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Decarbonisation for the packaging sector JODIE EATON, CEO of Shell Energy UK, examines the
complexities of decarbonising the diverse packaging sector, which covers many of the most intensive energy users
While steel is Europe’s most recycled packaging material, processing and recycling steel is carbon and energy intensive. With the International Energy Agency (IEA) predicting that it will be one of the last sectors to still use coal in 2050 due to its role as a reducing agent, Eaton discusses technological advances to help decarbonise the packaging industry.
Optimising operational energy efficiency remains high on the agenda for major energy users. After all, with energy prices remaining volatile, businesses are increasingly looking towards solutions to drive down costs, reduce overheads and stay competitive and the packaging industry is no exception.
Major energy users are scrutinised by regulators, government bodies, customers and shareholders. It’s now nearly two years since it became mandatory for more than 1,300 of the largest UK-registered businesses to disclose climate-related financial information, aligned with the UK government’s drive to reach net zero by 2050. The disclosure regime was endorsed by 60% of global businesses and have helped to frame decarbonisation strategies among some of the UK’s largest companies.
It’s important to remember that the packaging industry covers many of the most intensive energy users, including pulp and paper, plastics, metals and glass producers. The industry is a significant employer and a major economic contributor. According to the UK’s Packaging Federation, the sector’s annual sales exceed £14 billion, with 85,000 people employed across numerous roles – representing 3% of the UK’s entire manufacturing workforce, and there’s further growth in the pipeline.
So, when it comes to decarbonisation, there’s significant complexity involved. Innovate UK highlights that the overall impact of packaging on the environment is influenced by factors, ranging from material choices and their supply chains through to
recycling and refillable containers. However, some aspects of decarbonisation require behavioural change by consumers from making more sustainable purchasing choices to embracing the best recycling practices.
When it comes to manufacturing, technological advances including hydrogen- powered or electric arc furnaces are helping to mitigate the impact of carbon-intensive processes. For instance, ArcelorMittal, a customer of Shell Energy in Spain, set aside €67m in funding last year to invest in an electric furnace for steelmaking, and Encirc has announced plans to develop an ultra-low carbon hydrogen-powered glass furnace at its UK site in Cheshire. The routes being taken vary from industry to industry, with glass, plastics, paper and metal all embarking on subtly different routes to decarbonisation.
The UK’s Food & Drink Federation recently called on its members to explore flexibility as an option to manage energy costs, claiming that many businesses had now reached the limit of passing inflationary pressures on, having found energy efficiencies where possible, and cutting other costs, including limiting product ranges, R&D and advertising. In October, it encouraged members to participate in the Demand Flexibility Service (DFS) that allows them to earn money for shifting electricity usage outside peak demand hours, enabling the Electricity System Operator (ESO) to manage supply through periods when margins are tight.
The toughest challenge Steel is used to pack more than 1,500 food and drink items such as canned soup and biscuit tins as well as paint, health and beauty products like deodorant and shaving cream aerosol cans, and various household items. The steel packaging recycling rate has reached over 90% in some countries, and steel is Europe’s most recycled packaging material. However, processing and recycling steel is carbon and energy intensive. The
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IEA predicts that iron and steel will be one of the last sectors to still use coal in 2050 due to its role as a reducing agent. However, technologies including carbon capture and hydrogen-based production are being explored with a view to developing at scale in the longer term.
Considerable progress has been made across the sector to lower emissions over the past decade, including the deployment of low-emission heating technologies such as industrial heat pumps and other energy efficiency measures. Examples of this include SSAB’s steel plant in Sweden’s Oxelosund, which has significantly cut its CO2 emissions through the use of heat pump technology.
However, the IEA sets out that efforts must accelerate to get on track with the Net Zero Emissions by 2050 (NZE) Scenario, where emissions decline by 6% per year to 2030, compared to 1.6% on average over the past decade.
A collaborative approach
When it comes to finding efficiencies and reducing carbon, the packaging industry faces many challenges. Working in partnership with suppliers such as Shell Energy can bring fresh insight to help deliver the progress needed.
Packaging industries can benefit hugely from being able to better understand the potential return on investment of the different routes available. Technological advances are often in their infancy and businesses are keen to establish what their short, medium and long-term choices are and how they can be financed in a way that will ensure solutions are commercially viable and more sustainable.
The packaging industry’s journey towards sustainability is progressing but it is a complex challenge that requires the collective effort of manufacturers, retailers, consumers, and policy makers.
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