Last year, COP27 was hailed as the “implementation COP” – a gathering of the global community focusing on concrete steps to achieve a sustainable future. In less than six months, COP28 will take place in Dubai, marking a pivotal moment that demands a concerted effort for transitioning to a low – or no-carbon economy.
As COP28 President-Designate Dr. Sultan Ahmed Al Jaber stated at UAE Climate Week, “We need to reimagine the relationship between energy producers and industrial consumers, from one based purely on supply and demand to one that is focused on co-creating the future. We must create an active partnership between the largest producers of energy, the biggest industrial consumers, technology companies, the finance community, governments and civil society. Working together, the goal would be an accelerated, practical and just energy transition that leaves no one behind, particularly across the global south. In short, our goal must be to hold back emissions, not progress.”
Read: British ambassador to UAE praises COP28
For asset-intensive industries, two key questions need addressing: How are companies handling the challenge of meeting rising energy and resource demands while ensuring sustainable operations? And what steps are they currently taking to navigate the energy transition?
To achieve global sustainability goals, innovation must span the entire value chain, encompassing new business models, go-to-market strategies, collaboration and co-innovation approaches.
In the short term, digital technologies are instrumental in delivering significant sustainability benefits. Measures like advanced process controls, digital twin modeling, and supply chain management help companies maximize efficiency from existing assets while minimizing emissions.
Furthermore, various technologies offer benefits that extend beyond efficiency improvements. Advanced modeling and simulation tools enable companies to test and identify the most efficient, cost-effective and scalable processes before making substantial capital investments. Additionally, easy-to-implement sustainability models can accelerate efforts across different sustainability targets, including emissions management and renewable energy adoption, among others.
In other cases, AI-driven maintenance solutions can help companies predict breakdowns before they happen, avoiding costly downtime and emissions associated with emergency shutdowns. Digital supply chain solutions maintain a steady supply of raw materials while reducing Scope 3 emissions, and digital grid management software simplifies integrating renewable energy into energy supplies.
A growing number of companies are exploring new technology options. According to Bloomberg NEF, global investment in low-carbon technologies reached $755 billion in 2021, with spending on carbon capture more than doubling from 2022 to 2023, reaching a record $6.4 billion. Biofuels and the hydrogen economy have seen similar increases – an IEA report indicated biofuel investment surpassed $8 billion in 2021, while a World Bank study predicted the hydrogen production market would grow by over 9 percent through 2030.
The electrification market has also experienced significant growth, reaching $73.6 billion in 2022, as companies increasingly turn to renewable sources of power to reduce their carbon footprint. Going forward, this trend is expected to continue, reaching a market value of nearly $174 billion by 2032, according to a Precedence Research study.
As these technologies continue to grow, digital simulation tools and systems-level risk modeling will play key roles in their development, allowing organizations to evaluate different processing options and identify the most economically feasible solutions.
While digital technology will remain vital for value creation, it is also critical for reaching sustainability goals, and must be accompanied by new ways of doing business. In the Middle East, companies like Aramco have already begun pursuing these innovations.
Working in collaboration with the Korea Advanced Institute of Science and Technology, the company developed new technology last year that optimizes carbon capture and utilization (CCU) with the goal of accelerating CCU system adoption. At the heart of the system is an algorithm that analyzes the economics, process design, operations constraints, and CO2 reduction achieved with different carbon capture technologies, allowing companies to identify and implement the most promising approaches.
To bring the technology to the market, Aramco took a unique approach by licensing it to an industrial software company as part of an integrated modeling and optimization solution. This approach enables asset-intensive industries to develop practical and economic carbon capture solutions.
International companies like Aramco, however, are not alone in seeking new business opportunities. Sustainability-focused startups have attracted billions in investor funding, with over €8.8 billion invested in European sustainability startups1 in 2021 alone, and even more invested worldwide.
Along with new business models and co-innovation strategies, companies must also focus on achieving organizational excellence by investing in talent, developing training programs, and establishing best practices. The goal is to attract and retain highly skilled workers.
As the workforce undergoes rapid change in the coming years, building these internal competencies and skills will be critical to ensure employees and organizations can effectively adopt new technologies and adapt to emerging business models. These adaptations will play a significant role in driving both profitability and sustainability in the future.
Asset-intensive industries are vital components of modern life. Remaking them for a sustainable future won’t be easy or happen overnight; it demands dedication, creativity, and a willingness to push the boundaries of technology and business.
As we look ahead to COP28, the world faces a distinct opportunity – a chance for us to collaborate and discover innovative ways to create a sustainable future that benefits everyone.
I look forward to the emergence of these innovations and am eager to see what tomorrow holds.
Antonio Pietri is president and CEO of Aspen Technology.
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