ISSUE BRIEF
REDUCING US INDUSTRIAL EMISSIONS UNDER BUDGETARY UNCERTAINTY
ISSUE BRIEF
Reducing US industrial emissions under budgetary uncertainty NOVEMBER 2024
DAVID GOLDWYN AND ANDREA CLABOUGH
I. EXECUTIVE SUMMARY Despite a transformative shift in policy and financial, technical, and regulatory support for low-carbon energy deployment in the United States, the pathway to deep decarbonization for the pillars of the US industrial economy remains unclear. Through legislative and executive efforts at the federal level, combined with those of numerous state and local governments, the United States has fostered a historically favorable environment for clean energy technology development. However, intent is one matter, and execution is another. Over the last two years, inflationary challenges, uncertainty over the issuance of permits, delayed federal guidelines, and volatile energy-demand trends have undermined the anticipated American clean energy and manufacturing renaissance. The speed bumps have been especially problematic for industrial decarbonization, where key sectors are considered “hard to abate” with existing, mature low-carbon technologies.
The Atlantic Council Global Energy Center develops and promotes pragmatic and nonpartisan policy solutions designed to advance global energy security, enhance economic opportunity, and accelerate pathways to net-zero emissions.
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This study was conducted in conjunction with expert analysts and private sector investors who represent key stakeholders in these emerging industries. It considers a fundamental question: How can these high-emitting industrial sectors, foundational to the US and global economy, decarbonize primarily through nascent and presently expensive technology suites in the potentially constrained fiscal environment ahead? Discussions revealed three overarching themes as the most prominent challenges to achieving industrial decarbonization. First, uncertainty over policy consistency and the durability of US decarbonization incentives elevates risk for private-sector investors in emerging technologies. Similarly, there is a profound mismatch between the longer time scales at which investors and project developers need to operate, and the much shorter ones which
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