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Released August 21, 2019 | GALWAY, IRELAND
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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--European cement makers are coming under pressure to reduce their greenhouse emissions by two major investor groups with $33 trillion in assets under management.
Investor members of the Institutional Investors Group on Climate Change (IIGCC) and participants in Climate Action 100+, have set out their demands in a document titled "Investor Expectations of Companies in the Construction Materials Sector" and have sent it to the chairs of the board for CRH, LafargeHolcim (Lafarge) and HeidelbergCement, in addition to Saint-Gobain and others. The cement and construction industry, along with the oil and gas, metals and minerals, and power sectors are under increasing pressure to reduce their emissions. Cement, according to the IIGCC, is the source of 7% of global man-made carbon dioxide emissions. The group stated: "If the cement industry were a country, it would be the third-largest global emitter, behind only China and the U.S."
"The cement sector needs to dramatically reduce the contribution it makes to climate change," explained Stephanie Pfeifer, chief executive officer of Institutional Investors Group on Climate Change and a member of the Climate Action 100+ global steering committee. "Delaying or avoiding this challenge is not an option. This is ultimately a business-critical issue for the sector. Major economies such as the U.K. and France are increasingly adopting economy-wide net zero emission targets. The cement sector needs to get ahead of the profound transformation their sector faces by addressing barriers to decarbonisation in the short- to medium-term if companies are to secure their future."
Industrial Info is tracking some leading-edge projects in Europe that are aiming to reduce their emissions and power the production process with cleaner energy. In February, Industrial Info reported that Vattenfall was working with Cementa AB on the first project globally to electrify the production of cement. The CemZero project at Cementa's factory in Slite on the island of Gotland in Sweden has shown that "technical prerequisites exist for electrified cement production." For additional information, see February 11, 2019 article - World's First 'Zero-Carbon' Cement Plant Project Advances in Sweden.
In April, mining and smelting major Boliden (Stockholm, Sweden) signed a partnership agreement with energy company Vattenfall (Stockholm, Sweden) to work toward the electrification of its European mines and smelters. Boliden operates six mining units and five smelters in Sweden, Finland, Norway and Ireland. The Swedish company is one of the world's leading zinc producers, owning the largest zinc mine in Europe at Tara in Ireland, and is the largest producer of copper and nickel in Europe. Under the four-year deal, the companies will develop business solutions involving batteries, solar panels, electric transport and recycling of new-generation car batteries. For additional information, see April 17, 2019, article - Boliden and Vattenfall to Power Mines and Smelters with Clean Energy.
The group has recognised the steps HeidelbergCement "in particular has taken in already having committed to meeting key aspects of the investor expectations outlined." It is now calling on CRH, Lafarge and Saint-Gobain to follow suit, given the significant role they play as European-based multinationals, "with investors making clear the need for the companies to set net zero emission targets, as HeidelbergCement already has."
Vincent Kaufmann, chief executive officer of Ethos Foundation, added: "Construction materials companies may ultimately risk divestment and lack of access to capital as an increasing number of investors seek to exclude highly carbon-intensive sectors from their portfolios to meet their own decarbonisation plans. Thus, investors expect construction materials companies to substantially increase the R&D budgets available for research into decarbonising cement production."
Northern and Western Europe's cement sector, according to Industrial Info data, is home to about $1.9 billion of investment, led by the U.K. ($740 million), France ($437 million) and Germany ($324 million). About $433 million of the total is attributed to unit additions, while nearly $180 million is going toward environmental compliance. The latter could increase over the next few years. For additional information, see August 1, 2019, article - Cement Sector Sees Nearly $2 Billion in Northern, Western European Projects.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Our European headquarters are located in Galway, Ireland. Follow IIR Europe on: Facebook - Twitter - LinkedIn For more information on our European coverage send inquiries to info@industrialinfo.eu or visit us online at Industrial Info Europe.
Investor members of the Institutional Investors Group on Climate Change (IIGCC) and participants in Climate Action 100+, have set out their demands in a document titled "Investor Expectations of Companies in the Construction Materials Sector" and have sent it to the chairs of the board for CRH, LafargeHolcim (Lafarge) and HeidelbergCement, in addition to Saint-Gobain and others. The cement and construction industry, along with the oil and gas, metals and minerals, and power sectors are under increasing pressure to reduce their emissions. Cement, according to the IIGCC, is the source of 7% of global man-made carbon dioxide emissions. The group stated: "If the cement industry were a country, it would be the third-largest global emitter, behind only China and the U.S."
"The cement sector needs to dramatically reduce the contribution it makes to climate change," explained Stephanie Pfeifer, chief executive officer of Institutional Investors Group on Climate Change and a member of the Climate Action 100+ global steering committee. "Delaying or avoiding this challenge is not an option. This is ultimately a business-critical issue for the sector. Major economies such as the U.K. and France are increasingly adopting economy-wide net zero emission targets. The cement sector needs to get ahead of the profound transformation their sector faces by addressing barriers to decarbonisation in the short- to medium-term if companies are to secure their future."
Industrial Info is tracking some leading-edge projects in Europe that are aiming to reduce their emissions and power the production process with cleaner energy. In February, Industrial Info reported that Vattenfall was working with Cementa AB on the first project globally to electrify the production of cement. The CemZero project at Cementa's factory in Slite on the island of Gotland in Sweden has shown that "technical prerequisites exist for electrified cement production." For additional information, see February 11, 2019 article - World's First 'Zero-Carbon' Cement Plant Project Advances in Sweden.
In April, mining and smelting major Boliden (Stockholm, Sweden) signed a partnership agreement with energy company Vattenfall (Stockholm, Sweden) to work toward the electrification of its European mines and smelters. Boliden operates six mining units and five smelters in Sweden, Finland, Norway and Ireland. The Swedish company is one of the world's leading zinc producers, owning the largest zinc mine in Europe at Tara in Ireland, and is the largest producer of copper and nickel in Europe. Under the four-year deal, the companies will develop business solutions involving batteries, solar panels, electric transport and recycling of new-generation car batteries. For additional information, see April 17, 2019, article - Boliden and Vattenfall to Power Mines and Smelters with Clean Energy.
The group has recognised the steps HeidelbergCement "in particular has taken in already having committed to meeting key aspects of the investor expectations outlined." It is now calling on CRH, Lafarge and Saint-Gobain to follow suit, given the significant role they play as European-based multinationals, "with investors making clear the need for the companies to set net zero emission targets, as HeidelbergCement already has."
Vincent Kaufmann, chief executive officer of Ethos Foundation, added: "Construction materials companies may ultimately risk divestment and lack of access to capital as an increasing number of investors seek to exclude highly carbon-intensive sectors from their portfolios to meet their own decarbonisation plans. Thus, investors expect construction materials companies to substantially increase the R&D budgets available for research into decarbonising cement production."
Northern and Western Europe's cement sector, according to Industrial Info data, is home to about $1.9 billion of investment, led by the U.K. ($740 million), France ($437 million) and Germany ($324 million). About $433 million of the total is attributed to unit additions, while nearly $180 million is going toward environmental compliance. The latter could increase over the next few years. For additional information, see August 1, 2019, article - Cement Sector Sees Nearly $2 Billion in Northern, Western European Projects.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Our European headquarters are located in Galway, Ireland. Follow IIR Europe on: Facebook - Twitter - LinkedIn For more information on our European coverage send inquiries to info@industrialinfo.eu or visit us online at Industrial Info Europe.
