Global Sustainability Agenda #46: Leveraging Advanced Manufacturing and Circularity to Drive Industry Decarbonization and Supply Chain Resilience

Global Sustainability Reality

Catastrophic’ Hurricane Helene makes landfall in Florida (France24)

Climate change destroyed an Alaska village. Its residents are starting over in a new town (AP News)

Deadly Thai floods intensified by climate change, La Niña displace 150,000 families (Voa News)

UN head warns of ‘a rising tide of misery’ as sea levels rise (Le Monde)

Climate change supercharged Europe floods – scientists (BBC)

Siberia to Brazil, Climate-Fueled Wildfires Move Underground (Bloomberg)

Global Sustainability Business Impact

Roadmap For U.S.-India Initiative to Build Safe and Secure Global Clean Energy Supply Chains (The White House)

Amazon Joins Firms in $180 Million Brazil Carbon Credits Deal (Asia Financial)

“Decarbonization is the biggest transformation of the global economy of this century. But we risk entrenching a two-speed global transition”: Simon Stiell (UNFCCC)

Decarbonization and Electrification: A Roadmap to Federal Net-Zero (U.S. Department of Energy)

Investments in biofuels and green hydrogen on the rise: S&P Global (CNBC)

Why Investing in Climate Action Makes Good Economic Sense (Boston Consulting Group)

Aligning AI and climate governance (United Nations)

Colombia Looks to Future Without Oil in $40 Billion Transition Plan (Financial Post)

How investing in coal phase-out can lead to an $85 trillion opportunity (World Economic Forum)

Amazon expects to remain renewable energy’s top buyer (Axios)

US lawmakers plan bill to boost US maritime capabilities, citing global threats (S&P Global)

California Plan for Corporate Carbon Accounting Pushes Forward (The Wall Street Journal)

The path forward

Global efforts to drastically reduce greenhouse gas (GHG) emissions by 2050 are intensifying. The Paris Agreement aims to limit global temperature rise to below 2°C, preferably 1.5°C. Achieving the Paris goals requires reaching net-zero emissions in the latter half of the century, with near-zero emissions necessary by 2050 to limit warming to 1.5°C.

In 2022, the industrial sector was responsible for approximately one-third of global energy consumption and one-quarter of CO₂ emissions (about 9.0 GtCO₂). In the United States, the industrial sector accounted for 33% of the nation’s primary energy use and 30% of its energy-related GHG emissions, making decarbonizing industry crucial to addressing the climate crisis and achieving carbon neutrality.

Industry emissions come not only from energy use but also from processes like the production of F-gases (fluorinated gases used in industrial applications).

Decarbonizing industry is particularly challenging for sectors where it is difficult to substitute raw materials in manufacturing. However, various strategies have been developed to tackle these barriers. Key decarbonization measures include energy and resource efficiency, fuel and material switching, process optimization, heat recovery, electrification, recycling, carbon capture, and the use of renewable energy and bio-based materials.

The U.S. Department of Energy (DOE) categorizes these strategies into four pillars: energy efficiency, electrification, low-carbon resources, and carbon capture, utilization, and storage (CCUS). These approaches are essential for reducing industrial greenhouse gas emissions.

The industrial sector is foreseeing the adoption of emerging technologies like electrification and CCUS to meet zero emissions by 2050. In the near term, energy efficiency remains the most effective and immediate strategy, while transformative technologies will bring long-term reductions.

The DOE’s Better Plants Program supports over 270 manufacturers in adopting energy-efficient practices, improving competitiveness, and reducing emissions. Globally, other nations are following similar paths. The UK, EU, and Australia have outlined energy efficiency and decarbonization roadmaps, targeting significant reductions in energy use and emissions by 2050, with sector-specific solutions deployed based on industrial needs.

Advanced Manufacturing and Circularity

Integrating and adopting advanced manufacturing technologies and circular economy principles is a powerful approach to significantly reducing greenhouse gas (GHG) emissions across various industries while creating more sustainable, resilient production systems.

These technologies enable more efficient resource use, energy reduction, and the adoption of sustainable practices that are crucial for meeting global decarbonization goals.

As technologies like 3D printing, AI, and intelligent factories continue to evolve, industries have the opportunity to significantly reduce waste, lower emissions, and create products that last longer and use fewer resources.

Here are some examples of how they can interact:

1. Energy Efficiency and Optimization:

• Advanced manufacturing technologies such as automation, robotics, and AI allow for the optimization of production processes, reducing energy consumption and waste.
• Smart factories (Industry 4.0) use data from sensors and IoT devices to monitor and adjust production in real-time. This ensures that only the required energy is consumed, leading to lower emissions.
• Digital twins can model production processes and optimize energy use by simulating different scenarios, enabling manufacturers to reduce energy waste.

Example: Siemens’ smart factory technologies have reduced energy use in manufacturing operations by optimizing equipment performance and reducing idle time.

2. Reducing Embodied Carbon in Products:

Circularity and advanced manufacturing technologies help reduce the embodied carbon in products—the carbon emitted during production, transportation, and disposal.

• Lightweight and Low-Carbon Materials: Advanced materials science enables the development of lighter and more energy-efficient materials, such as composites or bio-based materials, which reduce the energy required for production and transportation.
• Circular Product Design: Circularity encourages the design of products with lower embodied carbon by ensuring they are recyclable, made from sustainable materials, and designed for long life cycles.

Example: Patagonia uses recycled materials in its outdoor apparel and designs its products for durability and repairability, reducing the carbon emissions associated with manufacturing new products.

3. Circular Economy and Resource Efficiency:

• Advanced manufacturing facilitates the adoption of circular economy principles, where materials and products are reused, refurbished, or recycled at the end of their lifecycle, minimizing waste and reducing emissions from raw material extraction.
• Technologies such as robotics and AI-driven remanufacturing enable products to be repaired and reused, further reducing the need for new materials and energy.
• Closed-loop manufacturing systems powered by IoT and smart technologies enable tracking of products and materials throughout their lifecycle, ensuring that they are recycled or reused.

Example: Caterpillar’s remanufacturing program, which uses robotics to refurbish old equipment and components, significantly reduces the energy and emissions involved in producing new equipment.

4. Decarbonizing Industrial Processes with AI and Digital Twins:

Advanced digital technologies such as AI and digital twins help industries optimize processes and reduce emissions by providing data-driven insights.

• Process Optimization with AI: AI algorithms can analyze vast amounts of data to identify inefficiencies in industrial processes. By optimizing processes in real-time, manufacturers can reduce energy consumption and emissions.
• Digital Twins for Energy Efficiency: Digital twins create virtual models of physical manufacturing systems, allowing companies to simulate various production scenarios and optimize resource use. This reduces energy waste and improves process efficiency, contributing to lower emissions.

Example: The Port of Rotterdam uses a digital twin to optimize logistics and port operations, reducing fuel consumption and emissions from ships and transport vehicles.

5. Additive Manufacturing (3D Printing):

• Additive manufacturing (AM) is inherently more sustainable compared to traditional subtractive manufacturing (where materials are cut away to form a product), as it uses only the necessary amount of material, significantly reducing waste.
• AM also allows for lightweight product designs, especially in industries like aerospace and automotive, reducing fuel consumption and emissions during the product’s use phase.
• Localized production using 3D printing reduces transportation needs, as products can be made closer to where they are used, cutting down on transport-related emissions.

Example: GE Aviation’s 3D-printed fuel nozzles for jet engines are lighter and more efficient, reducing fuel consumption and emissions during flights.

6. Electrification and Renewable Energy Integration:

• Many advanced manufacturing technologies enable the integration of electrified systems, which can be powered by renewable energy sources like solar or wind. Electrification of manufacturing processes reduces dependence on fossil fuels and helps manufacturers decarbonize their operations.
• Battery storage technologies, which are often produced using advanced manufacturing methods, allow for greater integration of renewable energy into the grid, helping manufacturers use clean energy more consistently.

Example: Tesla’s Gigafactories produce electric vehicle batteries using advanced manufacturing processes. They are powered by renewable energy sources and designed to minimize emissions throughout production.

7. Supply Chain Decarbonization:

• Advanced manufacturing technologies facilitate supply chain transparency by using IoT, AI, and blockchain to monitor emissions across the supply chain. This allows manufacturers to track and optimize every step of the process, from material sourcing to transportation, ensuring a reduction in carbon emissions throughout the entire production lifecycle.
• On-demand manufacturing enabled by advanced technologies can shorten supply chains by reducing inventory, storage, and excess production, further lowering emissions associated with logistics and warehousing.

Example: Adidas uses 3D printing and localized production to reduce supply chain emissions. This allows them to produce shoes closer to consumer markets, lowering the carbon footprint associated with long-distance transportation.

8. Reduction of Industrial Emissions:

• Advanced manufacturing technologies, such as carbon capture and waste heat recovery, help industries capture emissions from their processes and convert them into usable energy or sequester them for later use.
• AI-driven process control systems can optimize manufacturing processes in energy-intensive industries like steel, cement, and chemicals, helping to reduce emissions during production.

Example: ArcelorMittal, one of the world’s largest steel producers, uses AI-based technologies to optimize its steel production processes, reducing the amount of energy required and cutting down on associated emissions.

9. Product Lifecycle Extension:

• Advanced manufacturing processes like robotic maintenance and AI-driven predictive maintenance allow manufacturers to keep equipment and products in service longer by reducing the need for replacements and extending their useful life.
• By using advanced diagnostics and sensors, manufacturers can proactively monitor product health and repair them, reducing the carbon impact of producing new products or parts.

Example: Rolls-Royce uses predictive maintenance powered by AI to keep its jet engines in service longer, reducing the need for new parts and cutting down on emissions related to manufacturing new engines.

10. Sustainable Material Use:

• Advanced manufacturing processes can enable the use of recycled, renewable, and bio-based materials, which helps to reduce the carbon footprint associated with the extraction and processing of raw materials.
• Advanced materials science is developing materials that are both stronger and lighter, reducing material consumption while improving product efficiency. These materials are often designed to be more recyclable, contributing to circular economy goals.

Example: The development of composite materials in the automotive and aerospace industries, which are lighter than traditional metals and reduce fuel consumption, lowering emissions over a product’s lifecycle.

Challenges and Opportunities in Integrating Advanced Manufacturing for Decarbonization:

Challenges:

• High Initial Investment: Implementing advanced manufacturing technologies can require substantial capital expenditure.
• Skilled Workforce: The adoption of new technologies requires a skilled workforce capable of operating and maintaining these systems.
• Infrastructure Readiness: Full decarbonization may require additional infrastructure (e.g., renewable energy grids) that is not yet available everywhere.
• Lifecycle Emissions of Advanced Technologies: While advanced manufacturing can reduce operational emissions, the production of advanced technologies (e.g., AI systems and robots) must also be considered in decarbonization strategies.

Opportunities:

• Increased Efficiency and Cost Savings: Although the initial investment is high, the long-term benefits include lower operational costs, higher efficiency, and reduced waste.
• Regulatory Compliance: Governments are increasingly introducing carbon reduction regulations. Advanced manufacturing can help companies comply with these regulations.
• Market Competitiveness: Companies that adopt decarbonized manufacturing processes may benefit from consumer demand for sustainable products and services, giving them a competitive advantage.

Advanced manufacturing and circularity play a critical role in the transition toward decarbonization by enabling more efficient, flexible, and sustainable production systems. From energy efficiency and resource optimization to integrating renewable energy and reducing supply chain emissions, advanced technologies and circular economy principles are paving the way for industries to significantly reduce their carbon footprint. As manufacturing continues to evolve with the adoption of technologies like AI, robotics, and additive manufacturing, the potential for further decarbonization grows, helping industries meet global climate targets and move toward a more sustainable future.