The Sustainability Imperative

LEAG CEO Thorsten Kramer offers a first-person account of his company’s plan to transform from a coal-based electricity producer in eastern Germany to one of Europe’s largest providers of green energy. Kramer is honest about the Herculean effort this plan will require, particularly in light of recent fears about his country’s electricity supply. But the German government decreed that energy producers must phase out coal by the end of 2038 at the latest, and Kramer believes that: (1) green energy is the only direction worth taking and (2) if you’re going to go green you must go big. He describes the ambitious project in detail, gives us a glimpse into the changes his company is already experiencing, and previews his strategy for coping with the changes still to come.

In this issue of Amplify, we measure how far we’ve come on our decarbonization journey, look at several obstacles to progress, and present ideas for how they can be overcome. The articles demonstrate the complexity of topics involved in the journey to decarbonization. They also highlight multiple approaches that can be adopted, providing business leaders with inspiration to accelerate their efforts and successfully deliver on their commitments.

Senthil Sundaramoorthy, Dipti Kamath, Sachin Nimbalkar, Christopher Price, Thomas Wenning, and Joseph Cresko from Oak Ridge National Laboratory (ORNL) examine strategies for industrial decarbonization, particularly for the six most energy-intensive industries. Almost three-quarters of all industrial GHG emissions in the US come from manufacturers, and the bulk of those come from iron and steel, chemical, food and beverage, petroleum refining, pulp and paper, and cement. Sundaramoorthy et al. assert that “Energy-efficiency improvement is a feasible, low-cost approach that, in most cases, does not require any major change to industrial processes and can bring immediate emissions reductions.” Along with statistics from the US Department of Energy (DOE) about potential emissions reductions, the authors describe how strategic energy management, system efficiency, material and lifecycle efficiency, smart manufacturing, and combined heat and power can bring both short- and long-term reductions in carbon emissions.

Martin Dix and Oliver Golly examine how CCUS technologies can bridge the gap between current policies and decarbonization targets. Dix and Golly say CCUS offers a range of business opportunities: capture (designing and building CO2 capture infrastructure as well as operating and maintaining these facilities), transport (via pipeline, truck, or ship), storage, usage (providing CO2 to customers instead of storing it), and CCUS as a service (managing the upstream, midstream, and downstream lifecycle). They detail the key players in the CCUS value chain and describe which players are well positioned to succeed at which market segment. According to Dix and Golly, “CCUS can act as a bridge to the developing hydrogen economy, reducing short-term emissions while infrastructure and capacity mature and providing a long-term solution in areas where hydrogen will not deliver effective emissions reduction.”

Enrique Castro-Leon advocates for using carbon offsets (COs). He acknowledges the challenges (including several accounting issues) and reminds us that the CO market is immature, making it difficult to compare offerings. Castro-Leon says IT can be leveraged to maintain real-time inventories of carbon assets and could be used to create a system designed to meet specific GHG-mitigation goals. He describes the Scalable Carbon Offset Open Platform (SCOOP) specification currently under development at OptimiLabs, which creates a digital twin that’s essentially a computer model of the physical carbon store asset. This allows CO suppliers to easily place their offsets in the carbon market of choice and demand-side entities to discharge their carbon liabilities by either paying a premium buying offsets or paying a broker to carry out a discharge on their behalf. This type of system, says Castro-Leon, establishes a formal linkage between carbon stores, carbon sources of emissions, and trading mechanisms toward global net zero goals.

Ani Melkonyan-Gottschalk and Maximilian Palmié recommend focusing decarbonization efforts on urban areas. Urban infrastructures cover only about 2% of Earth’s surface, but they consume roughly 75% of the world’s resources and 70% of global primary energy while emitting 50%-60% of the world’s GHG. Melkonyan-Gottschalk and Palmié describe the role of urban transportation systems in the decarbonization process and outline a comprehensive strategy designed to increase their overall sustainability. This includes integrating mitigation and adaptation tactics into a unified strategy, prioritizing strategies that go beyond technological improvements, optimizing the performance of multimodal logistics chains by prioritizing energy-efficient modes, and investing in the public-private cooperation necessary for decarbonization to enter a deep societal transformation process.

To achieve a circular economy, companies must first develop a comprehensive view of emissions data across their extended supply chain. Developing such a baseline at the supplier and category level is essential to identifying the greatest opportunities and developing an effective action plan.

Modern large language models (LLMs) require huge amounts of computing power to churn through huge amounts of data. In this Advisor, we analyze the carbon footprint of these LLMs and its impact on the environment.