A circular economy of concrete and cement could produce €110 billion in net value and avoid or mitigate two billion tons of CO₂ emissions by 2050, according to a new McKinsey & Company report.
McKinsey & Company says this will be driven by capture, storage and usage of CO2 from cement and concrete production, reuse of energy from waste material and recirculation of materials and minerals across the built environment.
“The circular cement value chain: Sustainable and profitable” report projects that adoption of circular technologies could also decarbonise 80% of all cement and concrete emissions by 2050.
Adoption of circular economy principles is estimated to offset more than half of the losses to the cement industry from rising costs and reduced demand, according to the report.
The report states that recycling and reusing construction materials and minerals alone will add nearly €80 billion of annual EBITDA while reusing concrete modules and structures will drive an estimated €24 billion of net value by 2050.
The cement industry is perfectly positioned to create closed loops for CO2, materials and minerals, and energy.
Regions with high landfill costs and construction and demolition waste will also reap “major benefits” from the use of alternative fuels from waste material with the global average share of alternative fuels reaching 43% by 2050.
Jukka Maksimainen, global co-leader of McKinsey’s Global Energy & Materials practice, said: “Applying circular economy principles to cement and concrete would not only help decarbonise the built environment but generate enormous economic value.
“The cement industry is perfectly positioned to create closed loops for CO2, materials and minerals, and energy. We estimate each of these circular technologies will be value-positive by 2050, while some are already more profitable than today’s typical solutions.
“This will also drastically reduce global emissions and 30 to 40% of the world’s solid waste created through construction and maintenance of the built environment.”
McKinsey suggests, to take advantage of the opportunities presented, two actions: engage in circular business building and use circular technologies to react to the evolving financial risks.
