Market News

 October 15, 2007
Cement Industry is Responsible for 5% of the Worlds GHG Production!

 California, USA -- The cement industry is in a tough position in this new, climate-concerned world. In addition to being vitally important to how countries develop or maintain their infrastructure, the very act of making cement is responsible for a massive amount of global greenhouse gas emissions.

In a report from David Adam of the Guardian newspaper in the U.K., some of the world's largest cement companies gathered in Brussels last week to consider the ways that they could reduce emissions from operations.

It's an uphill battle, Adam notes. Producing cement means burning coal to heat kilns to more than 2,700 degrees Fahrenheit, and the decomposition of limestone, an essential process in making cement, releases CO2 as well. From production to application, cement and the concrete it is needed for tends to result in higher emissions: concrete means new or wider roads, more buildings, and generally more energy use.

"No matter what you do, cement production will always release carbon dioxide. You can't change the chemistry, so we can't achieve spectacular cuts in emissions," Dimitri Papalexopoulos, managing director of Titan Cement in Athens, told Adam. "Cement is needed to satisfy basic human needs, and there is no obvious substitute, so there is a trade-off between development and sustainability."

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But the industry is well aware of the need to begin making cuts, especially as legislation on climate change takes off in Europe, the United States, and around the world. European companies already face caps on emissions under the E.U.'s Greenhouse Gas Emission Trading Scheme, and legislation in the U.S. is likely not far off.

The meeting last week in Brussels convened representatives of 18 companies, which are responsible for more than 40 percent of global cement production. The primary focus among the companies at the meeting was developing voluntary goals and reducing the energy intensity of the process, but Adam writes that some companies have begun to reduce their impact in advance of mandatory legislation.

"Most people are not even aware that making cement produces carbon dioxide," Adam quotes Howard Klee, coordinator of the Cement Sustainability Initiative. "It is an incredibly low-profile business and power companies, transportation and airlines get much more attention. But if producing carbon dioxide starts to cost businesses money, it looks like it will have a huge impact on [cement companies'] financial performance."

The development of the CSI is one sign of how the industry is anticipating changes. The group was created in 1999 by 10 cement companies, in partnership with the World Business Council for Sustainable Development, and currently counts 18 companies as members. The group said it is working on standards to make plants more energy-efficient, change the formulas they use in making cement, and other methods to reduce the emissions from production.

The CSI will release a progress report and guidelines for cement companies in February 2008.