NACE International released a new study that measured the significant—and detrimental—impact that corrosion will have on the world’s economy; the study also examined the need for effective corrosion management programs (CMP) by industry.

The research, published in a 216-page report entitled “International Measures of Prevention, Application and Economics of Corrosion Technology” (IMPACT), estimated that the eventual global cost of corrosion to assets will equal $2.5 trillion—equivalent to roughly 3.4% of the global gross domestic product. The two-year study was released at the society’s March 2016 conference in Vancouver, British Columbia.

It examined the economics of corrosion and the role CMP play in establishing industry best practices. The study found that implementing corrosion prevention best practices could result in global savings of between 15% and 35% of the potential cost of damage, or between $375 million and $875 billion.

“The IMPACT study reinforces what recent news headlines have made all too clear: there needs to be a change in how corrosion decisions are made,” said Bob Chalker, CEO of NACE International. “Whether it is a pipeline, an airplane, a water treatment plant or highway bridge, corrosion prevention and control is essential to avoiding catastrophic events before it’s too late.”

Expanding on a discussion of corrosion’s cost to businesses and industries worldwide, IMPACT assessed corrosion management across various industries and regions. Specifically, the study examined the oil and gas, pipeline and drinking and wastewater industries, as well as the U.S. Department of Defense.

The report highlighted a case study of corrosion management within the automobile industry, which it considered a success story. Over time, the study said, corrosion management saved $9.6 billion, or 52% annually, in 1999 compared with 1975.

“Looking at the success within the auto industry, corrosion prevention decisions were made at the highest levels,” added Chalker. “The result has been lower corrosion costs for automakers and longer lasting autos for consumers.”

The IMPACT study covered energy business issues in depth, noting “corrosion has been a major cost in the operation of oil and gas facilities.

“The oil and gas industry is a capital-intensive industry with assets ranging from wells, risers, drilling rigs and offshore platforms in the upstream segment, to pipelines, LNG terminals and refineries in the midstream and downstream segments,” it noted.

The effectiveness of CMP within oil and gas can vary by “size, geographic location and culture of the companies,” it added. The breadth and effectiveness of corrosion control efforts “differed significantly,” it cautioned.

“When there are significant policy differences within the same company, this would indicate that the corrosion management policy is not truly integrated into the organization’s policy at the highest level, either deliberately or by omission,” it said.

“Lack of corrosion management can… lead to inefficient use of resources because corrosion control activities are not adequately prioritized on the basis of ROI [all costs including direct financial and safety and environmental risk].”

Within the oil and gas business, the report measured policy, stakeholder integration, organization, accountability, resources, communication, CMP, continuous improvement and performance measures for responding energy organizations. It discussed differences in regions and differences by business type. U.S. pipeline firms ranked high in organization, resources and CMP integration but lower in performance measures and policy.

Corrosion management systems typically address the threat of corrosion for existing and future assets across the complete lifecycle of the asset from design to decommissioning, the corrosion-focused organization explained in announcing the study.

NACE noted the IMPACT study outlines best practices for companies, including corrosion management systems that are integrated with organization policy overall, corrosion management information that is made available to everyone within an organization and linked to the organization’s overall goals, and organizational leadership that is actively involved in corrosion management decision-making.

The study also warned of the need for more corrosion management professionals, given there is a significant wave of retirements in this area projected in the next decade. NACE said the University of Akron in Ohio provides the only bachelor’s degree in corrosion engineering, with its first class graduating only in 2015.

“There needs to be a renewed sense of priority for corrosion engineering amongst employers and educators,” said Jim Feather, president of NACE International. “NACE has provided training and professional development to tens of thousands of engineers and professionals in more than 130 countries, but the industry needs more academic programs and more universal means of communications across all levels of business.”

NACE International has 36,000 members in 130 countries. Based in Houston with offices in the U.S., China, Malaysia, India, Brazil and Saudi Arabia and a training center in Dubai, the organization serves all industries impacted by corrosion and provides specific technical training and sets industry standards.

Paul Hart can be reached at pdhart@hartenergy.com