“Today is Earth Day, and as I watch the news or browse through LinkedIn, I am impressed how this special day is gaining popularity every year. This past year has been hard on everyone and that is why the pledges for a better and more sustainable future are now louder than ever before. This is perfectly captured in this year’s motto: Restore our Earth.
Climate change has rightfully been at the top of the public agenda, not just recently and despite the global pandemic. It is THE challenge of our time and we must not lose time. On our way to a low carbon and more sustainable future, actions speak louder than words. To make climate neutrality a reality, everybody has to do their part. And we need a joint effort by the industry, politics, and society.
“On our way to climate neutrality let’s turn the pledges, the political ambitions, and personal good intentions into concrete actions.”
First call for action is directed at the industry: Start with yourself
Innovations from the chemical industry are crucial to make a modern, sustainable life possible. There would be no electric cars without innovative battery materials. No energy-efficient living without modern insulation materials. No wind turbines or solar panels without chemical components making them robust and durable.
To put it simply: There will be no low-carbon future without the products and innovations from the chemical industry.
At the same time, chemical production is highly energy and CO2-intensive. Transforming our industry to become carbon-neutral while remaining competitive is a huge challenge! But there is no time to complain.
At BASF, we are leading the way. Over the last years we have been working hard on fundamentally new low-emission production technologies and processes. And we have made great technological progress. We can reduce our emissions faster than we previously expected. That is why we committed to our new ambitious climate targets a few weeks ago:
- We want to become climate neutral by 2050.
- And by 2030 we want to reduce our emissions by 25% compared to 2018. Compared to 1990 emissions, this is a reduction of 60% – even more than targeted in the Paris climate agreement!
And we are not only talking. We are taking action with a number of concrete projects and new technologies: One is the electrification of our steam crackers. By heating the steam cracker furnaces with renewable electricity instead of using fossil fuel gas, we avoid any CO2 emissions from heating! Other projects include the production of clean hydrogen or the replacement of fossil feedstocks with bio-based raw materials.
“As the chemical industry we have the chance to become frontrunners in the transition to carbon neutrality. And we will take on this role!”
But despite our entrepreneurial courage and motivation, we cannot do it alone. We need support from politics and society to make the change happen.
Second call for action is to politics: Create an enabling framework and outcome-oriented regulations
New low carbon technologies will only become economically feasible with an enabling political framework that incentivizes this change. The high investments needed for our transformation require legal and planning certainty, funding programs for new technologies and the appropriate infrastructure.
One example for this is renewable energy. A climate-neutral chemical industry is only possible with an adequate supply of renewable energy at competitive prices. Just take Ludwigshafen, globally our largest production site. By implementing our new, CO2-free production processes, we estimate our electricity consumption will triple by 2030. Currently, renewable energy is not available in this quantity. And due to the German levy scheme, the price for green electricity is far from being competitive at this point. This is where governments need to get active. They need to turn ambitions into implementation. That means a massive expansion of renewable electricity.
The second point is regulation: Climate action happens on the ground, in the nitty-gritty details of regulation. And it needs to be smart, pragmatic and consistent. In the end, it will be only a competitive and robust chemical industry that can effectively lead the way towards climate neutrality.
To get there, we need a holistic roadmap that brings investment, regulations, and also trade instruments and competition policy together. We need new alliances and a new way of working together. And this leads to my third call of action:
Third call to action for society as a whole: Let’s all be part of the change (and put our money there as well)
There is something else that we all need to realize: climate protection comes at a price. There is no way around this. We all want our future to be more sustainable, so we will have to pay for it. Climate neutrality will become a product feature that differentiates, but also costs more. This is already the case with food. There, for example, the sugar content has long been a decision criterion for the purchase. It all started with transparency about the ingredients. And transparency is the key to creating a market for low-carbon products as well. That is why we at BASF are the first chemical company worldwide to provide our customers with a carbon footprint for all our 45,000 sales products. This transparency needs to be passed on from our customers to the end consumer. Only then, we as consumers, can make decisions for sustainable products and for a sustainable future.
Three calls for action all come down to one appeal: Let’s work together to make climate neutrality a reality
We as chemical industry can lead the way with our entrepreneurial courage, our innovative power and new technologies. Policymakers need to provide the enabling framework to make that transformation economically possible. Consumers with their demand for carbon-neutral products will create new markets for low carbon products.
We all want to restore our planet? Let’s stop talking and start doing. The ambition is clear, let’s all act together now!”
CEOforLIFE – We promote life. We support the SDGs.