How aligned are industry strategy and government policy for the decarbonization of energy-intensive process industries?

Decarbonization of energy-intensive process industries (EPIs) is a central unresolved challenge for limiting global warming to 1.5°C or well-below 2°C. In this article, we investigate the alignment between government policy and applicable industry strategy in decarbonization efforts across six European countries – Denmark, Germany, Netherlands, Norway, Sweden and the United Kingdom. We distinguish between ‘target alignment’ (How comparable are the size of the emission reduction commitments?), ‘temporal alignment’ (How closely do the timelines match?) and ‘solution alignment’ (Are the same types of solutions prioritized?). Based on an analysis of national policy documents, company strategies of the 10 largest emitting EPI plants in each country, as well as secondary sources, we find high target alignment. However, we find substantially lower temporal alignment as emitters are reluctant to commit to intermediate targets that match the decarbonization timelines laid out in national government policy. Solution alignment is intermediate across all six countries as emitters generally pursue the decarbonization options prioritized in policy, but with most emitters remaining at the level of ambitions or plans and few examples of commercial investments so far.Public policies across the analysed countries mainly prioritize CCUS, hydrogen and electrification as decarbonization solutions.Large emitters formulate ambitions or plans for the prioritized decarbonization options, but actual investment commitment remains limited.Governments should continuously survey alignment of their policy targets and prioritized decarbonization options with industry targets and activities.In particular, intermediate targets set by the largest emitters do not match those of national governments.Additional support and incentives to make industry act sufficient fast are required.