How the cement industry could set an example in cutting carbon emissions

The global cement industry is making progress in its efforts to achieve net carbon neutrality, which could set an example for other sectors, even those less intensive in greenhouse emissions.

"The climate agenda is such a strategy for the sector that 20 years ago we understood the need to manage this issue and the cement sector created the largest database in the world. This group now comprises 48 companies worldwide," Gonzalo Visedo (pictured), the head of environment and sustainability at Brazilian cement producers’ association SNIC, told BNamericas. 

The database contains emissions and environmental indicators of the sector worldwide. The 48 large cement companies involved have some 850 plants.

"This database made all the difference in the carbon reduction strategy, since those who do not measure do not manage," said Visedo.

Cement production is a complex industrial process and intensive in the consumption of raw materials and energy, as well as greenhouse gas emissions. 

The industry globally accounts for about 7% of all carbon dioxide emissions. However, due to measures taken over recent decades, in Brazil the rate is just 2.3%.

The local industry implemented initiatives including the use of alternative raw materials, alternative fuels, energy efficiency measures and innovative and emerging technologies.

The decisions to take steps to reduce greenhouse gas emissions by cement players put the sector at an advantage compared to other industries at a time when the issue is under the scrutiny of stakeholders. 

"The major pressure to reduce and neutralize emissions today is from coming society and investors. Industries cannot adapt overnight. Anyone who does not incorporate low carbon discussions into their business will lose competitiveness. This is a matter of survival, a matter of competitiveness," said Visedo.

He said the cement industry has faced for years strict environmental rules.

"The licensing processes have always been very bureaucratic and also very rigid. A factory installation takes five years," he added.

The commitment of the cement industry to reduce carbon emissions will likely put companies in the sector at the forefront of the development of a carbon credit market and also open space for debt issues linked to sustainability goals.

Currently, the non-profit Climate Bonds Initiative (CBI) is holding a public consultation to insert more segments into the so-called transition bond market, which is for companies that are in the process of improving their footprint but are not yet eligible to access the green bond market.

"We initiated talks with CBI about that and currently companies are evaluating such financing mechanisms as this can help firms reduce financing costs," Visedo said.

He added that the cement industry's initiatives to move towards carbon neutrality can favor infrastructure and construction companies. The sector is in talks with the federal government to develop a Brazilian platform with details of the carbon footprint of various segments, which can be a key element for the development of a carbon credit market, Visedo said.