INFOGRAPHIC
Business and finance call on government to unlock demand for low carbon products
Endorsed by 40 + global business leaders and 700 + financial institutions , the Industrial Transition Accelerator ( ITA ) has issued an open letter urging governments to use policy to stimulate demand for green products . Uncertain demand and a lack of incentives is stalling industrial decarbonisation , with producers and customers at a stalemate due to lower priced higher carbon products
Governments must urgently act to stimulate demand for green materials , chemicals and fuels to accelerate the decarbonisation of the world ’ s highest-emitting industries , according to 40 + business / finance leaders and coalitions , representing more than 1,000 companies and financial institutions , in a new open letter . Doing so could unlock up to US $ 1 trillion of investment and bring more than 500 green industrial plants to construction by 2030 . This would enable the emissions reduction needed from aluminium , cement , chemicals , steel , aviation and shipping – to align with a 1.5 ° C pathway in the next decade .
New data from the ITA and the Mission Possible Partnership ( MPP ) reveals a growing pipeline of industrial projects . However , < 20 % are operational or have the finance and approvals necessary to begin construction . Since April 2024 , only eight facilities globally have reached Final Investment Decision ( FID ), leaving 561 announced but not yet definitively confirmed . Three hundred of these have been awaiting investment decisions for at least two years . If this rate continues linearly , it would take around 35 years for enough facilities to begin construction .
To move to a 1.5 ° C-aligned trajectory the full pipeline of projects must be financed and begin construction within the next two years .
A lack of policies has led to insufficient demand for green products leaving corporations and financiers without the certainty needed for long-term investments . Consequently , projects are stalling . Buyers are unable to commit to longterm offtake agreements at scale due to the continued availability of cheaper , higher carbon
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