Chart: Heavy industry is the next big climate problem to tackle

America’s industrial sector is on track to become the nation’s biggest source of planet-warming emissions by 2035, according to Rhodium Group.

While the Inflation Reduction Act’s clean energy and electric vehicle subsidies are set to drive significant emissions reductions in both the power and transportation sectors over the next decade, industrial emissions are expected to remain stubbornly high.

With the policies currently in place, the report projects that overall U.S. emissions will be between 32 and 51 percent below 2005 levels in 2035.

The main driver of that decline will be the power sector, where emissions are expected to plummet over the next decade as more and more wind, solar, and storage projects plug into the grid. Transportation is the next biggest contributor. Rhodium Group forecasts the sector — currently the biggest source of carbon emissions in the U.S. — will cut its emissions by about 23 percent between 2022 and 2035.

The industrial sector’s outlook is far less optimistic. By 2035, heavy industry will still emit the same amount of CO₂ as it does today — and account for one-third of all U.S. emissions.

Industrial processes like manufacturing cement, steel, and chemicals are both deeply embedded in the economy and particularly tough to decarbonize. Producing these materials requires immense amounts of high-temperature heat that’s challenging to generate without fossil fuels. Some of these processes, like steelmaking, still rely on coal as a major input.

It’s a global problem. Worldwide, industrial emissions account for over one-quarter of total greenhouse gas emissions — more than all modes of transportation combined. The challenge is expected to grow in the years to come, as demand for industrial materials rises due to everything from economic development to the rapid buildout of renewables, batteries, and EVs, all of which require inputs like steel and aluminum.

Recent federal investments such as the Inflation Reduction Act aim to grease the wheels of heavy industry decarbonization in the U.S. by subsidizing some of the technologies needed to tackle the problem, like clean hydrogen and carbon capture. The Biden administration also recently funded large-scale heavy industry decarbonization projects, including the first-ever hydrogen-based green steel facility in the U.S., through the $6 billion Industrial Demonstrations Program.

But as other emissions-intensive sectors go zero-carbon, much more is needed to bend the emissions curve in time to meet global climate goals.