Increasingly, industry is confronted with the challenge of moving toward a cleaner, more sustainable path of production and consumption, while increasing global competitiveness. Technology will be essential for meeting these challenges. At some point, businesses are faced with investment in new capital stock. At this decision point, new and emerging technologies compete for capital investment alongside more established or mature technologies. Understanding the dynamics of the decision-making process is important to perceive what drives technology change and the overall effect on industrial energy use. From a policy-making perspective, the better we understand technology developments the more effective we will be in utilizing our future research dollars and in undertaking sound strategy development.

This report focuses on the long-term potential for energy-efficiency improvement in industry. In 2002, the industrial sector consumed 33% of the primary energy and was responsible for 30% of the energy-related greenhouse gas (GHG) emissions in the U.S. Due to the extremely diverse character of the industrial sector, it is not possible to provide an all-encompassing discussion of technology trends and potentials. Instead we focus on a number of key technology areas that illustrate the significant potential energy savings available to industry, given a sustained state, federal and private R&D effort. These include: near net shape casting, membranes, gasification, motor systems, and advanced cogeneration. The discussion of each of these technologies provides a detailed assessment of the potential for future contributions to energy efficiency improvement, economics and performance, as well as the potential development path, including promising areas for research, demonstration or other support. Some of these technologies have particular applications for a specific industry (e.g. near net shape casting in the metal producing sectors and black liquor gasification in the pulp and paper industry), while others can be found in many industries (e.g. advanced motor systems, membranes and advanced cogeneration applications).

The results demonstrate that the United States is not running out of technologies to improve energy efficiency and economic and environmental performance, and will not run out in the foreseeable future. The five technology areas alone can potentially result in total primary energy savings of just over 2,600 TBtu by 2025, or nearly 6.5% of total industrial energy use by 2025. The savings are additional to energy savings found in the AEO 2004 reference case forecasts. The technical potential of these technologies in the long term is roughly three times larger, while additional technologies beyond the five covered in this report are currently available or under development.