How Carbon Emissions Reductions Will Alter Supply Chains

Although the world is moving closer to an international agreement on climate policy, any deal will likely run into the same problems previous iterations have: enforcing binding legislation. Although the signatories have not set their final emissions goals yet, many countries, especially those that are relatively underdeveloped and those that are coping with major economic slowdowns, will eventually fall short of whatever targets they decide on.

But the effort to curb emissions and address concerns over climate change will continue. Instead of fixating on another upcoming summit with limited potential for success, the important areas to watch for long-term impacts are the instances in which adopting different technologies to reduce emissions will have geopolitical consequences. Increased use of lower emission technologies will cause a shift in supply chains because they require different raw materials. These include rare earth elements and other less common metals and minerals. Securing these raw material imports poses a new set of challenges, and in the future, many researchers will focus on using cheaper, more readily available inputs when developing new and alternative technologies.