The hydrocarbon crisis sparked by the Russo-Ukrainian war has prompted European countries such as Italy to speed up their energy-saving efforts. A circular economy-inspired project promoted by the European Union may now help the country’s industry achieve carbon neutrality.
Europe has changed significantly since the Russo-Ukrainian began a year ago, especially regarding energy supply. Before Russia’s invasion of Ukraine in February 2022, nations such as Germany and Italy were among the largest beneficiaries of the Russian hydrocarbon market. Therefore, Rome and Berlin were left in a precarious position when Moscow’s brutality forced them to find alternative energy sources.
The two countries boast the highest industrial productivity in the EU and respectively rank fourth and seventh globally. In particular, Italian manufacturing today employs more than four million people, equivalent to nearly one-fifth of the total workforce nationwide. However, such numbers also require large amounts of energy. In 2020, 44% of the country’s electricity supply was used to power Italy’s industrial sector. Manufacturing alone accounted for 39% of the nation’s consumption that year.
Since natural gas provides most of this electricity, energy prices have skyrocketed in 2022. This has led to a staggering 25% drop in Italian companies’ direct industrial gas consumption. Nevertheless, national productivity still showed a 1.4% increase in January, indicating a resilient industrial sector despite the crisis.
Italy, however, isn’t the only nation to be overreliant on fossil fuels. The global energy supply is still heavily based on oil, natural gas, and coal – although the latter is less prevalent nowadays than it used to be. 83% of the world’s energy is still derived from hydrocarbons and only 17% from low-carbon alternatives, such as renewables and nuclear. As a matter of fact, oil, coal, and gas remain the main contributors to global energy needs – and emissions.
The transition to true carbon neutrality – that is, achieving a balance between CO2 emissions and capture – is still a long and winding path. In this global picture, where energy needs, business costs, and the need to contain or neutralise emissions overlap, creative solutions are required.
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Italy’s Circular Economy-Inspired Energy Strategy to Reach Carbon Neutrality
One immediate answer is to optimise fossil fuel yield, wasting as little as possible. This approach is inspired by circular economy principles, which include sharing and reusing materials, products and services. Experts in R-ACES, a European project funded by Horizon 2020, are working on this very concept.
The principle is pretty straightforward. Since there tends to be a great deal of energy leakage in high-intensity industrial processes, it makes sense to channel these losses to other industrial plants that are geographically nearby, thus maximising energy usage. In other words, turn what is “waste” for one industry into a valuable resource for another nearby.
The concept of an ecoregion is based on this idea: an area where different infrastructures can exchange excess energy flows between them.
“Often, companies don’t know what their neighbours are producing or wasting,” explained Sergio Pinotti, energy efficiency expert at Spinenergy, which is participating in the project in Italy’s Bergamo ecoregion.
“In other words, the first thing to do is bring these companies together to share information about their energy flows.”
Pinotti refers explicitly to the use of energy in high-intensive processes. For example, in Europe, cooling and heating account for 50% of the total energy demand, and much of that energy goes to waste, primarily by being used inefficiently. Through the approach proposed by R-ACES, industries can share and recover these resources, reducing demand and consumption. Ideally, companies provided with R-ACES special self-assessment and data-sharing tools will benefit from energy derived from their neighbours’ ‘waste’ streams. In practice, this will be achieved through district heating and cooling systems. Such infrastructures are localised networks of pipes that transfer heat (or cold) generated during an industrial process to others – an ambitious goal, not without a few obstacles.
“The main technical challenges revolve around the reliability of the district heating networks infrastructure, the context, and their proximity to heat sources,” explained Paola Santini of A2A Life Company, a participant in the R-ACES project in the Bergamo ecoregion.
Additionally, Santini points out that there is still mistrust surrounding this sharing among industrial actors and local institutions.
“There are legal problems that hinder agreement between the parties. That’s why administrative procedures must be simple, with defined objectives.”
For this very reason, R-ACES likewise provides various legal assistance tools to help the parties sign contracts that are as clear and satisfactory as possible.
“We certainly need to exchange energy to avoid waste, but also information,” Pinotti concludes. “Alone, we may move faster, but we can go further by working together.”
The project is currently implemented in three pilot districts: Antwerp (Belgium), Nyborg (Denmark) and Bergamo. The next step will be to expand into seven more ecoregions across Italy, including Brescia, Emilia-Romagna, and the Milanese hinterland.