Decarbonisation modelling for key industrial sectors focusing on process changes in a cost-optimised pathway

Decarbonisation of industrial sectors is imperative for mitigating global warming. However, there is a paucity of studies that explore potential synergies among various industrial sectors at the national level, particularly concerning CO2 reuse. This study focuses on six key European countries (France, Germany, the United Kingdom, Italy, Belgium, and Spain) and analyses four primary CO2-emitting sectors (steel, chemicals, cement, and glass), with the inclusion of an e-fuels sector as an additional outlet for captured CO2. This paper evaluates the influence of diverse technical and economic conditions on energy consumption patterns and incentives for industrial stakeholders to reduce their emissions. A bottom-up technological model was developed, and all the technical and economic data are detailed in the paper. Findings underscore the significance of electricity consumption, bioenergy utilisation, and carbon capture technologies for decarbonisation. Moreover, the study reveals that in the reference scenario, a considerable proportion of captured CO2 is stored rather than reused during the period between 2030 and 2040 due to the delayed deployment of CO2 reuse technologies. A sensitivity analysis on various model parameters indicates that depending on the price of electricity, a carbon tax of 150<euro>/tCO2 would reduce total emissions by between 65% and 85%, compared with 97% at 300<euro>/tCO2. A carbon tax exceeding 300<euro>/tCO2 leads to negligible reductions in total emissions, as direct emissions covered by the carbon tax approach zero. However, residual emissions persist, primarily stemming from the extraction for the remaining fossil fuels consumption. Thus, achieving a complete phase-out of fossil fuels necessitates significant economic incentives or the implementation of robust policy frameworks beyond mere economic considerations.