Here's how industrial clusters in China are moving towards energy self-sufficiency.

Industrial clusters can be heavy emitters, but they also provide the most significant opportunities for decarbonization.

Targetting Scope 2 emissions - gases emitted indirectly from purchased energy- through greater use of renewable energy and heat on-site can help lead the clean energy push.

Sites in China's Qinghai Province are leading efforts to make this transition.

As COP27 wrapped up late last year, we saw an urgent call to abate emissions and deliver the targets pledged over the years. The industrial sector, responsible for approximately 30% of global CO2 emissions and 37% of global final energy use, needs to be decarbonized more than ever. That's even more true if we consider Scope 2 emissions - gases emitted indirectly from purchased energy.

Industrial sectors always band together to create greater economic opportunities: what's referred to as "industrial clusters". By co-locating in one geographical area, members share common infrastructure, facilitate easy access to resources, lower production costs and leverage policy as well as financing innovation. Yet clustering can also create negative impacts by making the area a significant carbon emitter, as it becomes both energy-intensive and resource-dependent.

As the "world's factory", China sees a higher percentage of carbon emissions and energy consumption from industry than many other countries. In 2020, the industrial sector in China accounted for about 70% of total final energy use. China has over 25,000 industrial parks across the country. And if we look further into it, industrial parks at or above the provincial level - which account for around 10% of the total number - produce 31% of China's total carbon emissions. Decarbonizing these carbon behemoths will contribute a lot to the net-zero transition of not just China but also the global community.

The four net-zero pillars

Decarbonizing these big emitters is not easy. Some industrial clusters represent a single industry and gather companies from upstream to downstream, while others incorporate multiple industries in one location. In both scenarios, they usually consume a great volume of energy and produce a correspondingly huge amount of emissions. However, their size and intra- or inter-industry nature also catalyze integrated, large-scale and systematic solutions to decarbonization. To accelerate this synergy, a dedicated global initiative, tasked to transition industrial clusters into a net-zero future, was launched during...