Breedon warns unclear carbon border rules threaten UK cement industry

UK-based Breedon Group has called for urgent government action to ensure fair treatment of domestic cement producers ahead of the UK's Carbon Border Adjustment Mechanism implementation on January 1, 2027, warning that unclear rules could undermine British manufacturing and threaten investment in low-carbon technologies, according to an April 7 press release.

The company, Britain's largest domestic cement manufacturer, submitted a response to HMRC's technical consultation highlighting concerns that key elements of the CBAM scheme remain undefined just months before the planned rollout. The mechanism aims to prevent carbon leakage by imposing charges on imports from countries with weaker climate policies, but Breedon said poorly designed rules could allow higher-carbon imports to gain unfair advantages over UK production.

The company outlined five priority areas requiring government attention, including early publication of CBAM rates and default emission values in 2026, supported by non-binding guidance on cement-specific methodology. Breedon also urged inclusion of the cement industry in current and future Energy Intensive Industry compensation schemes to address electricity cost gaps that the CBAM does not resolve, as UK producers face higher power costs than non-UK competitors.

Breedon cautioned that poorly calibrated default emission values could enable higher-carbon imports to underpay for their emissions, potentially undermining the mechanism's effectiveness. The company also called for strengthened product classification, verification and enforcement to prevent under-reporting and mislabeling of imported cement, which could give imports unfair advantages.

"Breedon welcomes the introduction of a UK CBAM as a critical step in addressing carbon leakage and ensuring UK manufacturers are not undercut by higher-carbon imports," said Chief Executive Rob Wood, adding, "However, key elements of the UK CBAM scheme remain unclear just months ahead of planned implementation in January 2027, risking continued pressure on UK cement production and the Government's ambitions to deliver 1.5 million new homes, whilst jeopardizing investment in low-carbon technologies to meet the UK's net zero ambitions."