High-Emitting Sectors: Challenges and Opportunities for Low-Carbon Suppliers

High-Emitting Sectors:Challenges and Opportunitiesfor Low-Carbon Suppliers I N S I G H TR E P O R TS E P T E M B E R2 0 2 4 Contents Foreword4Executive summary51Aviation101.1 Current emissions profile111.2 The FMC commitment121.3 Decarbonization pathways in aviation121.4 Supplier challenges and opportunities in low-carbon aviation132Shipping162.1 Current emissions profile172.2 The FMC commitment182.3 Decarbonization pathways in shipping182.4 Supplier challenges and opportunities in low-carbon shipping193Trucking213.1 Current emissions profile223.2 The FMC commitment233.3 Decarbonization pathways in trucking233.4 Supplier challenges and opportunities in low-carbon trucking244Aluminium274.1 Current emissions profile284.2 The FMC commitment294.3 Decarbonization pathways in aluminium294.4 Supplier challenges and opportunities in low-carbon aluminium305Cement and Concrete325.1 Current emissions profile335.2 The FMC commitment345.3 Decarbonization pathways in cement and concrete355.4 Supplier challenges and opportunities in low-carbon cement36and concrete6Steel386.1 Current emissions profile396.2 The FMC commitment406.3 Decarbonization pathways in steel406.4 Supplier challenges and opportunities in low-carbon steel41 7Carbon dioxide removal (CDR)43 7.1 Current emissions profile447.2 The FMC commitment457.3 Decarbonization pathways in carbon dioxide removal457.4 Supplier challenges and opportunities in carbon dioxide removal46 8Cross-sector challenges and opportunities488.1 Lack of emissions measurement methods and standards508.2 Availability and cost of inputs518.3 Buyers’ risk aversion and unfamiliarity with decarbonized solutions52 9Conclusion54 Contributors55 Endnotes57 Disclaimer This document is published by the World Economic Forum as a contribution to a project, insight area or interaction. The findings,interpretations and conclusions expressed herein are a result of a collaborative process facilitated and endorsed by the WorldEconomic Forum but whose results do not necessarily represent the views of the World Economic Forum, nor the entirety of itsMembers, Partners or other stakeholders. The document was created in collaboration with Deloitte Consulting, an entity withinthe Deloitte network. The findings, interpretations and conclusions expressed herein do not necessarily represent the views ofDeloitte and Deloitte shall not be liable for any loss in connection with this document. Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee (“DTTL”), itsnetwork of member firms and their related entities. DTTL and each of its member firms are legally separate and independententities. DTTL (also referred to as “Deloitte Global”) does not provide services to clients. Please see www.deloitte.com/about tolearn more about our global network of member firms. © 2024 World Economic Forum. All rights reserved. No part of this publication may be reproduced or transmitted in any form orby any means, including photocopying and recording, or by any information storage and retrieval system. Foreword By 2050, 50% of emissions reductions neededto achieve net-zero goals are expected to comefrom technologies not yet available at scale.1 Rob Johann Adriaan van RietProgramme Head,Climate Action andFirst Movers Coalition,World Economic Forum Dilip KrishnaChief Technology OfficerSustainability,Deloitte Building early market demand for breakthroughtechnologies is therefore critical to catalyse theircommercial adoption and take steps towards globaldecarbonization. Given the scale and complexity ofthe challenge, strategic reforms and engagementfrom governments, regulators, investors, purchasingfirms, researchers and the public are crucial to helpaccelerate the deployment of low-carbon solutions. with a pool of suppliers as well as connectingsuppliers to FMC members, policy-makers andfinanciers looking to grow the availability of low-carbon goods. Suppliers are a key player in this ecosystem asthey are responsible for piloting, developing andscaling-up the low-carbon technologies neededglobally. They are instrumental in driving innovationand bringing these technologies to market, therebyinfluencing downstream emissions across the globalvalue chain. The World Economic Forum, alongside privatefirms and research institutions established the FirstMovers Coalition (FMC) to enable the accelerationof breakthrough technologies and send credible,large-scale demand signals to carbon-intensivesectors. FMC members pledge to purchaselarge volumes of goods that meet science-basedemission reduction targets. As part of this FMCeffort, the Forum created the First SuppliersHub (FSH) with strategic support from DeloitteConsulting. The FSH is a global repository wheresuppliers provide information on their low-carbonprojects to facilitate information-sharing andofftake agreements. This database connects users Informed by the lessons learned from the FMC andFSH, this report, develope