This article originally appeared in the Economic Times on 7 September, 2022.
From providing homes and places to work and do business, to building safe roads and other key infrastructure such as dams and bridges, a flourishing construction industry is the mark of a healthy, growing economy.
The materials that fuel this growth, such as cement, concrete, and steel, are far more ubiquitous than many people realise. Globally, the only substance used more than concrete in total volume is water.
India is set to become the world’s fastest-growing major economy this year. As millions of Indians move to cities in search of high-quality jobs, construction will be one of the major drivers of long-term growth. Experts suggest that India’s urban population is expected to hit 525 million by 2025 and 600 million by 2036, a rapid increase from the current 400 million, which will require a huge amount of new housing and infrastructure to be constructed. Furthermore, according to the Alliance for an Energy Efficient Economy, more than half of the residential and commercial building stock expected in 2030 is yet to be built.
The Indian cement industry has worked hard to reduce emissions from cement production, which requires substantial energy and resources to produce, to become one of the most energy efficient cement sectors, globally. But as the race to net zero emissions accelerates, in order to support India’s pledge to reduce the carbon intensity of its economy by 45% by 2030, India’s construction industry is now striving to do even more to enable emission reduction across the entire value chain.
Collaboration among key players in India’s construction industry will enable the use of new technologies and practices needed to both reduce emissions and drive growth. This is why Xynteo has launched the Build Ahead coalition – a multi-stakeholder coalition dedicated to collectively tackling the challenge of achieving a net-zero built environment in India. The coalition is a collective effort of Xynteo and its partners from across the construction value chain, including JLL, Godrej Construction, Lodha, JSW Cement, SED Fund and Shell India.
Decarbonisation through innovation
There are two critical areas for reducing the carbon footprint of buildings and infrastructure –embodied emissions (those emissions that arise from the materials used for construction) and operating emissions (those that arise from the use of the building), both of which are critical to tackle to reach net-zero emissions.
The Indian cement sector has become a global leader in reducing operating emissions, even though it is the world’s second-largest cement producer. This is largely because of a strong commitment from industry players to improve energy efficiency measures and utilise new processes and materials, including using by-products from other sectors, such as fly ash and slag. Yet, these energy-efficiency measures alone are not enough to meet India’s climate targets. Although globally, experts estimate emissions in the cement industry could be reduced by 75% by 2050, the majority of these reductions will be possible only from the adoption of new technologies and materials. Only 20% of global emissions reductions in cement will come from operational advances such as energy efficiency, according to McKinsey & Company.
To realise this potential emissions reduction, the industry needs to invest in scaling innovative technologies such as carbon capture, utilisation, and storage (CCUS), developing technologies for improving construction efficiency, or finding new, low-carbon raw materials. Although many of the technologies that can support further emission reductions already exist, they are expensive and not yet market-ready. To make low-carbon solutions viable, Build Ahead hopes to work with key stakeholders to find ways to make them accessible, affordable and attractive to the construction industry’s entire ecosystem.
Some businesses in India’s construction industry are already leading the way. What’s more, commercial appetite for low-carbon buildings is growing, especially in the corporate real estate market. According to research by Build Ahead partner JLL, 9 in 10 real estate leaders in Asia Pacific believe the link between corporate real estate and sustainability is a board level agenda, and 7 in 10 are willing to pay a premium to lease green certified buildings.
In response, a growing number of businesses are setting ESG metrics and making public commitments. These are a great start – but there needs to be a platform for the construction industry to work on this problem together, involving the whole ecosystem. Respondents to JLL’s survey also agreed that stakeholder partnerships are crucial to accelerating the race to net zero.
In response to this cross-sectoral need, Xynteo along with JLL, Godrej Construction, Lodha, JSW Cement, SED Fund and Shell India has launched the Build Ahead coalition. This multi-stakeholder coalition is designed to accelerate decarbonisation across the Indian construction value chain. Using collective action and collaboration, Build Ahead aims to support India's pledge to achieve net-zero emissions by increasing the adoption of low-carbon building materials in construction, and reducing emissions during the design, construction, use and end-of-life phases of real estate, construction and infrastructure projects.
Build Ahead will help scale technological innovation, improve existing growth models, and build partnerships to accelerate decarbonisation in construction. The coalition will initially focus on cement and concrete before expanding to other sectors.
By working together, the coalition can help enable future short and long-term demand for low-carbon building materials from across the construction industry, lowering the cost of investment in decarbonisation. The coalition will work with cement producers and consumers to understand the demand for low-carbon construction products, thus helping to de-risk investments in new technologies.
The coalition will focus on four key activities:
- Creating a platform for forward-leaning organisations to work together across the construction value chain in accelerating the industry towards net zero.
- Creating opportunities to build and strengthen alliances within and beyond the Indian construction sector for enabling the increased use of low-carbon building materials, including shifting mindsets to accelerate the adoption of these materials.
- Developing a shared narrative on the Indian cement sector’s continued interest – as well as the Indian construction industry’s growing interest in decarbonisation – by showcasing the impact of collaborative action.
- Supporting first movers and de-risking investments in demonstrating and scaling innovative decarbonisation technologies and low-carbon building materials.
Building the future
As India grows, we must not forget what lies at the heart of this opportunity: people and the planet. Only through collaboration across the construction industry will we be able to further reduce emissions at the pace needed while generating growth that supports a safe and prosperous place to live and work for future generations.
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