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Financial implications of climate change

Climate change: risk or opportunity?

The transition towards a carbon smart economy, using carbon resources in a smart and climate neutral manner whilst preserving and re-enforcing economic and industrial activity in Europe and our climate, is a huge challenge for society, and by extension for our energy and water intensive sector.

Our sector plays a key role in the transition towards a sustainable society. The indicators on energy consumption, energy efficiency and greenhouse gas emissions, demonstrate how our sector has already made the switch to less climate impacting energy sources and how energy efficiency has increased making it possible to produce more with less energy. The indicator on resource efficiency shows how alternative feedstock are being investigated in the context of what is feasible given the high global demand for chemical products. The two water indicators show how the sector is reducing its water footprint, both in terms of water used and discharges into the environment. But more is expected in the transition towards a sustainable society to reach the Paris Agreement target.

On the other hand, the chemicals and plastics industry is also a provider of energy-efficiency and energy-saving solutions throughout the economy, such as light-weight composites for automotive applications, thermal insulation materials, high-tech materials for wind mills and solar panels, storage and use of CO2 as a resource, and carbon neutral fuels. Hence the sector continuously increases its own sustainability, and produces products and technologies that are contributing to the reduction of greenhouse gases elsewhere in society.

The pathway towards a carbon smart economy has multiple connections with our sector. Climate technologies can create market opportunities for the sector – provided that production in Europe is maintained in a profitable manner given the international context. However, EU companies are also confronted with a range of EU climate related costs.

Smart choices will have to be made when implementing new policies to balance climate objectives with the economic global context, and social aspects such as affordability and availability of alternatives. Only if all can thrive all three – planet, people and prosperity – we will be heading toward a sustainable, climate neutral future.

Global challenges such as climate change, energy transition and transition toward a smart carbon society, need a global approach. Indeed, we can only evolve towards a carbon-neutral society if we work all together to bridge the existing technological, social and economic gaps. This requires a balanced, innovation-driven and global climate policy that provides the chemicals, plastics and life sciences industry sufficient capacity to compete on an international scale in the context of less ambitious policies among Europe’s global competitors, and to get access to necessary financial means. Only with such a well-considered policy that supports the competitiveness and innovative power of European industry on the one hand, and places the climate challenge at the top of the innovation agenda on the other hand, the chemicals, plastics and life sciences industry in Belgium and Europe will have sufficient opportunities to continue to develop sustainable innovations that are necessary to contribute to the global climate problem.

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