The U.S. Department of Energy’s choice to recoup US$3.7 billion in grants from large industrial projects could unintentionally boost American manufacturing.

Many of the recipients were working on carbon capture and storage, technologies intended to stop harmful carbon emissions from polluting the atmosphere by trapping it and burying it underground. This strategy has been regarded as essential for mitigating the impact that industries like chemicals and cement have on climate change.

A Reality Check on Emissions

Cleaning up heavy industry is seen as one of the biggest challenges in the economy.

On the other hand, the U.S. power sector has made strides, reducing emissions by 35% since 2005 by shifting to more affordable natural gas and increasing the use of solar and wind energy. It’s projected that over 93% of new grid capacity in 2025 will come from these renewable sources. In transportation, electric vehicles are the fastest-growing segment and are set to significantly lower pollution levels.

However, emissions from U.S. industries have largely remained stable, partly due to the large amounts of coal, gas, and oil required to produce steel, concrete, aluminum, glass, and chemicals, which collectively generate about 22% of U.S. greenhouse gas emissions.

The global industrial scenario is evolving, and U.S. industries cannot rely solely on outdated production methods to remain competitive.

Even without local laws forcing reductions, U.S. industries face significant economic challenges. The EU’s new Carbon Border Adjustment Mechanism imposes taxes on the carbon emissions linked to imported steel, chemicals, cement, and aluminum. Similar regulations are being explored by Canada, Japan, Singapore, South Korea, and the United Kingdom, and were even suggested in the United States.

The Illusion of Carbon Capture

The initial promise of carbon capture and storage was that it could be easily implemented in existing factories with minimal disruption, allowing pollution to be eliminated.

Government subsidies for carbon capture enabled companies to keep using polluting technologies and support gas-powered chemical production or coal-powered concrete production.

The reduction of carbon capture grants under the Trump administration now eliminates some of these artificial supports.

With decreased reliance on carbon capture for compliance, there’s an opportunity to focus on breakthrough materials that could transform manufacturing while addressing emissions.

Opportunities for Material Innovation

What could new emission-reducing technologies look like for industries such as cement, steel, and chemicals? As a civil and environmental engineer with experience in federal industrial policy, I examine how these sectors relate to U.S. economic competitiveness and infrastructure.

There are numerous exciting examples of American innovation. Here are a few industries highlighted:

Cement: A fundamental material, cement’s technology hasn’t changed much in over 150 years, but its production contributes to around 8% of global carbon emissions. If it were a country, it would rank third globally for emissions.

Researchers are exploring options for lighter, heat-absorbing concrete, which could significantly lower costs for building and cooling homes. Sublime Systems found a way to create cement using electricity instead of fossil fuels. Although they lost their IDP grant in May 2025, they now have a partnership with Microsoft.

Enhancements in concrete could speed up the transition. Researchers at both Stanford and MIT are crafting energy-storing concrete that could hold over 10 kilowatt-hours of energy per cubic meter, enabling it to possibly store surplus electricity from solar panels or charging electric vehicles via roads.

Innovations like these may give U.S. companies a competitive edge while reducing emissions. Heat-reflecting concrete can reduce air conditioning usage, lighter mixes necessitate less material for structures, and energy-storing concrete could replace energy-intensive battery production.

Steel and Iron: Steel and iron manufacturing contributes about 7% of global emissions. Traditional blast furnace processes, which involve burning fossil fuels at intense temperatures, are responsible for significant pollution. There are new hydrogen-based methods that can produce steel with only water vapor as a byproduct, requiring new supply chains and techniques.

U.S. Steel is developing methods for producing stronger microstructures in steel that require 50% less material and offer greater strength. This could dramatically reduce iron ore mining, emissions from coal-powered operations, and overall transportation emissions.

Chemicals: Over the past 50 years, chemical manufacturing has caused simultaneous crises, with PFAS “forever chemicals” and microplastics found in human blood and ecosystems, while also producing a large portion of U.S. industrial emissions.

Innovations are being developed to create chemicals using engineered enzymes, achieving a potential 90% reduction in emissions while also reducing costs. These bio-based chemicals naturally decompose, and their production does not require high-energy heat.

Is There a Solution Without Carbon Capture?

While carbon capture and storage may not be the ultimate fix for emissions that many expected, innovations for managing industrial heat could be a close alternative.

Most industrial processes need temperatures between 300 and 1,830°F (150 and 1,000°C) for various operations, from food processing to steel creation. Currently, fossil fuels are burned to produce this heat, leading to emissions that electric solutions struggle to replace. Heat batteries could revolutionize this by storing renewable energy as thermal energy and then releasing it when needed.

Companies like Rondo Energy are creating systems that store wind and solar energy in heat-retaining materials at high temperatures, effectively turning electricity into heat during times of excess energy, commonly at night. This heat can later be utilized in manufacturing, reducing energy costs and enhancing grid reliability by easing demand during peak usage times. Although funding for Rondo’s projects was cut, their technology is being evaluated in other nations.

Industrial heat pumps also offer a way to harness waste heat, achieving the high temperatures needed for production without relying heavily on fossil fuels.

The Way Forward

The Department of Energy’s recent decision presents a crucial turning point for U.S. industry. One route may lead back to traditional, polluting practices. The other could pave the way for innovative solutions.

Carbon capture has been a costly solution for old technologies. Directing investments toward material innovation and alternative production methods promises significant, transformative changes for a sustainable future.