s energy and climate practice, and the report’s lead author.

In general, though, industrial manufacturers currently have two potential pathways for slashing industrial emissions. First, they can install carbon capture systems, which remove CO₂ from an existing facility’s waste gases and then either permanently sequester the CO₂ underground or use it to make commodity products. Second, they can replace conventionally produced hydrogen — made using fossil gas — with ​“clean hydrogen” made using renewable electricity and water.

“It really does take quite a bit of work to understand how some types of decarbonization technologies can be applied,” King said. ​“Is carbon capture an option in this part of the industrial sector, or is there an opportunity for [clean] hydrogen? It’s a complex set of considerations.”