INTERVIEW: Circularity, regulation vital for cement industry decarbonization goals: GCCA

Global leaders, policymakers, public authorities, urban planners, developers, and built environment practitioners convened at the Circular Cities and Policy Summit, hosted by the Global Cement and Concrete Association in partnership with Mexico City from June 3-6.

Platts, part of S&P Global Commodity Insights, spoke with Thomas Guillot, chief executive of GCCA, about sustainability in the cement industry and various GCCA initiatives aimed at increasing the adoption of low-carbon cement and concrete.

The interview has been edited for length and clarity.

Platts: GCCA launched the world's first low-carbon rating for cement and concrete in April. What has the response been so far?

Thomas Guillot: The low-carbon ratings are invaluable for the industry and our customers, as they provide a clear definition of low-carbon cement and concrete. We began by asking how to define green materials, and the resulting ratings have received approval from various global stakeholders. A clear definition is essential for decarbonizing the industry, enabling customers to identify and differentiate products. These ratings will help establish a procurement framework and assist governments and private suppliers in prioritizing lower-carbon cement and concrete.

To facilitate adoption, we are leveraging our deep co-operation with national and regional cement and concrete associations, explaining the rationale and showcasing how the ratings function. These associations, governments, and stakeholders can adapt the concept to their local markets while maintaining the core rationale.

We aim to raise global awareness about these ratings and are focusing on customer engagement and creating procurement frameworks with governments and public procurement agencies to promote worldwide adoption.

Platts: How will these ratings contribute to developing the procurement framework for cement?

Guillot: Cement procurement is inherently local, and the ratings allow for adaptation to local conditions. We are collaborating with UNIDO on various initiatives, including developing a procurement framework to accelerate decarbonization and the adoption of low-carbon cement.

For instance, we have partnered with UNIDO Thailand to secure funding for decarbonization efforts that align with local requirements, including procurement and regulations for low-carbon cement. We aim to disseminate these ratings widely in Asia and among other national partners globally.

Platts: How else is GCCA promoting the decarbonization of the industry? Is funding available for low-carbon cement?

Guillot: Significant funding is earmarked for just transition, and our goal is to ensure that it drives tangible impacts. Many projects remain at the study stage, and we need to shift that paradigm by creating a pipeline of actionable projects and a roadmap to achieve net-zero goals. We are actively engaging with national associations to understand local realities and identify available projects, policies, and funds.

Our low-carbon strategy also focuses on supplementary cementitious materials for effective carbon management. The carbon capture value chain is also critical, as technology must evolve to handle the substantial carbon produced during manufacturing. Identifying and enabling necessary regulatory support is essential; circularity and regulations are vital for achieving our goals.

While developed economies have existing standards, UNIDO is facilitating adoption in emerging economies. Convincing consumers to transition will take time, and while we we have 25 years to get to net zero, we know we need to make progress now to help accelerate change.

Platts: Who will finance this transition and support decarbonization projects? Are customers willing to pay a premium for low-carbon cement?

Guillot: While some projects have secured funding, many have not. The cement industry is making greater financial commitments than many other sectors, but we are still far from what is necessary. A clear roadmap on financing would greatly benefit the cement industry. Where there is support available for the industry's transition, we are fully prepared to act.

Transitioning to low-carbon options is feasible with available SCMs, but achieving near to zero or net-zero status is more challenging and costly. As we move toward deep decarbonization, a market must exist, which is why we differentiate between low-carbon and net-zero ratings.

Determining who will pay is complex, but we aim to establish a procurement framework and regulations that create a chain of custody similar to green electricity, which is priced differently. We envision a net-zero chain of custody model that connects sellers with appropriate customers for the right cement.

We also want to extend co-processing to all parts of the world. Industrial assets can utilize low-quality energy, and through waste-to-energy initiatives, we can offer local communities solutions for waste treatment, providing access to alternative fuels and systematic waste usage. This is already happening in Europe, where some plants use up to 90% alternative fuels. The cost impact varies by location, but this approach ensures that polluters contribute to waste treatment, providing cement with a viable solution for specific waste categories. Partnerships with local authorities, as seen in Mexico City, are essential for success.