Electrifying U.S. Industry
Technology and Process-Based Approach to Decarbonization

However, only 10% of this demand is met using renewable energy. In the United States, due in large part to the country’s relatively inexpensive natural gas, fossil fuel combustion to produce heat and steam used for process heating, process reactions, and process evaporation, concentration, and drying creates about 52% of the country’s industrial direct greenhouse gas (GHG) emissions.

There is a significant opportunity to decarbonize the industrial sector by shifting heat production away from carbon-intensive fossil fuels to clean sources such as electrification where low- or zero-carbon electricity is used.

The report’s Technical Assessment provides an analysis of the current state of industrial electrification needs, the technologies available, and the potential for electrification in thirteen industrial subsectors, separately. The subsectors included in this analysis are:

• Aluminum casting

• Paper (from virgin pulp)

• Recycled paper

• Container Glass

• Ammonia

• Methanol

• Recycled plastic

• Steel

• Beer

• Beet Sugar

• Milk powder

• Wet corn milling

• Crude soybean oil

The total technical annual energy savings potential (with 100% adoption rate) in the thirteen subsectors studied is over 529 petajoules (PJ) per year in 2019, and 663 PJ per year in 2050. This corresponds to annual CO2 emissions reduction of over 134 million tonne (Mt) per year in 2050. The report also analyzes a separate scenario for electrification of all conventional boilers in the U.S. industrial sector.

While in almost all cases analyzed the cost per unit of production is higher for the electrified processes compared to the conventional process during the period of study, future prices of electricity, particularly renewable electricity, and natural gas could impact this analysis. The price of renewable electricity may decrease more rapidly and the price of natural gas may increase more substantially than what is assumed in this study up to 2050. It should also be noted that our cost comparison focuses only on energy cost.

The electrification technologies considered in this analysis may not be the only electrification option for each process and subsector. Other electrified heating technologies might be available and applicable, or may become available in the future. In addition, other processes within the subsectors studied might have electrification potential which is not considered in this study. In summary, the energy savings and CO2 reduction potentials shown in this study are only a portion of total savings potentials that can be achieved by full electrification of these industrial subsectors in the U.S.

The report reviews the major technical, economic, market, institutional, and policy barriers to scaled development and deployment of industrial electrification technologies, as well as proposals that could help to overcome these barriers. Categories of barriers and proposals include technology, knowledge and education, financing, costs, policy, and electric utility connection and reliability.

The report’s Action Plan describes actions and policy recommendations that can be taken by industry and others to scale up industrial electrification, given the state of the market and the institutional and policy environment described in the Technical Assessment. Several key recommendations are listed below. Detailed recommendations are included in chapter 8 of the report.

• The industrial sector should initiate partnerships with academia, national labs, think thanks and other stakeholders to develop or scale electrification technologies.

• Government should provide incentives for electrification technology development and demonstration and use the capacity at the U.S. Department of Energy (DOE) national labs to advance electrification technologies for industry.

• Government and utilities should provide financial incentives in the form of tax credits or grants for pilot projects and demonstration of emerging electrification technologies in industry.

• Techno-economic analysis should be conducted for all electrification technologies applicable to each industrial subsector using capital cost, operation and maintenance cost, and energy cost. This analysis should consider non-energy benefits of electrification technologies as well as possible future costs of carbon.

• Government should create or support an industrial electrification information dissemination platform. This should include development and dissemination of case studies.

• Utilities should evaluate the demand response (DR) potential that increased electrification in the industrial sector can provide to utilities and its financial implications.

• Utilities should provide information about their electric rates, market structures, and grid upgrade implications of industrial electrification.

• Industry should work with different stakeholders to educate policymakers, utilities, and financial institutions about the benefits of electrification and what policy, regulatory, and financial support is required to electrify industrial processes.

• Government should adopt a variety of policies and programs to support industrial electrification.

• Utilities should adopt electricity rate designs that encourage electrification.

• Industry should provide training for employees and contractors about electrified technologies. Government and utilities should support such training programs.

To read the full report and see complete results and analysis of this new study, Download the full report from the link above.

Stay up to date with our work on electrifying the industrial sector through the Industrial Electrification Center.