Clean energy infrastructure encompasses a broad range of applications, including the development of gas networks for clean gases, the setup of energy efficiency infrastructure, and the electrification of industrial processes and chemical processing facilities to produce clean fuels. Additionally, transport infrastructure must be enhanced to support both regional and international trade. This will involve the construction of new infrastructure at port facilities, charging stations, storage facilities, refuelling stations, pipelines and interconnectors to link regions of clean energy production and export with import regions. The current infrastructure, however, falls short of the required scale and pace of growth. For power, there is a risk of its supply being up to 14% short of the predicted demand in Europe by 2030 when there are unfavourable weather conditions, as determined by Accenture modelling.6 In clean hydrogen production, most announced projects remain in planning or earlier phases. The International Energy Agency (IEA) estimates that for the full clean hydrogen production project pipeline to materialize, the sector must achieve a compound annual growth rate (CAGR) of over 90% annually from 2024 to 2030. Assuming all announced projects are realized, export-oriented projects are expected to account for approximately one-third of clean hydrogen production by 2030, but progress has been negligible.7 Effective policy can support long-term stability, facilitating the demand conditions necessary to invigorate the market and drive transformative change for clean energy infrastructure. Over the past year, the clean energy policy landscape has continued to evolve. For example, additional public funding of approximately $100 billion for clean hydrogen projects has been announced, enacted or allocated worldwide. However, it is worth noting that two-thirds of these funds remain at the announcement stage.8 Nationally and regionally, support for clean energy infrastructure is being embedded into important clean energy and industrial transformation policies and legislation. For example: –In the European Union (EU), the Fit for 559 package of proposals aims to provide a coherent and balanced framework for reaching the EU’s climate objectives while ensuring a just and socially fair transition. Through a range of measures such as the Carbon Border Adjustment Mechanism (CBAM)10 and the EU’s Emissions Trading System (EU ETS),11 it provides a framework to drive and support the energy transition in heavy industry. –In the US, the 2022 Inflation Reduction Act (IRA) and 2021 Bipartisan Infrastructure Law12 put a strong focus on investment initiatives in clean energy infrastructure with measures supporting clean electricity, clean fuels and industrial clusters. –China’s 14th five-year plan (2021-2025)13 was developed to support the goal of carbon neutrality by 2060. The plan encompasses dimensions across the full clean energy value chain, including generating, distributing and using clean energy. For example, the plan includes advancements of a green, integrated and optimized multi- modal transport system, as well as enhancing connectivity with neighbouring countries.14 Focusing on clean fuels, the number of defined and refreshed national strategies and approaches is growing, including India’s National Green Hydrogen Mission,15 Chile’s National Green Hydrogen Strategy,16 the Morocco Offer for green hydrogen,17 Germany’s adapted National Hydrogen Strategy,18 Japan’s Green Growth Strategy,19 the UK’s Biomass Strategy20 and the US Sustainable Aviation Fuel Grand Challenge Roadmap.21 While policy is maturing around the globe, challenges remain, such as the approach to transposing policy into national and regional legislation, ensuring interoperability across regions, navigating new policy at pace and balancing push-pull mechanisms across the value chain. For example, in the EU, truck manufacturers are required to produce low-emission trucks to meet CO2 reduction targets for heavy-duty vehicles. However, there is no corresponding requirement for companies to purchase them or invest in the necessary infrastructure (such as charging infrastructure), creating a disconnect between supply and demand for sustainable transport solutions. While policy is maturing around the globe, challenges remain, such as the approach to transposing policy into national and regional legislation. Unleashing the Full Potential of Industrial Clusters: Infrastructure Solutions for Clean Energies 7

Unleashing the Potential of Industrial Clusters 2025