New Tech Fund Launched to Help Cut Heavy Industry Emissions

During the summer legislation was passed to cut UK carbon emissions to net zero by 2050, the first major economy to set this target. This was done to make sure the UK ends its contribution to global heating. It was clear that action needed to be taken to fulfil this target.

The UK government has designed a scheme which will offer funds over the next 5 years to businesses with high power use. The idea behind the Industrial Energy Transformation Fund (IETF), an investment of £315m is to find new technologies that can shrink the carbon footprint of the most polluting factories in order to help meet the UK’s climate targets. Energy intensive companies such as manufacturers will be able to invest in new technology which can make their operation more efficient and so reduce their energy use. The scheme will be launched next summer, and businesses will be able to compete for a share of up to £30m, with a second phase following in 2021.

Plans have been set out by the government to drastically improve the energy efficiency of commercial buildings while also benefiting businesses by saving them up to £1 billion a year on their energy bills by 2030. Not only will efficiency be improved, but carbon emissions will be cut by 2m tonnes or the equivalent of taking nearly 200,000 cars of the road each year. Included in the scheme is improving the energy performance of rented commercial buildings and setting a minimum energy efficiency standard of Energy Performance Certificate (EPC) band B by 2030.

The announcement of the fund came after the Business, Energy and Industrial Strategy (BEIS) had released a raft of new energy proposals which included a focus on making commercial buildings more efficient.

The government proposed the £250m Clean Steel Fund in late August this year and the Industrial Energy Transformation Fund builds, on this scheme to help clean up climate emissions from the UK’s steel manufacturing industry.

Energy minister Kwasi Kwarteng said the fund will bolster investment in clean energy as it works towards its climate targets.

Kwarteng said that providing energy intensive businesses with the latest low-emission technologies will not only help the UK meet its climate targets but has the potential to help companies remain competitive and create skilled well-paid jobs.

There are 8 industrial sectors, namely cement, ceramics, chemicals, food and drink, glass, paper, iron and steel, and oil refining that currently emit two-thirds of all industrial carbon emissions according to the government.

The government are aware that some businesses from various sectors are already taking steps to reduce their energy consumption and carbon footprint.

Government ministers are keen to fund tried and tested low-carbon industrial processes, as well as exploring new options that will keep British industries agile.

A significant change in technology for heavy industry will be needed as it is expected to be one of the most difficult areas to decarbonise.

For example, Nestle has successfully cut energy costs by nearly £150,000 every year by using high temperature heat pumps for heating and cooling during the chocolate manufacturing process.

Manufacturer Ibstock Bricks are using brick-building robots to help make repetitive manufacturing processes more efficient and as a result they have halved emissions output for every brick produced.

Other factories are testing new software which use algorithms to close down non-essential machines when renewable energy is low and demand from the national energy grid is high. This process helps to reduces bills by only using electricity at cheaper times when renewable energy output is higher.

Manufacturer Saint-Gobain, are saving £165,000 a year in energy costs by becoming more responsive to demand, powering down its factories at peak energy periods

A further example is in the ceramics sector, where energy accounts for a third of its production costs. Heat reduction programmes have reduced the heat used to glaze tableware by 5%, helping cut their carbon footprint by 25%

The funding will allow more businesses to take steps like this to increase their energy efficiency.

Business, Energy and Clean Growth Minister Kwasi Kwarteng said:

“The UK is already cutting emissions faster than any other major economy and we’re the first to legislate to end our contribution to climate change entirely.

Eliminating emissions from industry is key to achieving this but doing so does not have to mean compromising our business success. That’s why we’re bolstering our investment in clean growth.

Ensuring energy-intensive businesses are equipped with the latest low-emission technologies will not only help our transition to net-zero but will also ensure that these companies are more agile and competitive going forward, creating new skilled and well-paid jobs.”

Mike Childs, Friends of the Earth head of policy, said in response to this report:

‘Too much of the UK’s emissions reductions since 1990 have been through industry moving overseas. We need to keep the industry in the UK and ensure it is clean and green.’

Heavy industry is thought to be one of the most challenging areas to decarbonise. Embracing new technology will be essential to reduce emissions from industry. Shrinking their carbon footprint will require a sustained and focused effort.

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