In order for Sweden to reach the goal of net zero emissions of greenhouse gases in 2045, major changes are required in all sectors. Industry is central to the transition, as it accounts for a third of all emissions of greenhouse gases within Sweden’s borders. The industry is also a driving force for the increased electrification that we see in our long-term scenarios for the next 30 years.
The industry is investing widely to cope with the transition
Common to the most emission-intensive industries is that they need to combine several different technologies to switch to fossil-free. To succeed, the industry is betting on a combination of six main tracks, from energy efficiency to carbon capture, and none of them is sufficient alone. The development differs between the industries.
– The iron and steel industry has come the furthest with hydrogen-based production, while the mineral industry is dependent on the separation and storage of carbon dioxide for climate-neutral cement. The refining and chemical industry invests in fossil-free hydrogen and electrofuels. But several projects have been delayed due to market uncertainties, says Mimmi Fröjdh, industry analyst at the Energy Agency.
Need for clear rules of the game
The transition is affected by global factors such as trade conflicts, recession and changed policy instruments. The emission-heavy industry has long investment cycles and needs stable and long-term conditions to be able to continue investing in conversion projects.
– Swedish companies are ready to invest. But in order for them to dare to invest in innovative technology and innovative solutions that involve high risk, clear rules of the game are required in the form of targets, regulations and other governing instruments, says Cristofer Remar, policy analyst at the Energy Agency.
Despite the challenges, Sweden has good conditions to be at the forefront thanks to access to fossil-free electricity and low electricity prices. The EU’s new climate target of a 90 percent net emission reduction by 2040, from 1990 levels, also puts further pressure on the transition.
