Industrial Emissions in the United States
Greenhouse gas emissions data can be reported either by economic sector, which includes electric power generation as a separate sector, or by end-use sector, which distributes the emissions from electricity generation across the economic sectors where the electricity is used. The industrial sector encompasses a wide range of activities (manufacturing, agriculture, mining and construction), including all facilities and equipment used for producing, processing, or assembling goods. Greenhouse gas emissions are produced from diverse processes, including the combustion of fossil fuels for heat and power, non-energy use of fossil fuels, and numerous industrial processes. The industrial sector is a large consumer of centrally generated electricity (26 percent of total U.S. electricity sales), so it is appropriate to address both emissions from direct sources and electricity end use for this sector. When electric power sector emissions are assigned to the end-use sectors that consume the electricity, the industrial sector accounts for 28 percent of total U.S. greenhouse gas emissions.
Direct emissions from the industrial sector account for 20 percent of total greenhouse gas emissions in the United States (see Figure 1).
Figure 1: U.S. Greenhouse Gas Emissions by Economic Sector (2012)
Source: Environmental Protection Agency (EPA), Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990-2012, Table ES-7, 2014. http://www.epa.gov/climatechange/emissions/usinventoryreport.html
Emissions from the industrial sector come from fossil fuel combustion from manufacturing facilities (57 percent) and from non-energy use of fuels and industrial processes (43 percent). For example, heating iron ore to produce iron directly releases carbon dioxide (CO2). Similarly, the cement manufacturing process requires heating limestone, which also results in the release of CO2.
In addition to on-site fossil fuel combustion, the main sources of industrial emissions in the United States (Figure 2) include: natural gas systems (13 percent), the non-energy use of fuels (7 percent), coal mining (4 percent), iron and steel production (4 percent), cement production (3 percent), petroleum systems (2 percent), and a variety of other sources (9 percent). Industrial process emissions, which excludes on-site fossil fuel combustion, mobile combustion, natural gas systems and non-energy use of fuels, account for 5 percent of total U.S. greenhouse gas emissions.
Figure 2: Direct Emissions of Greenhouse Gases from the U.S. Industrial Sector (2012)
Source: EPA, Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990-2012, Table 2-12, 2014. http://www.epa.gov/climatechange/emissions/usinventoryreport.html
Industrial process emissions include numerous greenhouse gases, including several gases with high global warming potentials, like hydrofluorocarbons (HFCs), perfluorocarbons (PFCs), and sulfur hexafluoride (SF6). Global warming potential (GWP) is a metric used to compare the warming effects of different gases. Over a 100-year time horizon, carbon dioxide (CO2) is assumed to have a GWP of one. In comparison, SF6 has a GWP of 23,900, which means that over 100 years one ton of SF6 will have the same effect as 23,900 tons of CO2 (see Table 1).
The industrial sector is responsible for 25 percent of total non-CO2 emissions, specifically 40 percent of total U.S. methane (CH4), 7 percent of nitrous oxide (N2O), and 19 percent of other (HFCs, PFCs and SF6) emissions.
Table 1: Global Warming Potentials for 100-year Time Horizon
Source: EPA, Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990-2012, Table ES-1, 2014. http://www.epa.gov/climatechange/emissions/usinventoryreport.html
Between 1990 and 2012, total industrial process emissions increased a little less than 6 percent, as emission decreases from some sources have been offset by increases from other sources. Notably, HFCs have increased more than 300 percent during this time period as a result of phasing out ozone depleting substances, such as chlorofluorocarbons (CFCs) (see Figure 3). Also, the economic downturn and slow recovery (2008 – 12) has reduced CO2 emissions from cement production more than 23 percent below their 2006 peak.
Figure 3: Industrial Process Emissions by Greenhouse Gas Type in Million Metric Tons of CO2e
Source: EPA, Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990-2012, Table 2-6, 2014. http://www.epa.gov/climatechange/emissions/usinventoryreport.html
U.S. electricity sales are split among the residential, commercial, and industrial sectors, with the industrial sector accounting for almost 26 percent of sales (see Figure 4).
Figure 4: Retail Sales of Electricity to Ultimate Customers, Total by End-Use Sector (2012)
Source: U.S. Energy Information Administration (EIA), Electric Power Monthly, Table 5.1, September 2014. http://www.eia.gov/electricity/monthly/epm_table_grapher.cfm?t=epmt_5_01
When greenhouse gas emissions from electricity generation are distributed across the end-use sectors, the industrial sector is the second largest source of greenhouse gas emissions, responsible for almost 28 percent of total U.S. emissions (see Figure 5). Emissions from the use of electricity generated off-site (“electricity-related emissions” in the graph below) are also called indirect emissions to distinguish them from the direct emissions released on site.
Figure 5: Direct and Electricity-related Greenhouse Gas Emissions by End-Use Sector (2012)
Source: EPA, Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990-2012, Table 2-14, 2014. http://epa.gov/climatechange/emissions/usinventoryreport.html
Relative to the residential and commercial sectors, a smaller percentage of the industrial sector’s greenhouse gas emissions come from electricity use. The industrial sector relies less on purchased electricity in part because of the on-site production of heat and power, also known as cogeneration or combined heat and power (CHP).
Industrial Emission Sources and Types
The industrial sector encompasses a diverse collection of businesses that have a variety of energy and feedstock needs to create products that range from paper to gasoline to pharmaceuticals. While greenhouse gas emissions from the electricity sector depend largely on the type of fuel used, and emissions from the residential and commercial sectors come largely from buildings, similar generalizations cannot be made about the industrial sector. Examining industrial emissions on an industry-by-industry basis shows that the magnitude of emissions associated with different industries varies significantly (see Figure 6).
Figure 6: Greenhouse gas Emissions for Key Industrial Sub-sectors in Million Metric Tons (MMT) of CO2e (2002)
Source: EPA, Quantifying Greenhouse Gas Emissions from Key Industrial Sectors in the United States, Working Draft, Table 1-3, 2008. http://www.epa.gov/ispd/
Figure 6 also shows the relative importance of different types of emissions to individual industries. For example, five industries (oil and gas, chemicals, iron and steel, mining, and cement) produce the majority of non-combustion-related direct emissions. Similarly, oil and gas, chemicals, construction, forest products, and food and beverages produce large amounts of greenhouse gas emissions from on-site fossil fuel combustion.
Certain industries are termed energy-intensive because they require large energy inputs per unit of output or activity. The largest energy-consuming industries in the United States are bulk chemicals, oil and gas, steel, paper, and food products; these five industries account for 60 percent of industrial energy use, but only 22 percent of the value of the products. Other energy-intensive industries include glass, cement, and aluminum. In general, energy-intensive industries are growing more slowly in the United States than industries with lower energy intensities.
Total industrial emissions in the United States have gradually declined over the past decade in both absolute and relative terms (see Figure 7). From 1990 to 2012 U.S. industrial output increased by 55 percent, while CO2 emissions from industrial processes decreased by a little more than 23 percent. Several factors have contributed to this reduction, including development of new methods (less carbon intensive), fuel switching, increased efficiency, and changes to the U.S. economy from a more manufacturing-based to a more service-based economy and from more energy-intensive industries to less energy-intensive industries. Over time, the proportion of industrial greenhouse gas emissions from electricity use has increased, while the proportion of greenhouse gases from direct emissions has decreased.
Figure 7: Greenhouse Gas Emissions by End-Use Sector (2012)
Source: EPA, Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990-2012, Table 2-14, 2014. http://www.epa.gov/climatechange/emissions/usinventoryreport.html
The industrial sector is the largest end-user of energy in the United States. Since 1973, total energy consumption has increased across all end-use sectors except the industrial sector (see Figure 8). This is due to three primary factors: a shift away from manufacturing and towards a more service-oriented economy; a move towards less energy-intensive manufacturing, and energy efficiency in the industrial sector.
Figure 8. Total Energy Consumption by End-Use Sector 1973 – 2013
Source: U.S. Energy Information Administration (EIA), Monthly Energy Review, September 2014. http://www.eia.gov/totalenergy/data/monthly/pdf/sec2_3.pdf
At the global level, the industrial sector is a key energy consumer and greenhouse gas producer. Manufacturing industries account for more than one-third of total energy consumption and 37 percent of CO2 emissions from energy use. At the global level, data on non-CO2 gases and non-combustion CO2 emissions have higher levels of uncertainty. A small number of industries account for a large percentage of global industrial emissions. In 2007, five industries (chemicals and petrochemicals, iron and steel, non-metallic minerals, pulp and paper, and non-ferrous metals) accounted for 50 percent of total industrial energy use.
Trends in global industrial energy use and emissions include:
- Overall industrial energy use increased between 1971 and 2004, with demand growing especially rapidly in emerging economies.
- Energy efficiency in energy-intensive manufacturing industries has increased, with Japan and Korea generally achieving the highest levels of energy efficiency.
- Cost-effective greenhouse gas mitigation opportunities exist for the industrial sector but are currently under-utilized in both developed and developing countries. The adoption of best practice commercial technologies by manufacturing industries could reduce industrial sector CO2 emissions by 19-32 percent annually by, for example, improving the efficiency of motor systems.
- Since 1970, several energy-intensive industries have seen significant growth. For example, production of steel increased 84 percent; paper, 180 percent; ammonia, 200 percent; aluminum 223 percent; and cement, 271 percent.
- Developed economies usually have a more energy-efficient industrial sector, and a larger fraction of their output comes from non-energy-intensive sectors than is the case for developing economies. On average, industrial energy intensity, which is the industrial sector’s energy consumption per dollar of economic output, is double in developing countries. Energy-intensive manufacturing industries are growing in many developing countries. Industrial energy use frequently accounts for a larger portion of total energy consumption in these countries; for example, an estimated 75 percent of delivered energy in China was used by the industrial sector in 2007.
- In 2007 the industrial sector comprised 51 percent of global energy use, and is projected to grow at an annual rate of 1.3 percent.
Industrial Sector Mitigation Opportunities
There is a diverse portfolio of options for mitigating greenhouse gas emissions from the industrial sector, including energy efficiency, fuel switching, combined heat and power, renewable energy sources, and the more efficient use and recycling of materials. The diverse opportunities for reducing emissions from the industrial sector can be broken down into three broad categories:
Some mitigation options can be used across many different industries, for example energy efficiency improvements for cross-cutting technologies, such as electric motor systems, can yield benefits across diverse sub-sectors. Other sector-wide mitigation options include the use of fuel switching, combined heat and power, renewable energy sources, more efficient electricity use, more efficient use of materials and materials recycling, and carbon capture and storage.
Certain mitigation opportunities come from improvements to specific processes and are not applicable across the entire sector. For energy-intensive industries, process improvements can reduce energy demand and, therefore, greenhouse gas emissions and energy costs. Other improvements can reduce emissions of non-CO2 gases with high global warming potentials.
Case studies can help illuminate the effectiveness of these process-specific options. For example, Alcoa’s aluminum smelters collectively reduced their emissions of perfluorocarbons (PFCs) from anode effects, which occur when a particular step in the smelting process is interrupted, by more than 1.1 million tons in 2008.
A variety of mitigation opportunities can be achieved through improvements to standard operating procedures. These options can include making optimal use of currently available technologies, such as improving insulation and reducing air leaks in furnaces.
A variety of public and private efforts have been developed to help reduce industrial greenhouse gas emissions, energy use, or energy intensity. Some of these programs include:
- Climate Leaders – U.S. Environmental Protection Agency (EPA)
- Partnership between industry and government to develop comprehensive climate change strategies. http://www.epa.gov/stateply/
- Climate VISION – Interagency program, including U.S. Department of Energy (DOE), U.S. EPA, U.S. Department of Transportation, and U.S. Department of Agriculture
- Voluntary program to reduce U.S. greenhouse gas emissions intensity. http://climatevision.gov/
- ENERGY STAR® for Industry – U.S. EPA
- Program to improve corporate energy management. http://www.energystar.gov/index.cfm?c=industry.bus_industry
- Save Energy Now – U.S. DOE, Industrial Technologies Program
- Program to achieve the goal of reducing industrial energy intensity 25 percent by 2017, per the Energy Policy Act of 2005. http://www1.eere.energy.gov/industry/saveenergynow/
- Voluntary Programs to Reduce High Global Warming Potential Gases – U.S. EPA
- A variety of programs to reduce gases with high global warming potentials, including perfluorocarbons (PFCs), hydrofluorocarbons (HFCs), and sulfur hexafluoride (SF6). http://www.epa.gov/highgwp/voluntary.html
C2ES Work in the Industrial Sector
At C2ES we work on several issues related to climate change and the industrial sector, including emissions reduction policy, energy efficiency, and adaptation. We track and inform policymakers about pragmatic policy options at the state, federal, and international level, collaborate on white papers and reports, blog about current issues impacting the industrial sector, and keep up-to-date online resources on innovative technologies.
Tracking Policy - We keep track of state, federal, and international policy that will impact the industrial sector. Our state maps have information about which states have adopted various GHG mitigation policies. We also track and analyze federal policy, including what is happening in Congress and the Executive Branch.
Research - At C2ES, we produce research, including reports, white papers, and briefs, on issues related to climate change and industry. C2ES's Corporate Energy Efficiency Project is a multi-year research and communications effort to identify and highlight the most effective methods used by companies, including many industrial firms, to reduce their energy consumption and lower their related GHG emissions. Other examples of relevant C2ES work include The Competitiveness Impacts of Climate Change Mitigation Policies and Adaption to Climate Change: A Business Approach.
Climate Compass Blog - Our blog includes entries about current perspectives on GHG emissions from Industry, and can be viewed here.
Climate Techbook - The industrial section of the Climate Techbook includes an overview of GHG emissions from the industrial sector as well as technologies that can be used to reduce those emissions. Below is a list of the Techbook factsheets that pertain to the industrial sector.
Alliance to Save Energy
American Council for an Energy-Efficient Economy
Intergovernmental Panel on Climate Change (IPCC)
U.S. Department of Energy (DOE)
U.S. Energy Information Administration (EIA)
U.S. Environmental Protection Agency (EPA)
Related Business Environmental Leadership Council (BELC) Companies
 One million metric ton is equal to one teragram. For reference, one million metric ton of CO2e is equal to 280,000 new cars each being driven 12,500 miles or 90 minutes of U.S. energy consumption or 1 day of U.S. energy emissions from lighting buildings, see U.S. Department of Energy (DOE), 2009 Buildings Energy Data Book. Prepared for U.S. Department of Energy Office of Energy Efficiency and Renewable Energy by D&R International, Ltd. Silver Spring, MD. 2009. http://buildingsdatabook.eren.doe.gov
 Global warming potential is a system of multipliers devised to enable warming effects of different gases to be compared. The cumulative warming effect, over a specified time period, of an emission of a mass unit of CO2 is assigned the value of 1. Effects of emissions of a mass unit of non-CO2 greenhouse gases are estimated as multiples. For example, over the next 100 years, a gram of methane (CH4) in the atmosphere is currently estimated as having 23 times the warming effect as a gram of carbon dioxide; methane's 100-year GWP is thus 23. Estimates of GWP vary depending on the time-scale considered (e.g., 20-, 50-, or 100-year GWP) because the effects of some GHGs are more persistent than others.
 Carbon dioxide equivalent (CO2e) is a unit used to measure the emissions of a gas, by weight, multiplied by its global warming potential.
 Intergovernmental Panel on Climate Change (IPCC), “Industry.” In Climate Change 2007: Mitigation. Contribution of Working Group III to the Fourth Assessment Report. Cambridge: Cambridge University Press, 2007. http://www.ipcc.ch/ipccreports/ar4-wg3.htm
 EIA, International Energy Outlook 2010. July 2010. http://www.eia.doe.gov/oiaf/ieo/pdf/0484(2010).pdf