MechChem Africa November-December 2024

CBAM, COP29 and doubling the rate of energy efficiency

Peter Middleton

At the time of writing COP29 had just begun under the theme: ‘Exploring the economic opportunities of net-zero transitions.’ As a starting point, the IEA presented key insights from its recent report, ‘From Taking Stock to Taking Action’, which assesses how to scale up clean energy investment based on COP28 commitments, especially in emerging markets and developing economies. To help limit warming to 1.5°C and achieve global net zero emissions by 2050, the IEA is calling for the inclusion of “economy-wide” reduction targets for all sectors, with emissions reduction embedded in the next round of national climate action plans (NDCs). The COP28 vision for a net zero energy system, according to the IEA’s key insights report, contrasts a key failure – the world continues to break records for energy-related emissions and global temperatures – with records for global clean energy investment and deployment. Without the surge of clean energy technologies, emissions growth since the Covid-19 pandemic would have been three times larger, sug gests the IEA. Yet the world is still falling far short of meeting targets for limiting global warming! In analysing the impacts of full implementation of last year’s ‘UAE Consensus’, the report finds that tripling renewables and doubling efficiency targets could, on their own, reduce the world’s GHG emis sions by 10-billion tonnes by the end of the decade compared with the current trend. This would ac count for two thirds of the reduction necessary to hold global warming to 1.5 °C. In contrast, if countries only focus on a subset of the COP28 outcomes and fail to translate them into comprehensive plans and policies, or are slow to develop the necessary enabling infrastructure, such as storage and grids, then most of the huge positive potential promised at COP28 will remain unrealised. Doubling the global rate of energy efficiency improvements was calculated to provide larger emissions reductions by 2030 than anything else. But, based on current policy trends, this target still looks “far out of reach”. Consequently, in addition to annual emissions being 6.5 Gt higher by 2030, energy costs for consumers are set to be 8% higher than they would be if the doubling efficiency goal was fully implemented. What does this require? Adopting the efficiency benefits of electrification, most notably electric vehicles and heat pumps; greater use of public trans portation; improved material efficiency; support ing energy-saving among consumers; and, key for emerging economies, strengthening and enforcing efficiency standards for new buildings, factories and appliances. The cover story for this issue comes from

the CSIR’s National Cleaner Production Centre for South Africa (NCPC-SA), in which project manager, Zenzile Masipa, outlines how South African export ers can prepare for the implementation of the EU’s Carbon Border Adjustment Mechanism (CBAM). Simply put, CBAM is a tax all products imported into the EU from carbon intensive industries based on their production-related emissions.” explains Masipa. At the NCPC Sustainable Industries Conference in September this year, the head of environmental sustainability for Hulamin in South Africa, Hendrik de Villiers, outlined the rolling mill’s initiatives to meet CBAM requirements. Hulamin manufactures 10 to 12 t coils of aluminium products of different grades and exports 22% of these into the EU. Each of these must now be categorised into one of 10 CN codes; exact Scope 1 emissions embedded per ton of metal must be reported; and Scope 2 emissions for every kWh of energy used in the coil’s production must be accounted for. With 50 to 80 different processes and up to 200 different combinations of alloys and thicknesses, following different routes to an end product, he says that there is no formula that can be applied universally to calculate Scope 1 and Scope 2 data for individual coils. A hard alloy might consume double the electrical energy compared to a soft alloy, for example. Fortunately, De Villiers was able to envisage how to do this because of the resource efficiency discus sions he had at the 2019 NCPC-SA conference. As a result, Hulamin developed and began to pilot a comprehensive process monitoring system – now called its Per Lot Resource Consumption System – to help them understand what happens to each coil from the start of processing to when it stops. Metering of gas and electricity consumption and other parameters throughout the whole process allows all the relevant data needed to be collected and allocated to specific end products. The initial idea was to track every alloy going through the different machines to highlight and minimise wastefulness. But the data from the 200 000 t of metal that Hulamin produces is now being extracted for customers in the EU, split into the relevant CN codes and used to compile product specific spreadsheet reports in the format required for CBAM. Through initiatives such as the NSPC-SA, we have access to the support we need to double our rate of energy efficiency improvements. And while we have to do it for the planet, getting efficiency right can certainly result in significant economic opportunities.

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2 ¦ MechChem Africa • November-December 2024