Heavy industry companies can reduce their scope 2 emissions which are mainly generated from purchased electricity, steam, heating and cooling by switching to renewable energy sources. This means actively procuring 100% renewable electricity for their operations whether through onsite solar installations, power purchase agreements (PPAs or virtual PPAs) or energy attribute certificates (EACs).

3Degrees supports industrial organizations by developing and implementing tailored global renewable energy strategies, balancing the costs, risks and impacts of each option for informed decision making. We also help clients with long-term EAC purchases with additionality and supplier PPA aggregations that align with their climate targets, regulatory frameworks and operational needs.

The EU Emissions Trading System (ETS) directly impacts industrial companies, of a certain size, operating within the European Union by imposing a price on carbon emissions. If your company falls under sectors covered by the EU ETS, you are required to hold and surrender allowances for each tonne of CO2 equivalent you emit. This incentivizes emissions reductions, as reducing scope 1 emissions in manufacturing can lower your compliance costs. Furthermore, the Carbon Border Adjustment Mechanism (CBAM) compliance for industrial companies is a closely related regulation that will place a carbon price on imported goods, impacting companies in sectors like cement, steel, and fertilizers, and requiring precise reporting of embedded emissions.

3Degrees’ market intelligence team analyzes the impacts of evolving regulations, climate science, and market changes. Their insights ensure decision-making is informed by the latest and best available information.

Regardless of where the organization is on its climate journey, there are plenty of practical solutions that help all the sectors within heavy industry demonstrate near-term progress and align with frameworks such as the Greenhouse Gas (GHG) Protocol, CDP, and the Science-Based Targets initiative (SBTi).

Purchasing high-quality carbon credits to offset current emissions, deploying a biomethane procurement strategy to quickly cut natural gas emissions, implementing renewable thermal solutions for process heat can all be quick wins. Meanwhile, long-term decarbonization strategies for heavy industry should map a path to net zero, incorporating scope 1 emissions in manufacturing reductions, electrification, and regulatory alignment with CBAM compliance for industrial companies.

These solutions span stakeholder engagement and education, spot or long-term EAC and RTC/biomethane certificates purchases, value chain interventions, indirect mitigations, and accurate disclosure, while developing a roadmap for net zero. At 3Degrees, we support companies every step of the way.

Making a compelling business case for climate action in heavy industry involves demonstrating not just environmental benefits but also tangible financial and operational advantages. Highlight potential cost savings from energy efficiency improvements and the strategic advantage of securing renewable gas solutions and cleaner energy sources. Emphasize how decarbonization aligns with evolving customer and investor expectations, enhances brand reputation, and strengthens resilience against future regulatory changes or carbon pricing. Crucially, showcase how leveraging incentives like the 45V and 45Z tax credits for industry in North America, or CO2 tax incentives in Europe, can scale climate investments for business improvement reducing exposure and enhancing competitiveness.

3Degrees can assist companies with this crucial step by connecting decarbonization strategies to financial performance, risk management, and market opportunity. By translating climate action into clear business value, we help leadership teams align on a strategy that delivers tangible emissions reductions.

Addressing scope 3 emissions in your industrial supply chain is a complex but critical component to achieving 2030 climate targets. These indirect emissions occur from activities not directly owned or controlled by your company but are included within its value chain (e.g., purchased goods and services, transportation); effective strategies involve close collaboration and influence.
Key approaches include: partnering with suppliers committed to their own decarbonization goals, optimizing logistics and transportation to reduce fuel consumption, implementing circular economy practices to minimize waste from materials and end-of-life products, and encouraging your suppliers to adopt renewable gas solutions while pursuing an electrification strategy. Utilizing data analytics and engaging with your supply chain to encourage feedback can be a challenge in addressing these emissions.

Scope 1 emissions in heavy industry often come from high-heat processes like smelting, cement production, and chemical manufacturing. A low CAPEX approach for reducing scope 1 emissions can include replacing traditional fossil fuels with lower-carbon alternatives. This includes biomethane or renewable natural gas (RNG), which is particularly relevant for process heat emissions in sub-sectors like plastics, glass, chemicals and even grid heating.

3Degrees helps companies reduce these emissions through renewable thermal solutions, biomethane options assessments, and transition strategy consulting, considering the unique operational and regulatory constraints of the sector.

Heavy industry companies can cut their carbon emissions by switching to renewable energy, electrifying industrial processes–where feasible and considering the life cycle value of the industrial equipment–and transitioning to low-carbon fuels like green hydrogen and biomethane. Industrials should also engage their supply chains to address upstream emissions, prioritize low-carbon suppliers and consider aggregated renewable energy offtakes. Implementing a Supplier Code of Conduct can be a first step towards this goal and incentivising value-chain interventions. Transparent reporting and national incentives can help with decarbonization and compliance and demonstrate progress to stakeholders.

3Degrees helps companies in industrial sectors reduce carbon emissions in their supply chains by combining advisory, supplier engagement, and credible emission reduction projects. We map and measure scope 3 emissions to identify the most carbon-intensive suppliers and materials, then design and implement targeted reduction strategies like insetting projects at supplier facilities or renewable energy sourcing for upstream suppliers.