Interview: practitioners on Low-carbon materials (cement, steel, timber) — what they wish they knew earlier

Cement alone accounts for approximately 8% of global CO₂ emissions, while steel contributes another 7-9%. Together with construction timber, these three materials form the backbone of the built environment—and represent some of the most challenging sectors to decarbonize. Yet across the European Union, practitioners are discovering that the path from pilot projects to scaled deployment is littered with unexpected obstacles that no feasibility study predicted. In conversations with procurement directors, sustainability officers, and materials scientists working at the coalface of the low-carbon transition, a consistent theme emerges: the technical solutions exist, but the unit economics, supply chain inertia, and regulatory timing continue to surprise even seasoned professionals.

Why It Matters

The urgency of decarbonizing construction materials cannot be overstated. According to the Global Cement and Concrete Association's 2024 roadmap update, achieving net-zero cement by 2050 requires a 24% reduction in clinker factor and massive deployment of carbon capture technologies—yet current investment levels suggest the industry will fall 40% short of its 2030 interim targets. Steel faces similar headwinds: the European Steel Association (EUROFER) reported in early 2025 that only 12% of EU steelmaking capacity has committed to hydrogen-based direct reduction routes, despite these technologies being technically proven since 2021.

For the European Union specifically, the stakes extend beyond climate targets. The Carbon Border Adjustment Mechanism (CBAM), which entered its transitional phase in October 2023 and will impose full financial obligations from 2026, fundamentally reshapes the competitive landscape. EU producers using low-carbon processes will gain tariff advantages over carbon-intensive imports, but only if they can prove their emissions reductions through robust verification systems. The EU's Construction Products Regulation revision, expected to mandate Environmental Product Declarations (EPDs) for all construction materials by 2027, adds another layer of compliance complexity that practitioners consistently underestimate.

Timber presents a more nuanced picture. While cross-laminated timber (CLT) and glued laminated timber (glulam) can store approximately 1.6 tonnes of CO₂ equivalent per cubic meter, the 2024 European Forest Strategy update has tightened sustainable sourcing requirements. Practitioners report that certification bottlenecks—particularly Forest Stewardship Council (FSC) chain-of-custody verification—now add 8-14 weeks to project timelines, a delay that can collapse the business case for hybrid timber-concrete structures.

Key Concepts

Low-Carbon Materials: Materials whose production generates substantially fewer greenhouse gas emissions than conventional alternatives, typically quantified through lifecycle assessment (LCA). For cement, this means clinker substitution ratios exceeding 30% or integration of carbon capture at point sources. For steel, it encompasses electric arc furnace (EAF) processing using renewable electricity or hydrogen-based direct reduced iron (H-DRI). The EU Taxonomy's technical screening criteria require a minimum 40% emissions reduction relative to industry benchmarks to qualify as a "substantial contribution" to climate mitigation.

Traceability: The ability to track materials through every stage of the supply chain, from raw material extraction to final installation. In practice, traceability systems for low-carbon materials must capture emissions data at each transformation point—quarry, kiln, rolling mill, fabrication shop, construction site. The EU's Digital Product Passport initiative, mandated under the Ecodesign for Sustainable Products Regulation, will require machine-readable traceability for construction materials by 2028.

Soil Carbon and Biogenic Sequestration: For timber products, the carbon stored in wood represents atmospheric CO₂ captured through photosynthesis. However, practitioners must navigate complex accounting rules: the EU Emissions Trading System recognizes biogenic carbon storage in harvested wood products, but only for products with expected lifespans exceeding 25 years and with verified sustainable forestry origins.

Benchmark KPIs: Standardized performance indicators enabling comparison across projects and suppliers. The EN 15804+A2 standard establishes the methodology for EPDs in Europe, while the Level(s) framework provides building-level sustainability metrics. Key KPIs include Global Warming Potential (GWP) per functional unit, recycled content percentage, and end-of-life recyclability rate.

Unit Economics: The profitability calculation at the individual unit level—per tonne of cement, per tonne of steel, per cubic meter of timber. Practitioners consistently report that low-carbon premiums of 15-40% erode competitiveness in price-sensitive tenders, particularly when whole-life carbon benefits are not monetized.

What's Working and What Isn't

What's Working

Green Public Procurement Mandates: The Netherlands' requirement that all government-funded projects achieve a maximum environmental cost indicator (MKI) of €0.80 per euro of construction value has created predictable demand for low-carbon materials. Practitioners report that this policy certainty—combined with a national database of validated EPDs—has reduced bid uncertainty and enabled suppliers to invest in production capacity. By Q3 2024, Dutch procurement accounted for 38% of European low-carbon concrete orders.

Offtake Agreements for Green Steel: Companies including Mercedes-Benz, Volvo Group, and IKEA have signed multi-year purchase commitments with green steel producers such as H2 Green Steel and SSAB. These agreements, typically covering 5-10 years of production, provide the revenue visibility that enables project financing for new hydrogen-based facilities. The European Investment Bank's €2.3 billion green steel facility guarantee program, launched in 2024, explicitly requires signed offtake agreements covering at least 60% of planned capacity.

Modular Timber Construction Systems: Standardized CLT and glulam systems from manufacturers such as Stora Enso, Binderholz, and Hasslacher have achieved installation speeds 40% faster than conventional reinforced concrete for buildings up to 10 storeys. Practitioners note that the labor shortage across European construction—estimated at 1.5 million unfilled positions in 2025—makes timber's reduced on-site labor requirements increasingly attractive, partially offsetting material cost premiums.

What Isn't Working

Verification and Certification Bottlenecks: The proliferation of environmental claims has overwhelmed third-party verification capacity. Practitioners report EPD certification timelines extending from 6 weeks to 16 weeks between 2023 and 2025, with auditor fees increasing by 60% over the same period. For steel, ResponsibleSteel certification—increasingly required by automotive customers—involves 18-month audit cycles that delay market access for new low-carbon production lines.

Grid Constraints for Electrification: Electric arc furnaces and electric kilns require stable, high-capacity grid connections that many European industrial sites lack. Practitioners in Germany and Poland report 3-5 year queues for grid connection upgrades exceeding 50 MW, effectively blocking electrification timelines regardless of technology readiness. The EU's Grid Action Plan announced in late 2024 acknowledges this constraint but proposes solutions that will not materialize before 2028.

Insurance and Warranty Gaps: Novel low-carbon materials—particularly supplementary cite cementitious materials (SCMs) with high calcined clay content or recycled aggregate concretes—face resistance from insurers and warranty providers. Practitioners describe a "catch-22" where insurers demand 10-year track records for full coverage, but the materials cannot build track records without insurance coverage. The European Insurance and Occupational Pensions Authority's 2024 guidance on climate-aligned underwriting explicitly omits construction materials innovation, leaving a regulatory vacuum.

Key Players

Established Leaders

HeidelbergCement (Heidelberg Materials): Operating Europe's first commercial-scale carbon capture facility on a cement plant in Brevik, Norway, with 400,000 tonnes annual capture capacity operational since 2024. The company's evoZero carbon-neutral cement product line, launched across 8 European markets, represents the most ambitious commercial low-carbon cement offering currently available.

SSAB: The Swedish steelmaker delivered the world's first fossil-free steel to commercial customers in 2021 and is constructing its HYBRIT demonstration plant at Luleå. By 2026, SSAB targets 1.3 million tonnes of annual hydrogen-based steel production, representing approximately 15% of total Nordic steel output.

Holcim: Through its ECOPact product range, Holcim offers concretes with 30-100% lower carbon footprint than standard mixes. The company's acquisition of PRB Group in 2023 strengthened its position in low-carbon mortars and renders, completing a full building envelope solution.

ArcelorMittal: Europe's largest steel producer has committed €10 billion to decarbonization through 2030, with hydrogen-DRI projects in Spain (Sestao) and Germany (Bremen) expected to deliver 2.5 million tonnes of near-zero emissions steel annually by 2028.

Stora Enso: The Finnish-Swedish forestry company operates Europe's largest CLT production facilities and has pioneered lignin-based carbon fiber alternatives. Its Building Solutions division grew 27% in 2024, driven by multi-residential and commercial timber construction across Central Europe.

Emerging Startups

Ecocem: This Irish company's GGBS (ground granulated blast-furnace slag) and novel SCM products enable clinker substitution rates exceeding 70% while maintaining structural performance. Ecocem's plant in Dunkirk, France, represents the largest slag processing facility in Western Europe.

H2 Green Steel: Backed by €6.5 billion in equity and debt financing, this Swedish venture is constructing Europe's first purpose-built green steel facility in Boden, targeting 5 million tonnes annual capacity by 2030 with emissions intensity below 0.5 kg CO₂ per kg steel.

CarbonCure Technologies: Though founded in Canada, CarbonCure's CO₂ mineralization technology has been deployed across 47 European concrete plants since 2022, permanently sequestering over 200,000 tonnes of CO₂ in concrete products.

Biomason: This American biotech company operates a European licensing partnership with Skanska, producing biocement using microorganisms at ambient temperature—eliminating kiln emissions entirely for specialty applications.

Lignin Industries: Spun out of Chalmers University, this Swedish startup converts lignin—a byproduct of paper production—into carbon-negative construction binders, with pilot production launched in 2024.

Key Investors & Funders

European Investment Bank (EIB): Through its Climate Bank Roadmap, the EIB has committed €1 trillion to climate action through 2030, with heavy materials decarbonization identified as a priority sector. The 2024 green steel guarantee program represents its largest single industrial commitment.

Breakthrough Energy Ventures: Bill Gates' climate investment fund has deployed over €400 million into European materials decarbonization, including significant stakes in H2 Green Steel and Ecocem.

LKAB Minerals Fund: Anchored by Sweden's state-owned mining company, this €2 billion fund focuses exclusively on iron ore value chain decarbonization, including hydrogen infrastructure and green steel production.

InnoEnergy: The EU's sustainable energy accelerator has supported over 30 low-carbon construction materials ventures since 2020, with portfolio companies raising €3.2 billion in follow-on funding.

Pale Blue Dot Energy: This UK-based private equity firm specializes in carbon capture and storage infrastructure, providing the long-term capital that cement and steel carbon capture projects require but that traditional venture capital cannot offer.

Examples

Skanska's Gothenburg Waterfront Development (Sweden, 2024): This 180,000 m² mixed-use project specified near-zero carbon concrete for all structural elements, achieving a 72% reduction in embodied carbon compared to conventional construction. Skanska reported a 23% cost premium for materials but a net 8% total project cost increase when accounting for reduced construction time enabled by prefabricated low-carbon elements. The project secured green bond financing at 45 basis points below conventional rates, partially offsetting material premiums.

Bouygues Construction's Paris Olympic Village (France, 2024): Featuring Europe's largest mass timber residential complex at 125,000 m² of CLT and glulam, the project stored approximately 47,000 tonnes of CO₂ equivalent in structural timber. Post-occupancy monitoring through 2025 confirmed indoor air quality benefits, with volatile organic compound levels 60% below French regulatory limits. However, practitioners noted that insurance premiums for timber structures remained 35% above concrete equivalents despite favorable fire safety test results.

ThyssenKrupp's Duisburg Green Steel Pilot (Germany, 2024-2025): This €500 million retrofit of an existing blast furnace to hydrogen-ready configuration represents the EU's largest brownfield steel decarbonization project. Initial hydrogen injection trials achieved 15% emissions reduction while maintaining steel quality specifications. However, practitioners reported that hydrogen supply contracts at €4.50/kg rendered the economics unviable without CBAM protection and Contract for Difference (CfD) support from the German government.

Action Checklist

• Conduct a baseline emissions inventory for all structural materials currently specified in your projects, using EN 15804+A2 compliant EPDs where available
• Map your supply chain to identify which suppliers can provide verified low-carbon alternatives within your procurement timelines
• Engage with insurance providers early to understand coverage limitations for novel materials and identify necessary third-party testing requirements
• Build relationships with at least two alternative suppliers for each critical low-carbon material to mitigate certification and production bottlenecks
• Monitor CBAM implementation timelines and assess exposure for any imported materials in your supply chain
• Develop internal capability for whole-life carbon assessment using the Level(s) framework to quantify operational and embodied carbon trade-offs
• Establish long-term offtake agreements with green steel and low-carbon cement producers to secure supply and favorable pricing
• Invest in workforce training for timber construction techniques, recognizing the 12-18 month lead time for competency development
• Engage with public procurement bodies to advocate for performance-based specifications that enable material innovation
• Track regulatory developments in the Construction Products Regulation revision and Digital Product Passport requirements to ensure compliance readiness

FAQ

Q: What is the realistic green premium for low-carbon materials in EU markets as of 2025? A: Practitioners report green premiums varying significantly by material and geography. Low-carbon concrete with 30-50% emissions reduction typically commands 10-20% premiums, while near-zero variants can reach 40-60% premiums. Green steel from hydrogen-based production currently carries premiums of €150-300 per tonne (approximately 15-30% above conventional), though forward contracts suggest convergence to €80-120 premiums by 2028 as production scales. Certified sustainable timber premiums have moderated to 5-12% above conventional lumber as supply chains mature, though CLT premiums remain elevated at 15-25% due to manufacturing capacity constraints.

Q: How do verification and certification timelines impact project schedules? A: This represents the most consistently underestimated challenge practitioners identify. EPD certification for new products now requires 12-20 weeks, up from 6-8 weeks in 2022. ResponsibleSteel certification involves an 18-month cycle. FSC chain-of-custody audits for timber average 8-14 weeks. Practitioners recommend initiating certification processes 12-18 months before anticipated construction starts and maintaining relationships with multiple certification bodies to mitigate queue risks.

Q: What policies should EU decision-makers watch for the most significant near-term impact? A: Three regulatory developments demand immediate attention. First, CBAM full implementation in January 2026 will impose financial obligations on carbon-intensive imports, fundamentally shifting competitiveness calculations. Second, the Construction Products Regulation revision will mandate EPDs for all construction products sold in the EU, creating compliance urgency for suppliers without existing declarations. Third, national green public procurement thresholds—particularly the Dutch MKI approach gaining traction in Belgium, Germany, and Nordic countries—will increasingly exclude conventional materials from public projects.

Q: How do grid constraints affect electrification timelines for cement and steel? A: Grid connection queues represent a binding constraint that technology deployment cannot circumvent. In Germany, connections exceeding 50 MW face average wait times of 4-5 years. Poland and Central European states report similar constraints. Practitioners recommend early engagement with transmission system operators—ideally 5-7 years before planned electrification—and exploring on-site renewable generation with battery storage as a partial mitigation strategy. The EU's Grid Action Plan may accelerate timelines after 2028, but near-term projects must plan around existing infrastructure.

Q: What role does carbon accounting methodology play in material selection? A: Methodology choices significantly impact apparent emissions performance. The EN 15804+A2 standard provides consistency within Europe, but practitioners must understand module boundaries: many EPDs report only A1-A3 (cradle-to-gate) emissions, omitting transport, installation, and end-of-life phases that can represent 15-30% of total lifecycle impact. For timber, biogenic carbon accounting remains contentious—the -1/+1 approach recognizes temporary storage benefits, but some procurement frameworks exclude biogenic credits entirely. Decision-makers should require consistent boundary conditions when comparing materials.

Sources

• Global Cement and Concrete Association. (2024). Concrete Future: The GCCA 2050 Cement and Concrete Industry Roadmap for Net Zero Concrete. https://gccassociation.org/concretefuture/
• EUROFER - European Steel Association. (2025). European Steel in Figures 2025. Brussels: EUROFER.
• European Commission. (2024). Carbon Border Adjustment Mechanism: Implementation Guidelines. Official Journal of the European Union.
• EN 15804:2012+A2:2019. Sustainability of construction works — Environmental product declarations — Core rules for the product category of construction products. European Committee for Standardization.
• European Investment Bank. (2024). Climate Bank Roadmap 2021-2025: Progress Report and 2024 Update. Luxembourg: EIB Publications.
• Material Economics. (2024). Industrial Transformation 2050: Pathways to Net-Zero Emissions from EU Heavy Industry. Stockholm: Material Economics.
• International Energy Agency. (2024). Iron and Steel Technology Roadmap: Towards More Sustainable Steelmaking. Paris: IEA Publications.