Displaying items by tag: Sustainability

South Korea: Korea Cement Association (KCA) members have agreed to reduce their net CO₂ emissions to zero by 2050. To help them achieve this target, the state-owned Korea Development Bank has pledged US876m in investments in emissions reduction and green production upgrades by 2025, according to the Maeil Business Newspaper. The KCA says that 90% of local cement producers have increased their environmental, social and corporate governance investment and reduced their use of coal.

LafargeHolcim became Holcim this week with the launch of its new group identity. It also released a manifesto. Corporate names and logos come and go in the swirl of capital but straight up declarations of intent are rarer. Companies in the normally conservative building materials sector don’t tend to do this. This is more the terrain of political movements. So what’s going on?

Figure 1: From a merger of equals to building progress for people and the planet, the LafargeHolcim and Holcim logos.

Looking at the new logo gives us a few clues. The light grey-brown Tetris-style ‘L’ and ‘H’ letters symbolising the ‘merger of equals’ have gone. In its place come two circular symbols that look like they might connect. Together they give the impression of a slanted figure of eight or a lemniscate (infinity symbol). All of this is set to a few shades of blue and green. Could these two symbols be suggesting recycling or the circular economy? Who knows, but hopefully the advertising agency that came up with it was well remunerated. Luckily for us Holcim’s chief executive officer, Jan Jenisch, explained it, “Today marks a milestone for our company in our transformation to become the global leader in innovative and sustainable solutions.”

The manifesto is clearer. Entitled ‘Building progress for people and the planet’ it lays out some of the problems facing the world, such as population growth, urbanisation and climate change mitigation. It then addresses how Holcim is already tackling these issues and how it wants to go further in becoming part of the answer. This is the big vision so it doesn’t trouble itself with the detail on how, for example, the company is going to eliminate process emissions from clinker production on its journey to net zero. This is after all the big pitch to hearts and minds. It also doesn’t stain its fingers with anything suggesting who is going to pay for this grand noble ambition. We’ll have to wait for the next investor’s event to discover how much of this dream washes over into the private equity and pension fund crowd.

In Holcim’s defence, as one of the world’s largest building materials producers, it needs to carve itself a grand vision to occupy within a future preoccupied with climate change. Pretty much everyone in the developed world uses products manufactured by Holcim and its competitors even if they don’t realise it. Yet they are increasingly becoming more aware of the negative issues raised by environmental campaigners. Over in the developing world, adequate housing and infrastructure provision are live political issues for many as economies grow. Threading the needle to tie these trends together is quite the challenge for Holcim and the others. As a public company it serves its shareholders, but, as a multinational wedged in the middle of the climate change debate cascading into global politics, it ultimately answers to everyone. Hence a mission statement or a manifesto makes sense.

Meanwhile, for a glimpse on the Chinese approach to these kinds of problems, China National Building Materials (CNBM) subsidiary China Building Materials Academy (CBMA) signed a knowledge sharing agreement this week with the Canada-based International CCS Knowledge Centre to collaborate on carbon capture technology. The project plans to start with a 155kg CO2/day pilot on an active cement plant kiln. If successful, the study could lead to CNBM rolling it out across its entire cement operations. This would be hugely significant globally and given the scale of the Chinese industrial sector there’s also a reasonable chance it could happen at speed. If this occurred CNBM could leave the politics to its owner, the Chinese government.

Greece: Eurocert has awarded Platinum Zero Waste to Landfill certificates to all three of Titan Group’s cement plants in Greece. The producer said that the certification ‘reaffirms the excellent environmental performance’ of its Kamari, Patra and Thessaloniki cement plants. It says that the plants achieved the highest waste management certificate through effective waste prevention and proper management to avoid landfill.

Greece general manager Angelos Kalogerakos said “Titan is clearly committed to contributing substantively, through its operation and products, to the zero-waste goal. The Platinum Zero Waste to Landfill certification endorses and rewards the good practices that we have systematically applied for many years and that we have adopted in order to minimise our footprint and ensure a sustainable future for coming generations. We want to make all of our partners part of this commitment, aiming for a reliable and sustainable supply chain.”

There was good news from the corporate finance sector for cement producers this week in the form of an approving statement by Fitch Ratings. It declared that it expected the sector to be able to pass on the costs of decarbonisation to customers due to a lack of alternatives. It recognised the challenges posed by regulators, investors and societal pressure but, even so, it suggested that cement was still an industry worth backing. Or at least for now. Added to this, it forecast that demand for building materials would grow to support the transition to a low carbon economy and to combat the damage caused by climate change. It did admit that the capital or operating costs required to decarbonise are seen as being potentially large, especially with uncertainty over how much governments will pay or incentivise. Yet the timescales involved are beyond the ratings agency’s ‘horizon’ hence no really disruptive shifts in producer economics are expected anytime soon.

This was obviously a win for the cement industry and its cheerleading associations led by the Global Cement and Concrete Association (GCCA), the World Cement Association and the regional associations. After all, the increasingly convergent message to the wider world has been along the lines of ‘concrete is part of the solution and you need our products because there’s nothing else.’ Good timing then for the GCCA to launch its collaboration with the World Economic Forum, the ‘Concrete Action for Climate’ (CAC) initiative. The collaborative platform is planned to help drive the industry’s journey to carbon neutral concrete by 2050 as part of the wider Mission Possible Partnership, a wider coalition of public and private organisations working on setting the heavy industry and transport sectors towards net-zero. Expect lots more of these kinds of announcements on the road to the 26th UN Climate Change Conference of the Parties (COP26) taking place in Scotland in late October 2021.

Fitch Ratings did point out that societal awareness was likely to accelerate decarbonisation. The sharp end of this trend was experienced by the building materials industry this week when environmental activist group Extinction Rebellion forced operations to stop temporarily at LafargeHolcim’s Port de Javel ready-mixed concrete plant in Paris on 30 June 2021. This followed a similar incident by the same group at a LafargeHolcim subsidiary ready-mix plant in London in mid-2019. Given the share of global CO₂ emissions from the cement-concrete production chain, it is perhaps surprising that climate activists haven’t targeted clinker-producing cement plants directly in the same way that they have gone after coal-fired power stations. Clinker kilns are, after all, the source of the majority of the sector’s emissions. However, blockading a concrete plant in the city may conjure up a more potent media image than doing the same to a factory out in the country.

Instead the battles with cement plants and their quarries tend to be of a ‘not in my back yard’ (Nimby) nature. Or rather ‘not in my monastery (Nimmon?) this week, with the news that a subsidiary of YTL Cement in Malaysia is attempting to evict a group of Buddhist monks and their underground place of worship from a quarry on Mount Kanthan in Perak. In the latest twist of the long running saga, the monks have hit back with an attempt to get their portion of the site recognised as a place of worship and a heritage site. Thankfully a more positive example of how quarries can fit in with the wider community could be found this week in the guise of an archaeological dig at CRH subsidiary Tarmac’s Knobb’s Farm quarry in Cambridgeshire, UK. The discovery of a Roman Britain-era cemetery with a high proportion of decapitated bodies may have been gruesome but the relations between the operator and the archaeologists were much more harmonious. Another recent example was the discovery of what may be a new precursor species of humans, unearthed at a quarry run by Nesher-Israel Cement Enterprises site at Ramla in late June 2021.

The paradox building materials producers pose to environmental activists could be summed up by the record heat wave that hit the north-western region of North America recently. CO₂ emissions, in minor part produced by the cement and concrete industries, are the most likely reason for an increased frequency of extreme weather events such as this. Yet, infrastructure such as pavements and roads were widely reported as having buckled in the heat, principally because they weren’t built for such high temperatures. They will have to be rebuilt to withstand similar temperatures in the future. Building materials can thus be seen as both part of the problem and part of the solution. Yet with net zero targets nearly 30 years away it seems likely that continued extreme weather events and their potentially lethal consequences will speed up the public demand for decarbonisation. It is worth noting here that one of Extinction Rebellion’s demands in the UK is that the country should become net zero by 2025.

Fitch Ratings has cast its vote for now and Extinction Rebellion and its fellows are set to continue to wage their political campaigns. In the meantime it is debatable how much spiritual solace will be found by the monks of Mount Kanthan during blasting hours at the neighbouring quarry.

Canada: Lafarge Canada has signed a non-binding memorandum of understanding with carbon utilisation company, Carbon Upcycling Technologies. The agreement allows for the potential integration of Carbon Upcycling’s CO₂-embedded concrete additive into Lafarge operations and will explore opportunities to expand Carbon Upcycling’s operating capacity by developing larger processing facilities.

Carbon Upcycling produces an additive that makes concrete both stronger and more sustainable with the ability to reduce the carbon footprint of concrete by up to 25% on a lifecycle basis. Carbon Upcycling’s involvement into construction materials began in 2018 through its participation in the LafargeHolcim Accelerator program, which aimed to accelerate the growth of innovations in the building materials industry.

The deal aligns with Lafarge's Net-Zero 2030 pledge to accelerate green construction and combat the climate change crisis with low carbon concrete and circular economy solutions, and Carbon Upcycling goal to reduce overall CO₂ emissions by 600Mt by 2030.

UK: The Global Cement and Concrete Association (GCCA) has launched Concrete Action for Climate (CAC) in partnership with the World Economic Forum. The GCCA says that CAC will support industry, civil society, governments and investors to coordinate global climate actions towards 2050 net-zero targets. The initiative represents 40% of the global concrete and cement industry through the GCCA and will bring it together with external expertise and influence. It will achieve its aims by helping to help deliver and coordinate global climate action, stimulating demand for sustainable materials and ensuring appropriate financing and public policy is in place to help the sector reduce its carbon footprint, according to the association.

CAC chair Dominik von Achten said, “Concrete is vital to the development of the modern world, being used to develop key infrastructure like safe homes, bridges and hospitals, as well as supporting the transition to clean energy. Strong action to improve the sustainability of cement and concrete is already underway, but the industry needs to engage and collaborate with others to help drive collective action towards achieving carbon neutral concrete for the world. Today’s launch of the CAC platform is a great example of such collective action. It’s encouraging and exciting to see influential, global organisations from across the world come together to support the cement and concrete industry on its path to carbon neutrality.”

France: Cemex France has inaugurated a multi-service green building materials outlet and recycling centre at Genevilliers in Paris, Île-de-France. The company says that the facility will stock its reduced-CO₂ Vertua concrete range. It will also receive construction waste, excavated earth and rubble for use in concrete production or resale as aggregates. The company will offer complete traceability of waste received, and non-recyclable waste will be used in quarry restoration.

France North director of materials Alain Plantier said, "Developing construction in high-growth urban locations requires circular economy solutions which mitigate climate change and save natural resources while improving the wellbeing of inhabitants." He added “Cemex is uniquely positioned to provide integrated solutions for building and maintaining more sustainable and resilient cities, and this new site demonstrates this perfectly. Clients in Paris need low-carbon construction solutions which perform throughout their life cycle. Working together with our clients, this site will help to reduce the carbon footprint of new projects in line with Cemex’s Future In Action strategy – committed to net zero CO₂.”

Austria/Australia: Refractory producer RHI Magnesita and Calix say they have started a memorandum of understanding to develop a flash calciner for use in the production of refractory materials, to enable CO₂ separation for either utilisation or storage. The companies have agreed to run studies up to and including basic front-end engineering and design for a commercial-scale demonstration facility at an RHI Magnesita site.

RHI Magnesita and Calix started discussing a collaboration in early 2019. The application of Calix's technology to refractory products has been the subject of pilot scale test work during 2020, with larger scale test work currently underway.

Luis Bittencourt, chief technology officer of RHI Magnesita said, "We are pleased to be working with Calix on this project, which is a key part of the research and development programme on CO₂ emissions reduction that we are carrying out over the next five years. Together with our partners at Calix, we are seeking to develop new technologies for the capture, storage and utilisation of CO₂ that would otherwise be emitted during the refractory production process." Phil Hodgson, the managing director of Calix added that the company was also looking at strategic opportunities in its magnesium oxide businesses.

Philippines: Holcim Philippines says it is focusing on sustainability and invocation to its customers. At a virtual conference held in mid-June 2021, the building materials producer said that it is using more alternative low-carbon fuels and developing new products that contain less clinker. It added that builders could improve their carbon footprint by ensuring that structures are made with the right materials to meet strength and durability requirements without being overdesigned and that hardware stores could play a role in guiding customers to the correct building materials for their projects. The company is also working on its digital platforms to make customer transactions smoother.

“With our commitment to sustainability and innovation, we will develop the next generation of building materials that will help the country build better for the future. We want to continue to strengthen our collaboration with our customers to raise consumer awareness that these products support their aspirations for a greener and healthier Philippines," said Horia Adrian, Holcim Philippines’ president and chief executive officer.

UK: Fitch Ratings says it does not expect the financial profiles of cement producers to be changed by decarbonisation efforts in its rating horizon. The credit rating agency expects that regulatory scrutiny, investor pressure and societal awareness are likely to accelerate the building materials sector’s decarbonisation drive. However, it predicts that producers will pass on costs to consumers as there are no substitutes for its products. In addition, demand for building materials will grow, supported by increasing needs for infrastructure to cope with the transition to a low-carbon economy and the physical effects of climate change.

It added that, since there are no low carbon solution readily available, such improvements will require ‘significant’ investment and research. Fitch Ratings expect this to arrive after 2030 to meet the tight 2050 sustainability targets by both governments and companies. The cost of this may be large especially as government incentives to support it are, as yet, uncertain.

Fitch Ratings noted that the industry had made significant progress with an 18% reduction in the global average CO₂ intensity of cement production since 1990. However, due to growing demand for cement, the sector’s gross emissions have increased by 50%. It pointed out the large role China and India have to play in emissions reductions as they are the largest concrete producers in the world. However, Europe is seen as the most demanding region for decarbonisation regulations at present.