The industrial and manufacturing sectors account for approximately one-third of global energy consumption, making them pivotal in the fight against climate change.
According to the International Energy Agency (IEA), fossil fuels, particularly coal, dominate industrial energy use, contributing about a quarter of energy-related CO2 emissions.
As the global economy and population expand, the demand for materials and goods will rise, making it even more critical to identify and implement technologies and strategies that promote sustainable manufacturing practices.
However, the sector still faces formidable challenges in aligning with global net-zero targets. As McKinsey’s Global Energy Perspective 2024 underscores the growing energy demand between 2025 and 2035 threatens to drive emissions higher unless aggressive changes are implemented.
While advancements in low-carbon technologies are promising, they remain either underdeveloped or too costly for widespread adoption, highlighting the need for stronger policy support and financial incentives to enable the necessary transition.
It is noteworthy, however, that a growing movement of businesses is actively addressing this challenge. The RE100 initiative, a global network of influential companies committed to utilising 100percent renewable electricity has seen participation from over 400 corporations.
For example, at Epson, we are actively promoting the use of renewable energy as evidenced by the company’s switchover to 100 percent renewable electricity for all its sites in Japan in 2021 and completed the transition to renewable electricity globally by the end of 2023.
This feat was achieved through the steady implementation of decarbonisation targets and the use of renewable electricity since 2018.
One of the driving factors behind the increasing adoption of renewable energy is the significant decline in costs.
According to the International Renewable Energy Agency, solar photovoltaic power was 710 percent more expensive than the cheapest fossil fuels in 2010.
By 2022, solar power was 29percent cheaper than fossil fuels. Electricity, which accounts for around 20 percent of energy use in manufacturing, is expected to become an even more significant cost factor as industries scale up.
Renewable energy offers substantial financial and environmental benefits. Manufacturers that operate heavy machinery during daylight hours, for instance, can reduce emissions by as much as 80percent by switching to renewable energy.
By diversifying energy sources, manufacturers can shield themselves from volatile fossil fuel prices and supply chain disruptions.
Companies that commit to renewable energy are also positioned to enhance their brand reputation, attract environmentally conscious consumers, and retain employees who value sustainability. Adopting renewable energy also allows manufacturers to decouple economic growth from environmental harm, setting the stage for a more sustainable future.
The transition towards renewable energy however has its challenges. For example, the initial capital required for renewable energy projects can be prohibitive, especially for smaller companies. Manufacturing also requires an enormous amount of electricity in comparison to powering offices.
In some countries or regions where the supply of renewable electricity is limited, like Japan, Taiwan, and Singapore, it is much more expensive than electricity produced by traditional means, placing a significant future cost burden on companies that purchase renewable electricity.
Geographic limitations also play a role, as the availability of certain renewable energy sources, such as solar, wind, or hydroelectric power, varies by location. For some manufacturers, these barriers may slow the transition to renewable energy, even as costs continue to decline.
The transition to renewable energy in manufacturing is no longer just an option—it’s an imperative.
Governments, businesses, and investors must collaborate to accelerate clean energy adoption, ensuring that the manufacturing sector not only meets global net-zero targets but thrives in a sustainable future.
The question isn’t whether we can afford the shift, but whether we can afford to wait. Let’s commit to powering progress with clean energy—before it’s too late.
The author is Epson’s Regional Head for East and West Africa.
