Reducing embodied carbon in new construction
Three-quarters of the $9.2 trillion in infrastructure spending needed per year until 2050 will go toward new construction—offering opportunities to fight climate change by reducing embodied emissions.
Embodied carbon—the greenhouse-gas (GHG) emissions associated with construction—is by nature irreversible once an asset is built. Embodied carbon includes the CO2 emitted from extraction and manufacturing processes to create construction materials and the transport of materials and equipment to a project site, as well as all the emissions associated with the actual construction operations required for the installation of the materials.
These emissions during construction are a major contributor to lifetime emissions for capital projects (Exhibit 1). While operations may have decarbonization opportunities long after construction completion, the embodied-carbon emissions from construction are set in stone as the project is executed. Up-front carbon emissions account for up to 50 percent of total life cycle emissions.
The building operations industry is seeing a clear push toward greener energy sources and optimizing carbon emissions1 —but reducing embodied carbon during construction is a low priority at best and an afterthought at worst. The focus during design is usually on operational-carbon reduction, not embodied-carbon reduction, and operational carbon is also the focus of several certifications (such as LEED) that allow a more structured approach to reducing those emissions. Buildings are also built with the materials available, and given that low-embodied-carbon materials are often more expensive than traditional building materials, companies are not compelled to use them unless they are industry leaders in the practice.
The time is now for industry leaders to make tackling embodied emissions a priority. The long-term impact of what we’re building today creates a huge opportunity for construction companies—whether they are currently leaders in reducing operational emissions or not—to set the standard for the design choices, materials selection, and construction practices that reduce a project’s embodied-carbon footprint.
New construction: $7.2 trillion in annual spending
According to McKinsey analysis of the NGFS Net Zero 2050 scenario,2 $9.2 trillion per year will need to be spent on capital assets to meet global net-zero targets set forth in the Paris Agreement by 2050.3 Of that $9.2 trillion, $2.0 trillion will need to be applied toward retrofits, equipment upgrades, and improvements to existing assets. The other $7.2 trillion—more than three-quarters of the total—needs to be spent on new construction. This massive building effort will have a significant impact on global carbon emissions, and that’s why it is crucial for companies throughout the infrastructure value chain to prioritize embodied emissions as they build their project plans.
Those project plans will proliferate in the coming years as thousands of new assets come online around the world. The IEA estimates that to decarbonize in line with Paris Agreement targets, renewables deployed must increase fourfold, hydrogen production must increase sixfold, and battery demand must increase a staggering 70-fold (Exhibit 2). This will all be crucial to facilitate the 190-fold increase in CO2 captured per year—and scaling construction is quickly becoming the bottleneck that could prevent us from reaching net-zero goals.
New capital spending on assets considered to have low operational-carbon emissions, such as renewable energy sources, will account for roughly 70 percent of capital expenditures through 2050, according to McKinsey analysis of data from the Network for Greening the Financial System (Exhibit 3)—which is good news for the future of operational emissions.4
However, many assets with low operational emissions use the same construction materials and processes that are used for high-operational-emissions projects—meaning the up-front embodied-carbon footprint may be the same. Meanwhile, the urgency of reducing carbon emissions has never been higher: experts say we need to cut total emissions in half by 2030 to stay on track for Paris Agreement objectives.5 Embodied emissions could—and will have to—play a leading role in those reductions.Read More..
Source : mckinsey
