Low demand for green products is deterring the necessary investment of up to US$700bn in low-carbon projects within carbon-intensive industries such as steel, aluminium and cement, according to an initiative from the UN Climate Summit.
More than 450 major industrial projects worldwide are seeking hundreds of billions of dollars in investment to reduce carbon emissions, according to a statement from the Industrial Transition Accelerator (ITA), released on 19 September.
The ITA, an initiative launched at the COP28 summit in Dubai, UAE, aims to encourage investment in green projects.
The ITA’s report examined six heavy industry sectors (cement, aluminium, chemicals, steel, shipping and aviation), which were found to contribute approximately 30 per cent of global CO2 emissions.
The group noted, “To stay on track with Paris-aligned climate targets, a critical mass of large-scale projects... must reach their final investment decision within the next two to three years.” They added that project developers have not secured enough firm commitments from buyers for low-carbon products, such as green cement, green steel,and sustainable aviation fuel, to secure the necessary financing.
Faustine Delaselle, executive director of the ITA, stated, “The lack of clear, sustained demand for low-carbon products is the single biggest barrier to investment. Businesses and financiers cannot commit to these projects without market certainty.”
The ITA is active in Brazil and the UAE, providing support to project developers on how to decarbonise their operations.
