Pathways to Deep Decarbonisation of Germany's Industry by 2045

14.09.2021

WIFO Research Seminar by Andrea Herbst (Fraunhofer ISI)

On 8 August 2021, Andrea Herbst, Senior Researcher at the Fraunhofer Institute for Systems and Innovation Research ISI, gave a WIFO Research Seminar lecture. She presented recent model simulation results of different comprehensive technological pathways to decarbonisation. Comments were given by WIFO environmental economist Gerald Feichtinger.

To achieve the long‑term goal of greenhouse gas neutrality in Germany by 2045, industrial processes must also trend towards zero emissions. This requires a fundamental transformation of the entire industrial production system. In the seminar, several technological paths to achieve this goal were discussed using the simulation model "FORECAST". All presented scenarios hinge on material and energy efficiency and CO2-neutral primary (e.g., solar or wind) as well as secondary energy sources. By 2030, first solutions for the provision of CO2-neutral hydrogen and electricity should be promoted as a steppingstone. Among other things, targeted subsidies, green lead markets and CO2 pricing (such as ETS, Carbon Contracts for Difference, Cross Border Adjustment Mechanism) are mentioned as instruments. The research was conducted in the Copernicus Project ARIADNE 2020-2023.

Gerald Feichtinger reflected on the model results in his commentary with respect to the upcoming challenges towards a comprehensive electrification of industrial processes and put the results into an Austrian context.

 

Publications

WIFO Research Seminar, Österreichisches Institut für Wirtschaftsforschung, Wien, 08.09.2021 13:30
Online via Microsoft Teams, link will be submitted after registration (veranstaltungen@wifo.ac.at)
Organised by: Austrian Institute of Economic Research
Online since: 06.09.2021 0:00
Research question(s): How could different (technology) pathways to a near-climate neutral industry by 2045 look like? – What role does the use of electricity and hydrogen play in the different scenarios? – What are the challenges in individual sectors (e.g. basic chemicals)? – What are the priorities for the transformation until 2030? • Approach: "Forecast" is a bottom-up energy demand model that depicts the technology structure of industry and maps industrial energy consumption, emissions, and costs at the process level. Furthermore, technology areas such as electric motors, industrial furnaces, space heating and steam generation are modelled separately. • Main result(s): The four scenarios show alternative paths to almost CO2-neutral industrial production by 2045 – at least 95 percent by 2045 compared to 1990. They include ambitious changes to the entire industrial production system and assume a profound transformation in many sectors and value chains. In order for the transition to CO2-neutral industrial production by 2045 to succeed, the time horizon until 2030 is crucial. • Policy implication(s): The current German policy mix is not sufficient to achieve sufficient reductions in the medium term and, above all, does not provide sufficient incentives for the fundamental long-term transformation. A successful industrial transformation therefore requires an adjustment of the regulatory framework (CCfDs, EU-ETS minimum price paths, establishment of green lead markets, etc.).
Please contact

Gerald Feichtinger, BBakk.

Research groups: Environment, Agriculture and Energy
© Maksym Kaharlytskyi/Unsplash
© Maksym Kaharlytskyi/Unsplash