Decarbonizing Construction Industry for a Greener Future

A recent report by Deliotte - Shell indicates that the construction sector accounts for 37% of global CO2 emissions, of which 16% represent embodied carbon, that is carbon dioxide coming from material sourcing and manufacturing, logistics, and construction activities. This makes the construction industry one of the biggest single sectors to contribute to global warming, and therefore, vital for decarbonizing. Emissions from the production of construction materials, construction activities and logistics (embodied carbon) accounted for 5.4 gigatons of carbon dioxide in 2020 (16% of all global CO2 emissions). If business continues as usual, these emissions are forecast to remain significant beyond 2050.

Geographically, construction emissions are highest in countries such as China and India, where economies are rapidly developing and therefore construction volumes are higher. But regulation around embodied carbon in these markets is nascent. Developed economies such as the Western and Northern European countries and the USA, have smaller construction volumes on a per capita basis and here regulators are starting to act to restrict embodied carbon. Measures like the Emissions Trading System (ETS) in Europe and new subsidies introduced through the Inflation Reduction Act in the USA show clear signs of progress.