Exploring the Current Global Economy’s Major Material & Energy Flows

As the world transitions to a low-carbon economy, different sectors must work together at an unprecedented speed, developing shared assumptions and goals, while still delivering goods, energy, and services to a growing global population. The physical economy – the flow of energy and materials from raw resources to final services – must be transformed. Through a new interactive Sankey diagram, the MCSC aims to comprehensively map the system we are all working together to decarbonize: the global economy. Katie Daehn, Research Scientist at the MCSC, led the development of the diagram – extracting and compiling data on the production and use of the major material and energy commodities. This data can help users explore scale and visualize connections between sectors. Most data are from international agencies, such as the International Energy Agency, the Food and Agricultural Organization, and worldsteel, and supplemented by literature, as shown in the supplementary file.

The MCSC’s mission centers on bringing together industry leaders across sectors, connecting them with diverse expertise from academia, and then developing a shared vision for moving the needle on developing climate change solutions. Each of the MCSC’s member companies has their own viewpoint and points of leverage – and the MCSC provides a platform to explore the tensions and synergies that emerge as each company implements their decarbonization plans.

Daehn, along with Professor Elsa Olivetti, MCSC Strategic Advisor, thought through different storylines; for example, if long-haul trucking commits to electrification to decrease their demand for oil, how does the petrochemical industry respond – by also decreasing demand, or by making more plastics? Or, if the steel industry decides to shut down blast furnaces, less steelmaking slag is available for the cement industry – what will they use instead?

They started drawing linkages of the physical connections between sectors, and decided to continue until all major energy and material flows were accounted for.

“Material and energy use is at the heart of many sustainability issues, yet there are few comprehensive visualizations,” explained Daehn. “‘Decarbonizing the global economy’ is a tall order, and even harder when we all have only a vague idea of what the system looks like. We developed this visualization to aid industry leaders in conversations at the MCSC, but want to share it broadly to anyone curious about how resources are extracted and transformed.”

“Sankey diagrams are an effective data visualization tool for this type of exploration because they show the volume of a flow through the steps of a process or system – with the most valuable Sankey diagrams illustrating structure and scale,” Daehn continued. “This can then help generate understanding and insights that would not be possible by reading numbers in a table.”

The visualization has two main goals: to investigate scale and connections.

Scale is key for setting priorities and understanding feasibility. Not shown in this diagram is human-made CO2 emissions, but it is the largest single output of the global economy. About 37Gt/yr arises from fossil fuel combustion, and 5Gt/yr from land-use change. When thinking about capturing and sequestering this flow, a material flow of the same order of magnitude is required. The potential of cement as a carbon-sink has thus received attention because of its massive volume. Crops are the largest flow, and represent one of greatest opportunities to sequester more carbon in soil. Food waste and crop residues are massive flows that may be utilized more efficiently, but the data quality describing where they are and what happens to them now is very poor.

One can see the volume of post-consumer waste is significant, and the vast majority ends up in landfill – highlighting the potential to better use this resource, but the amount of steel, plastic and paper that could be recovered cannot meet demand for these materials. The circular economy can help reduce the quantity of primary resources we extract, but given growth, there are limits to its ability.

The diagram can also help with investigating cross-sector connections. As most net zero plans have been designed for a single sector or company, there are many interactions, trade-offs, and dependencies in the physical economy that should be carefully considered during a transition. In the new Sankey diagram, a user can click on any node and the upstream and downstream sectors that are directly connected (either as a supplier or a user/purchaser) are highlighted.

As the Sankey tool shows (for example by clicking on oil, natural gas and coal nodes), fossil fuels are used across all sectors. A fundamental re-structuring must occur as low-carbon resources are scaled up, with new connections emerging between sectors. Bio-based feedstocks may be a low-carbon resource for sectors that cannot directly electrify, such as aviation, maritime shipping and petrochemicals. Also depicted in the visualization, most bio-energy today is used in buildings as fuel. This energy use will need to be decreased, while advanced biorefineries that can co-generate bio-materials and biofuels are scaled-up. Currently the flow of biofuels to transportation is very small (~90 Mt-oe, compared to ~2,600 Mt-oe oil). Many such examples exist, and the Sankey diagram prompts areas that might be interesting and worthwhile to explore in more detail or for cross-sector industry representatives to partner around for positive leverage points.

The MCSC’s work is grounded in diverse sectors working together to reinforce and accelerate the transition to low-carbon resources. Sectors are physically coupled, and the feedback between sectors may lead to unexpected rates of change. One example is the build-out of renewable electricity infrastructure. This infrastructure requires minerals and metals, which are typically energy-intensive and environmentally harmful to produce. However, as more clean electricity comes online, it can be used to power mining, extraction and manufacturing with greater efficiency, to then decrease the impacts of making energy infrastructure. Electricity generation needs metals, and metals production needs electricity – with proper coordination, these sectors can work together to decouple from CO2 emissions.

View and interact with the Sankey diagram.