The industrial sector is extremely diverse and involves a wide range of activities.
Aggregate energy use and emissions depend on the structure of industry, and
the energy and carbon intensity of each of the activities. The structure of
industry may depend on the development of the economy, as well as factors like
resource availability and historical factors. In 1995, industry accounted for
41% (133 EJ1
) of global energy use and up to 43% of global CO2 emissions. Besides CO2 industry
also emits various other GHGs. Although the efficiency of industrial processes
has increased greatly during the past decades, energy efficiency improvements
remain the major opportunity to reduce CO2 emissions. Potentials for efficiency
improvement and emission reduction are found in all processes and sectors. In
the short term, energy efficiency improvement is the major GHG reduction measure.
Fundamentally new process schemes, resource efficiency, substitution of materials,
changes in design and manufacture of products resulting in less material use
and increased recycling can lead to substantial reductions in GHG emissions.
Future reductions in GHG emissions are technologically feasible for the industrial
sector of OECD countries if technologies comparable to that of efficient industrial
facilities are adopted during stock turnover. For Annex I countries with economies
in transition (CEITs), GHG reducing options are intimately tied to the economic
redevelopment choices and the form that industrial restructuring takes. In developing
countries large potentials for adoption of energy efficient technologies exist
as the role of industry is expanding in the economy.
In industry, GHG emission reduction is often the result of investments in modern
equipment, stressing the attention to sound and environmentally benign investment
policies. Industrialisation may affect the environment adversely, stressing
the need for the transfer of clean technologies to developing countries. Technology
transfer is a process involving assessment, agreement, implementation, evaluation
and adaptation, and repetition. Institutional barriers and policies influence
the transaction process, as well as the efficiency of the transfer process.
Developing countries suffer from all barriers that inhibit technology transfer
in industrialised countries plus a multitude of other problems. Investments
in industrial technology (i.e. hardware and software) are dominated by the private
sector. Foreign direct investment is increasing, although concentrated on a
small number of rapidly industrialising countries. These countries may impact
regional industrial development patterns, as seen in Southeast Asia. Private
investment in other developing regions is still limited, although increasing.
Public funding (in industrialised and developing countries) for technology development
and transfer, although still important, is decreasing. Funding for science and
technology development is important to support industrial development, especially
in developing countries. Public funding in the industrial sector, although small
in comparison to private funding, remains important.
It is essential that policies provide a clear framework for technology transfer.
An effective process for technology transfer will require interactivity between
various users, producers and developers of technology. The variety of stakeholders
makes it necessary to have a clear policy framework as part of an industrial
policy for technology transfer and cooperation, both for a technology donor
and recipient or user. Such a framework may include environmental, energy, (international)
trade, taxation and patent legislation, as well as a variety of well-aimed incentives.
Policymakers are responsible for developing such a comprehensive framework.
The interactive and dynamic character of technology transfer stresses the need
for innovative and flexible approaches, through partnerships between various
stakeholders, including public-private partnerships. There is a strong need
to develop the public and private capacities to assess and select technologies,
in particular for state owned and small and medium sized industries. Stakeholders
(policymakers, private investors, financing institutions) in developing countries
have even more difficult access to technology information, stressing the need
for a clearinghouse of information on climate change abatement technology, well
integrated in the policy framework. To be successful, long-term support for
capacity building is essential, stressing the need for public support and cooperation
of technology suppliers and users.
Adaptation of technology to local conditions is essential, but practices vary
widely. Countries that spend on average more on adaptation seem to be more successful
in technology transfer. As countries industrialise the technological capabilities
increase rapidly, accelerating the speed of technology diffusion and development,
and demonstrating that successful technology transfer includes transfer of technological