The Green Decarbonized State and Industrial Governance: How to render transformation of the energy-intensive industry possible?

Recently we suggested that future research on the state in environmental and climate politics needs to develop an understanding on how industry can be included in conceptualizing a Green Decarbonized State (Bäckstrand and Kronsell 2015). The State retains the authority and capacity to access diverse steering mechanisms to achieve climate and sustainability objectives (Bäckstrand et al. 2010) and can orchestrate decarbonization of societal structures in key sectors in the carbon economy (Hildingsson and Khan 2015). Welfare states have been particular successful, due to their capacity to reconcile different interests in society, by remediating social and environmental costs that arise from the externalities of industrial production (Gough and Meadowcroft 2011). At the same time, the welfare state has been inherently dependent on industrial and economic development. In the Paper we focus on the energy-intensive natural resource-based industry (ENRI), in which decarbonization is particularly challenging to achieve. While such industries represent key economic sectors, they are associated with intense energy consumption and high carbon emissions. In perspective of the Paris Agreement, and the long-term climate policy objectives, these industries are an important target for climate mitigation efforts and decarbonization strategies. Industry is a major emitter accounting for 30 % of global emission of greenhouse gases of which ENRI sectors including the iron and steel foundry, pulp and paper, cement and chemical industries are responsible for nearly half (IPCC 2014). But decarbonization efforts will expose policy makers of a major dilemma subject to the ENRIs; while industrial decarbonization is critical for climate policy, such sectors represent key export industries and large employers that are fundamentally important to national economies. In comparison to other industrial sectors, they are well-integrated into the global economy and as such highly dependent on retaining international competitiveness. Thus, prevailing strategies by state authorities have been to protect these industries from market competition and of late to rely on market forces in anticipation of the risk of carbon leakage (despite the support for such real effects are weak; see e.g. IPCC 2014). However, market-based policies and market-liberal norms of cost-efficiency are largely insufficient to incentivize long-term decarbonization strategies and transformative change in these industries (Henriksson et al 2014; Hildingsson and Khan 2015). Theories on the green state, relate these industries to the problematic economic imperative of the state (Eckersley 2005) referring to industrial sustainability innovation as ‘greenwash’. Transitions theory consider these old industries in terms of incumbent regimes that resist change with innovation only possible through ’niche’ development (Grin et al 2011), ecological modernization theory see the potential for innovative industries to establish lead markets (Jänicke and Jakob 2006). The paper uses these theoretical arguments as a starting point for a discussion on how a green decarbonized state can govern ENRIs and asks: how to render transformative change in and decarbonization of energy-intensive natural resource-based industries possible? References Bäckstrand, Karin and Kronsell, Annica (eds) (2015) Rethinking the Green State. Environmental governance towards climate and sustainability transitions, London and New York: Routledge, Earthscan. Bäckstrand, Karin, Jamil Khan, Annica Kronsell and Eva Lövbrand (2010) Environmental Politics and Deliberative Democracy: Examining the Promise of New Modes of Governance, Cheltenham: Edward Elgar Publishing ltd. Eckersley R 2004 The Green State: Rethinking Democracy and Sovereignty MIT Press, Cambridge; MA Gough I and Meadowcroft J 2011 Decarbonizing the Welfare State in Dryzek J Norgaard R and Schlosberg D eds The Oxford Handbook on Climate Change and Society Oxford University Press, Oxford 490-503. Grin, J., J. Rotmans and J. Schot (2011) Transitions to Sustainable Development. New Directions in the Study of Long Term Transformative Change, London: Routledge. Henriksson, Eva, Patrik Söderholm and Linda Wårell (2014) ‘Industrial electricity demand and energy efficiency policy: the case of the Swedish mining industry’, Energy Efficiency, 7: 477-491. Hildingsson, Roger and Khan, Jamil (2015) ‘Towards a decarbonized green state? The politics of low-carbon governance in Sweden’, in Bäckstrand and Kronsell, 156-173. IPCC (2014). Climate Change 2014: Mitigation of Climate Change. Contribution of Working Group III to the Fifth Assessment Report of the Intergovernmental Panel on Climate Change. New York and Cambridge, UK: Cambridge University Press. Jänicke, M. and K. Jacob (2006a) (eds) Environmental Governance in Global Perspective. New Approaches to Ecological Modernisation, FFU Report 01-2006, Berlin: Freie Universität Berlin.