Sustainability Atlas
Food, Agriculture & Materials·10 min read·

Case Study: Low-Carbon Materials (Cement, Steel, Timber) — A Leading Company's Implementation and Lessons Learned

How SSAB, Heidelberg Materials, and mass timber pioneers are cutting embodied carbon by up to 95% through green steel, carbon capture, and engineered wood.

Case Study: Low-Carbon Materials (Cement, Steel, Timber) — A Leading Company's Implementation and Lessons Learned

Buildings account for 39% of global energy-related carbon emissions, with 11% coming from embodied carbon—the emissions generated during material extraction, manufacturing, and construction before anyone even occupies the building. Steel and cement production alone represent approximately 14% of global CO₂ emissions. As the global building stock is expected to double by 2050, upfront embodied carbon will account for roughly half of new construction's carbon footprint. This reality has pushed leading companies to pioneer breakthrough approaches in low-carbon materials, offering valuable lessons for organizations seeking to decarbonize their supply chains.

Why It Matters

The construction industry faces an urgent decarbonization challenge that cannot be solved through operational efficiency alone. While energy-efficient buildings reduce emissions from heating and cooling, the carbon embedded in concrete, steel, and other materials is released during manufacturing—before construction even begins. The World Green Building Council has set ambitious targets: 40% reduction in embodied carbon for all new buildings by 2030 and net-zero embodied carbon by 2050.

Policy momentum is accelerating this transition. The US Federal Buy Clean Initiative has already procured over $4 billion in low-carbon materials and established environmental product declaration (EPD) requirements for federally funded projects. Thirteen states have aligned on procurement standards, while the EU's Carbon Border Adjustment Mechanism (CBAM) is reshaping competitive dynamics for material exporters. For companies in the construction value chain, acting now on low-carbon materials is both a regulatory imperative and a competitive opportunity.

Key Concepts

Embodied Carbon

Embodied carbon encompasses all greenhouse gas emissions from material extraction, manufacturing, transportation, construction, and end-of-life disposal. For a typical building, the foundation and structure account for approximately 80% of total embodied carbon. Unlike operational carbon, which can be reduced over a building's lifetime through efficiency upgrades, embodied carbon is essentially "locked in" at the moment of construction.

Green Premiums

Green premiums represent the additional cost of low-carbon alternatives compared to conventional materials. Current market data shows significant variation: low-carbon cement commands approximately 75% higher costs than conventional cement at the B2B level, though this translates to only 1.5-3% for end consumers. Green steel premiums in Europe have fluctuated between €50-140 per tonne, while hydrogen-based steel production adds roughly $225-231 per tonne at current hydrogen prices of $5/kg. However, these premiums translate to minimal impacts on final products—approximately $208 per automobile (less than 1% of vehicle price) or $563 per residential unit.

Buy Clean Policies

Buy Clean policies leverage government purchasing power to create demand for low-carbon materials. The US Federal Buy Clean Initiative, backed by $2.15 billion in Inflation Reduction Act funding, requires Environmental Product Declarations for steel, concrete, asphalt, and flat glass on federally funded projects. The EPA is developing a labeling program similar to Energy Star for construction materials, with global warming potential (GWP) thresholds being established for key material categories.

What's Working

Hydrogen-Based Steelmaking Achieves Commercial Readiness

SSAB's HYBRIT (Hydrogen Breakthrough Ironmaking Technology) project has demonstrated that fossil-free steel production is technically and commercially viable. After six years of pilot operations (2018-2024), the consortium of SSAB, LKAB, and Vattenfall has produced over 5,000 tonnes of hydrogen-reduced sponge iron with superior quality—98-99% metallization compared to conventional processes. The resulting steel emits less than 0.05 kg CO₂e per kg, compared to 2.2 tonnes CO₂e per tonne for traditional blast furnace steel—a reduction exceeding 95%.

The project has secured commercial customers including Volvo Group, Amazon Web Services, and Epiroc. In February 2025, HYBRIT successfully demonstrated large-scale underground hydrogen storage in lined rock caverns, achieving 25-40% cost savings on variable hydrogen production. This breakthrough addresses a critical bottleneck: the intermittency of renewable electricity for hydrogen production.

Carbon Capture Enters Industrial Scale for Cement

Heidelberg Materials has reached a pivotal milestone with the completion of construction at its Brevik, Norway cement plant—the world's first industrial-scale carbon capture and storage (CCS) facility in the cement industry. The system will capture 400,000 tonnes of CO₂ annually, representing 50% of plant emissions, when operations commence in 2025. The captured CO₂ will be transported to permanent storage beneath the North Sea as part of Norway's Longship CCS project.

This approach addresses a fundamental challenge: two-thirds of cement emissions come from limestone calcination, a chemical process that cannot be eliminated through fuel switching or efficiency improvements. Only carbon capture can address these unavoidable process emissions at scale.

Mass Timber Demonstrates Carbon Storage Potential

Mjøstårnet in Brumunddal, Norway—an 85.4-meter, 18-story mass timber building completed in 2019—has proven that engineered wood can replace steel and concrete in tall buildings while sequestering carbon. The structure used approximately 11,000 trees (2,600 m³ of timber), locking in over 2,000 tonnes of CO₂. According to environmental assessments, this approach achieved up to 85% reduction in material production emissions compared to conventional steel and concrete construction.

The project demonstrated that glue-laminated timber (glulam), cross-laminated timber (CLT), and laminated veneer lumber (LVL) can meet stringent fire safety requirements—load-bearing elements withstood 120 minutes of fire exposure in testing. Prefabricated components enabled rapid construction, with the building rising four stories at a time without external scaffolding.

What Isn't Working

Green Premium Gap Persists in Key Markets

Despite technical progress, significant gaps remain between production costs and market willingness to pay. In China, green steel production costs run approximately $140 per tonne higher than conventional steel, but buyers are only willing to pay $20 per tonne in premiums—a sevenfold gap that discourages production scale-up. In the United States, no meaningful green steel premium has emerged as of late 2024, partly because electric arc furnace (EAF) production already dominates (70% of output) and the market has not differentiated further.

CCUS Remains at Early Stage for Most Cement Producers

While Heidelberg Materials leads with its Brevik facility, carbon capture and utilization/storage (CCUS) technology remains at prototype stage (Technology Readiness Level 6) for the broader cement industry. Near-zero emissions cement represents less than 1% of global capacity. The industry faces an estimated $20 billion investment gap needed by 2030 to scale CCUS meaningfully. Heidelberg's Lengfurt, Germany facility—with only 70,000 tonnes annual capture capacity—illustrates the challenge of scaling smaller carbon capture utilization (CCU) projects.

Supply Chain and Certification Bottlenecks

The lack of standardized EPDs and life cycle assessment (LCA) data across supply chains creates friction for procurement teams seeking to specify low-carbon materials. While the EPA has distributed $42.5 million in EPD assistance grants to the concrete industry across all 50 states, many smaller suppliers lack the resources to develop verified environmental claims. Product Category Rules (PCRs) are still being finalized for key material categories like asphalt mixtures, creating uncertainty for both suppliers and buyers.

Real-World Examples

1. SSAB HYBRIT — Fossil-Free Steel at Commercial Scale

SSAB's transformation demonstrates how established industrial players can lead decarbonization. The company committed to converting its entire Nordic steel production to fossil-free processes by 2030, with commercial deliveries already underway. Vattenfall's order for the world's first fossil-free dam gate (120 tonnes of steel, saving 200 tonnes CO₂) showcases how infrastructure operators can drive demand. The lesson: long-term technology partnerships (SSAB, LKAB, Vattenfall since 2016) and anchor customers willing to pay premiums during scale-up are essential.

2. Heidelberg Materials Brevik — First-Mover in Cement CCS

Heidelberg Materials' investment in Brevik, with technology partner SLB Capturi, demonstrates that carbon capture can reach industrial scale in cement production. The company is already replicating the approach with projects in Padeswood, UK (800,000 tonnes CO₂/year capacity, planned for 2029) and Edmonton, Canada (targeting 1 million tonnes CO₂/year and carbon-neutral cement by late 2026). The lesson: securing government partnerships (Norway's Longship program) and committing to multiple facilities simultaneously signals credibility to investors and customers.

3. Mjøstårnet — Mass Timber Goes Mainstream

The Mjøstårnet project showed that mass timber can work for complex mixed-use developments including hotels, apartments, offices, and even swimming pools. Local sourcing—timber from Moelven Limtre, just 17 km away—minimized transportation emissions. Norwegian reforestation requirements (replanting within three years of harvest) ensured carbon neutrality of the wood supply. The lesson: mass timber projects succeed when they leverage regional forestry infrastructure and address fire and acoustics concerns through proven engineering solutions.

Action Checklist

  • Conduct embodied carbon baseline: Use tools like the EC3 calculator (buildingtransparency.org) to benchmark current material specifications against industry averages
  • Require EPDs in procurement: Specify Environmental Product Declarations for steel, concrete, and timber in all project RFPs to create supplier accountability
  • Evaluate green premium tolerance: Model the impact of low-carbon material premiums on project budgets—often 1-3% on final costs despite higher material prices
  • Identify anchor projects for pilots: Select high-visibility projects where green premiums can be absorbed and lessons documented for organization-wide rollout
  • Engage early with suppliers: Communicate demand signals to steel, cement, and timber suppliers 12-24 months ahead to enable production planning and secure allocation
  • Monitor policy incentives: Track Buy Clean requirements, CBAM implementation, and state-level procurement policies that may affect compliance obligations or unlock funding
  • Build internal expertise: Train procurement and sustainability teams on LCA methodology, EPD interpretation, and material specification best practices

FAQ

Q: How much do low-carbon materials actually add to project costs? A: While material-level premiums can be significant—75% for low-carbon cement, €50-140/tonne for green steel—the impact on finished buildings is typically 1-3% because materials represent only a portion of total project costs. Labor, land, design, and other expenses dilute the premium. For automobiles, green steel adds approximately $208 per vehicle, less than 1% of the purchase price.

Q: Are low-carbon materials available at scale today? A: Availability varies by material and region. Mass timber is commercially available in most markets with established supply chains. Green steel from hydrogen-based processes remains limited, with SSAB and a few others producing pilot quantities. Low-carbon cement with carbon capture is just reaching industrial scale with Heidelberg's Brevik plant in 2025. Electric arc furnace steel, which uses recycled scrap and has 75% lower emissions than blast furnace steel, is widely available and represents 70% of US production.

Q: What certifications or standards should we look for? A: Environmental Product Declarations (EPDs) verified by third-party program operators are the gold standard for comparing embodied carbon across materials. Look for EPDs that comply with ISO 14025 and EN 15804 standards. For timber, FSC (Forest Stewardship Council) or PEFC certification ensures sustainable forestry practices. The EPA is developing a label program for construction materials that will provide additional certification options by 2026.

Sources

Topics

green steellow-carbon cementmass timberembodied carbonHYBRITcarbon captureBuy CleanEPDCLTdecarbonizationgreen premium

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