Industrial heat production makes up a large share of global emissions. About 18% of all greenhouse gas emissions come from heat used in factories, plants, and manufacturing processes. This type of heat is hard to decarbonize because it often requires high temperatures that are still powered by fossil fuels like natural gas.
To tackle this challenge, AstraZeneca, together with Secaro and ERM, launched the Clean Heat Program. The initiative helps companies measure, plan, and reduce industrial heat emissions across their supply chains.
Rob Williams, Senior Director of Sustainable Procurement at AstraZeneca, said:
“It’s clear that a programme like this is the fastest and most effective way to decarbonise heat in our supply chain. We are long-term partners with Secaro and ERM, and now we’re expanding relationships with peers, buyers from other industries and suppliers to plan, fund and launch the projects that will make heat decarbonisation a reality.”
Industrial Heat: The Hidden Carbon Giant
Fossil fuels still supply most industrial heat energy today. Cleaner alternatives like electrification, hydrogen, or biofuels often cost more. They also require new technology and infrastructure.
Despite its importance, industrial heat has received less focus than clean electricity or transport. In many industries, heat drives fundamental operations, from making chemicals to processing food. Because of this, experts say improving how heat is produced is key to cutting industrial emissions.
Clean Heat Program: Turning Plans into Action
In March 2026, AstraZeneca teamed up with ERM and Secaro to launch the Clean Heat Program. This initiative aims to help companies reduce emissions tied to industrial heat across their supply chains.
By combining data tools, technical support, and financing options, the program aims to make it easier for industrial facilities to adopt low-carbon heat solutions and accelerate decarbonization.
AstraZeneca is joining as a founding partner. The company has its own near‑term climate goals. By 2026, it aims to cut 98% of its Scope 1 and 2 emissions from operations compared to a 2015 baseline.
The pharma giant has already achieved 88.1% reduction by the end of 2025. Its long‑term target is to reach net zero by 2045, including deep cuts in emissions across its suppliers and partners.
The Clean Heat Program is designed to go beyond simple planning. It aims to help companies move from studying options to actually acting on decarbonizing heat.
The program combines:
- Supply chain data tools that show where heat is used and emitted.
- Technical support to find practical ways to reduce emissions.
- Financing options to help companies afford projects that cut heat emissions.
Secaro maps heat emissions across supply chains while ERM designs bankable projects, heat pumps, biomass conversion, and electrification upgrades. Notably, financing leverages EU funds and carbon credit revenue to de-risk upfront costs, moving companies from analysis to implementation.
Unlike many efforts that focus on one plant or site, the program looks at supplier networks. This broader view helps companies pinpoint where changes will have the biggest impact.
Why High-Temperature Heat Is Hard to Replace
Industrial heat is one of the largest sources of industrial emissions. According to the International Energy Agency, around 70% of industrial energy demand goes to producing heat for processes such as steel, cement, and chemicals.
Estimates from IEA data show that heat-related emissions are about 6.5 gigatonnes of CO₂ each year. This underscores the significant decarbonization needed.
The same analysis suggests that these emissions must drop to less than 1 gigatonne by 2050. This pathway needs quick action from various industries. It also requires strong investment in technology and changes in supply chains to cut emissions in high-temperature processes.
Industrial heat often uses natural gas or other fossil fuels. While electricity can now come from wind or solar, renewable options for high‑temperature heat are still emerging. Solutions such as electrification, biomass fuels, or hydrogen require new equipment and deep planning.
Electrification technologies work for low-temperature heat below 200°C. But industries that need higher heat still rely on fossil fuels. Secaro’s data show that 80% of industrial energy consumption is tied to heat, and 60% of these come from natural gas.
This complexity makes industrial heat one of the hardest parts of decarbonization — even for companies with net‑zero goals. In many cases, heat emissions make up a large share of a company’s direct emissions, known as Scope 1 emissions.
Currently, less than 10% of sites use biofuels or other renewable energy. Industry forecasts suggest that renewable heat may reach only 15% of industrial use by 2028 unless strong action is taken.
Pressure’s On: Regulators, Investors, and Rising Energy Costs
Pressure to cut heat emissions is growing from both regulators and investors. New rules such as the European Union’s Carbon Border Adjustment Mechanism (CBAM) and updated disclosure requirements from the U.S. Securities and Exchange Commission (SEC) require more detailed emissions reporting and climate risk disclosure.
Companies that ignore their emissions might face penalties. They could also lose contracts with buyers who want cleaner supply chains.
Energy price volatility also plays a role. Firms that rely on fossil fuels for heat may face wide swings in energy costs. Decarbonizing heat can help companies stabilize fuel expenses and reduce exposure to price shocks, which investors increasingly watch closely.
Tools and Support for Heat Decarbonisation
Secaro’s data platform is central to the program. It now offers heat-specific insights, which show where emissions are highest and highlight chances for change. The platform links buyers, suppliers, and solution providers to highlight high‑impact decarbonization actions.
ERM steps in with its technical expertise. It helps companies assess options and build project plans to attract investment.
These can include:
- Higher energy efficiency
- Switching to low-carbon fuels
- Installing heat recovery systems
- Adopting new technologies, like high-temperature heat pumps
Financing is also part of the program. Many industrial heat projects stall because of upfront costs. The initiative aims to connect companies with financing options, including funds based in the European Union and other mechanisms that help lower financial barriers.
Markets Are Warming Up: Forecasts for Industrial Decarbonization
Efforts like the Clean Heat Program are significant as the market for industrial decarbonization is growing. A recent market outlook projects that global industrial heat decarbonization could grow steadily over the next decade.
From 2025 to 2033, the market is expected to expand at a compound annual growth rate (CAGR) of about 6%, reaching an estimated $380 billion by 2033.
Technologies such as industrial heat pumps are also gaining traction. These devices can reuse waste heat and reduce energy losses. A market forecast shows that the global industrial heat pump market will rise to over 13,150 units by 2035. Revenues may exceed $9.1 billion by that time.
Even though many low‑carbon heat solutions exist, adoption has been slow. For example, only a small share of industrial sites in some sectors currently use renewable heat sources. Without stronger action, forecasts suggest renewable heat may reach only around 15% of industrial heat use by 2028.
A Clear Path for Companies and Supply Chains
The Clean Heat Program offers companies a way to close the gap between their climate goals and the real challenges of industrial heat. It helps companies move beyond early analysis and toward real projects that reduce emissions, improve energy security, and meet investor and regulatory expectations.
For supply chain partners and smaller suppliers, the program can lower barriers to entry. Many small and mid‑tier suppliers struggle to access data, technical support, or financing. This initiative aims to change that by giving a clearer path to decarbonization. If widely adopted, this approach could help reduce significant emissions from industrial heat worldwide and support broader climate goals.
The post AstraZeneca Turns Up the Heat: New Program Tackles Industry’s Toughest Emissions appeared first on Carbon Credits.
Every business carbon footprint report ends with a number, the amount of carbon emissions produced by the business, less the amount of carbon reduced and offset, given in tonnes of CO₂. Many of the people who sign off on that number, including those who paid for it, cannot picture what it represents on the ground. A tonne is a unit of mass. CO₂ is invisible. The link between the amount offset in the report and a real piece of restored forest somewhere in the world is almost never indicated.
“…Protecting nature makes our business more resilient…”
For companies with land, water, food, fiber, or commodity exposure, the supply chain may be the most practical place to turn nature from a risk into an operating asset.
Your supply chain already has a nature strategy. It may be undocumented. It may live in procurement files, supplier contracts, commodity maps, and one spreadsheet nobody opens without coffee. But it exists.
If your business depends on farms, forests, water, soil, packaging, rubber, timber, fibers, minerals, or food ingredients, nature is part of your operating system. The question is whether you manage that system with intent, or discover it during a disruption, audit, or difficult board question.
That is why more companies are asking how to find Nature-Based Solutions in Your Supply Chain. Do not begin by shopping for offsets. Begin by asking where nature already affects cost, continuity, emissions, regulatory exposure, and supplier resilience.
What Nature-Based Solutions in Your Supply Chain Means
The European Commission defines nature-based solutions as approaches inspired and supported by nature that are cost-effective, deliver environmental, social, and economic benefits, and help build resilience. They should also benefit biodiversity and support ecosystem services.
In supply-chain terms, that becomes practical. Nature-based solutions in your supply chain can include agroforestry in cocoa, coffee, rubber, or palm supply chains. They can include soil health programs for food ingredients, watershed restoration near water-intensive operations, mangrove restoration linked to coastal sourcing regions, and avoided deforestation in forest-linked commodities.
The key test is business relevance. If your procurement team relies on a landscape, watershed, crop, or supplier base, that is where opportunity may sit. The best projects do not hover outside the business like a framed certificate. They plug into the system that already produces your revenue.
Why the Boardroom Should Care
For many companies, the largest climate and nature exposure sits outside direct operations. The GHG Protocol Scope 3 Standard gives companies a method to account for and report value-chain emissions across sectors. Purchased goods, land use, transport, supplier energy, and product use can make direct emissions look like the visible tip of a very large iceberg.
The Taskforce on Nature-related Financial Disclosures notes that many nature-related dependencies, impacts, risks, and opportunities arise upstream and downstream. That is why nature-based supply chain investments matter to boards. You are managing supply security, audit readiness, investor confidence, and regulatory preparedness.
For companies exposed to EU markets, this also connects to rules and expectations such as CSRD, CSDDD, EUDR, and SBTi FLAG.
Step One: Map Where You Touch Land, Water, and Living Systems
Finding Nature-Based Solutions in Your Supply Chain starts with mapping, not marketing.
Begin with procurement and Scope 3 data. Which categories carry high spend, high emissions, or high sourcing risk? Which suppliers depend on agriculture, forestry, mining, water-intensive processing, or land conversion? Which regions face water stress, heat, flood risk, soil degradation, deforestation, or biodiversity pressure?
The Science Based Targets Network uses a clear process for companies: assess, prioritize, set targets, act, and track. That sequence keeps companies from treating nature as a mood board. You identify where the business has exposure, then decide where intervention can create measurable value.
Step Two: Look for Operational Value Before Carbon Value
This is the center of CCC’s Dual-Value Model. A nature-based supply chain investment should do useful work for the business before anyone counts the carbon.
Agroforestry may improve farmer resilience, shade crops, protect soil, and reduce pressure on forests. Watershed restoration may reduce water risk for beverage, textile, or manufacturing sites. Soil health programs may improve the stability of agricultural inputs.
Carbon and sustainability value can still be created. In some cases, the project may support Scope 3 insetting. In others, it may generate verified carbon credits. Sometimes the main value may be resilience, readiness, and better supplier data.
The IPCC has found that ecosystem-based adaptation can reduce climate risks to people, biodiversity, and ecosystem services, with multiple co-benefits, while also warning that effectiveness declines as warming increases. That is a sober argument for acting early.
Step Three: Separate Insetting, Offsetting, and Resilience
Nature-based solutions in your supply chain are not automatically carbon credits. They are not automatically Scope 3 reductions either.
An insetting opportunity usually sits inside or close to your value chain. It may support Scope 3 reporting if the accounting rules, project boundaries, supplier connection, and data quality are strong enough.
An offsetting opportunity usually involves verified credits outside your value chain. High-quality credits can still play a role for residual emissions, but they should not distract from direct reductions or credible value-chain work.
A resilience opportunity may deliver business value even if you cannot claim a Scope 3 reduction immediately. That may include water security, supplier capacity, land restoration, biodiversity protection, or regulatory readiness.
Gold Standard’s Scope 3 value-chain guidance focuses on reporting emissions reductions from interventions in purchased goods and services. Verra’s Scope 3 Standard Program is being developed to certify value-chain interventions and issue units for companies’ emissions accounting. The direction is clear: stronger evidence, tighter boundaries, and more disciplined claims.
Step Four: Design for Audit-Readiness From the Beginning
Weak data is where promising nature projects go to become expensive anecdotes.
Before public claims are made, you need to know the baseline. What would have happened without the project? Who owns or manages the land? Which suppliers are involved? How will outcomes be measured? How will leakage, permanence, and double counting be addressed?
The GHG Protocol Land Sector and Removals Standard gives companies methods to quantify, report, and track land emissions, CO2 removals, and related metrics. This matters because land projects are rarely neat. Farms change practices. Suppliers shift volumes. Weather changes outcomes.
What Recent Corporate Examples Show
Recent case studies show that supply-chain nature work is becoming more serious, and more scrutinized.
Reuters has reported on insetting to reduce emissions within supply chains, including examples linked to Reckitt, Danone, Nestlé, Earthworm Foundation, and Nature-based Insights. The same article highlights familiar problems: measurement, double counting, supplier incentives, and credibility.
Reuters has also reported on companies using the Science Based Targets Network process to examine nature impacts. GSK, Holcim, and Kering were among the first companies with validated science-based targets for nature.
The Financial Times has covered the promise and difficulty of soil carbon in corporate supply chains, including a PepsiCo example in India where yields reportedly increased while greenhouse gas emissions fell. The lesson is that carbon, soil, biodiversity, farmer economics, and measurement need to be handled together.
A Practical Screening Checklist
A supply-chain nature-based solution deserves deeper review when you can answer yes to most of these questions:
- Does it sit in or near a material supply-chain hotspot?
- Does it address a real business risk?
- Can you connect it to supplier behavior, land management, or sourcing practices?
- Can the outcomes be measured?
- Are the claim boundaries clear?
- Does it support Scope 3 strategy, SBTi FLAG, CSRD, CSDDD, EUDR, or investor reporting needs?
- Are permanence, leakage, land rights, and community issues addressed?
Build the Asset, Then Make the Claim
Finding Nature-Based Solutions in Your Supply Chain is about identifying where your business already depends on living systems, then designing interventions that make those systems more resilient, measurable, and commercially useful.
For companies with material Scope 3 exposure, the right project can support supplier resilience, emissions strategy, regulatory readiness, and credible climate communication. The wrong project can become a glossy story with a weak audit trail.
Carbon Credit Capital helps companies design nature-based carbon and sustainability assets that embed directly into corporate supply chains. Through CCC’s Dual-Value Model, you can assess where sustainability investment may support operational resilience, Scope 3 insetting eligibility, regulatory readiness, and high-quality carbon or sustainability value.
Schedule your consultation with the carbon and sustainability experts at Carbon Credit Capital to explore how nature-based supply chain investments can support your next stage of climate strategy.
Sources
- European Commission: Nature-based solutions
- GHG Protocol: Corporate Value Chain Scope 3 Standard
- TNFD: Guidance on value chains
- European Commission: Corporate Sustainability Reporting
- European Commission: Corporate Sustainability Due Diligence
- European Commission: Regulation on Deforestation-free Products
- SBTi: Forest, Land and Agriculture FLAG
- Science Based Targets Network: Take Action
- IPCC AR6 WGII Summary for Policymakers
- Gold Standard: Scope 3 Value Chain Interventions Guidance
- Verra: Scope 3 Standard Program
- GHG Protocol: Land Sector and Removals Standard
- Reuters: Can insetting stack the cards towards more sustainable supply chains?
- Reuters: Three companies put their impacts on nature under a microscope
- Financial Times: The dubious climate gains of turning soil into a carbon sink
Americans are paying more for insurance, electricity, taxes, and home repairs every year. What many people may not realize is that climate change is already one of the drivers behind those rising costs.
For many households, climate change is no longer just an environmental issue. It is becoming a cost-of-living issue. While climate impacts like melting glaciers and shrinking polar ice can feel distant from everyday life, the financial effects are already showing up in monthly budgets across the country.
Today, a larger share of household income is consumed by fixed costs such as housing, insurance, utilities, and healthcare. (3) Climate change and climate inaction are adding pressure to many of those expenses through higher disaster recovery costs, rising energy demand, infrastructure repairs, and increased insurance risk.
The goal of this article is to help connect climate change to the everyday financial realities people already experience. Regardless of where someone stands on climate policy, it is important to recognize that climate change is already increasing costs for households, businesses, and taxpayers across the United States.
More conservative estimates indicate that the average household has experienced an increase of about $400 per year from observed climate change, while less conservative estimates suggest an increase of $900.(1) Those in more disaster-prone regions of the country face disproportionate costs, with some households experiencing climate-related costs averaging $1,300 per year.(1) Another study found that climate adaptation costs driven by climate change have already consumed over 3% of personal income in the U.S. since 2015.(9) By the end of the century, housing units could spend an additional $5,600 on adaptation costs.(1)
Whether we realize it or not, Americans are already paying for climate change through higher insurance premiums, energy costs, taxes, and infrastructure repairs. These growing expenses are often referred to as climate adaptation costs.
Without meaningful climate action, these costs are expected to continue rising. Choosing not to invest in climate action is also choosing to spend more on climate adaptation.
Here are a few ways climate change is already increasing the cost of living:
- Higher insurance costs from more frequent and severe storms
- Higher energy use during longer and hotter summers
- Higher electricity rates tied to storm recovery and grid upgrades
- Higher government spending and taxpayer-funded disaster recovery costs
The real debate is not whether climate change costs money. Americans are already paying for it. The question is where we want those costs to go. Should we invest more in climate action to help reduce future climate adaptation costs, or continue paying growing recovery and adaptation expenses in everyday life?
How Climate Change Is Increasing Insurance Costs
There is one industry that closely tracks the financial impact of natural disasters: insurance. Insurance companies are focused on assessing risk, estimating damages, and collecting enough revenue to cover losses and remain financially stable.
Comparing the 20-year periods 1980–1999 and 2000–2019, climate-related disasters increased 83% globally from 3,656 events to 6,681 events. The average time between billion-dollar disasters dropped from 82 days during the 1980s to 16 days during the last 10 years, and in 2025 the average time between disasters fell to just 10 days. (6)
According to the reinsurance firm Munich Re, total economic losses from natural disasters in 2024 exceeded $320 billion globally, nearly 40% higher than the decade-long annual average. Average annual inflation-adjusted costs more than quadrupled from $22.6 billion per year in the 1980s to $102 billion per year in the 2010s. Costs increased further to an average of $153.2 billion annually during 2020–2024, representing another 50% increase over the 2010s. (6)
In the United States, billion-dollar weather and climate disasters have also increased significantly. The average number of billion-dollar disasters per year has grown from roughly three annually during the 1980s to 19 annually over the last decade. In 2023 and 2024, the U.S. recorded 28 and 27 billion-dollar disasters respectively, both setting new records. (6)
The growing impact of climate change is one reason insurance costs continue to rise. “There are two things that drive insurance loss costs, which is the frequency of events and how much they cost,” said Robert Passmore, assistant vice president of personal lines at the Property Casualty Insurers Association of America. “So, as these events become more frequent, that’s definitely going to have an impact.” (8)
After adjusting for inflation, insurance costs have steadily increased over time. From 2000 to 2020, insurance costs consistently grew faster than the Consumer Price Index due to rising rebuilding costs and weather-related losses.(3) Between 2020 and 2023 alone, the average home insurance premium increased from $75 to $360 due to climate change impacts, with disaster-prone regions experiencing especially steep increases.(1) Since 2015, homeowners in some regions affected by more extreme weather have seen home insurance costs increased by nearly 57%.(1) Some insurers have also limited or stopped offering coverage in high-risk areas.(7)
For many families, rising insurance costs are no longer occasional financial burdens. They are becoming recurring monthly expenses tied directly to growing climate risk.
How Rising Temperatures Increase Household Energy Costs
The financial impacts of climate change extend beyond insurance. Rising temperatures are also changing how much energy Americans use and how utilities plan for future electricity demand.
Between 1950 and 2010, per capita electricity use increased 10-fold, though usage has flattened or slightly declined since 2012 due to more efficient appliances and LED lighting. (3) A significant share of increased energy demand comes from cooling needs associated with higher temperatures.
Over the last 20 years, the United States has experienced increasing Cooling Degree Days (CDD) and decreasing Heating Degree Days (HDD). Nearly all counties have become warmer over the past three decades, with some areas experiencing several hundred additional cooling degree days, equivalent to roughly one additional degree of warmth on most days. (1) This trend reflects a warming climate where air conditioning demand is increasing while heating demand generally declines. (4)
As temperatures continue rising, households are expected to spend more on cooling than they save on heating. The U.S. Energy Information Administration (EIA) projects that by 2050, national Heating Degree Days will be 11% lower while Cooling Degree Days will be 28% higher than 2021 levels. Cooling demand is projected to rise 2.5 times faster than heating demand declines. (5)
These projections come from energy and infrastructure experts planning for future electricity demand and grid capacity needs. Utilities and grid operators are already preparing for higher peak summer electricity loads caused by rising temperatures. (5)
Longer and hotter summers also affect how homes and buildings are designed. Buildings constructed for past climate conditions may require upgrades such as larger air conditioning systems, stronger insulation, and improved ventilation to remain comfortable and energy efficient in the future. (10)
For many households, this means higher monthly utility bills and potentially higher long-term home improvement costs as temperatures continue to rise.
How Climate Change Affects Electricity Rates
On an inflation-adjusted basis, average U.S. residential electricity rates are slightly lower today than they were 50 years ago. (2) However, climate-related damage to utility infrastructure is creating new upward pressure on electricity costs.
Electric utilities rely heavily on above-ground poles, wires, transformers, and substations that can be damaged by hurricanes, storms, floods, and wildfires. Repairing and upgrading this infrastructure often requires substantial investment.
As a result, utilities are increasing electricity rates in response to wildfire and hurricane events to fund infrastructure repairs and future mitigation efforts. (1) The average cumulative increase in per-household electricity expenditures due to climate-related price changes is approximately $30. (1)
While this increase may appear modest today, utility costs are expected to rise further as climate-related infrastructure damage becomes more frequent and severe.
How Climate Disasters Increase Government Spending and Taxes
Extreme weather events also damage public infrastructure, including roads, schools, bridges, airports, water systems, and emergency services infrastructure. Recovery and rebuilding costs are often funded through taxpayer dollars at the federal, state, and local levels.
The average annual government cost tied to climate-related disaster recovery is estimated at nearly $142 per household. (1) States that frequently experience hurricanes, wildfires, tornadoes, or flooding can face even higher public recovery costs.
These expenses affect taxpayers whether they personally experience a disaster or not. Climate-related recovery spending can increase pressure on public budgets, emergency management systems, and infrastructure funding nationwide.
Reducing Climate Costs Through Climate Action
While this article focuses on the growing financial costs associated with climate change, the issue is not only about money for many people. It is also about recognizing our environmental impact and taking responsibility for reducing it in order to help preserve a healthy planet for future generations.
While individuals alone cannot solve climate change, collective action can help reduce future climate adaptation costs over time.
For those interested in taking action, there are three important steps:
- Estimate your carbon footprint to better understand the emissions connected to your lifestyle and activities.
- Create a plan to gradually reduce emissions through energy efficiency, cleaner technologies, and more sustainable choices.
- Address remaining emissions by supporting verified carbon reduction projects through carbon credits.
Carbon credits are one of the most cost-effective tools available for climate action because they help fund projects that generate verified emission reductions at scale. Supporting global emission reduction efforts can help reduce the long-term impacts and costs associated with climate change.
Visit Terrapass to learn more about carbon footprints, carbon credits, and climate action solutions.
The post How Climate Change Is Raising the Cost of Living appeared first on Terrapass.
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