Sustainable Competitiveness Critical to Energy Transition

The advantages of the energy transition are often presented from an economic, environmental, and social perspective. However, from a business standpoint, we must urgently consider how a new energy consumption model will sustain and evolve competitiveness in the technological and aviation sectors. 

As the global economy moves toward a more sustainable model, technology and industrial companies must reevaluate their innovation and production strategies. Businesses need to realize that adopting clean energy and low-emission technologies is not an option anymore; it is a necessity to remain competitive. A significant shift is occurring in energy efficiency and clean energy overall, with numerous governments implementing new energy-saving initiatives or enhancing their current policies and programs.(1).

At Honeywell, we are betting on technologies such as carbon capture, energy storage systems, development of hybrid and electric aircraft engines, and sustainable aviation fuel (SAF), which can be used in the existing aircraft fleet without reconfiguring engines or modifying fuel supply processes. Particularly, regarding Honeywell's SAF, we can bring to the table benefits like 80% (2) in carbon emissions reductions. These innovations will not only help reduce emissions but also create new lines of business and sources of income.

In this regard, we see a firm path toward a more sustainable future in the aviation sector, as highlighted in our “2024 Honeywell Global Business Aviation Outlook,” a comprehensive report that provides insights into the current state and future direction of the industry. Respondents to this edition mentioned that purchasing new, more fuel-efficient aircraft is considered the most effective approach to reducing environmental impact, with 85% of respondents describing it as “very effective” or “moderately effective.” (3).

According to these insights, the challenge is clear: aviation accounts for approximately 2% of global carbon emissions (4). Solutions to reduce this impact range from the use of SAF to the electrification of aircraft, and each of these technologies represents an opportunity for companies that lead their development.

When it comes to sustainability in business aviation, we see that the total number of operators in North America taking proactive steps to reduce their carbon footprint remains higher than in any other region, due to the significantly higher volume of commercial aviation operations in the area (5). 

Hydrogen: An Efficient Path to Energy Transition 

On this path toward a new model, all industries must reorient their operations with green solutions. To do so, it is necessary to delve deeper into the capacity for change offered by hydrogen, a technology that we have sought to perfect and that will be essential for energy transition. 

Hydrogen is widely seen as a key component in advancing sustainable energy solutions and is vital for achieving net-zero emissions. For instance, the World Bank predicts that overall demand for hydrogen will grow 7x over the next 30 (6) years and awareness of the benefits of adopting renewable energy sources like wind and solar continues to rise. However, for many people, a lack of knowledge about hydrogen is holding back its adoption.

Let's reflect on the reality: Hydrogen, the most abundant element in the universe (7), holds enormous potential to reduce carbon emissions across the planet and create a greener and safer future for all of us. This is a goal to which we at Honeywell are fully committed, and it's a future we can all look forward to.

Hydrogen stands at the forefront of innovation in the renewable energy sector, offering simplicity and complexity. Honeywell's hydrogen combustion technologies will collectively reduce 50 million metric tons of carbon dioxide equivalent (CO2e) emissions from 2023 to 2030 (8).

Today, we seek to be part of this path by operating at any stage of transition that our allies are in to achieve efficiency and carbon neutrality, an experience that we have maintained for five decades.

From the perspective of a company like Honeywell, which is leading innovations in various sectors, including aviation, the energy transition is a moral obligation and a critical opportunity for business growth and technological leadership; however, this transformation is not without its challenges. It must be accompanied by equitable access to green innovations to ensure a fair and effective transition. This means addressing issues of affordability, scalability, and infrastructure. Only then can we fully realize the potential of the energy transition. 

Ensuring Universal Access to Green Tech

We must work with all societal actors to jointly address an important challenge: achieving equality in access to green technologies. Only through joint, sustainable, and technological incentives and actions can we bring small and medium-sized enterprises (SMEs) on board to break down the financial and technological barriers that allow them to adapt to the energy transition (9).

Promoting equal conditions and the possibility of participation for all companies will further trigger innovation. Inclusion, in this sense, will accelerate global progress toward sustainability, generating equitable prosperity in the long term, with a positive impact on emerging and less developed markets being evident and desirable.

The solution to this challenge lies in creating public and private policies that promote the democratization of green technology. Governments and large corporations must collaborate to create financial incentives, share knowledge, and provide access to advanced technologies that allow SMEs and developing countries to participate in this sustainable industrial revolution. R&D funding programs, accessible licensing agreements, and the creation of technological collaboration networks will be essential to achieving equitable adoption of sustainable solutions.

1  https://www.iea.org/reports/energy-efficiency-2023

 2 Honeywell Sustainable Aviation Fuel

3 From the Honeywell forecast shows increased for new business jets, stable growth for next decade. Press Release. 33rd annual Global Business Aviation Outlook.

4. https://www.iea.org/energy-system/transport/aviation

5 From the Honeywell forecast shows increased for new business jets, stable growth for next decade. Press Release. 33rd annual Global Business Aviation Outlook.

6 https://www.worldbank.org/en/topic/energy/publication/sufficiency-sustainability-and-circularity-of-critical-materials-for-clean-hydrogen

7 https://www.eia.gov/energyexplained/hydrogen/#:~:text=Hydrogen%20is%20the%20simplest%20element&text=Hydrogen%20is%20also%20the%20most,liquids%2C%20gases%2C%20or%20solids.

8 Methodology for estimating GHG mitigation impact is available at investor.honeywell.com (see “ESG/ESG Information/GHG Mitigation Impact of Honeywell Technologies”). 2. This estimate assumes (i) 3.7% of anthropogenic GHG emissions are addressable by fuel switch from fossil fuels to hydrogen, (ii) 5% of these emissions will be addressed by fuel substitution by 2030, (iii) Honeywell hydrogen burner solutions will be deployed in 20% of such applications, and (iv) 98% reduction in CO2 emissions will be achieved by fuel switch from fossil fuels to hydrogen.

9 https://www.weforum.org/agenda/2023/07/digital-transformation-potential-smes/#:~:text=However%2C%20SMEs%20still%20face%20barriers,intermediaries%20within%20any%20supply%20chain.