Displaying items by tag: European Commission

Saint-Gobain looks set to increase its presence in the construction chemicals market this week when it announced a deal to buy Fosroc. A definitive agreement has been set for the acquisition valued at just over US$1bn. The purchase will be financed in cash and is expected to close in the first half of 2025.

The light construction materials company has been growing its construction chemicals capabilities for several years now. In 2021 it acquired Chryso for Euro1.02bn and then it bought GCP Applied Technologies for Euro2.3bn in 2022. Acquisitions of smaller companies in the sector, including Duraziv and IMPAC, also took place. With regards to the proposed Fosroc transaction, Saint-Gobain highlighted in its press release that the deal was “supported by solid macroeconomic factors including the transition towards low-carbon concrete.” It also noted that Fosroc’s geographic profile would strengthen its own presence in emerging markets such as India and the Middle East. Chryso’s market share is mainly in Europe, Turkey and Africa. GCP’s is in North America, Latin America and Asia-Pacific.

As Riccardo Stoppa, Saint-Gobain’s Business Director of Cement additives related to Global Cement Magazine in our May 2024 issue, the Construction Chemicals Business Unit of Saint-Gobain’s High Performance Solutions (SGHS) division broadly produces two groups of products for the cement and concrete sector: additives and admixtures; and a wider range of more recent products using newer chemistry approaches. Saint-Gobain’s total annual revenue is around €48bn/yr with SGCC’s contribution weighing in at around €1bn/yr. Most of that latter revenue derives from the former businesses of Chryso and GCP. Finally, Stoppa highlighted SGCC’s strength in North America, Europe and China but also highlighted the potential in the Middle East for its products. That last point makes interesting reading in light of the current Fosroc deal.

India was flagged as a benefit of the proposed Fosroc purchase. If any further reminder of the growth and market consolidation taking place there were needed, UltraTech Cement revealed this week that it is in the process of buying a 23% share of The India Cements. This story ties into the rivalry between the country’s two largest cement companies. Both UltraTech Cement and Adani Group are mounting up production capacity at pace through both acquisitions and by building new plants. All of this is rosy news for a company selling additives and admixtures to the cement and concrete market.

Saint-Gobain latest acquisition is subject to the usual regulatory conditions as one might expect. Yet, what Saint-Gobain didn’t mention in its statement, was that it reportedly had one of its sites in Türkiye visited in late 2023 as part of an international investigation into anti-competitive behaviour in the sector. Switzerland-based Sika was also linked to the case at the time. The UK-based Competition and Markets Authority (CMA) announced in October 2023 that it had launched an investigation into suspected anti-competitive conduct in relation to the supply of chemicals for use in the construction industry. It said it was working with the European Commission and that it had been in contact with other authorities, including the US Department of Justice, Antitrust Division. At this time Sika confirmed to Construction News that inspections had taken place into “suspected antitrust irregularities in the area of additives for concrete and cement.” However, it is important to note here that these were merely information gathering activities and no accusations of any breaches of competition law have been made so far. All of this suggests that Saint-Gobain does not seem too troubled by the interest of the various competition bodies with regards to its expansion plans.

In his interview, Stoppa told Global Cement Magazine that SGCC’s products allow cement and concrete producers to reduce the amount of cement used in their concrete. This is almost heretical thinking to a world that produces too much clinker. Yet Saint-Gobain is betting on exactly this outcome through the expansion of its construction chemicals division. Its purchase of Fosroc is the latest stage in this line of thought. It’s not the only company doing this. In May 2023 Sika completed its purchase of MBCC Group, another admixture manufacturer. Further sector consolidation looks likely.

Belgium: Holcim kicked-off its Go4Zero project at its Obourg plant on 16 May 2024 in an event attended by the Belgian Prime Minister Alexander De Croo and the European Commissioner for Climate Action Wopke Hoekstra. The €500m Go4Zero project, supported with €230m of funding from the European Union, will enable the integrated plant to reduce its CO₂ emissions by 30% by 2027 and to produce 2Mt/yr of CO2-free cement by 2029. When fully operational, the Obourg plant will capture 1.2Mt/yr of CO₂.

The Go4Zero project incorporates a number of approaches to achieve net-zero CO₂ cement. The centrepiece is an oxy-fuel combustion process to generate an easy-to-handle exhaust gas with up to 80% CO₂. This will be coupled to a cryogenic purification unit to generate a >99%-pure CO₂ stream .The project will also make use of waste heat recovery (WHR), new exhaust filtration equipment and Europe’s largest floating solar panel farm.

EU: The European Commission has introduced a Draft Guidance document regarding the Free Allocation Regulation (FAR), now expanded to include ‘alternative hydraulic binders’ within the cement clinker benchmark. To qualify for allocation under this benchmark, these binders must meet three specific criteria: they must be used in cement production, not be included in any other benchmark under the European Union's Emissions Trading Scheme (ETS), and must not be by-products of waste or other production processes.

The European Cement Association (CEMBUREAU) has expressed concerns regarding these criteria. Namely, that the proposed changes suggest a shift from a clinker to a cement-based benchmark approach, making current methodologies and regulations inconsistent and impractical, especially as cement production often occurs outside ETS-covered sites. CEMBUREAU also states that some materials like pozzolana and calcined clay, requiring activation by lime or grey cement clinker, do not fit the hydraulic binder definition. Lastly, the association suggests that only materials covered by the standard EN 197-1 should be considered as alternative hydraulic binders, implying that the current definition in the FAR is overly broad and potentially problematic.

Czech Republic: The Czech Cement Association (SVC ČR) says that it is “firmly” committed to decarbonise the cement industry and has agreed a clear roadmap explaining how to reach net zero by 2050. It added that it was also backing the strategy outlined in the European Commission’s (EC) industrial deal. In a statement the association said, “The position of SVC ČR regarding the proposal of the decarbonising targets by 2040 is that the Czech government has to prepare in cooperation with the individual industries a deep analysis of the opportunities and the risks arising from the new proposal and prepare a long-term strategy to support the competitiveness of Czech energy-intensive industries.”

SVC ČR distanced itself from comments published in ČTK Business News reporting that a group of energy-intensive industry associations in the country had challenged the EC's proposal to aim to reduce CO₂ emissions by 90% by 2040. The associations argue that the target will harm the competitiveness of Czech industries. They say that it is based on unrealistic assumptions and overlooks the absence of necessary conditions for major investment in the EU’s green industry transformation.

This story was updated on 29 February 2024 with comments from SVC ČR

EU: Cemex has welcomed the European Commission's Carbon Management Strategy, its new policy approach to industrial CO₂ emissions reduction. The approach highlights the storage of biogenic CO₂ and the development of CO₂ transport infrastructure as major strategic paths. Cemex said that it will assist in the design and implementation of actions under the Carbon Management Strategy. In its European cement operations, Cemex reduced its CO₂ intensity by 45% in 2023 compared to 1990 levels, and aims to achieve a 55% reduction by 2030. The producer called for ‘the completion of the policy landscape’ in complement to the industry’s on-going efforts towards full decarbonisation.

Cemex Europe, Middle East and Africa director communications, public affairs and social impact Martin Casey said “The strategy is comprehensive and outlines relevant fields of action, but what is essential now is a timely implementation. For companies to move forward, the regulatory framework regarding carbon capture and utilisation or storage, along with carbon accounting and removals, must be completed as a matter of the utmost urgency. The cement plant of 2030 is planned and designed today.”

Latvia: Schwenk Latvija plans to build a 750,000t/yr carbon capture system at its 2Mt/yr Brocēni cement plant. The producer has hired Norway-based Capsol Technologies to conduct a CapsolEoP carbon capture feasibility study at the plant. Schwenk Latvija is a member of the CCS Baltic Consortium, which achieved provisional inclusion on the European Commission’s list of Projects of Common Interest in November 2023.

Schwenk Northern Europe CEO Reinhold Schneider said “Checking the best carbon capture methods and how they can be integrated with our production process is a crucial task for us on the way to carbon neutrality, and likely the major investment direction for the coming decade. To that end, we are excited to investigate the energy consumption and the scale of equipment required for carbon capture at the Brocēni plant, if potentially partnering with Capsol for this challenge.”

Capsol Technologies CEO Jan Kielland said “We are excited to work with Schwenk, one of the most innovative building materials producers in Europe, which has constantly improved its processes to reduce emissions since operations started at the Brocēni plant’s new kiln line in 2010” He added “With this feasibility study, we are taking another step towards building a position as the preferred carbon capture technology provider for cement.”

Capsol’s project pipeline includes 10 large-scale cement projects in the sales engineering and engineering studies phase. The total CO₂ capture capacity of these projects is 11Mt/yr.

Belgium: The government of Wallonia and the European Commission’s Just Transition Fund (JTF) have awarded funding to CBR Cement, CCB and Holcim Belgique to support the reduction of CO₂ emissions from Wallonia’s cement plants by 50%. The efforts will focus on renewable energy projects, including the construction of new waste heat recovery (WHR) systems. Alongside two steel plants, the companies will share Euro282m-worth of funding for projects across their four cement plants. The L’Echo newspaper has reported that Wallonia will contribute Euro169m, while the JTF will contribute the remaining Euro177m. The projected cost of planned decarbonisation projects in the Wallonian cement and steel industries is Euro346m. The proposed projects will increase the number of people employed across the sectors by 6.4% to 2773.

Poland: The European Commission has granted Lafarge Polska, Air Liquide Polska and energy provider Orlen Euro2.54m in funding for their construction of a 3Mt/yr CO₂ terminal in Gdansk, Pomeranian Voivodeship. The terminal will transmit captured CO₂ from local industrial sites, including 1Mt/yr from Lafarge Polska’s Kujawy w Blelawach cement plant in Kuyavian-Pomeranian Voivodeship, for sequestration below the North Sea. ISB News has reported that the partners will use the European Union funding to complete plans, including front-end engineering design, for the terminal.

Europe: The European Parliament voted in favour of multiple amendments to the European Commission’s Packaging and Packaging Waste Regulation (PPWR) on 22 November 2023. The amendments remove, modify or make non-binding the PPWR’s 2040 reuse targets. Meanwhile, 2030 targets were made adjustable to recycling rates. Total packaging volumes are still required to drop by 5% by 2030 and by 15% by 2040 in each member state.

Sustainability lobbying organisation Environmental Coalition on Standards (ECOS) described the introduction of recycling rates into a lower schema of waste targets as ‘comparing apples with pears.’ ECOS attributed the amendments to a ‘barrage’ of false claims, scaremongering and lobbying from industry players.

ECOS programme manager Mathias Falkenberg said “This decision will not sufficiently address rising plastic and packaging waste or the pollution crisis. The European Parliament has just weakened a perfectly feasible solution to tackle throwaway culture without offering an alternative. It is very frustrating that the European Commission’s progressive prevention and reuse agenda has not received full support from the Parliament today.”

ECOS founded the Alliance for Low-Carbon Cement & Concrete (ALCCC), an association of companies focused on alternative building materials production, in May 2023.

Europe: The EU has enacted the implementing regulation for the carbon border adjustment mechanism (CBAM) under its emissions trading scheme (ETS). Under the CBAM, importers of cement to the EU will eventually pay taxes for its embedded CO₂ emissions, equivalent to those levied against EU-based producers. Importers must begin to collect emissions data from 1 October 2023, and submit a report for the fourth quarter of 2023 to EU authorities by 31 January 2024. No financial adjustment will yet be payable during the transition period to full CBAM implementation from the start of 2026.

The Asset newspaper has reported that dedicated IT tools and training materials for importers affected by the CBAM are currently in development, according to the European Commission.