Researchers gauge lower emission concrete, steel price sensitivities

Sources: The Climate Group, London; CP staff

A global survey assesses construction and other industry stakeholder perspectives on two principal load-bearing materials produced at lower than normal levels of greenhouse gas emissions. Among respondents, 40 percent say they would be willing to pay a premium for emissions reductions of 25 percent or higher for concrete, while 47 percent would be willing to do so for reductions exceeding 50 percent. The respective numbers were 45 percent and 57 percent for steel. Nearly 80 percent of respondents expect lower emissions concrete and steel will be standard for new projects or products within the next decade, owing to market demand and regulatory pressures.

Survey results are presented in “The Steel and Concrete Transformation: 2024 market outlook on lower emission steel and concrete.” The report was released late last month at Climate Week NYC by The Climate Group and Ramboll Group A/S, an architectural/engineering firm with Copenhagen headquarters and North American offices. Climate Group hosts Climate Week NYC concurrent with United Nations General Assembly proceedings. Among its day to day initiatives are Concrete Zero and Steel Zero, each suiting GHG emissions reduction-minded producers and allies.

Climate Group and Ramboll researchers analyzed responses from 250-plus companies across 42 countries and 21 business sectors. While the outlook is broadly positive for climate-centered procurement, report authors examine respondent-cited barriers to low emissions concrete and steel adoption: Cost (84 percent of respondents), industry conservatism (37 percent), and lack of knowledge (33 percent). Businesses see financial levers such as tax incentives, credits, and subsidies (69 percent of respondents), carbon pricing (50 percent), plus minimum product standards or embodied carbon limits (43 percent) as priorities for regulators and other public officials.

“Business leaders are not only calling for change; they’re enacting it,” says Climate Group Head of Industry Jen Carson. “This report is a real temperature check of the market. It’s hugely encouraging to see the appetite is here, now, for organizations to pay a premium for lower emission steel and concrete. Actors across the value chain—suppliers, governments, and investors—should take note.”

“The fact that more companies are now willing to pay a premium for lower emission steel and concrete sends a strong signal to the market,” adds Ramboll Chief Operating Officer Michael Simmelsgaard. “To accelerate progress, all actors now need to come together—from policymakers and investors to off-takers of steel and concrete, as well as end users who will need to accept a price premium until the market matures. Let’s build on the momentum we have to drive a rapid and lasting decarbonization of heavy industries.”