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13. Industrial processes

Emissions from industrial processes across the Nordic region totalled 25 million tonnes of CO2e in 2021, corresponding to 17% of total Nordic emissions, including the LULUCF sector. Omitting the LULUCF sector, emissions from industrial processes are responsible for 13% of territorial Nordic emissions.
This chapter covers a combination of emissions from industrial processes and product use, following the categories in the IPCC Guidelines, and the emissions and challenges in the broader industry sector in the Nordic countries, following national delimitations of this part of the economy. If necessary, delimitations are described in the respective country sections. The emissions described in this introductory section do not include the energy use of the industrial (business) sector – this is covered instead in the Energy chapter.
The main emissions sources for industrial processes and product use are releases from industrial processes that chemically or physically transform materials, such as ammonia and other chemical products manufactured from fossil fuels used as chemical feedstock and the cement industry.
From 1990 to 2021, the GHG emissions from the Nordic industry sector have been reduced by 5 million tonnes of CO2e, corresponding to a 17% emission reduction in the sector.
Norway in particular has driven this reduction, with emission reductions in their industry sector of 39% from 1990 to 2021. In the same period, Denmark and Sweden reduced industrial process emissions by 9% and 6%, respectively, while Iceland and Finland experienced emissions increases in the sector of 122% and 3%, respectively.
Figure 18 provides an overview of the GHG emissions from industrial processes and product use across the Nordic countries.
Figure 18: GHG emissions from industrial processes and product use across the Nordic countries 1990-2021
The paper and pulp industries are large in Sweden and Finland, and the mineral and metals industries are important in Sweden, Finland, Norway and Iceland. The emissions from calcination from cement production is particularly an issue in Denmark, Sweden and Finland.
The emissions from the industrial sector in the Nordic countries have primarily been regulated through the EU ETS and different national carbon pricing mechanisms. For example, in Denmark, the green tax reform of 2022 with a CO2-tax on emissions on top of ETS is expected to drive a large part of the transition in this sector.
Table 7 and Table 8, below, give a summary of industrial process emissions across the Nordic countries, based on the sections following.
Emis­sions, 1990
Mt CO2e
Emis­sions, 2010
Mt CO2e
Emis­sions, 2021
Mt CO2e
Table 7: Emissions from industrial processes across the Nordic countries – a summary
Summary of main challenge(s)
  • Scaling up CCS to address process emissions from metallurgical, ceramic and other processes that require high temperatures
  • Availability of affordable, green electricity
  • Large investments needed for emission reduction technologies in the steel industry
  • Maturing and commercialisation of key decarbonisation technologies
  • Development of technological solutions including carbon capture for process emissions
  • Lack of targets and sector-focused strategy to reduce emissions
  • The large investments needed, the need for a long time horizon, an increasing power price, and the risk of reduced competitiveness within international markets
  • Expanding Sweden’s fossil-free power production capacity
  • Lack of competent labour in northern Sweden, where green production is planned
  • Timely mitigation of process emissions from the cement industry
Table 8: Industrial processes across the Nordic countries – a summary of main challenges
The industrial sector is also largely dependent on developments in the energy sector with respect to the access to dependable – and preferably cheap – fossil-free energy to electrify industrial processes without losing international competitiveness. CCS, CCU and similar technologies, together with green fuels, are expected to play a large role in achieving net-zero emissions in this sector and the Nordic countries are piloting different initiatives such as government support for CCS on point-sources and prioritizing R&D for CCS-technologies. Regarding green fuels, Denmark, for example, expects that its gas consumption will be 100% biogas in 2030. 
Achieving emissions reductions in the industrial sector necessitates overcoming financial barriers, as the transition to low-carbon industrial technologies often involves higher upfront costs and long payback periods.
The cross-Nordic challenges focused on in this report in the industrial processes and are:
  • reducing emissions through economic incentives while preserving international competitiveness.
  • scaling up and providing incentives for carbon capture, utilisation and storage (CCUS) and carbon dioxide removal (CDR).
In the industry sector, we see the following opportunities for creating added Nordic value through collaboration:
  • piloting public procurement for low-carbon industrial products
  • knowledge-sharing on best practices in incentivising direct electrification of suitable industrial processes across the Nordic countries.
  • intensifying collaboration on the value chain of Carbon Capture and Storage across the Nordic countries.
  • developing a joint Nordic CCS strategy to increase the potential to realise economies of scale in transportation and storage infrastructure for captured carbon dioxide.
  • Nordic research on governance and business models for generating CO2 removal (negative emissions).

13.2. Status of industrial processes across the Nordic countries

In Denmark, the DEA’s projections on industrial emissions also encompass emissions from energy use in the building and manufacturing sector. Emissions from oil and gas production are also included below, as well as from refineries. Thus, emissions described in the following are higher than presented in the introductory section. According to the DEA, emissions from industry were 10 million tonnes of CO2e in 1990, down to 7.8 million tonnes in 2021, a 22% decrease. The DEA expects the emissions to decrease to 4 million tonnes in 2030, a 60% decrease from 1990
Energistyrelsen (April 2023). Klimastatus og -fremskrivning, 2023. Retrieved from, https://ens.dk/sites/ens.dk/files/Basisfremskrivning/kf23_hovedrapport.pdf
. The decrease towards 2030 is primarily due to incentives created by the green tax reform and the EU ETS. A major proportion of industrial emissions in Denmark are from the production of cement, oil and gas, and refineries. As shown previously (and following the IPCC sectors), these process emissions have been reduced by 9% from 1990 to 2021.
The direct emissions from manufacturing industries and construction cover about 13% of Finland’s total emissions and have declined by about 44% from 2005. In addition to the direct emissions, industrial production has emissions allocated to the energy sector. Many significant Finnish industrial sectors, like the forest and steel industries, are energy intensive and thus the availability of low-carbon energy is key to reducing industrial emissions. Circular economy and hydrogen are seen as future solutions to reduce emissions in, for example, the chemical industry.
Kemian­teollisuus (2020, June). Roadmap to reach carbon neutral chemistry in Finland 2045. Pöyry. Retrieved from, https://kemianteollisuus.studio.crasman.cloud/file/dl/i/W03X2Q/PB5Ml6LzO_u6iKyGGkWFUQ/Kemianteollisuusroadmapandexecutivesummary.pdf  
The direct emissions of the mineral and metal sector cover approximately 6.5% of Finland’s total emissions. The majority of sector-related emissions come from the steel industry, but the emissions and the share of the mining industry are increasing due to rapidly increasing production
Kaivosteollisuus (2023, April 5). Ilmastopäästöt kuriin. [online] Retrieved from, https://www.kaivosteollisuus.fi/fi/vastuullista-toimintaa/ilmastopaastot-kuriin# [Accessed 20.05.2023].
The Icelandic minerals and metals industry accounts for 92% of emissions from industrial process and product use. The sector currently consists of three operating aluminum smelters, a ferro silicon plant and a silicon metal production plant and is responsible for close to 40% of total national emissions when excluding LULUCF.  In 1990, a cement plant was also operating but was closed in 2011.  As the minerals and metals industry already runs on low emissions electricity, emissions are largely process emissions. As expected with the increase in production capacity, emissions in 2021 from minerals and metals were 107% higher than emissions in 1990, with emissions from aluminum 133% higher in 2021 compared to 1990. The smaller increase in emissions compared to the increase in production capacity over the same time-period illustrates improvement in production efficiency and process management that has been achieved since 1990
Keller, N., Helgadóttir, Á.K., Einarsdóttir, S.R., Helgason, R., Ásgeirsson, B.U., Helgadóttir, D.,Helgadóttir, I.R., Barr, B. C., Thianthong C. J. Hilmarsson, K.M., Tinganelli, L., Snorrason, A., Brink, S.H. & Þórsson, J. (2023, April 14). National Inventory Report. Emissions of Greenhouse Gases in Iceland from 1990 to 2021. Environment Agency of Iceland. Retrieved from, https://ust.is/library/Skrar/loft/NIR/ISL_NIR%202023_15%20april_on_web.pdf
The minerals and metals industry is subject to EU ETS regulations and as a result has not received much focus in the Icelandic climate action plan. The action plan simply refers to the overall goal of the EU ETS sector, which was a 43% reduction in emissions by 2030 compared to 1990. The plan has not been updated since the EU increased its ambition for sectors governed by the EU ETS system, but the climate action plan refers to the need for this to be done. No additional climate policy instruments beyond the EU-ETS system have been applied.
In Norway, industrial GHG emissions have been reduced by 41% since 1990, mostly before 2010, due to various process changes for aluminum and fertiliser production (and closure of magnesium plants)
Miljøstatus (2023). Norske utslipp og opptak av klimagasser. Norwegian Environment Agency. Retrieved from, https://miljostatus.miljodirektoratet.no/tema/klima/norske-utslipp-av-klimagasser/ [Accessed 20.05.2023].
. The two major metal industries in Norway are aluminum and steel, where power is the dominating energy source and considerable emissions are process related.
Cement production is a major mineral-based industry in Norway, located near limestone deposits. The largest plant is Norcem Heidelberg Brevik, which is a major point source of CO2 that is included in the Langskip CCS project.
CCS Norway (n.d.). Longship timeline. Retrieved from, https://ccsnorway.com/ [Accessed 20.05.2023].
Most of the large cost of the CO2 capture facility at the plant is covered by the government.
In Sweden, the GHG emissions from industrial processes and product use amounted to 7 million tonnes of CO2e in 2021. The emissions in this sector are process-related and stem from the materials used in industrial processes as well as the use of various products
Swedish Environmental Protection Agency (2023, April 6). National Inventory Report Sweden 2023. Retrieved from, https://unfccc.int/documents/627663
The GHG emissions were 6% lower compared to 1990. The emissions in the sector are to a large extent linked to a few larger industrial plants in the iron and steel industry, mineral industry, chemical and refinery industry as well as mines and other metal industries. Among the industries within this sector, the metal industry was the largest contributor to GHG emissions in 2021, accounting for 3 kt CO2 eq. or 43%. The second largest contributor of GHG emissions in this sector is the mineral industry. Process-related emissions have decreased to a lesser extent than traditional measures to reduce emissions such as displacing fuel oil (and that part of the industry is included in the energy sector in this report). The decrease that has taken place is due to the introduction of new process technology.

13.3. Pathways towards climate neutrality in industrial processes

In Denmark, emissions are expected to decrease following the implementation of the national tax reform in combination with greener electricity, more biogas in the gas grid and electrification of industry. In the long term, oil and gas production emissions will decrease as fields are getting older and will eventually stop production in 2050 at the latest, according to the political agreement on oil and gas production in the North Sea
Klima-, Energi-, og Forsyningsministeriet (2020, December 4). Bred aftale om Nordsøens fremtid. [online] Retrieved from, https://kefm.dk/aktuelt/nyheder/2020/dec/bred-aftale-om-nordsoeens-fremtid [Accessed 20.05.2023].
. Emissions from refineries are, with some degree of uncertainty, expected to decline as the national carbon tax is introduced, thus incentivising e.g. process electrification and the use of renewable fuels, leading to CO2-reductions
Energistyrelsen (2023, April). Klimastatus og -fremskrivning, 2023. Retrieved from, https://ens.dk/sites/ens.dk/files/Basisfremskrivning/kf23_hovedrapport.pdf
In Finland, the reduction of industrial emissions is mainly guided by the low-carbon roadmaps produced by the business sectors with the support of the government. The roadmaps will be updated, where applicable, during 2023. Electrification and hydrogen play a key role in reducing emissions from the process industry and the government supports this development. An electrification subsidy for energy-intensive companies has been introduced to promote low-carbon investments in industry
Ministry of Economic A­airs and Employment of Finland (2022, September 9). Carbon neutral Finland 2035 – national climate and energy strategy. Retrieved from,  https://julkaisut.valtioneuvosto.fi/bitstream/handle/10024/164323/TEM_2022_55.pdf?sequence=4&isAllowed=y
, although only part of the subsidy is earmarked for actual electrification measures. Investment support has also been available.
The emission intensity per production unit in Finland has decreased in both the mining and steel industries, but the largest potential lies in the adoption of new technology. The steel sector is focusing on the development of new HYBRIT technology that aims to replace coking coal, traditionally needed for ore-based steelmaking, with green hydrogen. The first batch of raw material was produced in 2021
Sipola, T. (2021, August 18). Maailman ensimmäinen erä fossiilivapaata terästä on valmiina – uusi teknologia vähentää pian Suomen hiilidioksidipäästöjä seitsemän prosenttia. Yle. [online] Retrieved from, https://yle.fi/a/3-12062634 [Accessed 20.05.2023].
, and commercial production is expected to start in 2026
SSAB (n.d.). Time line for fossil-free steel production. [online] Retrieved from,  https://www.ssab.com/en/company/sustainability/first-in-fossil-free-steel/timeline [Accessed 20.05.2023].
. The launch of this technology alone would reduce Finland’s total carbon dioxide emissions in the 2030s by about 7%. Other industrial initiatives include biomass as an alternative to coke
Teknologiateollisuus (2020, January 9). Teknologiateollisuuden vähähiilitiekartta raportti – vaihe 1. Pöyry. Retrieved from, https://teknologiateollisuus.fi/sites/default/files/inline-files/Teknologiateollisuuden%20tiekartta1_Teknologiaselvitys%20vähähiiliratkaisuista_Pöyry.pdf
, intelligent process control technologies, increased use of side streams and recycled materials, elec­tri­fi­cation of mining machines and different parts of the steel process
Teknologiateollisuus (2020, January 9). Teknologiateollisuuden vähähiilitiekartta raportti – vaihe 1. Pöyry. Retrieved from, https://teknologiateollisuus.fi/sites/default/files/inline-files/Teknologiateollisuuden%20tiekartta1_Teknologiaselvitys%20vähähiiliratkaisuista_Pöyry.pdf 
, alternative sources of energy like small modular nuclear reactors
Fortum (2023, March 23). Fortum ja Outokumpu selvittävät mahdollisuuksia terästeollisuuden hiilidioksidipäästöjen vähentämiseksi. [online]. Retrieved from,  https://www.fortum.fi/media/2023/03/fortum-ja-outokumpu-selvittavat-mahdollisuuksia-terasteollisuuden-hiilidioksidipaastojen-vahentamiseksi [Accessed 20.05.2023].
as well as CCUS
Teknologiateollisuus (2020, January 9). Teknologiateollisuuden vähähiilitiekartta raportti – vaihe 1. Pöyry. Retrieved from, https://teknologiateollisuus.fi/sites/default/files/inline-files/Teknologiateollisuuden%20tiekartta1_Teknologiaselvitys%20vähähiiliratkaisuista_Pöyry.pdf  
In Iceland, the sector is subject to the EU ETS system and no domestic policy initiatives beyond that system have materialised. Industry-driven initiatives have, however, begun to emerge that focus on carbon capture and mineralisation and in addition use the replacement of carbon electrodes. A Memorandum of Understanding (MOU) was signed between the government, Reykjavik Energy (via its subsidiary Carbfix) and the metals industry to explore the possible use of the Carbfix process to capture and mineralise emissions (CCM). 
The Coda Terminal
Carbifix (n.d.). Coda terminal. Retrieved from, https://www.carbfix.com/codaterminal [Accessed 10.05.2023]
, the first industrial scale CCM operation in Iceland not asso­ci­ated with a geothermal power plant, will be located at the site of the Rio Tinto alu­mi­num smelter in SW Iceland. Opportunities are being explored for CCM from the smel­ter but cost-effective carbon capture remains a challenge. Other initiatives in the alu­mi­num industry include using inert cathode material, such as by the company Arctus.
The ferro silicon plant, Elkem, is exploring options for carbon capture and use and has signed an MOU with Carbfix to potentially use the Carbfix CCM process in their operations.
In Norway, the most promising technological options to reduce GHG emissions from e. g. the aluminum, ferro & silicon, and manganese industries are replacement of the carbon anodes with inert anodes, replacing fossil carbon with biochar, using biogas and hydrogen for heating, and CCS. However, this will require large investments that would only be profitable given a high carbon price, and emissions could first be reduced after 2035. In addition, this transition would likely need more power for these industry processes.
Over 90% of total emissions from the Swedish industry are regulated within the EU ETS. Revisions of the EU ETS directive have decreased the number of available emissions allowances and will decrease even more rapidly in the future. This has already led to rising prices. In addition to the EU ETS, there are other policies, both at national and EU level, which affect the industry's emissions to varying extents. There is a range of support for research, development and demonstration within the industry. The Industrial Leap Programme (Industriklivet) targets process-related emissions through support towards research, development and demonstration (RD&D). The EU Innovation fund has granted support for several Swedish projects.
In projections
Naturvårdsverket (2023). Underlag till regeringens kommande klimathandlingsplan och klimatredovisning. NV-08102-22. Retrieved from, https://www.naturvardsverket.se/499a4f/contentassets/4c414b0778e9409fb2836fc4d3dc6259/underlag-till-regeringens-kommande-klimathandlingsplan-och-klimatredovisning-2023-04-13.pdf
, emissions from stationary plants within the EU ETS in Sweden are estimated to decrease by 67% by the year 2045 compared to 2005. The decrease is mainly due to a technology shift to hydrogen-based steel production, assumed to be implemented alongside the introduction of CCS technology in the cement industry and in refineries. The technology shifts are assumed to be implemented from 2030. In the projections, the emissions from product use also continue to decrease as an effect of the bans that are gradually coming into force for a number of uses of fluorinated greenhouse gases, as a result of new regulations in the EU.
According to an interview study, companies responsible for the largest emissions in the sector state that they have taken further steps towards meeting the goals for their business’s climate transition. Several companies have initiated permitting processes as part of restructuring their operations and are conducting feasibility studies to switch to methods with low or no emissions
Naturvårdsverket (2023). Underlag till regeringens kommande klimathandlingsplan och klimatredovisning. NV-08102-22. Retrieved from, https://www.naturvardsverket.se/499a4f/contentassets/4c414b0778e9409fb2836fc4d3dc6259/underlag-till-regeringens-kommande-klimathandlingsplan-och-klimatredovisning-2023-04-13.pdf
. It is stated that the demand for carbon dioxide-free products is starting to pick up, which could accelerate the transition even further. Several business sectors, including cement and steel, have produced roadmaps for fossil-free competitiveness within the framework of Fossil Free Sweden, an initiative that was started by the Swedish government in 2015. The roadmaps contain both commitments and political proposals which pave the way for an interaction between business and politics.
It is worth noting that the Swedish government is preparing a climate action plan to be delivered by the government in the autumn of 2023, which will describe how the climate goals are to be achieved.

13.4. Challenges in industrial processes on the way towards climate neutrality and opportunities for Nordic collaboration

In Denmark, the major challenge for decarbonising the industrial sector in the long term is cement production. Cement will likely be needed for many years, but increased use of renewables can only mitigate the energy-related emissions from cement (approximately 50%). Thus, CCS is likely to be necessary to mitigate process emissions (calcination). Both fuel switching and CCS are part of the Danish cement plant Aalborg Portland’s 2030 strategy to significantly lower their carbon footprint
Aalborgportland (n.d.). 2030 Roadmap. [online]. Retrieved from, https://www.aalborgportland.dk/baeredygtighed/2030-roadmap/ [Accessed 20.05.2023].
. The achievement of this transition is in large part conditional on lower CCS costs and/or the incentives provided by the EU ETS and the national carbon tax, as well as, potentially, state aid. This ambition may be supported by the fact that the ETS price is expected to increase towards 2030, significant state aid is already dedicated to CCS and CCS costs, considered broadly, may decrease in the future as basic learning curves and price reductions in the scaling of CCS are enacted.
For Finland, the main challenges in the steel industry are that significant emission-reduction technologies require large investment and are not yet in use on a commercial scale. There is also a significant need for affordable low-carbon electricity. Overall, many of the new technologies required to decarbonise process industries are still at relatively low levels of maturity, carrying both higher costs and risks.
Teknologiateollisuus (2020, January 9). Teknologiateollisuuden vähähiilitiekartta raportti – vaihe 1. Pöyry. Retrieved from, https://teknologiateollisuus.fi/sites/default/files/inline-files/Teknologiateollisuuden%20tiekartta1_Teknologiaselvitys%20vähähiiliratkaisuista_Pöyry.pdf  
While CCS is being considered in many industries, Finland does not have suitable geological for­ma­tions for permanently storing the carbon and no incentives yet to capture biogenic carbon.
In Iceland, the metals and minerals sector already relies on electricity derived from renewable energy sources. Emissions are therefore process emissions but amount to a significant share of Icelandic emissions. Technological development is still needed to realise mitigation options, for example cost effective capture technology in the aluminum sector and the development of inert cathode materials. To enhance action within the industry, the government needs to sharpen its focus and include the sector formally in its plans and evaluation of future emissions.  For example, the Environmental Agency could include expected impact of policy action such as the EU ETS system in its emissions forecasts
Helgadóttir, Á.K., Einarsdóttir, S.R., Keller, N., Helgason, R., Ásgeirsson, B.U., Helgadóttir, I.R., Barr, B.C., Hilmarsson, K.M., Thianthong, J.C., Snorrason, A., Tinganelli, L. & Þórsson, J. (2023, March 15). Report on Policies, Measures, and Projections. Projections of Greenhouse Gas Emissions in Iceland until 2050. Environment Agency of Iceland. Retrieved from, https://ust.is/library/Skrar/loft/NIR/0_PaMsProjections_Report_2023_WITH%20BOOKMARKS.pdf
The challenges to ensure effective mitigation from the sector are primarily threefold: i) Maintain competitiveness: in particular, as ambition of the EU ETS system increases and CBAM is implemented. ii) Technological challenges for example, the aluminum industry lacks cost effective scrubbing technologies and technologies for reduced process emissions. iii) Lack of targets and sector-focused strategy to reduce emissions: as the sector is responsible for a large share of national emissions, the government needs to sharpen its focus on the sector beyond its current full reliance on the EU-ETS system.
In Norway, the industry has adopted general long-term targets, but the main challenges for a green industry transformation are the large investments needed, the need for a long-term horizon, an increasing power price, and the risk of reduced competitiveness in international markets.
For Sweden, the tightening of the EU ETS gives industry stronger incentives to reduce their emissions. At the same time, there is a need for supplementary measures to remove remaining obstacles. Several challenges in this sector have been identified
Swedish Environmental Protection Agency (2023, April 6). National Inventory Report Sweden 2023. Retrieved from, https://unfccc.int/documents/627663
. The future need for electricity requiring an unprecedented expansion of Sweden’s fossil-free power production capacity, as well as expansion of transmission capacity. With the current difficulties to get permits for wind power (both on-shore and off-shore), this may delay the needed expansion. Another challenge is the need for competence and labour to settle in northern Sweden where much of the green production is planned. Also, efficient review and permitting processes are required.
In addition to those challenges, timely decarbonisation in the cement industry will be needed. The main cement production company in Sweden, Heidelberg cement, has the ambition and technologies to transform to near zero emissions in 7 years
Fossilfritt Sverige (n.d.). Cementbranschen. Retrieved from, https://fossilfrittsverige.se/roadmap/cementbranschen/ [Accessed 10.09.2023]
. With EU’s new climate package Fit-for-55 (FF55), the price of emissions allowances has exceeded 100 euros for the first time. This is described by Heidelberg cement as a gamechanger. At these levels it’s beginning to be commercially advantageous to produce cement with no emissions. However, Heidelberg says that to do the transition the Swedish state will have to fund a power transmission line to the site on the island of Gotland
Törnwall, M. (2023, May 6). Norsk klimatbov kan göra det omöjliga. Svenska Dagbladet. [online]. Retrieved from, https://www.svd.se/a/WR8jK2/klimathotet-kan-cementindustrin-gora-det-omojliga [Accessed 20.05.2023].
Across the Nordic countries, the industries may differ but the core challenges are the same. Below, we have focused on two where there is high potential for added Nordic value through increased Nordic collaboration. The two chosen challenges are:
  • reducing emissions through economic incentives while preserving international competitiveness
  • scaling up and providing incentives for negative emissions technologies.

13.4.1. Reducing emissions through economic incentives while preserving international competitiveness

The challenge
Most, if not all, of the industrial firms in the Nordic countries are competing internationally and a recurring argument against strong regulation on emissions from this sector is the risk of carbon leakage – i.e. that the emitting production “leaks” to another country with firms moving production facilities abroad. As such, to avoid leakage, costly investments in emission reduction technologies tend to need to be incentivised or subsidised.
Public procurement could provide one solution. More than 200 billion euros are spent on public procurement each year across the Nordic countries. This makes public procurement a powerful tool to leverage sustainable practices in the private sector
Nordregio (2022, May 30). The missing multiplier, How to use public procurement for more sustainable municipalities. [POLICY BRIEF, 2022:3]. Retrieved from, http://nordregio.org/wp-content/uploads/2022/05/the-missing-multiplier.pdf  
. Public procure­ment could, for example, be used to push for low-carbon industrial products such as green steel, concrete and various CCU products. There are many industrial investment plans in the Nordics that would benefit from creating first-mover markets for the products. Moreover, recent research has shown that price should not be seen as a barrier for public procurers in setting requirements for low-carbon industrial projects.
In the Mistra Carbon Exit project, the allocation of costs of CO2 abatement across the value chain for steel and cement was assessed. The results showed that the increase in selling price of new low-CO2 steel and cement would neither significantly alter the cost structure nor dramatically increase the price to be paid by end-users
Mistra Carbon Exit (n.d.) Pathways to Net Zero Greenhouse Gas Emissions in Supply Chains. Retrieved from, https://www.mistracarbonexit.com/ [Accessed 20.05.2023].  
Besides reducing emissions from industrial processes and product use, electrification is also a part of the way forward for the industry sector in the Nordic region. Industry electrification couples electricity and industry sectors by replacing the fossil fuel demand with electricity demands, thus enabling further integration of renewable electricity and transitioning the hard-to-abate energy sector
Sorknæs, P., Johannsen, R.M., Korberg, A.D., Nielsen, T.B., Petersen, U.R. and Mathiesen, B.V. (2022). Electrification of the industrial sector in 100% renewable energy scenarios. Energy, 254, p.124339. Retrieved from, https://www.sciencedirect.com/science/article/pii/S0360544222012427
. Barriers to electrification of industrial processes for the individual firm include up-front costs, planning and technical know-how.
We see the following opportunity for cross-Nordic collaboration addressing the challenges outlined above:
  • piloting public procurement for low-carbon industrial products.
To leverage the muscle of Nordic public procurement, a forum/network for Nordic public procurers should be established. Within this network, best practice to sustainable procurement of low-carbon industrial products can be shared and common practices developed.
  • Knowledge-sharing on best practice in incentivising direct electrification of suitable industrial processes across the Nordic countries
Knowledge-sharing across the Nordic countries could take place both at the government level: sharing experiences and best practice in how to incentivise direct electrification of the industrial sector; and at the industry level: sharing knowledge on direct electrification practices in different subsectors and how to overcome barriers.
The Nordic Council of Ministers could promote knowledge-sharing through forums or networks or by funding cross-Nordic studies with this aim.  

13.4.2. Scaling up and providing incentives for carbon capture, utilisation and storage (CCUS) and carbon dioxide removal (CDR)

The challenge
The attainment of Nordic countries’ individual and joint ambitions to reach net-zero GHG emissions may require very significant CCUS and CDR deployment within a couple of decades. But using CCUS and CDR as solutions to emissions and residual emissions in the industry sector is associated with a number of challenges.
In Denmark, the current estimated target is 3.2 million tonnes of CO2 pr. year through CCS by 2030. Currently, 0.43 million tonnes are in the pipeline for 2026 with the award of the first contract. The government expects that a tender for negative emissions in the autumn of 2023 will result in a further reduction of 0.5 million tonnes pr. year from 2026 . Moreover, there is broad political support to reach the remaining 2.3 million tonnes of CO2 pr. year through two tenders in 2024 and 2025, respectively. 
In Finland, similar issues arise. There are no dedicated targets, strategies, large-scale RDI funding programmes or incentive schemes for carbon removal in general and technical sinks in particular. A recent study indicates that Finland is lagging behind its Nordic peers in terms of a supportive policy framework. However, the new government has announced new measures, including a target for carbon removal, a reverse auction or a similar incentive for negative emissions and a possible phaseout date for releasing both fossil and biogenic carbon dioxide from large industrial point sources.
The Nordic countries already collaborate on CCUS development in the Networking group on CCUS (NgCCUS)
Nordic Co-operation (n.d.) Networking group on CCUS. Norden. Retrieved from, https://www.norden.org/en/organisation/networking-group-ccus [Accessed 20.05.2023].
; however, individual countries’ plans for CCUS primarily focus on national pipelines and national storage capacity. 
Current CCS development in the Nordic countries (and beyond) is driven by government tenders and subsidies. To accelerate CCS deployment in the Nordic industry sectors, governments need to have more tools available.
This gives rise to the following opportunities for cross-Nordic collaboration:
  • intensifying collaboration on the value chain of Carbon Capture and Storage across the Nordic countries
As recently recommended in the report on Regulatory framework for CCS in the Nordic countries (2023)
Nordic Council of Ministers (2023, June 22). Regulatory framework for CCS in the Nordic countries. Retrieved from, https://pub.norden.org/temanord2023-521/index.html
, the Nordic countries should intensify their cooperation and dialogue, providing for joint efforts to build knowledge, sharing of Nordic experience and lessons learned coordinated through a Nordic forum for collaboration on CCS. If pipelines and storage capacity are dimensioned to large volumes, including import and export of CO2, the price will be lower for both national point sources and potential CO2-exporting countries. Efficient co-ordination could also bring cost savings through facilitating more rational infrastructure configurations across countries.
  • developing a joint Nordic CCS strategy to increase the potential to realise economies of scale in transportation and storage infrastructure for captured carbon dioxide
In the same vein as the previous recommendation, the Nordic Council of Ministers could lay the groundwork for a joint Nordic CCS strategy. This has also been recommended by Nordic Energy Research in their Nordic Clean Energy Scenarios (2021)
Wråke, M., Karlsson, K., Kofoed-Wiuff, A., Bolkesjø, T.F., Lindroos, T.J., Hagberg, M., Simonsen, M.B., Unger, T., Tennbakk, B., Jåstad, E.O., Lehtilä, A., Putkonen, N. & Koljonen, T. (2021). Nordic Clean Energy Scenarios: Solutions for Carbon Neutrality. Nordic Energy Research. Retrieved from, https://norden.diva-portal.org/smash/get/diva2:1589875/FULLTEXT02.pdf
. A joint Nordic CCS strategy could inspire similar regional cooperation across the globe, illustrating how countries with different (geographical and technical) opportunities for BECCS can work together.
  • Nordic research on governance and business models for generating CO2 removal (negative emissions)
We recommend that the Nordic Council of Ministers – for example through Nordic Energy Research or Nordic Innovation – provide funding for further cross-Nordic research into incentive schemes for producing negative emissions and the practicalities and consequences of implementing these in the Nordic region.
Cross-Nordic research on incentive schemes for producing negative emissions should also attempt to answer the question: how to finance negative emissions in the long-run?
Negative emissions will eventually compensate for residual emissions to reach net-zero and hereafter for some historical emissions. This will likely be expensive, with the average cost of high-quality carbon removal priced at 537$/tonne by second quarter 2023
CDR.fyi (2023). CDR.fyi 2023 Mid-Year Progress Report. Medium. Retrieved from, https://medium.com/@cdr_fyi/cdr-fyi-2023-mid-year-progress-report-656826b7e4cb [Accessed 20.05.2023].
. Although the cost will likely decrease as the market matures, there is a need to look into who should pay to bring back the CO2-concentration to a desirable level in the future.