Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/227769
Authors: 
Chiappinelli, Olga
Gerres, Timo
Neuhoff, Karsten
Lettow, Frederik
de Coninck, Heleen
Felsmann, Balázs
Joltreau, Eugénie
Khandekar, Gauri
Linares, Pedro
Richstein, Jörn
Śniegocki, Aleksander
Stede, Jan
Wyns, Tomas
Zandt, Cornelis
Zetterberg, Lars
Year of Publication: 
2020
Series/Report no.: 
DIW Discussion Papers No. 1921
Abstract: 
This paper explores which climate-friendly projects could be part of the COVID-19 recovery while jump-starting the transition of the European basic materials industry. Findings from a literature review on technology options in advanced development stages for climate-friendly production and enhanced sorting and recycling of steel, cement, aluminium and plastics are combined with insights from interviews with 31 European industry stakeholders about the practical and economic feasibility of these technology options. Results indicate that with an estimated investment of 28.9 billion Euro, about 20% of EU's basic materials could be produced through low-emission processes or additional recycling by 2025 with technologies that are commercially available or at pilot scale today. However, our stakeholder consultation also shows that in order to make these short-term investments viable in the long term, six main barriers need to be addressed, namely i) the lack of effective and predictable carbon pricing, ii) the limited availability of affordable green electricity, iii) the lack of a regulatory framework for circularity, iv) low technology readiness and funding, v) the lack of infrastructure for hydrogen, CO2 and power, and vi) the lack of demand for climate-friendly and recycled materials. Based on these insights, the paper proposes elements of a policy package that can create a long-term framework favourable for investments in these technologies and should ideally accompany the recovery package to give credibility to investors that the business case will last beyond the recovery timeframe.
Subjects: 
Green COVID-19 Recovery
Industrial Decarbonisation
Policy Package
EU Green Deal
Technology Readiness
JEL: 
L61
L65
Q54
Q55
Q58
Document Type: 
Working Paper

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