Made up of some of the largest and most recognizable global businesses, the Mission Possible Partnership (MPP) wants to help accelerate decarbonization in the most carbon-intensive industries. To find out how its work will affect the packaging sector, we spoke with Anthony Hobley, the partnership’s Co-Executive Director, and Joanna Kolomanska, Platform Curator, Energy, Materials and Infrastructure Platform at the World Economic Forum.
Let’s start with an introduction – what is the Mission Possible Partnership and how will its work impact the packaging industry?
AH: The Mission Possible Partnership brings together the most influential global leaders in industrial decarbonisation, climate finance and policy development to trigger a transformational change in the world’s most carbon-intensive industries. These include Steel, Shipping, Aviation, Cement, Aluminum, Trucking, and Chemicals.
For packaging, the decarbonising of the chemicals and aluminium industries will be of direct relevance, but as the projects are about the full engagement of the value chain and capital providers, there will be other impacts over the next three decades too from all sectors. Systemic change will also need to take place in trucking and shipping, which the packaging industries rely heavily on too.
It’s no secret that the sectors involved in the MPP have thus far found it hard to make their practices more sustainable. When compared with other sectors that have decarbonised at a faster rate, why have these ones been lagging?
AH: These economic sectors are referred to as ‘harder-to-abate’, not because we lack the technological solutions but because these solutions carry a higher abatement cost than current higher-carbon technologies. However, it is technically and - with the right support - economically feasible for hard-to-abate industrial sectors to reach net-zero emissions by 2050 at a cost to the economy of less than 0.5% of global GDP and with minor impact on consumer living standards. Indeed, as the relevant clean technologies scale, these costs will come down.
In less than two years, we have convened more than 300 corporate leaders from the seven harder-to-abate sectors, along with their suppliers, customers and financial institutions to develop clear paths to net-zero across their value chains and start taking the first steps on that path. This is a journey that has clear milestones and tipping points, as well as dependencies to get the infrastructure and technology in place in this decade to scale it over the coming two decades. It is requiring systemic change, and that takes time.
I wonder if you could give us some insights into MPP’s positions on how policymakers and regulatory bodies can assist its efforts?
AH: Ambitious national, regional and international policy are critical to transitioning heavy industry and transport towards a net-zero economy. We work with industry to engage policymakers and together build a solid policy foundation to accelerate and scale sector decarbonisation. We offer a space for corporate government dialogue to design effective policies to unlock zero-carbon investment.
We are working to create a favourable policy environment for investment in and uptake of decarbonisation solutions by:
- Supporting the development of policy asks for MPP’s industry-led sector initiatives
- Leading development of policy asks that are relevant across multiple MPP sectors and backed by business, such as policies on market-based mechanisms, finance, infrastructure and public procurement
- Supporting engagement with policymakers in national and international settings, together with industry and other partners
Each sector will require specific policy instruments to help them achieve their net-zero goals, but five dimensions will be critical to all sectors. MPP’s policy asks relevant to the packaging industry are thus the following:
Creating demand for lower-emissions products and services, via mandates, consumer product standards and public procurement: Lifecycle carbon product standards on buildings and key consumer goods can incentivize the decarbonisation of key supply chains, creating demand for low-carbon materials. These can be implemented by any government and applied to both domestic and imported products but should ideally become international standards.
Leveling the playing field between high-carbon and low-carbon technologies, and across countries: We need government to ensure a level playing field between legacy high carbon technologies and low-carbon technologies. The first step should be to remove remaining fossil fuel subsidies, which currently distort market competition. Carbon pricing and other market-based measures can contribute to bridging the cost differential by ensuring legacy technologies bear the cost of the emissions they produce.
Supporting first movers by de-risking early investment: Governments play a central role in enabling first-of-a-kind projects, which face higher costs and risks than those using established technologies. Just as solar, wind and EV industries surged after strong financial support from governments, now our attention needs to turn to public and private sector financing of emerging technologies for low-carbon industry. This should include:
- Funding for public research, public-private collaborative research projects and demonstration projects.
- Support for industrial-scale projects by setting clear, national and sector decarbonisation targets and by providing incentives and support to first movers and broader deployment of next generation technologies
- De-risking financial mechanisms (e.g. reimbursable advances, loan guarantees) to crowd-in and reduce the cost of private capital for the first wave of commercial-scale projects, make low-carbon businesses investable (bankable?).
- Additional measures may be needed to reduce carbon price uncertainty (such as Carbon Contracts for Difference) or improve the economics of early projects (such as tax credits) to enable private-sector financing of these projects.
Enabling markets: To facilitate the development of differentiated markets for lower- or zerocarbon products and services, we need a credible way to certify products as lower- or zero-carbon. Internationally agreed, standardised emissions tracking and accounting, combined with credible, low-carbon product certifications, will be key to build confidence in early green markets. The establishment of trading platforms to dematerialise exchanges of low carbon commodities, for instance a book-and-claim platform for sustainable aviation fuels, will also be a key enabling mechanism
Building shared infrastructure for clean energy supply: The development of green industry and mobility will depend on the build-up of a new energy infrastructure, and governments have a key role to play in planning and co-financing it, e.g.:
- Direct and indirect electrification (through hydrogen) will play a significant role in most sectors, leading to a sharp increase in power demand (x4-5 times by mid-century), which makes rapid investment in renewable-based power systems even more crucial.
- Hydrogen use will almost certainly increase dramatically (up to x10 times), requiring the development from scratch of a new production, transport and storage infrastructure.
- Several industry sectors will benefit from the development of a CCS infrastructure, with up to 5-8Gt per annum of CO2 sequestration needed globally by mid-century (either in products or in underground storage).
In terms of the chemicals industry – what strategies/technologies does MPP think could help this sector to decarbonise?
JK: The chemical industry currently represents around 5-6% of global emissions – if the industry was a country, it would be the fifth-largest emitter in the world. Of these emissions, some 63% are energy-related. Therefore, to achieve carbon neutrality, the chemical industry has to master two challenges.
The first is reliable access to large quantities of competitive zero-carbon energy. The second if the development and implementation of new technologies that utilize renewable sources of energy and raw materials. To this end, MPP supports the Low-Carbon Emitting Technologies (LCET) initiative, a growing coalition, currently comprised of 10 leading chemical companies, focused on emissions reductions in the chemical industry and its value-chain, led by the LCET CEO Steering Board, convened and hosted by the World Economic Forum.
Our approach is based on accelerating development and upscaling of low-carbon emitting technologies for chemical production. Collaborative implementation of prioritized technologies, while addressing technology, regulatory, funding, and market challenges to decarbonisation.
LCET technology teams have identified technical principles and specific measures that can convert traditional operating models into net-zero production methodologies. Through the initiative’s transition from knowledge-sharing platform to implementation vehicle, these LCET pioneers will embark on tackling two key starting points of chemical value chains that are the largest sources of chemical GHG emissions: olefin production via steam cracking, and ammonia production with its integrated generation of hydrogen from natural gas.
LCET is moving toward pilot projects focusing on the highest GHG emitting processes. To this end, the initiative is promoting the development and upscaling of five key low-carbon emitting technology areas, namely: electrification, biomass utilisation, alternative hydrogen production, waste processing, carbon capture, and utilisation.
The first joint programmes demonstrating cross-industry collaboration are on the way, with an emerging R&D hub for plastic-waste processing and a collaborative project between BASF and SABIC, together with technology provider Linde, to pilot the world’s first electrically heated steam cracker furnace commercially. Further mission-critical technological building blocks – such as hydrogen generation in low-carbon emission processes, the use of CO2 and biomass as feedstock and the overall electrification of chemical operations – are being addressed in the LCET pipeline.
According to some estimates, the aluminium industry represents 2% of global emissions. In your organization’s view, what can be done to reduce this impact?
AH: You are correct, aluminium production currently accounts for 2% of total global emissions, or the equivalent of 252 coal-fired plants. Zero-carbon electricity can help the aluminium sector address 60% of emissions, while recycling and technologies such as non-carbon anodes that are under development can address the remaining 40%.
The Aluminium for Climate Initiative and the International Aluminium Institute have reached an agreement for collaboration on a sector transition strategy for the global aluminium industry. The transition strategy will include new industry-validated and open-access supply and demand-side modelling to net-zero for the sector.
New analysis on technologies to accelerate decarbonisation of the aluminum industry has been completed and enters the design stage prior to launching post-COP. In addition, the Accenture China team has developed new analysis on decarbonising the power supply for aluminum in China. Insights will be presented to Chinese and international audiences in sessions in December.
Ultimately, our goals are to build a larger, more geographically diverse coalition. To demonstrate the feasibility of low-cost power decarbonisation over the next 10-15 years across key regions, identifying the additional policy support required to accelerate power decarbonisation for aluminium production. And to develop a better understanding of how to unlock the deployment of low-carbon production technologies.
Transparency is key – how are MPP and the companies involved measuring and reporting their impact?
AH: To promote transparency and collaboration, our model materials and analytics are open-access, which facilitates regular refinement as data and insights evolve. It also ensures industry efforts can align behind a strategy the industry considers technically and economically feasible, subject to appropriate value chain collaboration, finance and policy support. MPP aims to provide a quantitative reference point that can underpin corporate target setting, science-based targets and financial-sector alignment methodologies.