Net Zero Scenario: How France, China, and the US compare

Using our Industry Climate Service, we explore the ways a net zero scenario can impact industrial sectors across countries with reference to three representative examples: China, France, and the United States. By 2050 we find significant scarring to US manufacturing output, with a smaller impact in both France and China.

What you will learn:

• The sectoral composition of the three countries explains the relative performance. China’s strong position in the renewables supply chain will benefit investment-facing sectors by 2050, offsetting much of the initial manufacturing shock caused by aggressive carbon pricing.
• The industrial energy mix is highly reliant on fossil fuels in all three countries. But we find that under our Net Zero scenario, industry in both China and France can significantly reduce its reliance on fossil fuels through the process of electrification and China’s investment in green steel smelting technologies.
• French electricity production is already significantly de-carbonised, with 67% generated by nuclear power. Therefore, we find in the Net Zero scenario that French electricity prices increase by a much smaller extent in response to carbon taxation relative to the US and China.