The world is moving towards a more sustainable future, and the machinery industry is no exception. The machinery end markets, including construction, infrastructure, agriculture, manufacturing, mining, and oil and gas, are receiving much attention from investors, regulators, and other stakeholders. New environmental initiatives such as the European Green Deal have significant compliance implications for industrial sectors. The European Green Deal aims to make the European economy environmentally sustainable by 20501. Meanwhile, in the United States, an updated climate agenda is taking shape under President Biden1.
The energy transition poses substantial cost and technology challenges. Much existing machinery relies on mechanical drives powered by carbon-emitting diesel or gasoline. Manufacturers have two primary pathways to consider: continue to use mechanical drives but with lower-carbon fuels such as hydrogen or switch to electric drives powered by batteries or fuel cells1. Because these pathways represent the end points on a continuum, companies may also choose a pathway that lies in between or that varies by equipment type or use case1.
For machinery suppliers, OEMs, dealers and distributors, and customers, transitioning to clean energy is an imperative. The task falls to each company to assess the implications of transitioning for its product and service portfolios, financials, and sourcing and procurement functions, among other areas, and set timelines for how and when to transition1. Over time, these more sustainable solutions may prove to be economically advantageous. Already in certain continuous operation use cases for heavy-duty machinery (for example, a 24/7 mine), some battery electric vehicles (BEVs) have achieved or exceeded total cost of ownership (TCO) parity with ICEs1.
In conclusion, the transition to greener and cleaner energy sources is essential for the machinery industry’s sustainability. Companies must take proactive steps towards this goal by assessing their product portfolios’ implications and setting timelines for transitioning.
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