State Best Practices Guide for Decarbonizing Industry

A new guide from the Industrial Innovation Initiative (I3) – a partnership among industrial, labor, and environmental stakeholders – recommends a suite of state policies and approaches to scale industrial decarbonization solutions.   

The State Best Practices Guide for Decarbonizing Industry pairs state-level policy recommendations with real-world examples of state legislation in use or under consideration across the United States. This unique pairing will aid state decision makers and advocates seeking to cut emissions from essential industrial sectors such as cement, steel, and chemicals by providing a starting point for policy development and state planning.  

Created with input from participating state officials, industry, labor, and environmental stakeholders, the guide emphasizes the critical role states will play in decarbonizing the US industrial sector. Supported by the recent influx of federal funding, states can create a regulatory and policy landscape that spurs local implementation, drives private investments, and complements federal incentives.

2022 Legislation in States by Key Topic Areas

Source: Great Plains Institute analysis based on data from Industrial Innovation Initiative, July 2022 Legislative Digest (December 2022). Note: Click on individual states in the map above to browse introduced or enacted legislation relating to carbon management, clean hydrogen, and low-carbon procurement.

The approaches described in the guide outline state policy options and current best practices that can help scale up industrial decarbonization solutions and positively affect local communities throughout the value chain. From retrofits to fuel switching, industrial decarbonization will have far-reaching upstream and downstream impacts on local jobs, health, and economies.   

The guide can be used in its entirety or as modules, should a state be particularly focused on an individual technology or policy. While there is no one-size-fits-all solution, carbon management, clean hydrogen, low-carbon procurement, electrification, and efficiency policies cut across industrial sectors and can be mixed and matched to greatly reduce a state’s industrial emissions. Additionally, cohesive state planning that emphasizes community engagement and impact, along with labor and workforce development considerations are critical components of any comprehensive plan to decarbonize a state.  

The six modules of the Guide

State Planning

The recommendations for state planning create cohesion and work as a part of the state’s larger decarbonization strategy. Supporting emerging technologies and cooperation among industrial sectors can help build markets for low-carbon industrial products and technologies while considering specific place-based needs. Investments in industrial decarbonization also serve as an opportunity to develop and implement projects in a way that prioritizes the health, safety, and economic activity of surrounding communities. 

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Labor and Workforce Development 

Investments in industrial decarbonization must be done in a way that benefits workers and prioritizes local communities. States can use this guide to craft policies that ensure industrial decarbonization goes hand in hand with the growth of good union jobs. In setting industrial decarbonization priorities, states can utilize these policy tools to grow the clean economy’s high-road workforce. 

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Carbon Management 

State policies play a critical role in helping individual carbon capture, transport, utilization, and geologic storage projects achieve feasibility. Carbon management is a key solution for eliminating process emissions from heavy industry. The policy approaches outlined in this guide can help a state provide investment certainty, enable cost reductions, and spur deployment for projects. 

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Clean Hydrogen 

Hydrogen holds great promise as a low- and zero-carbon fuel and chemical feedstock. It can be flexibly produced given available energy resources, and when burned generates high-temperature heat that industrial processes require. This guide identifies the state policies needed to reduce the cost of producing low- and zero-carbon hydrogen, spur deployment of new transport and distribution infrastructure, and help develop the consumer market. 

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Low-Carbon Procurement 

State procurement policies provide an opportunity for governments to lead by example. They are a critical lever to create a low-carbon product market and ensure reliable demand. This approach will help increase the deployment of new market-ready, low-carbon technologies through incentives or requirements for the public sector market. The policies set forth in the guide will be particularly effective for construction materials sectors, such as cement and steel, where state governments are one of the largest purchasers. 

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Electrification and Efficiency  

Many industrial processes can be electrified to reduce their direct emissions without impacting the final product. It is essential to pursue energy efficiency improvements in parallel with electrification to help offset expected increases in overall electricity demand. Efficiency measures described in this guide also have additional co-benefits, including the reduction of overall operating expenses, which can, in turn, lower the cost hurdle for other decarbonization solutions. 

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Taken together, this suite of “best practices” aims to help states think through the regulatory, financial, and geographic aspects of decarbonization. These recommendations are generally bipartisan and widely supported among I3’s industrial stakeholders — making the often dubbed, “hard to decarbonize,” industrial sectors a bit easier to approach.  


The Industrial Innovation Initiative (I3) is an ambitious coalition that aims to advance solutions key to decarbonizing the industrial sector through policy development and implementation, technology demonstration and adoption, and demand-side market development. The Initiative builds on years of stakeholder engagement and extensive work by its co-conveners, Great Plains Institute and World Resources Institute, to collaborate with government officials and advance decarbonization solutions important to the industrial sector. 

Keep up to date with I3 news by signing up for our monthly newsletter.  

For more information about I3 or to get involved, contact Gabrielle Habeeb at   

Gabrielle Habeeb, Kate Sullivan, Grace Olson

Industrial Innovation Initiative, Great Plains Institute