The Inter-American Development Bank (IDB) has published an introductory note that covers the opportunities arising from the decarbonization of heavy industry in Latin America and the Caribbean (LAC), one of the sectors with the largest contribution to GHG emissions (approximately 20% of total emissions in LAC). This report deep-dives into the sectors of steel, aluminum, cement and pulp and paper within heavy industry.

The publication is structured into three main sections: i) describes heavy industry in LAC in the context of climate change, highlighting its importance, forms of production, energy intensity and CO2 emissions, as well as an emission projection to year 2050; ii) proposes possible decarbonization pathways for heavy industry in LAC and a breakdown of emissions mitigation for each heavy industry sector; and iii) provides a series of recommendations for policy-makers related to heavy industries decarbonization.

The decarbonization pathways proposed in the report include: Clean or green and low-emission hydrogen; Carbon capture, utilization and storage (CCUS); Industrial groups; Renewable energies; Use of scrap or recycling; Energy efficiency; and Nature-based solutions.

The recommendations for policy-makers focus on the following six axes: i) Strategies, plans and programs; ii) Regulatory frameworks; iii) Economic incentives; iv) Research and education; v) Financing and risk mitigation mechanisms; vi) Collaboration frameworks.