Environmental Management and Decarbonization Nexus: A Pathway to the Energy Sector’s Sustainable Futures

Abstract

This paper examines the complex interplay between environmental management (EM) and decarbonization, highlighting how these domains can be seamlessly integrated to create a comprehensive framework for sustainable futures in the energy sector. The framework emphasizes the adoption of green technologies, energy efficiency measures, and innovative carbon capture, utilization, and storage (CCUS) technologies and infrastructures. Central to this approach are circular economy principles, low-greenhouse gas (GHG) emissions production processes, and CCUS strategies. A conceptual model of the EM–decarbonization nexus, comprising six enablers, was developed and illustrated with practical examples from various countries and regions worldwide. The findings reveal significant progress in advancing EM and decarbonization efforts. However, additional support from governments and the private sector is imperative in areas such as research and development, equitable transfer of renewable energy technologies, infrastructure for energy transitions, energy storage systems, green financing mechanisms, public education and community outreach, public–private partnerships, international cooperation, active engagement in global organizations, and the deployment of digital solutions. By addressing these areas, a sustainable future for the energy sector can be realized.

1. Introduction

The global shift towards a low-greenhouse gas (GHGs) emissions economy has put decarbonization at the forefront of environmental management (EM) strategies. Decarbonization, the process of reducing carbon dioxide (CO₂) emissions, encompasses a broad spectrum of initiatives aimed at mitigating the adverse impacts of climate change. As the international community increasingly embraces the UN sustainable development goals (UN SDGs), the intersection of EM and decarbonization presents a critical nexus to address problems associated with climate change, resource depletion, and ecosystem degradation. The EM and decarbonization nexus underscore the interconnectedness between reducing carbon footprints (CFPs) and safeguarding natural ecosystems, human health, and economic stability.

To highlight the scale of the problem, the total CO₂ emissions (gigatons, Gt) as well as emissions per capita (t/capita) in various countries and regions from different worldwide locations (i.e., the US, Latin America and the Caribbean (LAC), the European Union (EU), Africa, Middle East, Eurasia (the Caspian region and the Russian Federation), China, India, Japan and Korea, and Southeast Asia) are shown in Figure 1 (data from [1]). The figure indicates that China is the largest worldwide emitter, while Africa and LAC have the lowest CO₂ emissions intensities. In view of CO₂ emissions per capita, the US is the highest and Africa is the lowest. With these CO₂ emissions, quality of air became a major problem considering that (i) each year more than 4.5 million babies are lost worldwide due to outdoor air pollution [2], and (ii) nearly 3 million premature deaths occur because of indoor air pollution [1,3,4].

The intersection of EM and decarbonization, referred to as the decarbonization nexus, offers a comprehensive approach to mitigating the adverse effects of climate change while promoting ecological preservation and sustainable development. This nexus highlights the need to balance carbon reduction initiatives with the broader goals of resource conservation, biodiversity protection, and long-term economic resilience. EM provides a structured approach to overseeing the sustainable use of natural resources, ensuring that economic activities align with environmental conservation goals [5,6,7,8,9]. For example, using renewable technologies, such as wind and solar PV, to replace traditional thermal energy would result in a hefty decrease in water consumption in the energy sector, which stood at about 240 billion m³ in 2023 [1].) In addition, the disposition of renewable energy contributes to a net increase in workforce due to employment demand in areas such as civil works and industrial manufacturing activities, retrofitting of buildings, infrastructure maintenance, and environmental remediation. Notably, in 2023, the energy sector jobs stood at about 47 million people [1]. Moreover, developing skilled workers is important to enhance competitiveness and social equity (i.e., increasing female representation in new renewable technology industries), considering that in 2023, the female workforce accounted for about 15% of energy employment [1].

Integrating decarbonization within the EM framework involves deploying strategies such as carbon capture, utilization, and storage (CCUS); renewable energy implementation; energy efficiency enhancements; and waste minimization. Notably, CCUS technologies encompass innovative methods to capture CO₂ emissions from industrial processes and the atmosphere, store them securely in geological formations, or convert them into useful products like fuels and building materials. These approaches are pivotal in reducing emissions from hard-to-abate sectors and supporting global decarbonization efforts. These strategies not only reduce emissions but also ensure responsible ecosystem management practices and better quality of air. For example, as per [1], about 45 CCUS facilities are active, with an estimated storage capacity of about 615 Mt of CO₂ per year, which is 61.5% of the estimated 1 Gt CO₂ per year to achieve the NZE (i.e., net zero emissions) pledge by 2050.

Policy frameworks and governance structures are essential to realizing the potential of the EM and decarbonization nexus. National and international climate commitments, carbon pricing, and regulations that incentivize carbon reduction are necessary to drive progress [1,10]. Ultimately, the nexus emphasizes the need for an integrated, cross-sectoral approach to achieving a sustainable low-GHG emissions future. By aligning decarbonization efforts with the EM principles, societies can mitigate climate change’s adverse effects while fostering global economic resilience and ecological integrity.

Current strategies that deal with decarbonation face technical, economic, and social challenges hindering its widespread adoption. These challenges are briefly highlighted below:

• Technical and Infrastructure Challenges: Integrating renewables like solar and wind into existing grids is problematic due to their intermittency and dependence on weather. Limited energy storage capabilities worsen these issues. Grids designed for centralized fossil fuel generation require extensive upgrades to accommodate decentralized energy sources. Additionally, green hydrogen, a promising decarbonization tool, is costly and lacks the infrastructure needed for transport and storage.
• Economic and Financial Barriers: High capital costs for renewable installations, grid upgrades, and CCUS technologies are major obstacles, especially for developing nations. Dependence on government subsidies creates economic uncertainty, while ineffective carbon-pricing mechanisms fail to drive substantial emissions reductions. Emerging economies face compounded challenges as they prioritize other critical needs, like healthcare and poverty alleviation.
• Policy and Governance Limitations: Fragmented and inconsistent regulatory frameworks undermine global decarbonization efforts. Political resistance, often driven by fossil fuel stakeholders, delays critical legislation. Ensuring a just transition for workers in carbon-intensive industries remains underdeveloped, risking socioeconomic inequalities.
• Social and Behavioral Challenges: Public opposition to renewable energy projects, often due to concerns about aesthetics, noise, and land use, slows deployment. Efforts to encourage energy-conscious behaviors often fail to overcome cultural norms and perceived inconveniences.
• Technological Limitations: CCUS technologies, essential for hard-to-abate sectors, remain costly and unscalable. Energy storage technologies like advanced batteries are still experimental and face commercialization challenges, limiting their ability to address renewable intermittency.
• Geopolitical and Resource Constraints: The shift to renewables has heightened demand for critical minerals like lithium and cobalt, creating supply chain vulnerabilities and geopolitical tensions. Over-reliance on imported technologies and materials poses risks to energy security, particularly in unstable regions.
• Environmental Considerations: Large-scale renewable projects often lead to land use conflicts and biodiversity loss. Moreover, the manufacturing and disposal of renewable technologies, such as solar panels and wind turbines, produce emissions and waste, necessitating improved recycling technologies.

To address these challenges, there is a need for a holistic approach covering innovative financing mechanisms, global policy harmonization, investment in energy storage systems and CCUS, implementation of circular economy models to minimize the environmental footprint of renewables, and collaborative efforts across governments, industries, and communities. Such an approach is essential to overcoming the preceding barriers and achieving sustainable energy futures.

The primary objective of this paper is to develop this holistic approach that highlights the interconnectedness of EM and decarbonization, providing strategic pathways that mitigate climate change effects and environmental sustainability concurrently. By examining this integration, the paper aims to (i) demonstrate how decarbonization efforts can complement broader EM goals in the energy sector, including resource efficiency and pollution control; (ii) demonstrate where decarbonization and EM strategies can be aligned to maximize sustainability impacts; (iii) offer actionable recommendations for policymakers, industries, and communities to implement integrated approaches for reducing GHG emissions while preserving the environmental ecosystems; and (iv) highlight the benefits of a decarbonization-focused EM framework for achieving long-term sustainability and climate resilience.

2. Methodology and Data Analysis

To obtain the required information, the following methodology was used. First, an initial search was performed by entering keywords/phrases into a scholarly search engine such as Google Scholar. Then, the most relevant results were examined, and if more detail was needed, sources cited by those articles were also reviewed. These findings were used to guide searches performed using non-scholarly search engines, which were used to collect information on EM, decarbonation, and energy transition methods and technologies.

In terms of the data analysis, a ground theory approach (flexible and iterative method) was used as per the following steps: (i) an online search, (ii) use of relevant keywords, (iii) review of the abstracts, (iv) analysis of the full-length papers (i.e., reviewing the evolving patterns of discussions (agreements and disagreements) and familiarization with points made by the respective authors), and (v) identification and clustering of the nexuses.

3. Conceptual Design of the EM Decarbonization Nexus

The conceptual design (Figure 2) consists of (i) the central nexus (EM and decarbonization), (ii) the supporting elements around the nexus (energy transition (ET), sustainable infrastructure (SI), circular economy (CE), social equity (SE), technological innovations (TI), and public policy (PP)), and (iii) the pathways leading to sustainable futures (clean energy, resource efficiency, and GHG emissions reduction). These components are discussed below.

3.1. Central Nexus

The core of this design (the central nexus, Figure 2) has two interconnected concepts: EM and decarbonation. EM is a set of strategies and processes aimed at protecting natural ecosystems, managing resources sustainably, and preventing pollution. This includes activities like sustainable waste management, conservation of biodiversity, and ensuring that natural resources are used efficiently without degrading the environment. Decarbonization through a reduction in GHG emissions via cleaner energy sources, energy efficiency, and CCUS technologies is essential for limiting global warming and reducing the CFP of industrial processes, energy production, and electrification. The two central elements are mutually reinforcing (Figure 3). Decarbonization is crucial to protecting ecosystems from adverse impacts of climate change, while effective EM provides a healthier and more sustainable context for low-GHG developments.

3.2. Supporting Elements and Interactions

The six supporting elements of the EM and decarbonization nexus (Figure 2 and Figure 4a) and their interactions (Figure 4b) are discussed below.

(1)

Energy transition (ET): The conversion from oil- and gas-based fuels to renewable energy is a cornerstone of decarbonization [11,12,13,14,15,16,17,18,19]. This includes shifting to wind, solar PV, hydro, nuclear, and geothermal energy and electrifying sectors such as transportation and heating. The energy transition also involves improving energy efficiency and modernizing energy infrastructure such as grids and storage systems. The energy transition is closely linked with technological innovations, which provide the required clean energy technologies (Figure 4b). Public policy plays a key role by mandating emissions targets and incentivizing renewable energy adoption. The energy transition also drives the development of sustainable infrastructure and helps reduce GHG emissions across multiple sectors.

The impact of energy resources (renewables (REs) and non-renewables (NREs)) on decarbonation has been investigated by many researchers [20,21,22]. For example, (i) Bekun et al. [20], using a dataset from the period between 1996 and 2014 for the EU-16 economies, found that REs increased decarbonation, while NREs hindered decarbonation efforts; (ii) Kirikkaleli and Adebayo [23], using two new panel approaches—FMOLS and DOLS (the FMOLS estimator takes into account the nuisance parameters and possible autocorrelation and heteroscedasticity phenomena of the residues, while the DOLS approach eliminates the correlation between regressions and the error term)—from 1985 to 2017, found that REs and financial development (FD) enhanced decarbonation, while NREs and GDP adversely impacted decarbonation; (iii) Adebayo and Kirikkaleli [23], using wavelet methods to datasets from 1990Q1 to 2015Q4 for Japan, found that NREs adversely impacted (increased) CO₂ emissions; while REs positively impacted (reduced) CO₂ emissions; (iv) Ali et al. [24], using wavelet techniques on datasets from 1971 to 2019 for Malaysia, found associations between REs, NREs, and GDP on CO₂ emissions, whereby unfavorable association between energy consumption and CO₂ at various frequencies were found; (v) Khan et al. [25], using FMOLS and DOLS approaches on datasets from 1990 to 2017 for China, found that NRE sources increased CO₂ emissions, but RE sources decreased CO₂ emissions; and (vi) Hasanov et al. [26], using CS-ARDL modeling on datasets from 1990 to 2017 for BRICS economies, found that NRE and GDP surged CO₂ emissions, while RE sources enhanced decarbonation.

Financial development (FD) is a fundamental component of economic development since it assures capital formation through allocation, pooling, and savings, as well as improves the requisite knowledge on investment activities and allocation of resources [23]. The impact of FD on sustainably can be positive as well as negative. For example, the availability of financing systems can play a positive role in combating environmental degradation and reducing CO₂ emissions [27,28]. Also, it can support R&D and accelerate economic operations to support technological innovations for RE sources, which in turn reduce CO₂ emissions [29,30,31]. Moreover, Luo et al. [32] found that FD reduces CO₂ emissions in developing countries and minimizes the negative impact of trade on sustainable management. On the other hand, it can have a negative impact, as per Khan et al. [33], who studied data sets from 1987 to 2017 for China, and reported on the degradation of the environmental quality due to high financial development that resulted increasing household financial power and industrial energy utilization. Similarly, Jianguo et al. [30] reported that FD negatively impacted (increased) CO₂ emissions in OECD countries due to household buying power and high spending.

(2)

Sustainable infrastructure (SI): This refers to constructing facilities and utilizing systems that support low-GHG emissions and resource-efficient economies. This includes renewable energy grids and electric vehicle-charging stations. Infrastructure is essential for both decarbonization (to reduce emissions from energy) and EM (to improve resource use and waste management practices). Sustainable infrastructure depends on public policy support and is fueled by technological innovations (Figure 4b). For example, modernized electricity grids are needed to handle renewable energy sources. Infrastructure also supports the circular economy by facilitating resource recycling and waste management.

(3)

Circular economy (CE): This minimizes waste and encourages the continuous use of resources by promoting recycling, reusing, and refurbishing products. This reduces the need for new resource extraction, lowers GHG emissions, and helps achieve sustainable resource management. The circular economy aligns with EM by reducing waste and conserving natural resources. It also supports decarbonization by cutting emissions from resource extraction, processing, and waste disposal. Public policy can drive the adoption of circular economy models through regulations on waste management, product design, and recycling initiatives.

(4)

Social equity (SE): This ensures that the benefits of decarbonization and EM are distributed fairly, and that vulnerable populations are not disproportionately burdened by the transition to a sustainable economy. Equity considerations include access to clean energy, green jobs, and protection from the adverse impacts of climate change and environmental degradation. Social equity is a cross-cutting component that influences and is influenced by all other elements (Figure 4b). For example, public policies should ensure that marginalized communities benefit from green jobs and have access to affordable clean energy technologies. The just transition framework within decarbonization efforts helps ensure that workers in carbon-intensive industries are supported through retraining programs and social safety nets.

(5)

Technological innovations (TIs): These drive progress in both decarbonization and EM. Innovations like renewable energy technologies (solar PV, wind, hydropower, nuclear), CCUS, energy storage solutions, and smart grids are critical for reducing GHG emissions. In EM, technologies such as artificial intelligence (AI) for ecosystem monitoring and Internet of Things (IoT)-enabled devices for resource management improve the efficiency and effectiveness of sustainability efforts [34,35,36]. In addition, technological innovations directly support decarbonization by making clean energy more viable and accessible (Figure 4b). Simultaneously, these technologies enhance EM by providing tools for monitoring environmental impacts and reducing waste.

(6)

Public policy (PP): Policy frameworks guide and regulate the actions required to achieve decarbonization and environmental protection. Governments can set GHG emissions reduction targets, enforce environmental regulations, and create incentives (such as carbon taxes or renewable energy subsidies) that encourage industries and individuals to adopt sustainable practices. For example, it is estimated that presently, under one-quarter of global GHG emissions are covered by carbon taxes and/or emissions-trading systems [1]. Aggregate revenues from carbon price initiatives rose to more than USD 100 billion in 2023, a record high. Half of these revenues were generated by the European Union Emissions Trading Scheme (EU ETS) [1]. Public policies interact with all other components (Figure 4b). Strong regulations and incentives encourage technological innovation, shape energy transitions, and influence sustainable infrastructure development. Policies can also ensure that decarbonization efforts are socially inclusive and equitable, addressing potential disparities in access to clean technologies and green jobs.

The supporting elements’ interactions (Figure 4b) can briefly be emphasized as follows: (i) Public policy influences technological innovations, energy transition, sustainable infrastructure, and social equity through regulations, incentives, and climate goals; (ii) technological innovations feed into decarbonization by enabling clean energy and sustainable practices, and feed into EM by providing tools for ecosystem protection and resource efficiency; (iii) sustainable infrastructure supports decarbonization by reducing emissions and aligns with EM by promoting resource efficiency and waste reduction; (iv) circular economy promotes resource efficiency, reduces emissions, and aligns with environmental goals; and (v) social equity ensures that decarbonization and environmental policies are fair and inclusive, addressing the needs of vulnerable populations.

The dependence of renewable energy transition (RET) on environmentally stringent policy (ESP), foreign direct investment (FDI), technological innovation (TI), eco-innovation, and gross domestic product (GDP) has been previously investigated:

(i)

Most researchers have shown that ESP is an effective mechanism in eliminating carbon dioxide (CO₂) emissions and boosting renewable energy production [11,12,13,14]. For example, in a Chinese study [16], ESP was found to have a positive impact on the reduction in CO₂ emissions during the study period from 1993 to 2019. Also, in an Indian study [17], the effect of financial innovations, green energy, and economic growth on the transport-based CO₂ emissions in India from 1990 to 2018 was investigated. Using the quantile autoregressive distributed lag (QARDL) model and the Wald test, the study finds that financial innovation and green energy negatively impact CO₂ emissions, suggesting that increased use of green energy and financial innovation can reduce transportation sector emissions. Conversely, GDP positively affects CO₂ emissions, indicating that economic growth leads to higher emissions. Also, the study supported the environmental Kuznets curve hypothesis, which posits that economic growth initially increases pollution but eventually leads to environmental improvement after reaching a certain level of development. The study findings suggested that Indian policymakers should promote green financial innovation and sustainable energy to achieve carbon neutrality and sustainable development goals.

(ii)

Studies showed that FDI has a positive impact on renewable energy use in 15 West African countries and Bangladesh [37,38] because it offers manufacturing skills, managerial experience, and new ideas and strategies for carbon emissions reduction and energy-saving measures, which leads to the sustainable development of economies. Moreover, Sadorsky [39] suggested that FDI increases energy consumption, which leads to higher energy demand in developing countries; however, Yan [40] claimed that FDI reduces renewable energy use in OECD countries.

(iii)

Studies suggested that information and communication technology (ICT), as a proxy for TI, supports technologies and facilitates green energy innovations [41,42,43]. Also, in a study by Khan et al. [44], both TI and GDP had a positive effect on the RET in G10 countries during the period from 2000 to 2021. Moreover, a study by Chen et al. [45] found a significant effect of GDP and economic growth on RET in the 45 Asian countries analyzed during the period from 1990 to 2015.

(iv)

In a study by Wang et al. [46], it was found that eco-innovation (green technology) increases renewable energy consumption in OECD countries. However, studies by Best (2017) and Wu et al. [47] found that when using the fully modified ordinary least squares (FMOLS) model, eco-innovation increases the renewable energy consumption (REC), while when using the quantile regression model, eco-innovation decreases the REC. Furthermore, a study by Best [48] analyzed the impact of green finance and eco-innovation on energy efficiency from 1990 to 2020 in G7 economies and suggested that eco-innovation reduced the energy intensity. Moreover, in a Russian study [49], the eco-innovation was found to have positive impact on the RET during the study period from 1993 to 2018.

In a study by Ali et al. [15], the impact of energy resources and financial development on environmental sustainability within the E-7 economies (China, India, Russia, Brazil, Indonesia, Mexico, and Turkey) from 2000 to 2020 was investigated. The study aligned with the United Nations’ sustainable development goals (SDGs) for 2030, focusing on sustainable development, responsible energy consumption, access to clean energy, and climate action. The study employed advanced econometric methods, including ordinary least squares (OLS), panel quantile regression (PQR), and cross-sectionally augmented mean group (CCEMG) for robustness checks. The key findings include (i) renewable energy consumption (RENC): RENC has a statistically significant negative effect on CO₂ emissions across all quantiles, indicating that increased use of renewable energy improves environmental sustainability; (ii) nonrenewable energy consumption (NREC): NREC has a positive relationship with CO₂ emissions, suggesting that reliance on fossil fuels leads to environmental degradation; (iii) financial development (FND): FND is positively correlated with CO₂ emissions, implying that current financial development practices in the E-7 economies contribute to environmental pollution; (iv) economic growth (GDP): GDP growth is associated with increased CO₂ emissions, highlighting the environmental cost of rapid industrialization and economic activities; and (v) globalization (GLB): Higher levels of globalization are linked to reduced CO₂ emissions in most quantiles, suggesting that globalization can enhance environmental sustainability. The results advocated for policy frameworks that promote renewable energy and green financing to achieve the SDGs by 2030. Policy implications emphasized the need for E-7 countries to reduce dependence on fossil fuels, invest in renewable energy infrastructure, and implement green financing strategies to foster sustainable development without compromising environmental health.

Recently, a study by Azam [18] investigated the impact of ESP, TI, eco-innovation, and FDI on RET in newly industrialized countries (NICs) from 2000 to 2021. The study used panel quantile regression models to analyze data from NICs, including Brazil, China, India, Indonesia, Mexico, Turkey, and South Africa. The key findings include (i) positive impact of FDI: FDI positively and significantly influences energy transition, suggesting that increased FDI can enhance the shift from fossil fuels to renewable and nuclear energy; (ii) negative impact of environmental policy stringency and eco-innovation: Both environmental policy stringency and eco-innovation have an inverse effect on energy transition, particularly at higher quantiles. This indicates that stringent environmental policies and eco-innovation may not be effectively promoting energy transition in NICs. Therefore, policymakers need to cautiously implement economic development policies that improve the green economic system and green products and develop green technologies and innovations; (iii) negative impact of ICT trade: ICT trade also negatively affects energy transition, implying that higher levels of ICT trade are associated with lower levels of renewable energy consumption; and (iv) positive impact of GDP and electricity consumption: Economic growth (GDP) and electricity consumption positively influence energy transition, especially at middle and higher quantiles. The study suggested that NICs need to optimize their trade structures, re-innovate the latest innovation spillovers, and introduce strict environmental policies to facilitate energy transition. It also highlighted the importance of attracting more FDI to improve energy transition and suggested that NICs should focus on adopting trade liberalization policies to increase the share of green ICT goods and services. It also emphasized the need for government support in introducing environmental policies, channeling FDI towards clean energy development, and promoting eco-friendly innovations to achieve sustainable energy transition in NICs.

In another study by Du et al. [19], the impact of financial innovation (FIN) and environmental policies—specifically, environmental taxes (ETAXs) and environmental innovation (EIN)—on transport-related CO₂ emissions (TCO2Es) in Brazil, India, China, and South Africa (BICS) was investigated. The study used advanced econometric methods, including cross-sectionally augmented auto-regressive distributed lags (CS-ARDLs) and fully modified ordinary least squares (FMOLS), to analyze data from 2000 to 2018. The key findings include (i) financial innovation and economic growth increase TCO2Es, negatively affecting environmental quality; (ii) environmental taxes, environmental innovation, and energy transition reduce TCO2Es, promoting environmental sustainability; and (iii) implementation of carbon taxes, promotion of green financial innovation, and adoption of eco-friendly technologies would curb emissions. The study emphasized the need for policymakers to align financial innovations with sustainability goals and to use environmental taxes and innovations to mitigate the adverse effects of transport emissions. Moreover, it highlighted the importance of a combined approach involving policy measures, technological advancements, and financial tools to achieve significant emissions reductions and promote sustainable development in the BICS countries.

3.3. Pathways Leading to Sustainable Futures

There are several key pathways leading from the central nexus of EM and decarbonization toward the overarching goal of sustainable futures, such as clean energy, resource efficiency, GHG emissions reduction, biodiversity protection, social equity, and economic prosperity (Figure 5).

These pathways, which are highlighted below, represent the desired outcomes of integrating EM and decarbonization:

(1)

Social equity ensures fair access to green energy, addressing energy poverty and supporting affected communities through just transition initiatives. Inclusive policies, workforce re-skilling, and equitable resource distribution are vital to balancing economic, environmental, and social needs for sustainable development.

(2)

Resource efficiency refers to optimizing the use of natural resources by reducing waste, improving recycling, and promoting sustainable consumption and production. This helps conserve ecosystems and reduce emissions associated with resource extraction and waste management. The basic resource efficiency components involve circular economy, EM, and sustainable infrastructure.

(3)

Clean energy is a fully renewable and low-carbon energy system, such as solar PV, wind, hydropower, and nuclear. This pathway is critical to reducing the global CFP and moving away from oil- and gas-based fuels. The clean energy components involve technological innovations (renewable energy), energy transition, and sustainable infrastructure (smart grids, storage).

(4)

Emissions reduction addresses the reduction in GHG emissions through cleaner energy production, CCUS, energy efficiency, and sustainable industrial practices. This is central to mitigating climate change’s adverse effects. The emissions reduction techniques involve decarbonization, technological innovations, public policy, and energy transition.

(5)

Biodiversity protection ensures that ecosystems and species are preserved and restored. Biodiversity is vital for ecological health and adaptation in combating climate change’s adverse effects. The biodiversity protection components involve EM, sustainable infrastructure, and public policy.

(6)

Economic prosperity means fostering green innovation, creating sustainable jobs, and reducing dependency on fossil fuels. These processes attract investments in renewable technologies, improve resource efficiency, and mitigate climate-related risks, ultimately enhancing energy security, boosting gross domestic product (GDP), and ensuring long-term economic resilience.

The preceding discussion highlights the complex yet interconnected nature of the EM and decarbonization nexus. By addressing each of the elements and their relationships, societies can build a pathway to sustainable futures that promotes clean energy, efficient resource use, GHG emissions reduction, and biodiversity protection while ensuring energy transition is equitable for all.

4. Technical Aspects of the Energy Transition

4.1. Energy Demand

The energy sector, which is a key contributor to global emissions, plays a vital role in this nexus. The energy demand in various countries and regions from different worldwide locations (i.e., the US, LAC, the EU, Africa, Middle East, Eurasia, China, India, Japan and Korea, and Southeast Asia) is shown in Figure 6 (data from [1]). Electricity demand in the US increased by 4.4% from 2011 to 2023 [1]. Notably, over the last 10 years, the US has increased its production by about 80% and become a major energy producer. In 2023, Brazil contributed about 20 GW out of the 27 GW (from solar PV and wind) produced by the LAC region [1]. Also, in LAC, energy is produced from different nonrenewable sources, such as oil (60%), natural gas (34%), and coal (6%). In the Middle East, in 2023, energy from nonrenewable resources (oil and natural gas) accounted for about 98% of the 36 EJ of the energy requirement [1], while renewable resources (solar PV and wind) accounted for about 30 TWh only. In Eurasia, in 2023, 90% of the required energy was produced from nonrenewable sources (oil and gas). Similarly, in Southeast Asia, the energy demand was supplied from nonrenewable sources, such as oil and gas (75%) and coal (25%). In the EU, the picture is completely different, since only 10% of the energy demand was supplied by nonrenewable sources (oil and gas) and the remaining by renewables [1].

4.2. Mitigation of Energy Related GHG Emissions

The decline in energy-related GHG emissions in the EU and the US is shown in Figure 7 (data from [50]), which indicates that during the period from 1990 to 2021, the EU reduced its energy-related GHG emissions by 40.72%, while the US reduced them by 3.3% only. The declining energy-related CO₂ emissions in the EU were due to an increase in utilizing renewable sources, such as hydro and nuclear power, and strict environmental regulations for GHG emissions reduction.

Transitioning from nonrenewable (oil, gas, coal) resources to renewables such as solar PV, wind, and hydropower is a cornerstone of decarbonization efforts. The participation of various energy sources in the global energy mix (i.e., nonrenewable sources (oil, coal, natural gas) and renewables) is shown in Figure 8a, while Figure 8b shows the source of energy consumption in selected sectors in 2023 (data from [1]). Since 2000, the supply of oil, coal, and natural gas has stabilized, but the renewable energy supply has continued to increase (Figure 8a). The global energy consumption in the building, industry, and transport sectors in 2023 was about 445 exajoules (EJ), out of which the renewal energy contribution was about 6% (Figure 8b).

4.3. Green Technology Contribution to Energy Demand

As per the IEA [1], over the past 10 years (2013 to 2023), energy demand increased by 15%, of which 40% was supplied by renewables. In 2023, the EU introduced more than 60 GW of solar PV, which is double the amount produced in 2021, and 15 GW of wind capacity, which is about 40% more than that supplied in 2021. In 2023, China produced over 75 GW of wind energy and 260 GW of solar PV. However, in 2023, China contributed about 50 GW from newly installed coal-fired power plants. It is to be noted that globally, China has (i) a 40% share of the installed wind and solar PV, and about 50% of the produced EVs, and (ii) an 80% share of the manufactured solar PV modules and EV battery cells. Moreover, during the period from 2019 to 2023, electricity demand increased by about 860 TWh, of which about 23% was in renewable energy manufacturing.

4.4. Green Technology Contribution to Decarbonization

Clean energy contribution to decarbonization in 2023 is shown in Figure 9 (data from [1]). Global investment in clean energy rose on average by 10% annually since 2019 and is anticipated to be about 2 trillion USD in 2024 [1]. The use of several clean technologies (i.e., wind power, solar PV, nuclear, EVs, hydrogen, heat pumps, and CCUS) is estimated to contribute almost three-quarters of the energy decarbonation between 2023 and 2035 [1]. The year 2023’s contributions of different energy sources are shown in Figure 9 (data from [1]). In the case of solar PV, China is dominating the market, with a contribution of about 63%, while the EU, the US, and the rest of the world contributed about 14, 7, and 16%, respectively. Similarly, for wind power, China is dominating the market, with a 66% contribution, while the EU and the US contributed about 13 and 5%, respectively [1]. In 2023, 6.3 GW of nuclear power were generated by five countries (the US, China, the Slovak Republic, Belarus, and Korea). Notably, in 2024, new nuclear power energy of 4.5 GW was linked to current grid systems in the US, the UAE, China, and India [1].

Simultaneously, energy efficiency, electrification of transportation, and the embracing of low-GHG emissions technologies in various industrial sectors are essential to reducing the CFP of high-emissions sectors. For example, in 2023, 14 million EVs were sold worldwide, out of which 4.8 million EVs were sold in China [1]. It is worth noting that in 2023, globally [1], (i) about 2.2 TWh of EV battery capacity was manufactured, while the demand was about 750 gigawatt-hours (GWh); (ii) hydrogen production reached 97 Mt from coal (at 21.25%), natural gas (58.06%), fossil fuels with CCUS (8.6%), and by-products (11.84%), and about 1.4 GW from water electrolysis, of which 80% was contributed by China.

Also, technical efficiency improvements (i.e., new vehicle fuel technologies) have contributed to lower expenses due to lower energy consumption. Notably, in 2023, more than USD 390 billion was invested in energy efficiency, an increase of about 30% from that in 2020 [1], and several governments introduced policy measures geared towards energy efficiency, such as the “Inflation Reduction Act” in the US, the “Energy Efficiency Directive” in the EU, the revised act on “Rationalizing Energy Use” in Japan, and the most recent cycle of the “Perform, Achieve and Trade Scheme” in India. Circular economy principles, which prioritize recycling and resource efficiency, complement these efforts by reducing waste and minimizing emissions throughout product life cycles.

4.5. Strategic Alignment of the Nexus

Decarbonizing the energy sector is essential to meeting global GHG emissions targets, and EM plays an important role in guiding this conversion. The following strategies exemplify how the nexus can be aligned to serve the energy sector:

4.5.1. Renewable Energy Transition

Conversion from nonrenewable (oil, gas, and coal) to renewable energy sources (solar PV, wind, and hydropower) is a cornerstone of decarbonization. This shift reduces CFP and lessens the environmental impacts of energy extraction. EM frameworks guarantee that renewable energy projects are established in a manner that minimizes ecosystem disruption. As per the IEA [1], in 2023, new renewable energy sources of more than 560 GW were introduced, with an annual investment of about USD 2 trillion, which is about double the amount invested in new nonrenewable energy (oil, gas, and coal) projects. During this transition, China was the leading contributor, with almost 60% of the added global new renewable energy capacity. The amounts estimated to have been invested in renewables in 2024 are shown in Figure 10 (data from [1]). The developed countries and China contributed about 85% of the global investment.

4.5.2. Energy Efficiency and Electrification

Increasing energy efficiency across industrial processes reduces overall energy demand and emissions. The electrification of sectors like transportation, where EVs replace internal combustion engines, plays a key role in decarbonization. EM ensures that the expansion of EV infrastructure (i.e., batteries and grid modernization) adheres to sustainability principles. Currently, 20% of global new car sales is from EV, and it is expected to increase to 50% by 2030, as per the “Stated Policies Scenario” [1]. Notably, the transportation sector is accountable for a quarter of global CO₂ emissions, with urbanization intensifying these impacts. Figure 11 (data from [50]) shows that road transportation systems are a major contributor to GHG emissions. Also, both the EU and the US increased their GHG emissions by 14.02 and 6.48%, respectively, during the period from 1990 to 2021.

Electrification in road transport covers both passenger cars and heavy-duty buses. As per the IEA [1], in 2023, the energy required in the transportation sector increased by about 4%. Also, 28% of the new passenger cars sold were EVs (12% electric batteries and 16% hybrids). The share of passenger electric battery cars is expected to have increased to 20% in 2024. For zero-emissions heavy-duty trucks, in 2023, China had a share of 10% of global sales [51], while the EU had a 16% share of the electric buses sold in the first 6 months of 2024 [52].

4.5.3. Carbon Capture, Utilization, and Storage (CCUS)

CCUS technologies capture carbon dioxide emitted from a variety of industrial processes and store them underground or repurpose them for other industrial applications [53]. EM practices ensure that CCUS operations are carried out safely, with minimal environmental risks such as groundwater contamination or environmental ecosystem disruption. Momentum behind CCUS has been growing, as shown in Figure 12 (data from [1]). For example, CCUS technologies captured about 11.3 Gt of carbon dioxide from coal-fired power plants in 2023, which was about 30% of the global carbon dioxide emissions from the energy sector [1].

4.5.4. Circular Economy Integration

Circular economy aligns with decarbonization by promoting closed-loop systems whereby materials are reused and repurposed, thus minimizing resource extraction and reducing emissions throughout product life cycles [54,55,56,57]. EM supports the circular economy by ensuring that waste is processed safely and efficiently, with minimal environmental impact. Figure 13 illustrates the relationship between the circular economy and decarbonization that is supported by EM. At the center is a large circular loop representing the circular economy, showing key stages such as resource extraction, production, consumption, and recycling. Arrows flow between these stages, emphasizing material reuse and repurposing, which minimizes waste and resource extraction. Surrounding the loop are smaller arrows representing EM processes, including waste reprocessing, recycling, emissions reduction, and reuse of materials. The green and blue color scheme emphasizes sustainability and the interconnectedness between decarbonization efforts and sustainable EM strategies.

Circularity strategies (i.e., material use reduction, recycling, adaptive reuse, resource efficiency, and waste management) with their circular economy approach [58,59] for the case of wind turbine blades, as an example of renewable energy systems, are shown

Table 1. Linear and circular economy strategies for the case of wind turbine blades.

Strategy	Traditional Approach	Circular Economy Approach
Material reduction	Each project uses virgin materials.	Optimal use of materials with circular design for durability, reuse, and remanufacturing. For example, carbon fiber recovery through pyrolysis from wind turbine blades can minimize the use of raw carbon materials.
Recycling	Minimum recycling effort is required, with final disposal of waste in landfills.	Full recycling potential of both materials and waste. For example, wind turbine blades are repurposed and reused as raw materials in construction projects. Also, critical minerals are recovered and reused in manufacturing of renewable energy projects.
Adaptive reuse	Generated waste is disposed of after each processing cycle.	Circular design aspects for reconstruction for easy reworking and reuse after the lifecycle. For example, wind turbine blades can be reused as structural elements in civil works.
Resource efficiency	Minimum efficiency with maximum utilization of natural resources is implemented.	Effective use of virgin materials with optimal recovery and reuse techniques. For example, clean carbon fibers from wind turbine blades can be recovered through thermal decomposition processes.
Waste management	Generated waste is disposed of in landfills.	EM strategies for recovery of valuable materials and minimization of waste quantities sent to landfills.

. Notably, at present, solar panels and electrical batteries have been treated to extract valuable raw materials. It has been reported that currently about 65 to 70% by mass have been recycled, and by 2030, the value of extracted raw materials could reach a value of USD 450 million [60]. For example, in a study by Umicore [61], 90% of the cobalt and nickel present in the high-voltage batteries of the “Audi e-tron all-electric SUV” can be extracted and used to make new batteries. Similarly, circular business models for lithium-ion batteries that have been discarded from EVs have been reported [56,62,63,64].

It is important to note that conversion to renewable technologies is prompting enormous requests for critical minerals, such as lithium, cobalt, and rare earth metals, that are needed for manufacturing of renewable energy components [65,66,67]. Achieving net zero by 2040 requires an increase in critical mineral demand by about 60 times. Specifically, the demand for lithium could reach 40 times, and nickel and cobalt 200 times. Mining of these minerals poses challenges in terms of process sustainability and environmental risks [65]. However, implementation of circular economy via treatment and recycling from e-waste could help alleviate this problem [68].

5. Policy and Governance Frameworks

5.1. Current Policies

5.1.1. Energy and Climate Policies

Several governments have introduced policies related to energy and GHG emissions. For emissions, countries and regions such as the US and the EU have introduced new standards on limiting methane emissions, transboundary carbon adjustment mechanism, GHG emissions from fossil fuel-fired power plants, and transportations systems. For energy-related aspects, a number of countries have introduced schemes for investments in the nonrenewable energy (oil and gas) sectors, such as Argentina and South Africa, while others have introduced legislation for investment in renewable energy projects, such as the UK, Korea, Indonesia, the UAE, and Vietnam. Also, policies to support electrification have been introduced in Australia, and investments in CCUS projects have been the focus of various countries, such as Australia, Indonesia, Japan, and Korea. To enhance energy consumption in buildings and air quality in cities (i.e., promoting the concept of sustainable cities), Canada, China, and the UAE have introduced various strategies with sizable investments.

Examples of some successful policies and lessons learned include (1) Germany’s Energiewende: This combines renewable energy incentives with grid modernization initiatives. This policy has significantly increased renewable energy adoption but faces challenges with rising electricity costs and grid-stability issues. Lessons include the need for early investment in energy storage and careful management of subsidy structures. (2) The Regional Greenhouse Gas Initiative (RGGI) in the United States: This cap-and-trade program has successfully reduced carbon emissions in participating states while generating revenue for renewable energy projects. A key takeaway is the importance of reinvesting carbon-pricing revenue into sustainable infrastructure. (3) In Denmark, policies promoting wind energy through subsidies and favorable regulatory frameworks have made it a global leader in wind power. However, public resistance to large-scale wind farms highlights the importance of community engagement and transparent decision-making.

5.1.2. Manufacturing Support for Renewable Energy Policies

Examples of domestic direct manufacturing incentive schemes for the support of renewable energy in selected governments enacted since 2020 are shown in

Table 2. Schemes for the support of renewable energy manufacturing projects.

Country	Direct Incentive Schemes	Technologies Covered	Assigned Budget (Billion USD)
United States	“Inflation Reduction Act” “Infrastructure Investment and Jobs Act”	Mineral resources, renewables, electrification	51
Canada	“Clean Economy Investment Tax Credits” “Net Zero Accelerator Initiative” “Strategic Innovation Fund” “Canada Growth Fund”	Renewables, electrification, mineral resources, CCUS infrastructure	34
China	“New Energy Vehicle Promotion and Application Subsidy Funds”	Renewables, electrification	26
European Union	“European Green Deal” “New Batteries Regulation” “Strategic Technologies for Europe Platform” “Net Zero Industry Act”	Renewables, electrification	24
Australia	“Future Made in Australia Plan” “Hydrogen Head-start” “Powering Australia”	Mineral resources, renewables, electrification	13
India	“Production-linked Incentive Scheme” “National Hydrogen Mission” “Scheme for Viability Gap Funding”	Renewables, electrification	12
Japan	“Economic Security Promotion Act” “GX Green Transformation Policy”	Renewables, electrification	3
South Korea	“Semiconductor Industry Comprehensive Support Plan” “Battery Industry Innovation Strategy”	Renewables, electrification	1

[1].

5.1.3. Carbon Capture, Storage, and Utilization Policies

Specific policies related to CCSU in a number of countries are shown in

Table 3. Sample of CCSU support policies.

Country	Year	Policy Name	Areas of Policy Coverage
Norway	2023	“Projects to store CO2 in the North Sea”	Permitting processes
Germany	2021	“CO2 avoidance and use in raw material industries”	Payment, finance, and taxation; grants; payments and transfer
Norway	1991	“CO2 tax on offshore oil and gas”	Payment, finance, and taxation; carbon tax; GHG taxation; taxes, fees, and charges; carbon capture, utilization, and storage; renewable energy; industry sector processes and technology
United States	2021	“US-EU to reduce carbon emissions on steel and aluminium trade”	Energy efficiency; technology, research and development, and innovation; industry sector processes and technology; aluminum, iron, and steel
Thailand	2016	“Eco-Car programme-Excise tax”	Energy efficiency, road vehicle, transport technology, electric battery, drive train and engine, plug-in-hybrid
Malaysia	2011	“Import tax reduction”	Energy efficiency, road vehicle, transport technology, electric battery, drive train and engine, plug-in-hybrid
China		“Exemption of Vehicle Acquisition Tax for NEVs (2017) No. 172”	Energy efficiency, electrification, road vehicle, transport technology
Norway	2022	“Revised national budget 2021–2022: Energy price support”	Energy poverty, energy security, heating

.

5.1.4. Electrification Policies

Table 4. Samples of EV support policies.

Country/Region	Policy Type	Description	Year
Canada	Enacted	By 2035, zero emissions	2023
China	Enacted	Strategies to replace oil and gas vehicles with EVs	2024
European Union	Enacted	By 2035, zero emissions for all operated cars	2023
India	Enacted	Replacement scheme for EVs	2024
United Kingdom	Enacted	By 2030, 80% of new cars and 70% of new vans must be electric; by 2035, all must be electric.	2024
United States	Enacted	Funding for EV infrastructure	2021
Australia	Goal	EV sales and incentives	2023
Indonesia	Goal	Specified targets for EV passenger light-duty vehicles and electric motorcycles by 2030	2023
Japan	Goal	All operated passenger cars must be EVs by 2035, and by 2040 for all light commercial ones.	2021
Korea	Goal	By 2025, more than half of the car fleet must be EVs, and by 2030 the percentage must increase to 83%.	2021
Mexico	Goal	By 2020, all operated passenger cars and buses must be EVs.	2023
New Zealand	Goal	By 2035, all new cars and van sales must be electric and comprise 30% of the light-duty vehicle fleet.	2021
Pakistan	Goal	By 2030, 30% of passenger cars and 50% of two-/three-wheeler sales must be electric; by 2040, 90% of truck sales must be electric.	2019
Vietnam	Goal	By 2050, zero emissions in road operated vehicles	2022

(data from [1]) shows samples of government plans for the adoption of EVs. It is anticipated that by 2024, EVs will have contributed to about 5% of total global car sales. Notably, in this environment, China contributed about 80%, while other countries and regions had contributions ranging from 3% for the EU to 10% for the US and 15% for the UK. Moreover, the IEA [1] report highlighted the noticeable increase in EVs in Middle Eastern countries as well as in Brazil, Indonesia, Mexico, and the Caspian region.

5.2. Policy Development Strategies

For the development of a policy for effective clean energy innovation systems, governments must consider the following four main pillars [69]: development of skilled workforce and research infrastructure, knowledge transfer and management, increase in the market value to mitigate the research and development risks, and development of broad socio-political support for the new product or service. These pillars are highlighted in

Table 5. Policy development strategies.

Policy Type	Support Function	Support Type
Resource push	Research and development (R&D), prototyping, pilot study, education, training	Grants, support for researchers, R&D tax incentives, loans for start-ups, training grants
Knowledge management	Knowledge transfer, intellectual property registration	Intellectual support scheme, open-access publication, international research and exchange programs.
Market pull	Companies for innovation	Standardization, policies, subsidies, taxes, fees
Socio-political support	Technology adoption by users and companies, tension reduction between users and innovators	Consultancy funds, policies, market surveys

[69].

For example, the policy instruments used to support the “ultra-high-voltage electricity transmission technology” in China from 2014 to 2021 are shown in Figure 14 (data from [70]). In 2014, the introduced policies were related to knowledge management and market pull; however, in 2016, policies addressed three pillars (i.e., resource push, knowledge management, and market pull). However, all four pillars were induced in 2018 policies. Moreover, in 2018, policies covered only three pillars (i.e., resource push, knowledge management, and market pull). Finally, in 2021, policies related to resource push and market pull were introduced. The total investments increased from about USD 1.75 trillion in 2014 to about USD 6.750 trillion in 2021 [70].

Similarly, the policy instruments used to support solar PV technology and production in China from 2014 to 2021 are shown in Figure 15 (data from [70]). Most of the policies were issued to support the market pull of solar PV technology. The solar PV production rate increased from about 37.5 GW in 2014 to about 182.5 GW in 2021, and the percentage contribution of China to the total global production is marked at about 75% within the period from 2016 to 2021. Notably, among the top 20 solar PV manufacturing companies in 2022, 17 of them were from China, and many of them have operations around the world [70].

Therefore, the successful integration of EM and decarbonization requires strong policy and governance frameworks that support emissions reduction at multiple levels, such as:

(a)

Carbon pricing and incentives: Instruments such as “carbon taxes” or “cap-and-trade” incentivize companies and organizations to reduce GHG emissions. Also, governments can also offer support and financial enticements for renewables, electrification, and low-GHG emissions technologies.

(b)

Regulatory standards: Environmental regulations that limit GHG emissions from industrial processes; road, air, and marine transport; and energy production systems are essential for achieving decarbonization goals. These regulations should be aligned with broader EM objectives, such as clean air, water, and land; biodiversity conservation; and resource efficiency.

(c)

Cross-sector collaboration: Governments, industries, and civil society must collaborate to achieve decarbonization targets. Public–private partnerships can drive innovation and investment in low-GHG emissions technologies, while community engagement ensures that decarbonization strategies are inclusive and equitable.

6. Technological Innovations

Technological innovation is a key enabler of the EM and decarbonization nexus, driving transformative change across various sectors. As the world strives to meet ambitious climate goals, advancements in technology provide the tools to reduce emissions, improve resource efficiency, and enable better EM. Below are discussions regarding the current status of the renewable energy technologies, smart grids and IoT, CCUS, and digital and decision support systems that support energy transition.

6.1. Renewable Energy Technologies

The government spending on energy research and development is shown in Figure 16 (data from [70]), where in 2023, government spending was estimated at approximately 38% (China), 24% (North America), 30% (EU), and 7.6% (remaining countries). Also in 2023, venture capital funding for energy-related start-ups was estimated at USD 32 billion, distributed as 27% from China, 66% from developed countries, and 6.5% from developing countries [70]. Equally important are outreach programs that build awareness, drive consumer behavior change, and foster collaboration among stakeholders. Together, these two elements play a crucial role in achieving sustainable futures.

As per the IEA [1], investments in renewable energy reached about USD 3 trillion in 2024. Also, it was estimated that about USD 1.9 trillion is marked for support for renewable energy technologies, such as low-emissions power, energy efficiency and end-use, and CCSU infrastructure, and USD 1.1 trillion for other nonrenewable sources of energy supply (i.e., coal, oil, and natural gas) (Figure 17; data from [1]). In 2024, about 85% of the total renewable energy investments came from developed countries and China, while the remaining 15% came from developing countries (Figure 18; data from [1]), which are currently investing heavily in nonrenewable energy and suffer from high initial capital cost of supporting renewable energy technologies.

Financing of clean technologies can be characterized into the following three categories (Figure 19; data from [1]): (i) capital structure (equity and debt), with a share of about 33% of current energy investment; (ii) investors (household, corporate, and government), with about 34%; and (iii) financiers (commercial and public), with the remaining 33%. Basically, in 2023, investment in clean technologies was almost shared equally between capital structure, investors, and financiers.

Breakthroughs in solar, wind, geothermal, and hydropower technologies are making renewable energy more cost-effective and accessible. Also, new technologies in storing energy through batteries and the grid scale enhance the consistency of energy supply from renewables by mitigating intermittency challenges. Also, smart charging processes could enhance grid flexibility, optimize grid load, and supply power to buildings [70]. These innovations allow energy systems to reduce their CFP while ensuring energy security. The government support for renewable energy manufacturing processes from 2020 to 2024 is shown in Figure 20 (data from [1]). The support for EVs (electric, hydrogen, and batteries) marked 72.57%, for solar PV and wind 17.39%, for mineral resources 8.7%, and for heat pumps 1.34% of the total investments.

6.2. Smart Grids and Internet of Things

The amalgamation of smart grids and the Internet of Things (IoT) enables more efficient energy use by optimizing electricity distribution and consumption [71,72,73,74]. Smart grids can assimilate a variety of renewable technology sources, balance supply and demand, and reduce energy losses. Moreover, they can be installed for different purposes and functions; for example, microgrids installed at educational institutional campuses enhanced the sustainability and reliability of the power supply [75], while those installed at residential areas improved the energy supply and enhanced the implementation of new renewable energy projects [76]. Microgrids installed at industrial sites safeguarded the nonstop power supply, optimized energy expenses, and improved circularity through the integration of sustainable EM systems with sustainable renewable energy technology sources [77].

IoT technologies such as smart meters have been in use in smart grids in the US and in EU countries for monitoring and transmitting real-time electricity consumption to consumers as well as utility companies [78]. Also, in Germany and Denmark, IoT technologies are used to improve the efficiency of the electricity distribution systems [79], while in the US and Australia, they are used to regulate the power demand and alert consumers to the peak periods to minimize electricity usage [73]. Moreover, in Japan and South Korea, IoT devices are used to preserve optimum levels of voltage and frequency across the grid and ensure reliable quality of the power supply [80]. IoT is further used in energy management systems (EMSs) in the US, Germany, and China for monitoring, controlling, and optimizing electricity from generation, to distribution, to consumption, and finally to storage [81]. Also, IoT was used in the US, the Netherlands, and Norway for vehicle-to-grid integration to permit EVs to transfer stored energy to the grid system and incentivize owners of EVs [82].

6.3. Carbon Capture, Utilization, and Storage (CCUS)

CCUS technologies adsorb CO₂ from exhaust gases, thus stopping them from polluting the atmosphere. Captured CO₂ is used to produce valuable products, such as fuels, chemicals, and building materials, thus creating economic opportunities while reducing emissions. CCUS plays an important role in industries that are difficult to decarbonize, such as cement, steel, and petrochemicals. Examples of innovative solutions include the following [70]: (i) The 50 MW natural gas power plant operated by NET Power produces clean energy using CO₂ in its oxy-combustion process technology, and (ii) the Taizhou coal power plant, in China, has a capability of capturing 0.5 Mt CO₂ per year. However, higher CO₂ capture rates are vital for CCUS systems to be part of the technological processes that contribute to low-GHG emissions futures. Notably, new CO₂ adsorption systems with 99% capture rates have been reported by the IEAGHG [83].

6.4. Digital and Decision Support Systems

Digital and decision support systems, such as artificial intelligence (AI) and machine learning (ML) technologies, enable more efficient resource management by analyzing large datasets to optimize energy use, predict environmental risks, and guide policy decisions [7,66,84,85]. AI-driven models help optimize supply chains, improve crop yields in agriculture, and enhance circular economy processes by identifying new ways to reduce waste and recycle materials.

Table 6. Samples of digital systems that embrace circular economy.

Digital System Name	Purpose	Expected Benefits	Potential Use
“Circulytics”	Circular economy monitoring system	Measuring circularity score	Assessing and enhancing the efficient use of resources
“Reath”	Data management system for reusable materials for packaging	Lifecycle tracking of material used in packaging	Reduction in packaging waste
“Globechain”	Reusable item marketplace	Community engagement for reusing of materials	Donation platform for unused materials
“Material Mapper”	Surplus building material geolocation system	Redistribution mechanism for unused materials	Reduction in material waste
“Agraloop”	Digital system used in bio-refineries	Transformation of waste generated from crops to biodegradable fiber for use to manufacture cloth	In the fashion industry to enhance sustainability and a low-carbon future

shows examples of digital systems that embrace circular economy through resource conservation, real-time monitoring of material use, process control, and on-time communication with stakeholders to enhance decision-making (modified after [59]).

7. Outreach Programs and Public Engagement

Technological advancements alone are not enough to drive meaningful decarbonization and environmental outcomes. Outreach programs and public engagement are critical for fostering widespread support, driving behavioral change, and ensuring equitable implementation of decarbonization initiatives [86,87,88]. These programs serve as catalysts for levitation of the public consciousness towards the benefits of having sustainable EM systems and decarbonization strategies for transitioning to sustainable futures.

7.1. Public Education and Awareness Campaigns

Providing educational programs for the public about the impacts of GHG emissions and the importance of decarbonization is essential for creating a groundswell of support for sustainability initiatives. Awareness campaigns can communicate the benefits of efficient energy use, waste reduction, and sustainable practices, and encourage individuals and communities to adopt low-GHG emissions behaviors. Educational programs in schools and communities can inspire the next generation of environmental leaders. For example, homes with digital control systems (IoT and sensors) that control temperature at a comfortable level emit 22.4% less carbon than those without digital systems [89]. In addition, as per the Mckinsey Company’s report [90], in the US, approximately 20% of the required energy at homes could be set aside through the implementation of educational programs that lead to consumer behavior changes towards energy use in homes. Also, in an Indian study by Sachar et al. [91], it was estimated that 3.4 to 10.2 TWh per year by 2030 could be saved via the efficient use of energy as a result of consumer behavior change. Moreover, as per the IEA [92], Ireland estimated that an energy savings of about 2.4 and 6.5 TWh per year in residential and in commercial and public buildings, respectively, could be saved by simply adjusting room temperature, leading to an overall lower energy consumption of 5% across the country.

Outreach programs implemented in the US were compared in terms of (i) the “behavioral efficacy” (BE) programs that accounted for the use of issued home energy reports, alerts for consumers with high monthly energy bills, and regular energy audits at home, and (ii) “Climate Damage Avoided Cost” ($CDA) modelling, which accounts for in-depth evaluation of both performance and incentives of various installed home energy systems, such as retrofitting and efficient heating and cooling, and it was reported that depending on the state, both BE and $CDA varied. For example, the State of Illinois had a BE of 0.43 and a $CDA of 2.04, the state of Maryland had a BE of 2.03 and $CDA of 9.75, and the State of Massachusetts had a BE of 5.42 and a $CDA of 22.82.

Moreover, as per the IEA [87,92], constructive educational programs could lead to a widespread range of influences towards energy savings. Examples are (i) a 2.2% reduction in household electricity usage and a 1.6% reduction in natural gas consumption overall; (ii) a 14% reduction in electricity usage and a 10% reduction in gas usage through implementing educational programs that lead to consumer behavior change; (iii) a reduction of about 1.5% in natural gas usage and of 2.2% in electricity usage due to the use of IoT in households; (iv) a 3.6 to 6.9% savings in electricity usage resulting from New Zealand’s nationwide educational programs; and (v) electricity savings of about 2% as a result of Korea’s national campaign in 2011.

7.2. Community Engagement and Participation

Successful decarbonization and EM strategies rely on active participation from local communities. Outreach programs that engage communities in co-developing solutions—such as local green energy and infrastructure projects, or conservation programs—ensure that strategies are designed to meet the actual requirements of individual communities. Cooperative decision-making builds trust and ensures that sustainability efforts are inclusive and equitable. Examples include the following [92]: (i) BC Hydro, Canada, established a customer participation program combining regular consumer advice with other behavioral engagements and attracted more than 91,000 households over a period of 4 years, resulting in a reduction of 25.6 GWh in electricity consumption in comparison with the control group, and (ii) the Jemena Electricity Network, Australia, introduced “demand–response challenges” for reducing energy consumption during peak periods as well as during hot and cold weather trials, resulting in about a 26 to 42% reduction in energy consumption during a specified 3 h period.

Moreover, in 2016, the US Department of Energy [93] evaluated the impact of consumer behavior studies and reported that for customer response to pricing, there was (i) a 20% reduction in APD (average peak demand) for CPP (critical peak pricing), (ii) a 6% reduction in APD for CPR (critical peak rebates), (iii) a 35% reduction in CPP with automated control devices, and (iv) a 26% reduction in CPR with automated control devices. Moreover, for customer use of PCTs (personnel control technologies), the APD was reduced by 22% for CPP and by 45% for CPR.

Furthermore, policies geared towards increasing investments in energy efficiency in homes (i.e., building with insulation systems and appliances with energy-efficient technologies) could largely benefit from community engagement and participation programs [94].

7.3. Industry Collaboration and Knowledge Sharing

Industry-specific outreach programs are critical for disseminating successful case studies and programs that clearly demonstrate the environmental and economic benefits of decarbonization. Cross-industry collaboration platforms and knowledge-sharing initiatives can accelerate the implementation of technologies with low-GHG emissions and sustainable EM programs and strategies. These collaborations also foster innovation by bringing together diverse expertise from different sectors.

(a)

Government and Policy Advocacy: Outreach programs that target policymakers are essential for shaping effective environmental and emissions policies. Advocacy campaigns can help build political support for ambitious emissions targets, carbon pricing, renewable energy incentives, and regulatory frameworks that promote decarbonization. Public engagement in policy discussions ensures that diverse voices are heard, leading to more democratic and inclusive climate action. Moreover, a solid understanding of behavioral drivers of energy consumption and barriers to sustainable energy use is necessary to design people-centered energy policies for the transition [1].

(b)

Corporate Social Responsibility (CSR) Initiatives: Companies play a crucial role in advancing decarbonization and environmental sustainability through their CSR programs [95,96]. By aligning their business practices with sustainability goals, corporations can reduce their CFP, support conservation efforts, and promote responsible resource management. Corporate outreach programs that engage employees, customers, and suppliers in sustainability initiatives amplify the impact of these efforts. In a study by Yan and Zhu [97], 224 Chinese A-share businesses in the heavy pollution industry listed between 2016 and 2020 were analyzed, and the results concluded that there is clear evidence that CSR is positively associated with sustainable innovation in regions with better macroeconomic conditions, and is stronger in state-owned firms than in non-state enterprises. In another study by Chen et al. [96], the effects of GHG emissions restriction on firms’ outputs, price, profits, and social welfare were theoretically modelled, and the results indicated that high social concern reduces both social welfare and firms’ profits when the CSR firm’s GHG emissions restriction is not binding, and low social concern increases both social welfare and CSR firms’ profits when profit-maximizing firms are subject to GHG emissions restrictions (i.e., bound to emissions reduction). Notably, the study conclusion for the case of high social concern is consistent with Kopel and Brand [98] and is contrary to Goering [99] and to Benabou and Tirole [100]. In a recent study by Zhou et al. [101], the Stackelberg game model was used to examine optimal GHG emissions reduction and its influence under different decision-making modes. The results showed that (i) increased consumer green preferences and trust can improve manufacturing enterprises’ GHG emissions reduction rate; (ii) increased green innovation costs decrease the GHG emissions reduction rate; (iii) for constant green technology innovation costs, the GHG emissions reduction rate increases with the increase in the capacity of the market; and (iv) to achieve decarbonation production, the market capacity must be small. These findings are relevant to governments and enterprises with low-GHG emissions subsidies and supply chain management.

(c)

International Cooperation and Global Outreach: GHG emissions and environmental degradation are global challenges that require international cooperation. Outreach programs that facilitate dialogue and collaboration between countries, regions, and international organizations are vital for scaling up decarbonization efforts and sharing successful strategies. International platforms such as the United Nations Framework Convention on Climate Change (UNFCCC) provide opportunities for global knowledge exchange and collective action.

8. Expected Outcomes and Benefits

By integrating EM and decarbonization, several key outcomes can be achieved. A systematic approach to decarbonization across key sectors will significantly lower GHG emissions, contributing to the achievement of the projected zero-emission targets set in the UN Paris Agreement. In 2023, the global workforce in clean energy technologies was about 68 million workers, shared by the supply (9%), power (43%), vehicles (28%), and efficiency (20%) sectors (Figure 21; data from [1]), which is expected to increase by about 15 million to meet the net-zero-emissions scenario [1].

Decarbonization strategies that incorporate circular economy principles will promote the efficiency of natural resource utilization and the minimization of waste generated from industrial processes and their impact on human health and the environment. Decarbonizing transportation, reducing urban emissions, and improving waste management will lead to cleaner air, healthier ecosystems, and more livable urban environments, enhancing public health and overall quality of life.

Outreach programs will foster a greater sense of environmental responsibility among individuals, communities, and industries, resulting in more widespread support for sustainability initiatives and greater participation in low-GHG emissions practices. Also, outreach efforts that engage marginalized communities and ensure their voices are heard will lead to more just energy transitions and decarbonization strategies. This will help address social inequalities that intensified due to global climate change and ensure that the benefits of the low-GHG emissions transition are shared by all. Moreover, cross-sectoral and international collaboration will drive innovation in both technology and policy, enabling the development of more effective and scalable solutions for global warming mitigation and EM. The combination of technological innovations and public engagement will result in more resilient ecosystems, sustainable resource management, and reduced emissions, paving the way for a sustainable future that balances environmental ecosystem health, global economic growth, and social welfare.

9. Implementation Barriers

While the integration of EM and decarbonization is critical to building sustainable futures, several barriers must be addressed to achieve widespread success [57,64,102,103,104,105]. These barriers, spanning from technology, to economic, to social, and finally to political domains, are discussed below:

9.1. Technological Barriers

The technological and infrastructure limitations include the following [106,107,108,109,110,111]: (i) Many decarbonization technologies, such as CCUS, advanced battery storage, and smart grid systems, require significant upfront investment. In developing countries and regions with limited resources, the cost barrier can hinder the widespread adoption of these technologies. Also, the differential manufacturing cost between countries is another problem. For example, in a study by the IEA [1], the capital and operating costs required to establish a green energy manufacturing facility in developed countries are 70–130% higher than those required in China for the same output capacity (Figure 22). (ii) The successful conversion to renewable energy sources and low-GHG emissions systems relies on modern infrastructure, such as updated grids, storage facilities, and electric vehicle charging networks. Inadequate infrastructure, especially in rural or underserved regions, impedes the placement of green energy technologies and electrification. (iii) While many innovative technologies hold great potential for decarbonization, some innovative technologies are still in the early stage of technology readiness levels (TRLs) of one to four. Scaling these technologies to the global level will require further research, development, and investment.

9.2. Economic Barriers

The economic and market barriers include the following [103,112,113,114,115,116,117]: (i) Many economies remain heavily dependent on nonrenewable sources, not only for energy production but also as a source of revenue, particularly in oil- and gas-producing countries (Figure 23; data from [1]). The transition to renewable energy could result in economic disruptions and job losses in these industries, creating resistance to change. (ii) In many regions, there are insufficient economic incentives to adopt low-GHG emissions technologies and sustainable practices. Market structures often favor nonrenewable sources due to subsidies; hence, implementation of renewable energy sources and green technologies is difficult. (iii) Private sector financing of renewable energy technologies is often hindered by perceived risks, regulatory uncertainty, and long payback periods. These factors can limit the flow of capital needed to finance large-scale decarbonization projects.

9.3. Social Barriers

The anticipated social barriers include the following [108,118,119,120,121,122,123,124]: (i) Public understanding of decarbonization strategies and their environmental benefits remains limited in many areas. Resistance to change can arise due to concerns over the cost, inconvenience, or perceived threats to jobs and industries. (ii) Climate change and environmental degradation disproportionately affect marginalized and vulnerable populations. Decarbonization efforts, if not designed with equity in mind, risk exacerbating existing social inequalities, as vulnerable groups may lack access to clean technologies or face greater economic burdens from the transition.

9.4. Governance Barriers

The main policy and governance gaps are as follows [116,124,125,126,127,128,129]: (i) In many countries, environmental and climate policies are fragmented or insufficiently ambitious to drive the necessary level of decarbonization. The absence of long-term, coherent policies limits the ability of governments to effectively manage the conversion to a low-GHG emissions economy. (ii) Climate change is a global challenge, yet international cooperation is often limited by conflicting national interests, political priorities, and economic competition. The lack of binding international agreements and enforcement mechanisms undermines global efforts to reduce emissions and protect ecosystems.

10. Conclusions

The integration of environmental management (EM) and decarbonization presents a transformative opportunity to combat climate change while protecting ecosystems. However, achieving a sustainable, low-greenhouse gas (GHG) emissions future is fraught with challenges, including technological constraints, economic barriers, social equity concerns, and governance gaps. Addressing these obstacles requires a coordinated, multi-dimensional approach that emphasizes innovation, infrastructure modernization, market incentives, and inclusive policies. Public outreach and international cooperation are critical to scaling solutions and fostering a collective vision for sustainability.

The EM and decarbonization nexus are underpinned by six enablers: energy transition (ET), sustainable infrastructure (SI), circular economy (CE), social equity (SE), technological innovations (TIs), and public policy (PP). These enablers offer a framework for aligning EM and decarbonization strategies. For example, transitioning to renewable energy sources like solar, wind, and hydropower; promoting circularity through closed-loop systems; and advancing technological innovations are key actions that contribute to reducing emissions while enhancing resource efficiency.

Strong policy and governance frameworks are essential to integrating EM and decarbonization efforts effectively. Carbon-pricing mechanisms such as taxes and cap-and-trade systems incentivize businesses to adopt low-carbon technologies. Financial support, including subsidies and tax credits, encourages investments in renewable energy and sustainable practices. Environmental regulations that limit industrial GHG emissions align with broader EM goals like biodiversity conservation and resource efficiency. Public–private partnerships (PPPs) drive innovation and investment, while community engagement ensures that decarbonization strategies are inclusive and equitable.

Technological advancements are crucial for reducing emissions and improving resource efficiency. Innovations in renewable energy systems, electrification, energy storage, and carbon capture, utilization, and storage (CCUS) are urgently needed. Governments and industries must invest in research and development (R&D), promote international cooperation for technology transfer, and utilize digital tools like AI, IoT, and big data analytics to enhance decision-making processes. Smart city initiatives leveraging IoT sensors and data analytics can further reduce energy consumption, manage waste efficiently, and lower urban carbon footprints.

Addressing social equity is integral to successful decarbonization. Policies must incorporate just transition frameworks to support workers in carbon-intensive industries through retraining programs, job creation, and social protection. Public awareness campaigns and educational initiatives are also vital to fostering a culture of sustainability. These programs highlight the economic and social benefits of decarbonization, driving behavioral change and building widespread support for EM and decarbonization strategies.

Modernizing and expanding infrastructure is another critical pathway. Upgrading electricity grids, developing energy storage solutions, and building widespread charging networks for electric vehicles are necessary for transitioning to renewable energy systems. Infrastructure for recycling, waste-to-energy technologies, and resource recovery supports a circular economy, reducing emissions while enhancing economic resilience. Simultaneously, market mechanisms like carbon pricing and financial instruments such as green bonds attract private investment and facilitate the large-scale deployment of low-carbon technologies.

The pathways to advancing EM and decarbonization emphasize the need for investments in R&D, sustainable infrastructure, market mechanisms, policy frameworks, and technological innovation. Collaboration between governments, industries, and communities is paramount to building a resilient future. By integrating EM with decarbonization efforts, economies can be reshaped to address climate change challenges while promoting economic growth, social welfare, and environmental health. This nexus provides a comprehensive roadmap for transitioning to a sustainable and equitable low-GHG world.