An integrated framework for levelled up & low carbon industrial clusters

IDRIC Project MIP 1.7

Imperial College London

Background

The UK Industrial Decarbonization Challenge (IDC) aims at combining the need for transitioning to low carbon UK industrial clusters, with the UK government levelling up agenda. Driven by the IDC proposition, various assessments have recently focused on quantifying the socio-economic value associated with decarbonizing the major industrial clusters in the country. So far, these analyses have focused on single or restricted low carbon solutions and have considered each cluster in isolation, neglecting important socio-economic links within the UK. For these reasons, quantitative evidence of the levelling up value of the proposed solutions is currently lacking, as this would require accounting for the existing economic interdependencies within and between UK regions. In addition, these assessments adopt “in-house” approaches for deriving jobs and value creation, which hinders the transparent verification and comparison of different appraisals.

This project will adapt an established framework, JEDI-UK, to quantify the Gross Value Added (GVA) and employment opportunities deriving from a portfolio of low carbon options for the UK clusters. Collaboration with industrial partners throughout the project, will inform about the range of feasible low carbon solutions within each cluster. These empirical data will be incorporated in JEDI-UK to provide a transparent and coherent quantification of the socio-economic impacts associated with these pathways as well the reskilling requirement.

Professor Niall MacDowell

Professor Niall Mac Dowell

Principal Investigator
Imperial College London

Project Team

Imperial College London:

Dr Nadine Moustafa
Dr Mai Bui

Aim

The aim of the project is to present a spatial economic framework that quantifies the socioeconomic benefits arising from low carbon UK industrial clusters whilst accounting for region-specific features.

More Detail

Our project is composed of four work packages that will produce a robust and coherent assessment of the socio-economic impacts associated with decarbonising the six major industrial clusters in the UK.

WP1- Data gathering and collaboration

WP1- Data gathering and collaboration: This WP will identify low carbon technological pathways for key UK clusters. Key technical options for reducing emissions across major industrial clusters have been already proposed during phase I of the Strategy Challenge Fund’s (SCF). These solutions include carbon capture and storage (CCS), fuel switching to hydrogen, integration of renewables, together with improved process and energy efficiencies. It is expected that the optimal portfolio of technological solutions will depends on each cluster’s specificity. Hence, close collaboration with industry and public sector bodies in each cluster will be essential in this phase, especially for clusters that have already conducted technology screening activities, e.g. the Scottish Net Zero Roadmap.

WP2- Enhanced JEDI-UK: In this phase, JEDI-UK will be extended to include the range of technical solutions identified from the industrial engagement activities conducted in WP1. The tool already contains detailed techno-economic representation of promising technologies for blue and green hydrogen production. In this phase the tool will be further enhanced 1) to account for clusters specific requirements, for instance, capacity of hydrogen production facilities and CO2 pipeline sizing as well 2) to include further options which are not yet included in the tool, e.g., electrification.

WP3- Value creation in low carbon clusters: This WP will produce an assessment of the socio-economic impacts associated with the low-carbon solutions identified in WP1 and WP2. For each cluster, a detailed quantification of the Gross value Added (GVA) and direct jobs at sector level will be produced. The regional employment data collected in WP1 will be used to assess variations of the regional labour demand associated with low carbon pathways.

WP4- Employment transition: This WP will conduct an in-depth employment analysis specifying the corresponding demand for skills and job types across each cluster. The JEDI-UK already contains information of the skills and training requirements associated with the CCS industry. Here, the analysis will be replicated for other emerging sectors, e.g., Hydrogen, and it will be complemented with an in-depth analysis of regional statistics on skills (e.g., the OECD and ONS databases). This will allow to prepare a skill mismatch analysis detailing critical training and reskilling requirements at the regional level.

Meet the Team

 

Dr Mai Bui

Dr Mai Bui

Dr Mai Bui

Imperial College London

Dr Nadine Moustafa

Miss Nadine Moustafa

Dr Nadine Moustafa

Imperial College London

Dr Mai Bui

Dr Mai Bui

Dr Mai Bui

Imperial College London

Dr Nadine Moustafa

Miss Nadine Moustafa

Dr Nadine Moustafa

Imperial College London

Case Study

JEDI-UK is a well-established tool that quantifies the socio-economic impacts of investing in low-carbon solutions at the regional level. The tool has been developed over the last 3 years by Dr Patrizio and Professor Mac Dowell, and it contains a wide range of low carbon solutions for power generation, as well for key industrial sectors – cement, iron and steel and refineries. The tool has been adopted in a recent study to quantify the economic value of adopting blue hydrogen to meet the heat demand of major industrial clusters in the UK. In accounting for the economic and trade dependencies of the UK regions, JEDI-UK allowed to quantify the spillover effects associated with these investments, that is their levelling up potential.

Patrizio P., Sunny N., Mac Dowell N. (2022). Inefficient investments as a key to narrowing regional economic imbalances. iScience 25, 103911

Planned Outputs

In this project, the framework will be extended to include a wider range of feasible low-carbon solutions to reduce industrial clusters’ emissions. These options will be identified in strong collaboration with key industrial representatives, to reflect the specific needs of each cluster. Once the initial calibration phase is completed, the tool will produce a robust and coherent assessment of the jobs and value created by the identified solutions, leveraging the extensive macroeconomic database within the JEDI-UK tool.

Specific objectives of the project include:

  • To co-develop bottom-up low carbon roadmaps for major industrial clusters in the UK
  • To produce a coherent and robust assessment of the regional economic impacts of investing in these solutions within and between UK regions
  • To measure the levelling up potentials of the identified solutions by quantify the spillover effects generated by investments at the cluster level.
  • To produce an in-depth analysis of the reskilling and retraining requirements for transitioning the existing labour force

Investigate Further

  1. Xie J., Patrizio P., Mac Dowell N. (2022). Modeling the Socio-Economic Impacts of Carbon Capture and Storage Deployment: Current Practices and Pathways Forward. In Sustainable Carbon Capture, CRC Press, 323-339.
  2. Patrizio P. and Mac Dowell N. (2022) Socially Equitable Energy Transitions: Analytical Challenges and Policy Implications. Greenhouse Gas Removal Technologies 31, 465
  3. Patrizio P., Pratama Y., Mac Dowell N. (2020). Socially equitable energy systems transition. Joule, 8: 1700-1713