David McNew/Getty Images
The U.S. Department of Energy’s decision to claw back US$3.7 billion in grants from industrial demonstration projects may create an unexpected opening for American manufacturing.
Many of the grant recipients were deploying carbon capture and storage – technologies that are designed to prevent industrial carbon pollution from entering the atmosphere by capturing it and injecting it deep underground. The approach has long been considered critical for reducing the contributions chemicals, cement production and other heavy industries make to climate change.
However, the U.S. policy reversal could paradoxically accelerate emissions cuts from the industrial sector.
An emissions reality check
Heavy industry is widely viewed as the toughest part of the economy to clean up.
The U.S. power sector has made progress, cutting emissions 35% since 2005 as coal-fired power plants were replaced with cheaper natural gas, solar and wind energy. More than 93% of new grid capacity installed in the U.S. in 2025 was forecast to be solar, wind and batteries. In transportation, electric vehicles are the fastest-growing segment of the U.S. automotive market and will lead to meaningful reductions in pollution.
But U.S. industrial emissions have been mostly unchanged, in part because of the massive amount of coal, gas and oil required to make steel, concrete, aluminum, glass and chemicals. Together these materials account for about 22% of U.S. greenhouse gas emissions.
The global industrial landscape is changing, though, and U.S. industries cannot, in isolation, expect that yesterday’s means of production will be able to compete in a global marketplace.
Even without domestic mandates to reduce their emissions, U.S. industries face powerful economic pressures. The EU’s new Carbon Border Adjustment Mechanism imposes a tax on the emissions associated with imported steel, chemicals, cement and aluminum entering European markets. Similar policies are being considered by Canada, Japan, Singapore, South Korea and the United Kingdom, and were even floated in the United States.
The false promise of carbon capture
The appeal of carbon capture and storage, in theory, was that it could be bolted on to an existing factory with minimal changes to the core process and the carbon pollution would go away.
Government incentives for carbon capture allow producers to keep using polluting technologies and prop up gas-powered chemical production or coal-powered concrete production.
The Trump administration’s pullback of carbon capture and storage grants now removes some of these artificial supports.
Without the expectation that carbon capture will help them meet regulations, this may create space to focus on materials breakthroughs that could revolutionize manufacturing while solving industries’ emissions problems.
The materials innovation opportunity
So, what might emissions-lowering innovation look like for industries such as cement, steel and chemicals? As a civil and environmental engineer who has worked on federal industrial policy, I study the ways these industries intersect with U.S. economic competitiveness and our built environment.
There are many examples of U.S. innovation to be excited about. Consider just a few industries:
Cement: Cement is one of the most widely used materials on Earth, but the technology has changed little over the past 150 years. Today, its production generates roughly 8% of total global carbon pollution. If cement production were a country, it would rank third globally after China and the United States.
Researchers are looking at ways to make concrete that can shed heat or be lighter in weight to significantly reduce the cost of building and cooling a home. Sublime Systems developed a way to produce cement with electricity instead of coal or gas. The company lost its IDP grant in May 2025, but it has a new agreement with Microsoft.
Making concrete do more could accelerate the transition. Researchers at Stanford and separately at MIT are developing concrete that can act as a capacitor and store over 10 kilowatt-hours of energy per cubic meter. Such materials could potentially store electricity from your solar roof or allow for roadways that can charge cars in motion.
Technologies like these could give U.S. companies a competitive advantage while lowering emissions. Heat-shedding concrete cuts air conditioning demand, lighter formulations require less material per structure, and energy-storing concrete could potentially replace carbon-intensive battery manufacturing.
Steel and iron: Steel and iron production generate about 7% of global emissions with centuries-old blast furnace processes that use intense heat to melt iron ore and burn off impurities. A hydrogen-based steelmaking alternative exists today that emits only water vapor, but it requires new supply chains, infrastructure and production techniques.
U.S. Steel has been developing techniques to create stronger microstructures within steel for constructing structures with 50% less material and more strength than conventional designs. When a skyscraper needs that much less steel to achieve the same structural integrity, that eliminates millions of tons of iron ore mining, coal-fired blast furnace operations and transportation emissions.
Chemicals: Chemical manufacturing has created simultaneous crises over the past 50 years: PFAS “forever chemicals” and microplastics have been showing up in human blood and across ecosystems, and the industry generates a large share of U.S. industrial emissions.
Companies are developing ways to produce chemicals using engineered enzymes instead of traditional petrochemical processes, achieving 90% lower emissions in a way that could reduce production costs. These bio-based chemicals can naturally biodegrade, and the chemical processes operate at room temperature instead of requiring high heat that uses a lot of energy.
Is there a silver bullet without carbon capture?
While carbon capture and storage might not be the silver bullet for reducing emissions that many people thought it would be, new technologies for managing industrial heat might turn out to be the closest thing to one.
Most industrial processes require temperatures between 300 and 1830 degrees Fahrenheit (150 and 1000 degrees Celsisus for everything from food processing to steel production. Currently, industries burn fossil fuels directly to generate this heat, creating emissions that electric alternatives cannot easily replace. Heat batteries may offer a breakthrough solution by storing renewable electricity as thermal energy, then releasing that heat on demand for industrial processes.
Companies such as Rondo Energy are developing systems that store wind and solar power in bricklike materials heated to extreme temperatures. Essentially, they convert electricity into heat during times when electricity is abundant, usually at night. A manufacturing facility can later use that heat, which allows it to reduce energy costs and improve grid reliability by not drawing power at the busiest times. The Trump administration cut funding for projects working with Rondo’s technology, but the company’s products are being tested in other countries.
Industrial heat pumps provide another pathway by amplifying waste heat to reach the high temperatures manufacturing requires, without using as much fossil fuel.
The path forward
The Department of Energy’s decision forces industrial America into a defining moment. One path leads backward toward pollution-intensive business as usual propping up obsolete processes. The other path drives forward through innovation.
Carbon capture offered an expensive Band-Aid on old technology. Investing in materials innovation and new techniques for making them promises fundamental transformation for the future.
Andres Clarens receives funding from the National Science Foundation and the Alfred P Sloan Foundation.
