Climate neutral process heat holds “enormous” economic potential for German industry – report
Clean Energy Wire
Cleaning process heat in industry holds “enormous potential” to bring the sector in line with climate targets while simultaneously boosting competitiveness and benefitting the labour market, according to a report by consultancy Prognos.
The industrial sector needs heat to produce goods such as chemicals, steel and paper. This process heat accounts for almost half of total heat consumption in Germany, and has so far largely been produced using fossil fuels. Renewable energy, electrification and alternative fuels such as hydrogen can all generate heat for industrial applications, replacing fossil fuels and reducing emissions.
“The market for clean industrial process heat is developing into one of Germany's most dynamic green tech segments, with enormous potential for employment, exports, and climate action,” wrote energy efficiency industry alliance DENEFF, who commissioned the report.
The report’s authors found that the number of employees in Germany’s green process heat sector — from those who develop and produce industry heat systems to those who consult customers or install facilities — reached 60,000 in 2023, up 70 percent from 2010. Moreover, the sector could employ 270,000 people by 2030 and grow to over a million by mid-century. Meanwhile, the sector's gross added value reached 5.5 billion euros in 2023, and could reach 25 billion euros by the end of the decade and 91 billion euros by 2050. The projected growth relied on Germany and Europe meeting their 2030 and 2050 climate targets, Prognos said.
According to a 2024 report by think tank Agora Industry, direct electrification could replace the vast majority of fossil fuels used to provide process heat for the production of industrial goods by 2035.
Germany and Europe aim to make their industries climate friendly while maintaining competitiveness. A Clean Industrial Deal tabled by the EU includes plans to lower energy prices, increase demand for clean products, provide finance for the transition, boost circularity and access to materials, and work on global partnerships to achieve these goals.
