What is Carbon Management?
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Carbon management strategically reduces the CO2 emissions of a business’s carbon footprint. Find out how businesses are adopting carbon management strategies.
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Decarbonization: what it is and why it matters
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“ Time is running out. The 2024 Global Carbon Budget estimates that only 235 gigatonnes of carbon dioxide (CO₂) can still be released into the atmosphere if we’re to have a 50% chance of limiting global warming to 1.5°C. At the current pace, that limit could be reached in under six years. ”
This makes decarbonization one of the most urgent challenges we face.
Decarbonization is the process of systematically reducing carbon emissions across all areas of the economy – from how we generate power to how we build, manufacture, and transport. It’s about moving away from fossil fuels and reshaping our systems around low carbon energy sources and more sustainable alternatives.
But what does that actually look like in practice, and how can businesses start making real progress?
In this article, we explore:
- What decarbonization means – and why it’s more urgent than ever
- How emissions reached today’s levels and the science behind the climate crisis
- Why decarbonization matters for people, the planet, and the global economy
- The key shifts needed across sectors to reach net zero
- What the UK is doing to meet its climate targets
- Practical ways companies can start decarbonizing – and how Greenly can help
What is decarbonization? An overview
Decarbonization refers to the process of reducing carbon dioxide emissions caused by human activity, particularly those from burning fossil fuels like coal, oil, and natural gas. The goal is to shift towards a low-carbon economy powered by renewable energy sources such as wind, solar, and hydro, and supported by cleaner technologies and sustainable practices.
“ According to a McKinsey report, 83% of global carbon emissions come from energy consumption. Every year, more than 34 billion tonnes of CO₂ are released into the atmosphere, and cutting those emissions is essential to stabilizing the climate. ”
Decarbonization isn’t a single action, it’s a long-term transformation of how we generate energy, produce goods, move people and resources, and grow economies. And it’s the cornerstone of efforts to limit global warming and build climate resilience.
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How did we get here?
To understand why decarbonization is so urgent, we need to look at how global emissions reached their current levels.
Since the Industrial Revolution, human activity has significantly increased the concentration of greenhouse gases in the atmosphere, primarily through the burning of fossil fuels such as coal, oil, and gas. These fuels have powered the global economy for over a century, driving growth and industrialization, but at a steep environmental cost.
In 1750, atmospheric CO₂ levels were around 280 parts per million (ppm). Today, that figure has risen to over 420 ppm – the highest concentration in at least 800,000 years. The result? An intensified greenhouse effect, rising global temperatures, more extreme weather, melting glaciers and ice caps, and widespread ecological disruption.
Despite decades of warnings, emissions are still rising. In fact, recent estimates suggest that 2024 marked the highest level of carbon emissions on record, with around 41.6 billion tonnes of carbon dioxide released into the atmosphere, including 37.4 billion tonnes from fossil fuels alone.
“ The science is clear: unless we reverse this trend, we risk locking in irreversible climate impacts. Decarbonization is no longer optional, it's essential for building a liveable future and preventing further global warming. ”
Which sectors most urgently need to decarbonize?
“ Not all sectors contribute equally to climate change. In fact, just a handful are responsible for the majority of global emissions. Understanding where emissions come from helps us focus decarbonization efforts where they’ll have the greatest impact. ”
Below is an infographic adapted from the World Resources Institute showing global greenhouse gas emissions by sector and end use.
To dig deeper, explore the sectors below to learn why they matter – and what needs to happen to decarbonize them.
Energy – 75.7%
The largest contributor to global emissions. Most energy still comes from burning fossil fuels like coal, oil, and natural gas.
Agriculture – 11.7%
A major source of methane and nitrous oxide, largely from livestock and fertilizers.
Industrial Processes – 6.5%
Sectors like steel, cement, and chemicals are energy-intensive and hard to decarbonize.
Waste – 3.4%
Organic waste in landfills emits methane, while incineration releases CO₂ and nitrous oxide.
Land Use Change and Forestry – 2.7%
Emissions result mainly from deforestation, peatland degradation, and land conversion.
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Why do we need to decarbonize?
Decarbonization is essential not only to stabilize the climate but also to protect human health, preserve ecosystems, and ensure long-term economic resilience. The cost of inaction is growing, and the consequences of continued emissions will be felt across every part of society.
Here’s what’s at stake:
| Reason | What’s at risk | Key facts |
|---|---|---|
| Climate stability | Higher emissions drive global warming, resulting in extreme heat, droughts, wildfires, floods, sea level rise, and ecosystem collapse. | According to the IPCC, limiting warming to 1.5°C requires a 45% cut in global emissions by 2030 and net zero by 2050. |
| Human health & safety | Climate change increases respiratory illness, heat stress, food and water insecurity, and disaster-related deaths – especially in vulnerable regions. | WHO projects 250,000 additional deaths annually (2030–2050) from climate-related causes. Global South communities face 15× higher disaster mortality. |
| Economic resilience | Unchecked warming disrupts infrastructure, supply chains, agriculture, and markets – with escalating financial losses. | Climate inaction could cost up to $69 trillion globally by 2100. Decarbonizing early is the most cost-effective option. |
| Environmental protection | Rising temperatures and CO₂ levels are accelerating biodiversity loss, coral bleaching, desertification, and freshwater shortages. | A 10 cm rise in sea levels could displace 10 million people. Heavy rainfall events become 70% more likely at 2°C warming. |
The evolution of decarbonization
Decarbonization hasn’t always been a mainstream policy goal. The idea has gained traction over the decades, shaped by scientific findings, political milestones, and growing global awareness of climate risks.
Below is a timeline of key moments that have brought decarbonization to the forefront of international action:
1988 – IPCC is established
The Intergovernmental Panel on Climate Change (IPCC) is formed by the United Nations to assess scientific knowledge on climate change and its environmental and socio-economic impacts. Its reports become the foundation for international climate policy.
1997 – Kyoto Protocol
The Kyoto Protocol becomes the first legally binding global agreement to reduce GHG emissions. It focuses on industrialized countries and marks a turning point in global climate diplomacy.
2015 – Paris Agreement
195 countries adopt the Paris Agreement, committing to limit global temperature increases to well below 2°C – and ideally 1.5°C – above pre-industrial levels. The agreement makes decarbonization a global policy goal for the first time.
2018 – IPCC 1.5°C Special Report
The IPCC publishes a landmark report showing the stark difference between 1.5°C and 2°C of warming. It warns of severe risks even at 2°C and calls for global emissions to fall by 45% by 2030, reaching net zero by 2050.
2021 – UNEP Emissions Gap Report
The United Nations Environment Programme (UNEP) reveals that existing national pledges are not enough, setting the world on a path toward 2.7°C of warming. The report calls for stronger decarbonization commitments.
2023–2024 – Record emissions, shrinking carbon budget
Global carbon emissions reach an all-time high. The 2024 Global Carbon Budget warns that only around 235 gigatonnes of CO₂ remain for a 50% chance of limiting warming to 1.5°C – a budget that could be exhausted in under six years.
What is needed to achieve decarbonisation?
Decarbonization isn’t just about switching from fossil fuels to renewables – it’s about transforming every part of the economy. From how we generate power to how we design our energy system, build infrastructure, move goods, and consume resources, every sector must evolve. Here are the six critical shifts that will define the path to net zero:
1. Transition to renewable energy sources
Decarbonizing the power sector is priority number one. This means rapidly expanding renewable energy sources like wind power and solar power, and using clean electricity generated from these sources to power heating systems, electric vehicles, and industrial systems. Energy efficiency is also a crucial aspect of decarbonizing this sector.
2. Transform heavy industry
Steel, cement, and chemical sectors rely on high-temperature processes. Clean heat, green hydrogen, electrification, and carbon capture will all play a role, but need rapid scale-up and investment.
3. Decarbonize transport
Road transport must shift away from fossil fuels to EVs, supported by robust charging infrastructure and renewable energy. For aviation and shipping, the focus is on sustainable fuels and efficiency improvements.
4. Cut building emissions
Energy efficiency is key. As one of the core energy efficiency sectors, buildings need better insulation, low-carbon heating, and smarter energy use. Scaling up retrofitting and phasing out gas boilers will be essential.
5. Regenerate land and nature
Agriculture, forestry, and land use must shift from being emission sources to carbon sinks. Solutions include regenerative farming, afforestation, peatland restoration, and carbon sequestration through improved land management.
6. Build a circular economy
A shift toward reuse, recycling, and better product design can reduce upstream emissions and material demand. Circular systems and extended producer responsibility will be essential.
“ All of these shifts require more than just technology – they demand clear policies, public investment, private sector leadership, and strong accountability to keep climate goals on track. ”
Decarbonization in the United States: Climate crossroads
The United States has experienced a tumultuous journey in climate policy over the past few years. The Biden administration's tenure marked a significant shift towards aggressive decarbonization efforts, positioning the U.S. as a global leader in climate action. However, the recent political transition has introduced new uncertainties, casting doubt on the nation's commitment to its climate goals.
Biden's climate legacy: Ambitious policies and investments
Under President Biden, the U.S. set forth an ambitious agenda to combat climate change:
- Legislative milestones: The Inflation Reduction Act (IRA) and the Infrastructure Investment and Jobs Act (IIJA) collectively allocated over $1 trillion towards clean energy, infrastructure, and climate resilience projects. These investments aimed to reduce greenhouse gas emissions by 29–46% by 2030 compared to 2005 levels.
- Regulatory actions: The Environmental Protection Agency (EPA) implemented stringent emissions standards for vehicles and power plants, targeting significant reductions in carbon emissions by 2032.
- State-level initiatives: States like California received federal approval to enforce bans on new gasoline-only vehicle sales by 2035, with several other states adopting similar measures.
These efforts collectively aimed to position the U.S. on a path to meet its Paris Agreement commitment of reducing emissions by 50–52% by 2030.
Energy demand and infrastructure hurdles
Despite these initiatives, several challenges became clear:
- Stagnant emissions: In 2024, U.S. greenhouse gas emissions plateaued, indicating that current measures may be insufficient to achieve the 2030 targets.
- Rising energy demand: The rapid expansion of AI data centers has led to increased electricity consumption, straining the power grid and complicating decarbonization efforts.
- Infrastructure bottlenecks: Delays in renewable energy project approvals and transmission infrastructure development have hindered the integration of clean energy sources into the grid.
The Trump administration's reversal
“ The 2024 election brought a significant political shift with the return of President Donald Trump. Early actions by the new administration have raised concerns. ”
- Policy rollbacks: The administration has initiated steps to dismantle key components of the IRA and other climate-focused policies, potentially undermining previous progress.
- International commitments: Plans to withdraw from the Paris Agreement for a second time have been announced, signaling a retreat from global climate leadership.
- Regulatory changes: Efforts are underway to relax environmental regulations, including those governing coal ash disposal, which could have adverse environmental and public health impacts.
These developments have introduced uncertainty into the U.S. climate policy landscape, with potential implications for both domestic and international climate efforts.
The road head
“ The future of U.S. climate policy remains uncertain. While federal initiatives face potential rollbacks, state governments, private sector actors, and civil society organizations continue to pursue climate action ”
- State Leadership: States may continue to implement and enforce their own climate policies, potentially filling gaps left by federal retrenchment.
- Private Sector Engagement: Companies are increasingly investing in clean energy and sustainability initiatives, driven by market forces and stakeholder expectations.
- Public Support: Public opinion continues to favor climate action, which may influence future policy decisions and political dynamics.
In this complex and evolving context, the trajectory of U.S. climate policy will depend on the interplay between federal actions, state initiatives, private sector commitments, and public engagement.
How to decarbonize your company
Businesses play a vital role in tackling climate change. According to the Carbon Majors Database, just 57 companies are responsible for 80% of global greenhouse gas emissions – a powerful reminder of the impact the private sector can have.
The good news? With the right strategy, decarbonising your business isn’t just possible – it can unlock new opportunities, boost resilience, and help future-proof your operations.
Here are five practical ways to get started:
Before you can cut the greenhouse gas emissions produced by your company, you need to understand where they’re coming from. A full carbon footprint assessment is the essential first step. It shows you which activities, suppliers, and systems consume energy and drive the bulk of your emissions, so you can start targeting the right areas.
At Greenly, we help companies of all sizes measure and manage their emissions. Get in touch to see how we can support your decarbonization journey.
Once you know your baseline, it’s time to define where you want to go. Set SMART goals – specific, measurable, achievable, relevant, and time-bound – and link them to KPIs so you can track your progress over time.
Clarity here is key: your targets should be ambitious but achievable, and aligned with recognised frameworks like the Science Based Targets initiative (SBTi).
Decarbonization isn’t just about compliance – it’s a chance to build a more future-ready business. From reducing operational costs to attracting ESG-focused investors and new customers, the benefits go beyond emissions alone.
Companies that move early tend to lead. By investing in climate action now, you’ll build resilience, unlock innovation, and stay ahead of incoming regulation and shifting market expectations.
Your people are key to making your sustainability goals stick. Get them involved early – from ideation to implementation – and create space for collaboration, creativity, and ownership.
Build buy-in with transparent communication, offer incentives, and celebrate milestones along the way. When your team feels empowered, sustainability becomes part of your culture, not just a checkbox.
Decarbonization isn’t a one-off project – it’s a long-term shift. That means embedding it across your operations, procurement, product development, and reporting, and prioritizing more energy efficient systems and processes wherever possible.
Align your sustainability goals with broader business objectives, and regularly review your progress to stay on track.
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How can Greenly help you decarbonize?
Decarbonization doesn’t have to be overwhelming. At Greenly, we help streamline the process, giving you the tools, insights, and support you need to track, understand, and reduce your emissions across your entire business.
Here’s how we support your climate journey:
- Measure your emissions with confidence: We help you calculate your Scope 1, 2, and 3 emissions – accurately and efficiently. With our platform and expert guidance, you’ll gain a clear view of your carbon footprint and know where to focus your efforts.
- Take action with a clear plan: Once your emissions are measured, we help you to build a custom action plan – whether that’s switching to lower-emission suppliers, improving energy efficiency, adopting low carbon solutions, or reducing waste. Our climate experts support implementation every step of the way.
- Tackle Scope 3 and supply chain emissions: Scope 3 emissions often account for up to 90% of a company’s total footprint. We help you: analyze and break down your value chain emissions; improve transparency in your sustainability reporting; replace high-impact suppliers with more sustainable alternatives
- Understand your product’s full impact: Our Life Cycle Assessment (LCA) services evaluate the environmental impact of your products from cradle to grave. Giving you credible data to improve sustainability performance, transparent insights for customers and stakeholders, and a competitive edge in a climate-conscious marketplace.
Want to find out how Greenly could support your decarbonization goals?
Contact our team to learn more about how we can help you reduce emissions and work towards a low carbon future.
Sources:
- Global Carbon Budget, GCB 2024 Report
https://globalcarbonbudget.org/gcb-2024/ - McKinsey & Company, The Net-Zero Challenge: Accelerating Decarbonization Worldwide
https://www.mckinsey.com/capabilities/sustainability/our-insights/the-net-zero-challenge-accelerating-decarbonization-worldwide - Greenly, What Was the Industrial Revolution’s Environmental Impact?
https://greenly.earth/en-gb/blog/ecology-news/what-was-the-industrial-revolutions-environmental-impact - World Meteorological Organization, WMO Report Documents Spiralling Weather and Climate Impacts
https://wmo.int/news/media-centre/wmo-report-documents-spiralling-weather-and-climate-impacts - World Meteorological Organization, Record Carbon Emissions Highlight Urgency of Global Greenhouse Gas Watch
https://wmo.int/media/news/record-carbon-emissions-highlight-urgency-of-global-greenhouse-gas-watch#:~:text=Total%20carbon%20dioxide%20(CO2)%20emissions,to%20the%20Global%20Carbon%20Budget - United Nations, Climate and Health – Climate Change and Health Risks
https://www.un.org/en/climatechange/science/climate-issues/health#:~:text=Between%202030%20and%202050%2C%20climate,to%20the%20World%20Health%20Organization - Intergovernmental Panel on Climate Change (IPCC), SROCC Chapter 4: Sea Level Rise and Implications
https://www.ipcc.ch/srocc/chapter/chapter-4-sea-level-rise-and-implications-for-low-lying-islands-coasts-and-communities/ - Greenly, The UK Climate Change Act: Everything You Need to Know
https://greenly.earth/en-gb/blog/company-guide/the-uk-climate-change-act-everything-you-need-to-know - UK Government, Powering Up Britain: Net Zero Growth Plan
https://www.gov.uk/government/publications/powering-up-britain/powering-up-britain-net-zero-growth-plan - Greenly, Net Zero Strategy: What Is It and How Can You Implement It?
https://greenly.earth/en-gb/blog/ecology-news/net-zero-strategy-what-is-it-and-how-can-you-implement-it - Climate Change Committee (CCC), UK Action on Climate Change: Progress Snapshot
https://www.theccc.org.uk/climate-action/uk-action-on-climate-change/progress-snapshot/ - The Guardian, Just 57 Companies Linked to 80% of Greenhouse Gas Emissions Since 2016
https://www.theguardian.com/environment/2024/apr/04/just-57-companies-linked-to-80-of-greenhouse-gas-emissions-since-2016 - Greenly, Carbon Footprint: Calculate, Reduce, and Offset Your Impact
https://greenly.earth/en-gb/blog/company-guide/carbon-footprint-calculate-reduce-and-offset-your-impact - Greenly, Greenhouse Gas Emissions: Scopes 1, 2 and 3
https://greenly.earth/en-gb/blog/company-guide/greenhouse-gas-emissions-scopes-1-2-and-3
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