Sustainable industrial transformation in Europe

The challenge of balancing competitiveness and decarbonization

Europe faces a decisive decade to transform its industrial fabric towards a more sustainable, efficient and competitive model. The study recently published by Cornell University, entitled “Pursuing decarbonization and competitiveness: a narrow corridor for European green industrial transformation”, analyzes in depth how European industry can advance towards climate neutrality without losing its productive strength or its strategic autonomy.

A dual objective: reducing emissions and maintaining competitiveness

The research highlights one of the great dilemmas of European climate policy: how to drastically reduce industrial emissions without compromising global competitiveness. Sectors such as steel, cement, chemicals and fertilizers account for more than 60% of EU industrial emissions, and are als

The study concludes that deep decarbonization is technically feasible, thanks in particular to electrification and the use of green hydrogen as a substitute for fossil fuels. However, it warns that energy and infrastructure costs can create imbalances between countries and sectors, causing some industries to seek to relocate outside Europe if a stable competitive framework is not guaranteed..

Three paths to a green European industry

The researchers propose three strategies to achieve this balance between sustainability and profitability:

1. Industrial relocation within Europe.
   Moving part of the production to areas with greater availability of renewable resources, such as southern or Northern Europe, could slightly reduce energy costs, but also entails social and logistical risks. Relocation is only viable if planned with a joint European vision and with public support in the affected regions.
2. Selective import of green intermediates.
   Incorporating materials such as ammonia, methanol or hydrogen-reduced iron (HBI) produced in countries with abundant renewable energy can reduce costs and emissions, while maintaining the added value of the final stages of production in Europe. This route is presented as one of the most efficient options for maintaining employment, production and competitiveness without being completely dependent on external industry.
3. Selective subsidies and public policies.
   Government aid is essential to prevent the flight of green industry, but the study warns that it cannot be unlimited. Support must be concentrated on strategic sectors – such as steel or ammonia – and on the modernization of existing facilities, rather than on the massive expansion of new plants. In this way, the energy transition can be economically sustainable and socially fair.

The key: a realistic technological transition

According to the results of the PyPSA-Eur energy model, developed by the authors, the electrification of industrial processes and the combined use of green hydrogen and carbon capture can reduce emissions by up to 90% by 2040 and reach climate neutrality by 2050.
In addition, local production of renewable energy, solar, wind and hydraulic, becomes essential to reduce external dependence and guarantee competitive prices in the long term.

Despite the challenges, the study underlines that Europe has a pioneering regulatory framework (such as the Net-Zero Industry Act and the Clean Industrial Deal), which can turn sustainability into a driver of economic growth and technological innovation.

Electrification as a key piece of decarbonization

The Cornell University study also highlights the electrification of industrial heat as one of the fundamental technological pillars to achieve climate goals.
Industrial electric heating systems, together with green hydrogen and carbon capture (CCS), are identified as viable solutions to replace fossil fuels in numerous production processes. This transition would significantly reduce emissions associated with high-temperature heat generation, one of the main sources of CO₂ in the industrial sector.

Although some sectors still require additional technological innovations, such as the use of plasma or indirect electrification for cement, electric heat is already a mature and essential alternative for many industrial applications.

How does IES Soler contribute to this transformation?

This industrial transformation is not only a political challengepublic policies, but also an opportunity for industrial companies that are committed to energy efficiency and decarbonization.
In this context, at IES Soler we accompany European industry on this path towards sustainability with electric heat solutions and efficient thermal engineering, which allow replacing systems based on fossil fuels with controlled and clean electrical alternatives. Our technologies contribute to:

• Electrifying industrial thermal processes, reducing direct emissions and improving overall efficiency.
• Integrating renewable energy sources into production processes, with a high level of thermal control.
• Minimizing maintenance and environmental impact thanks to robust and durable systems.

In addition, IES Soler’s more than 80 years of experience and our focus on innovation, safety and sustainability make it a strategic partner for companies that want to move towards a decarbonized and competitive industrial model.

Towards a new European industrial revolution

The European green transition will not only be a question of reducing emissions, but also of rethinking how and where we produce. As the Cornell study points out, Europe’s industrial future will depend on the ability to combine energy efficiency, technological innovation and collaboration across sectors.

Companies like us are already demonstrating that sustainable industrial transformation is possible, profitable and, above all, essential to guarantee the future of European industry.