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Global Innovations Driving Zero Carbon Cement

Key takeaways

  • When analyzing the scope of cement carbon emissions, equity research typically hones in on ESG metrics like “clinker ratios”—which measure the percent of clinker in cement versus lower-carbon ingredients—and the ratio of “alternative fuels” used to heat cement kilns. Our on-the-ground analysts in China and India explain why some of these yardsticks can unravel upon closer inspection.
  • To gauge prospects for zero-carbon cement, company-level metrics give you only half the picture. The economics of carbon capture technology, for example, don’t work without national carbon pricing and publicly financed infrastructure. When grading country-level policies for capacity to decarbonize, our analysts think China may hold an edge in the coming years, compared with a more slow-moving EU.
  • The EU plans to be the first carbon-neutral continent, with China pledging to decarbonize by 2060. Since India isn’t following a similar glidepath (for now), two equity research shops recently predicted India could sell lower-priced (but higher-carbon) cement into Europe, benefiting from “carbon leakage.” We explain why future carbon border adjustments will likely prevent this scenario from playing out.

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  •   28 January 2021
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