29 April 2022
It’s a fact that construction projects are often reliant on global supply chains for materials. This has been brought into sharp focus over the last year with a global supply crisis driven by pent up demand, a lack of capacity at ports and rising shipping costs.
But in a society aiming for net zero transition, the issue should not just be about whether construction materials make it to site. It needs to be about the carbon impact across a material or product’s lifecycle.
There is currently a significant shortcoming in UK net zero legislation because emissions targets can be met, or partially met, by buying more imported goods in place of domestic production. This simply moves responsibility for emissions to other countries.
Emissions from imported products across many parts of the economy – including imported construction materials – have effectively been ‘offshored’, leaving the problem as out of sight and out of mind.
The UK must provide an honest account of its progress to net zero. This means taking responsibility for emissions from both materials and goods produced in the UK, as well as those production emissions from foreign imports.
A failure to do this will undermine the UK Government’s commitment to tackle climate change and the credibility of domestic action in the fight to reduce emissions.
The Environmental Audit Committee has rightly highlighted this issue and proposed a “carbon border adjustment mechanism” (CBAM). This would help create a level playing field so that importers face the same carbon cost as domestic manufacturers of materials such as cement which is a key ingredient in concrete.
Concrete is a locally sourced construction material with 95% being manufactured in the UK. However, the cement used in concrete is produced domestically and imported. Cement imports currently represent 23% of the UK market. Imports/net imports currently equate to 2.6 million tonnes of manufactured cement and around 1.85 million tonnes of CO2 that the UK is not taking environmental responsibility for via national carbon accounting.
With unequal carbon pricing across borders and the cumulative impact of high domestic energy prices, carbon leakage is both a present and future threat.
The recently published energy security strategy recognised the support that energy intensive industries require to have UK energy prices brought down to levels in line with the rates paid by competitors in other countries. However, a level playing field in terms of carbon cost is also required alongside this to further mitigate the risk of carbon leakage.
If not tackled this could see even more cement production move outside the UK, resulting in further loss of manufacturing jobs, increased uncertainty on security of supply and an increase in overall global emissions.
The UK concrete and cement industry is focused on its transition to net zero but a just transition requires a level playing field and to ensure that high value manufacturing jobs are not lost.
The benefit of a border levy, which the Environmental Audit Committee has said should be launched this decade, is that it would incentivize industries abroad looking to export to the UK to reduce the emissions associated with their goods. The EU is proposing a similar levy to be introduced by 2023.
For construction, there needs to be greater understanding of where materials come from and critically the associated emissions. Global supply issues have shone a light on complex construction logistics. Net zero will require an even greater understanding of associated emissions and taking collective responsibility.
By Diana Casey, Mineral Products Association