 This video is about decarbonizing Dutch energy intensive industry and is part of a project by the Green European Foundation. Industrial emissions account for around 30% of Dutch national emissions, so heavy industry is a crucial sector to address. If the goal is to decarbonize industry, the key word is how. To better approach this question, we use the language of blockers and enablers. We will ask three experts what they think is currently blocking Dutch industry from decarbonizing. Most importantly, we ask them how these blockers can be overcome. What needs to change to enable the decarbonization of heavy industry? But before asking the experts, I'll provide some context. I do this by asking the following questions. What industries emit most greenhouse gas emissions? What are the historical developments in industrial emissions? And what are the most promising technologies? After we've briefly addressed these questions, we'll let the experts shine their light on the issue. So which industries deserve our attention? Looking at Dutch industrial greenhouse gas emissions by sector, we see that the chemical, refinery and basic metals industries together represent around 79% of all industrial emissions. It's for this reason that we'll focus on these three sectors. Although industrial emissions reduced between 1990 and 2010, since 2010, the total level of industrial emissions is quite stable. Absolute decarbonization is only happening marginally. The question arises, what is blocking the Dutch chemical, refinery and basic metals industries from decarbonizing? Before we ask the experts, I will say a few more things. A lot is expected from carbon capture and storage, electrification and hydrogen. Although these technologies need to be scaled up first, in theory they can enable a significant reduction in greenhouse gas emissions. But the application of new technologies comes with new challenges, such as a strong increase in electricity demand and the need for new infrastructures such as for CO2 and hydrogen. So again the question, what is blocking the Dutch chemical, refinery and basic metals industries from decarbonizing? My colleague Evert asked GroenLinks representative Tom van der Lee about his views on the issue. You are the member of parliament for GroenLinks and greening the Dutch industry, the heavy industry or the energy intensive industry. It is on your agenda and sometimes I get the feeling that it is one of your favorite subjects, isn't it so? Yes, definitely it is. For such a small country we have quite a lot of fossil industry. One of the main challenges to reach our climate goals is to realize a transition in the whole of the Dutch industry. From a political point of view or perspective, why is it so difficult? What would you say are the main blockers to green the Dutch industry? The main blocker is the hard fact that 90% of our energy consumption in the Netherlands is still fossil fuel. And as I said earlier, for a relatively small economy with 17 million people, we have an awful lot of fossil industry because of our geography. We have the largest harbour of Europe in Rotterdam and we have several industrial clusters along the coast. So for us it is quite challenging and we have had a policy for decades by many governments to attract even more industry. And if you look at the way greenhouse gases are being priced, that is not enough to give enough incentives to the industry to save energy or to change to renewable energy. So a blocker might be our geographical position or our histories we sort of locked in by previous governments. Well we can't change our geography but we can change our policy and due to fiscal and measures and subsidies we attracted quite a lot of heavy industry. So one of the more important steps is to create a level playing field to increase energy taxes, carbon taxes here in the Netherlands, even on top of the European emission trading system. In the next government for sure, this is one of the few things that are really for sure, is that the Groenlings will be in the government, in the next government. It might even be so that you will be the minister of economic affairs or climate and economic affairs. What would be your first policy measures you will take for greening the Dutch industry? What would be your favorite? You mentioned the CO2 taxes. Yeah I think the most important step is to put the right price on carbon emission. So we need carbon tax and even a broader carbon tax than the ETS companies. So we have to look further than that and also think about ways to put a price on carbon in other parts of the economy. So carbon tax is crucial. I think the second one and we haven't done enough is saving energy. Not using energy is the best way to save money and to save the climate. And I think we have to, through regulations, enforce companies to improve their performance on the use of energy, the lack of it, that's even more important. So saving energy I think would be my second priority. And the third one is that I would like to see the Dutch taking a lead in hydrogen applications. Because the only way to make industry carbon neutral is to use hydrogen and there are a lot of possibilities here and we have waited quite a long time as Dutch people to adapt to solar energy, wind energy, because we were afraid of the high entry costs. Other countries have taken a lead and costs have reduced. And I think we need to take a lead in regard to hydrogen. And this is crucial to make a sustainable climate neutral industry here in the Netherlands, but also in the rural area and throughout Europe. Tom said many things, but I'll highlight just one of his main points. According to Tom, not sufficiently pricing industrial emissions forms a key blocker. Increasing the price of emissions is a logical enabler. This would give industry strong incentive to make efforts to reduce emissions. As Tom mentioned in the end, the Dutch have waited quite long with choosing for renewable energy development. As you can see in this figure, in 2018 the share of renewable energy consumption was very low compared to other European countries, the Netherlands is all the way on the right side. It's only recently that the development of offshore wind production really took off in the Netherlands. So what needs to be done to avoid such a scenario in the context of heavy industry? We asked the independent policy advisor Tom van Dril what he thinks is blocking Dutch heavy industry from decarbonizing. Tom has 26 years of experience in researching the decarbonization of industry. There is no real solution or choice yet made on which technology should be in place and where it should apply and how far it should apply. So that makes industry very uncertain. They want to basically make joint decisions with the government on technologies. The government is kind of hesitant and well, there's a certain background to that because many times economists say that politicians should not decide on technologies. The market should do that. Whereas the market parties say, well, this is really a serious decision we have to take for the next 30 or 40 years. So it's either carbon capture and storage or we should electrify or we should turn over to biomass or we should take on hydrogen. And that is not, you know, we cannot switch easily once this choice is made. And we really need, you know, some vision and support from government on will the infrastructure be there, for instance. And for instance, if we electrify, is there enough to address the intermittent renewable electricity production? So the industry needs a sort of a long horizon at 30 years and the government is sort of hesitant at this moment to make this decision. The government basically says, yes, that is for the market parties to decide, but it's not a simple market issue where there's lots of choices possible and you can gradually go to it. Because industry is required to make this big step forward, this big turnover, and that's not really, you know, just to the markets for the markets to solve. So I would suggest that basically together with industry government really makes decisions on which technologies, where and when and how much technologies of a certain kind, where should this piece of infrastructure come down, who would, you know, should use CCS, who should use electrification, who can venture into hydrogen. Of course that doesn't have to be, you know, carved in stone, but basically, I mean, these directions are required to really take these steps forward. And so you might wish the government wisdom and courage to tackle this and to make those decisions or is it understandable that they're hesitant? It is understandable, as I said, because this economic argument is very prominent still in departments of finance and economics. So it really, you know, you have to really cross certain thresholds there. And of course there are basically also in the background competitiveness issues once you decide on certain technologies. I think we have been deciding on technologies for quite some time. And I think there is a good example also that Dutch government has taken, you know, the initiative back then when offshore wind parks should have been planned and they really took the initiative together with the great company and that really worked out fairly well. I mean, on the ministry they were quite satisfied that this worked out so well and incurred a large, for instance, a large cost decrease. So it's time to, you know, take this success story a step further and, you know, put it to work onshore. And then might it be hydrogen or other techniques? It is a mix, of course. But and since it's a mix and government says, yes, we need all these technologies, you know, you have to take it a step further and say, OK, so which technology where and to what extent, you know, what is the diameter of this hydrogen pipe, or what is the, you know, the capacity of this cable and who should use it. And, you know, that is not a game that you, you know, should end up in a market situation and there because, yeah, it is often they say it's a chicken and egg problem. So not an industry will not decide for a certain technology once and, you know, first a government should decide if this is viable, you know, in multiple ways viable. So industry becomes confident to really take this step. And they're not confident yet. The uncertainty is too large. Uncertainty is mantra that is currently hurt very much from from the side of the industry. Uncertainty is the keyword here, according to Tom. Industry is waiting for a government to take away uncertainty. Tom clearly calls for stronger government intervention instead of leaving everything up to the market. At last Averd had a conversation with Marjan Minnisma, being the director of Urgenda. Marjan won the climate law case against the Dutch government. This forced the Dutch state to reduce emissions by at least 25%. But Urgenda hasn't only filed a law case against the Dutch state. They also developed a vision on how emission reductions can be achieved in practice. Among the many ideas and proposals, Marjan will explain a potentially revolutionary idea to decarbonize industry. It will take time. In some cases you need space. So if you, for example, want to make steel and chemistry at the same time energy neutral, you would actually need them together. So that the coal monoxide, which is coming out of the steel industry is led to the chemical industry because for them it's one of their building blocks. So then you need to, well, move the chemical industry to a new place. So that might be a blocker because that is a big investment decision and you need enough space and you need governments that give them permits to have your chemical factory over there and so on. But that would be one of the better ways to do it because then you really have an industrial cluster which helps each other. And I think that that's the way to go. Yeah, I think you call it in your book Symbiotic Industry. Yeah. And so a blocker here is the lack of infrastructure, more or less. Yeah, or the will to move to another place or the permits that you need from a government and it takes often years before a government gives a permit for a new industry. Yeah. Oh, yeah, they can all be blockers. Yeah. Yeah, I heard once about Camelot, which is a large chemical cluster in the Netherlands. And then we're in a group discussion with a lot of people from the industry. And then someone from a tenant, which is the, what they call is the, they have the backbone for high for electricity in the Netherlands. And they said, yeah, well, if they want to do in Camelot, if they want to do an experiment with the processes which are based on electricity and not on fossil fuels, yeah, that we need to have to give them a line. We need to give them the infrastructure to do so. And this might take 10 or 12 years. Because of, so, so if we wait for an experiment for an experiment, we're not going to do this. Because it's, yeah, it takes too much time because of the legislation and all the procedures, etc. But in the meantime, the ice is melting. So how can we. Yeah, if you would look at it from a rational perspective, then such a cluster of Camelot would normally be placed at the sea where you can have the wind turbines to get your electricity quickly to this industry and you would put them close to the steel industry so you can have this industrial symbiosis. So they are actually in the wrong place. But there's a lot of lobby to keep them there, keep the jobs and so on and so on. So say lobby for other reasons is also a blocker that would lead to maybe suboptimal solutions. My own clearly explained that ideally the steel and chemical industries are located in the same area. So industrial symbiosis becomes an option. As this is not the case currently, the chemical industry would have to be moved, which is a gigantic operation. Likely to meet resistance overcoming this resistance also in the form of a lobby power would be an important enabler according to my own. So just to sum up, I'll just list here the three blockers and enablers that we've highlighted so far. So to begin with, emissions are at the moment not sufficiently priced. So a stronger CO2 tax would be an enabler here. Secondly, there's a lot of uncertainty for industry. So the government really should take the lead here and not be afraid of making choices. And at last, some industries are located at a suboptimal location within the Netherlands. So moving the chemistry industry close to the steel industry would allow for industrial symbiosis. So this was only a brief impression of our project on greening Dutch industry. There are many more blockers and enablers, which will be discussed in our final report. But for now we say thank you for watching.