EDITORIAL
STEVENGISLAM
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Shortages, deluges and a bridge to net-zero In our final issue of the year we focus on three of the stickiest challenges facing global industry right now: the semiconductor shortage, the rapidly growing deluge of single-use plastics, and the ongoing push – especially in harder-to-abate sectors such as aviation and shipping - to reach net-zero as humanity attempts to mitigate the worst effects of climate change and keep the planet below that crucial 1.5 C temperature rise, as laid out in the 2015 Paris Climate Agreement.
Chips on our shoulders? 2021 has been a year marked by various shortages from gas to truck drivers to shipping containers to abattoir workers. These shortages have been compounded by supply chain disruptions occurring in the wake of the the pandemic. The first of these stories of scarcity, and arguably the one with the biggest impact, has been the shortage of semiconductors - the focus of our cover story. While the root causes of this are manifold, the event that brought it to a head is somewhat obvious – Covid-19. 2020 - the year when we all stayed home - saw a boom in sales for consumer electronics such as games consoles and 5G-enabled smartphones, as a bored, locked-down population looked for things to do and spend their money on. At the same time, the automotive industry was attempting to shake off oil, accepting the inevitability of the shift to electric vehicles, and increasing investment in eMobility. As we all know, home electronics and EVs all require semiconductors. Suddenly, a new spotlight was shone on hitherto relatively obscure multi-billion tech companies like Taiwan’s TSMC as electronics companies, automakers and governments alike looked to woo them to fulfil their production demands. Of course, as with many manufacturing sectors, the pandemic had put a dampener on production within the semiconductor sector itself. The situation was worsened by the disruptions to global shipping caused by Covid. One telling moment was when Samsung, which sells $56 billion of semiconductors to others, and consumes $36 billion of them itself, had to postpone the launch of its own Galaxy Note smartphone due to the crisis.
In September, Industry Europe’s very own Ash Jones spoke to Rekha Menon-Varma and David Chouvelon from Vertaeon. The interview focused on the global chip shortage and took a deeper dive into how the automotive industry should prepare for the looming supply chain disruptions and chip scarcity that may lie ahead for the EV market.
The Plastic Population While plastic is unquestionably one of the most versatile man-made materials, and one which is incredibly useful, we all know by now that we can’t go on like this. Humanity’s plastic addiction has reached feverish levels and shows little sign of abating. According to the UN Environment Programme, if current trends continue, plastic could account for 20% of the world’s emissions by 2050. Indeed, some elements within the oil sector are banking on our continued, unquenchable lust for plastic driving profits as the combustion engine car is phased out. Plastic has now become so prevalent in our environment that some are touting it as one of the indicators for the dawning of the Anthropocene era. A recent study also found that the Covid-19 pandemic has only made the issue worse, with billions of pieces of Personal Protective Equipment further compounding the problem. It’s not all doom, gloom, and dead sea animals though. Many companies are making efforts to replace single-use plastics, and legislation like the EU’s ban on certain single-use plastics may be flawed but certainly offer baby steps in the right direction. While plastic has seen its reputation fall from its golden era in the 1950s to the environmental bogeyman it is today, there is still room for a nuanced debate on its future as a material. In our second focus, Ben Smye, Head of Growth at Matmatch, argues that there is still a place for it in our world. As a material, its versatility makes it hard to replace. What is needed, he says, is to rethink our approach. Designers should no longer view it as disposable but as durable and long-lasting. He argues that an improvement in waste management and recycling techniques,
coupled with a more long-term approach to product and packaging design, should allow plastic to assume a new role – one of long-term permanence rather than singleuse, disposal products.
Cleaning up our act As Covid-19, hopefully, turns into something we are learning to live with, and the lukewarm successes of COP26 are still fresh in our memories, attention has turned back to the other, much larger crisis of climate change. Recent events in Madagascar, which simply appears to be drying up, not to mention all those Pacific island nations which will probably be submerged over the course of the next century, are stark reminders that a global pandemic is only the start of our troubles. The burning issue of our time is how we transform our energy supply, our transportation, and our manufacturing processes. As urgent as things may seem, necessity has and will always be the mother of innovation. The climate crisis comes at a time when our technological ability provides us the tools to make that transformation. What’s more, the political will is there too, by and large, both in governments and the private sector, as well as among the general public. Decarbonisation is a process and as such there are numerous ways in which we can clean up our collective act. One of the interesting grey-areas in the energy transition is biomass. While it’s renewable, it can be destructive to biodiversity, especially when forests are cut down to make way for plantations. And while emissions are far lower with most forms of biomass, they are not carbon neutral. Our third focus is an interview with Lord Adair Turner and Dr Meera Atreya of the Energy Transitions Commission about their report on the role that biomass can play. Unlike the previous ETC reports this year on hydrogen and electrification, this one strikes a more cautious note. And while biomass may not be a viable end solution, they argue that it could provide an important bridge as harder-to-abate sectors invest in developing net-zero technologies which help power their own transitions to n a cleaner future. Industry Europe 3
