Demand Key readiness question Can the market support low-emission products given the green premiums and 2030 project progress? Key messages –Demand signals for low-carbon products are increasing, but the gap between demand commitments and willingness to pay green premiums puts clean technology investments at risk. –Key barriers for scaling demand include unclear standards for carbon thresholds, uncertainty in measurements, low willingness to pay and limited previous experiences and typically unbinding offtake agreements at scale for low- carbon products. –Collaboration between sectors and policy- makers is needed to establish clear standards, improve reliability of carbon measurements and address high costs to encourage the adoption of low-carbon products. Demand scores for low-emission products across sectors (2022-2024) FIGURE 17 Cement Steel Trucking Oil and gas Shipping Primary chemicalsAviation 2022 2023 2024Aluminium12345Demand readiness scores Note: Aviation, shipping and trucking sectors were not included in the 2022 report, and the primary chemicals sector has been added this year. Sectors with readiness score movements in the past year: –Shipping: The score increased from 2 to 3 compared to last year as MPP’s announced projects exceeded the 2030 target. –Aluminium: The score decreased from 4 to 3 compared to last year due to limited progress towards the MPP’s announced projects of 70 low-carbon refineries and smelters by 2030. Demand signals for low-carbon products are gradually growing and are starting to be tested for scale and associated green premium potential. The apparent disconnect between demand commitments and readiness to pay a green premium is weakening the business case for low-carbon producers being willing to invest in clean technologies. Challenges Currently the main barriers for scaling demand include: –Standards and definitions: Lack of clear and unified industry-wide standardized thresholds for low-carbon and near-zero emission products impedes product comparison. Carbon footprint methodologies and emissions tracking standards have been developed in most sectors but are not being implemented consistently to reach widespread adoption. Net-Zero Industry Tracker: 2024 Edition 30

Net Zero Industry Tracker 2024