Can Scotland solve the 'hard-to-abate' problem in industrial decarbonisation?

The transition to net zero has a dirty secret. While solar panels and wind turbines grab the headlines, the real challenge lies hidden in the industrial heartlands where our steel, cement, chemicals and jet fuel are made.

These "hard-to-abate" sectors account for 16% of UK greenhouse gas emissions – and they can't simply be plugged into the renewable grid.

The problem is chemistry, not just energy. Making steel requires coking coal – not as fuel but as a chemical ingredient to strip oxygen from iron ore. Cement production releases CO₂ when limestone is heated – a process that happens regardless of whether you're burning gas or green electricity. Steel production emits 2.6 tonnes of CO₂ per tonne produced, while cement accounts for 7% of global emissions.

Yet Scotland could hold the key to solving this puzzle. From Grangemouth's chemical complexes to Orkney's hydrogen ferries, the country is quietly becoming Europe's testing ground for clean industrial technologies that could define the next century.

The regional advantage

Scotland's industrial geography reads like a clean energy playbook. The Northeast, anchored by the Acorn project near Peterhead, is becoming the UK's carbon storage hub. It's repurposing 175 miles of old gas pipelines to transport captured CO₂ from industrial sites to permanent storage in depleted North Sea fields.

The Central Belt exemplifies this challenge. Grangemouth – Scotland's former oil refinery that ceased operations in 2025 and major chemical hub – now faces reinvention as fossil fuel demand declines. The Scottish Government's Just Transition Plan outlines nine potential pathways including sustainable aviation fuel, green chemicals and hydrogen production that could preserve thousands of skilled jobs at the wider industrial complex.

Elsewhere in central Scotland, Carlton Power and Superglass are advancing the Stirling Green Hydrogen project. The scheme will begin with a 10MW electrolyser producing around 1,000 tonnes of green hydrogen annually. This will cut carbon emissions at Superglass’ insulation manufacturing plant by the equivalent of taking 160 trucks a year off the roads, and give it scope to expand as regional demand grows.

Most remarkably, Scotland's islands have become living laboratories. Orkney has been testing hydrogen ferries, airport refuelling and building heating for years. These aren't pilot projects – they're proving clean technologies work in the real world.

Breakthrough technologies

The solutions emerging could revolutionise global industry. Hydrogen-based steel production, already proven in Sweden's HYBRIT project, uses hydrogen instead of coking coal to produce water rather than CO₂. The challenge? It requires 3.2 tonnes of hydrogen per tonne of steel, highlighting why hydrogen infrastructure and industrial decarbonisation must develop together.

Cement companies are testing carbon capture systems that could trap 85-95% of process emissions, plus alternative chemistries reducing limestone content by half while maintaining strength. Some are developing "carbon-negative" concrete that absorbs CO₂ as it cures.

Aviation presents the toughest challenge. Sustainable aviation fuels work in existing planes but cost three to four times more than conventional fuel. Hydrogen aircraft could handle short flights – companies like ZeroAvia are testing hydrogen-electric systems and building a manufacturing facility in Scotland – but hydrogen cannot match jet fuel's energy density for long-haul routes.

The economic opportunity

This isn't just environmental necessity – it's massive economic opportunity. The World Economic Forum estimates that nature-positive solutions could create $10 trillion in business opportunities and 395 million jobs by 2030.

Early movers are already benefiting. BMW and Volvo specifically source low-carbon steel, creating premium markets. Scotland's renewable advantage could make it a hydrogen exporter to European markets, where clean energy costs more.

However, UK industrial electricity costs run 50% higher than France or Germany, threatening "carbon leakage" where production simply moves to dirtier jurisdictions. Without action, the UK risks losing both its industrial base and climate goals.

The communication challenge

The biggest obstacle might be communication. Industrial transformation affects workers, communities, investors and policymakers – each with different concerns. Many still see decarbonisation as a cost rather than opportunity.

Research shows that 44% of company valuations now depend on CEO reputation, often linked to environmental leadership. Yet only 25% of employees believe their leaders communicate effectively about change. Oxford Business School found that well-managed environmental transitions can increase shareholder value by 15%.

Scotland's success stories need better storytelling. Orkney's hydrogen ferries prove technologies work. Grangemouth's transformation plans show evolution, not extinction. But positive narratives get drowned out by focus on costs and challenges.