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ChemCo Marginal Abatement Cost Curve (MACC)

year (decades) pathway.
Here are the levers and technologies Chemical
Companies could consider: Decarbonization as license
To abate Scope 1 emissions interventions on as- to operate but requiring high
sets owned and operated by the company: Cra-
cking furnaces electrification, Electric boilers, Em- investments in a complex and
ployment of alternative technologies such as H2, hard-to-abate environment
CCS, biomethane as feedstock.
Scope 2, instead, considers emissions coming In defining a winning decarbonization strategy,
from the generation of purchased energy, thus Chemical Companies should change mindset,
from fuels feeding processes (e.g., switch to 100% making Net Zero a competitive advantage and va-
green electricity is one of the key elements, emer- lue creating objective (vs. a pure cost constraint)
ging technologies for carbon-free steam, energy and planning for a medium / long-term pragmatic
efficiency initiatives). pathway, progressively operationalizing options
The abatement of Scope 3 requires focus on main and engaging supply chain partners and policy
contributors such as purchased feedstock and pro- makers.
ducts processing; direct initiatives mainly refer to We see 3 concrete steps for the multi-year decar-
mechanical and chemical recycling, bio-products, bonization journey:
CO2-to-Chemicals. It is also critical to engage the 1. From initiatives to delivery: accelerate mar-
wider ecosystem of customers, suppliers and peers ginal decarbonization
up and down the value chain, encouraging key sta- a Most companies have already defines
keholders to act virtuously toward decarbonization. a first set of initiatives, they will need to
In addition, companies can take actions to help operationalize and integrate with a broa-
society reduce emissions outside own value chain: der set of solutions to provide optionality
scope 4 initiatives aiming at avoiding emissions in the medium-long term on all scopes;
cannot be accounted for target setting, but may be ensure pragmatism of solutions (combi-
leveraged for strategic communication (SBTi sets nation of business sense and sustainabili-
a cap of 10% for efforts to compensate unabated ty targets)
emissions). b Setup a robust orchestration of the de-
carbonization efforts (specific governan-
Achieving abatement goals will be extremely com- ce) and then performance manage (i.e.,
plex and costly. monitor results and adapt as business /
The Marginal Abatement Cost Curve (MACC) re- market context evolves and technology
presents costs or saving expected from different matures) to ensure drumbeat and deci-
abatement levers, alongside the potential volume sion making at key turning points all along
of emissions that could be reduced if initiatives are the journey
successfully implemented.
In assessing the convenience of executing the- 2. New initiatives and monetization: embed
se initiatives, the resulting average marginal cost customer excellence approaches in scope 3
needs to be compared with the opportunity cost reduction
of compensating emissions through the purchase a Launch new initiatives with engagement
of ETS allowances. of value chain stakeholders (suppliers and
Clearly, each initiative faces a relevant trade-off, customers) to tackle scope 3 early on
where timing and technological complexity play a b Understand voice of the customer (and
crucial role. Some initiatives result ready to be im- of supplier) to prioritize accounts and
plemented and “in the money”, others require more progressively engage into a decarbo-
time and efforts for further developments. nization pathway. Evaluate partner-

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