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Building Demand for Low-Carbon Materials: How Market Demand can Accelerate Cement and Steel Decarbonisation in Europe

December 8, 2023 Category: Industry

This report, produced by Trinomics for Clean Air Task Force, provides an analysis of how demand-side measures can significantly contribute to the decarbonisation of Europe’s industrial sectors. Focusing on the steel and cement industries, known for their high CO2 emissions, the report also presents a detailed examination of the current and potential role of the EU Emissions Trading System (ETS) in driving these industries towards a more sustainable future. 

Key insights: 

  • Strategic focus on heavy industries: The report emphasises the need for a paradigm shift in Europe’s steel and cement industries, urging comprehensive technological innovation and significant investment to meet ambitious climate neutrality goals. 
  • Crucial role of EU Emissions Trading System: An in-depth analysis of the EU ETS highlights its central role in driving decarbonisation efforts. The study predicts an increasing impact of ETS pricing, further supported by policies like the Carbon Border Adjustment Mechanism (CBAM). 
  • Demand-side initiatives: The report explores a range of government and industry-led initiatives, such as Green Public Procurement, product standards, and voluntary purchasing pledges, highlighting their potential in catalysing the demand for low-carbon products. 
  • Consistent, high-ambition standards: Deployment of deep decarbonisation technologies such as carbon capture and storage and hydrogen requires standards that recognise and incentivise significant carbon intensity reductions, alongside more incremental measures. 

This report provides forward-thinking recommendations, emphasising the growing importance of sustainable procurement policies and product regulations in driving industrial decarbonisation. It suggests innovative financing models to bolster the adoption of low-carbon solutions.