Climate and industrial innovation: Thermal energy solutions needed

Republican and Democratic policymakers have long supported polices to generate electricity with clean energy and to power our cars and trucks with alternative fuels, including electricity. Lawmakers prioritized these sectors for good reason; they are the largest sources of greenhouse gas (GHG) emissions and investing in them stimulates our economy and creates the jobs of the future. But now it’s time for Congress to take on the long-overlooked and third largest source of energy-related GHG emissions: the heat needed for running industrial processes. Tackling these emissions is essential to effective action on climate change and presents tremendous economic opportunities for the United States.

Manufacturing processes depend on heat for almost everything — for ovens that forge steel and kilns that fire ceramics, for making chemicals that go into the products we use every day, for processing foods and beverages, and for drying paper goods, paints and other products. These are just a few of the thousands of ways U.S. industries use heat as an essential part of their operations. This heat, called thermal energy, accounts for over 12 percent of U.S. emissions, generating even more emissions than the entire U.S. agricultural sector.

Many large U.S. companies have set ambitious climate and clean energy goals and have begun to tackle their thermal emissions, but to meet these goals they need Congress to pass robust federal policies that promote innovation, reward early adoption and facilitate scaling up clean energy solutions in the marketplace.

Addressing thermal energy carbon pollution will unlock many economic and environmental opportunities. It will help the U.S. increase energy independence, counteract energy-driven price inflation and decrease reliance on autocrats who control large global energy supplies. It will also unlock development of the next generation of energy supplies and technologies, drive investment in new and existing industries and create jobs and strengthen communities across the country. And last but certainly not least, it will help global U.S. companies to compete economically while reducing their carbon footprint.

Conversely, if we fail to address these emissions, we will have no viable pathway to keeping global warming below 1.5 degrees Celsius, which is the critical threshold that science tells us we can’t breach if we are to avoid the worst effects of climate change.

As Congress considers how best to support U.S. industry, there are several promising alternatives to fossil fuels waiting in the wings. One is capturing solar energy to heat industrial fluids or create steam at an industrial scale. Another is using biogas — captured from landfills or converted from animal and food waste — to replace conventional natural gas. Green hydrogen, which eliminates emissions by using renewable energy to create clean burning hydrogen, can also substitute for conventional natural gas and other transportation fuels. Electrifying industrial processes, with renewable electricity, presents many opportunities. And heat pumps are often a simple cost-effective addition to any industrial system that can capture and reuse waste heat.

These examples are just the beginning of a nascent industry. With further innovation, we can unlock the full potential of renewable thermal energy. So, what is standing in the way of renewable thermal uptake?

One barrier is technology. Research and development of many of these promising renewable thermal energy technologies is still in its early days. And even established technologies, like hydrogen, often remain commercially unavailable or too costly compared to existing fossil fuel options like natural gas.

The lack of one-size-fits-all solutions makes scalability a challenge. Industrial processes and sectors vary greatly in their needs, including temperature requirements and industrial applications. Cleaner fuel availability is often limited: the sun shines more intensely in some places, geothermal solutions aren’t possible everywhere, while animal and food wastes are far from where they may be needed for fuel and expensive to pipe or transport.

Market and policy barriers have made it difficult to close the price gap between renewable thermal and fossil fuels, thereby slowing adoption of renewable thermal technologies. Large energy buyers struggle with general lack of information about these technologies, and the financing tools for underwriting the cost are inadequate. The relatively immature marketplace for renewable thermal energy solutions also lacks tools like the Renewable Energy Certificates (RECs), which played a key role in developing a market for buying and selling renewable electricity. RECs enabled companies, government agencies and even individuals to buy, sell and trade units of “renewable electricity” in a way that is both credible and traceable, enabling huge investments and a robust marketplace.

Tackling these barriers is long overdue. Yet, no one organization can solve them alone. This was the impetus behind the Renewable Thermal Collaborative (RTC), a unique buyer-led coalition of major commercial and industrial thermal energy users and solution providers who joined together in 2017 to take this challenge head-on.

These energy buyers and solution providers are building a community to drive change and work with policymakers — to go further and faster, together. Members are learning from one another to better understand how to transition to renewables, speed technological advancements and support policies that promote the adoption of renewable thermal solutions.

The RTC has set an ambitious goal of increasing renewable thermal energy use by 150 percent by 2030 — and in so doing, slash industrial thermal energy emissions by 30 percent. It’s a bold goal, and success will depend in part on federal government action. Right now, the renewable thermal energy marketplace lacks the policy incentives that proved to be so critical in accelerating the deployment of renewable electricity. These successful policy incentives included tax credits, standards, research, development and deployment programs and more. Renewable thermal energy solutions need a similar array of incentives to help reduce technology costs, unlock investment and accelerate deployment.

Drawing on this successful playbook, Congress should make renewable thermal technologies eligible for a 30 percent investment tax credit. These technologies would include green hydrogen, beneficial electrification, biogas (including landfill gas), renewable natural gas, solar thermal and thermal storage. In addition, Congress should increase funding for the Department of Energy to expand research, development, demonstration and deployment (RDD&D) programs and support partnerships with the private sector to accelerate low-carbon renewable thermal technology development. 

Only with robust national policy can we affect the kind of meaningful, lasting change needed to solve the thermal energy challenge and reinvest in U.S. manufacturing at the scale it deserves. The U.S. business community is increasingly engaged on this issue. Now it’s time for Congress to do its part in ensuring the U.S. meets its climate goals and remains globally competitive.

Marty Spitzer is World Wildlife Fund’s (WWF) senior director of climate and renewable energy.