Federal Buy Clean for Cement and Steel

Policy Design and Impact on Industrial Emissions and Competitiveness

The cement and steel industry combined account for around 15% of global anthropogenic greenhouse gas (GHG) emissions in the world. The United States is the 4th largest producer and consumer of cement and steel in the world. Total cement consumption in the U.S. was 98.5 million tonne (Mt) in 2018. From that, around 45 Mt was used in public constructions, which is 46% of total cement used in the U.S. Total steel consumption in the U.S. was 101 Mt in 2018. Slightly less than half of the steel used in the U.S. is for construction, and roughly 18% of total steel use in the U.S. is for public construction.

Both federal and state government should leverage their large-scale purchasing power by buying goods and services with a lower carbon footprint, and help drive markets in the direction of sustainability, reduce the negative impacts of their use of goods, and produce positive environmental and social benefits. Many governments around the world have already recognized the value of green public procurement (GPP) - otherwise often referred to in the U.S. as Buy Clean - as a policy instrument and are trying to leverage the money they invest in large contracts to achieve decarbonization goals.

There are some new positive developments in the United States related to Buy Clean – a policy that requires the government to consider embodied carbon in its procurement decisions and reward producers and contractors with lower embodied carbon footprints. In January 2021, President Biden issued an Executive Order to consider additional regulatory steps the federal government can make to promote increased contractor attention on supply chain emissions. The House of Representatives also introduced a bill in March 2021 – the Climate Leadership and Environmental Action for our Nation’s (CLEAN) Future Act – containing provisions establishing a Buy Clean framework for federal procurement. There are also Buy Clean policies at the state level. California led the way by passing a Buy Clean Act in 2017, and several other states such as Washington, Oregon, Minnesota, Colorado, New York and New Jersey are considering ways to implement their own state-level Buy Clean policy as well.

In this study, we estimated the CO2 emissions associated with cement and steel used in public construction projects and the potential impact of Buy Clean to reduce those emissions. Approximately half of the annual CO2 emissions associated with cement consumption is associated with public construction which was around 36 Mt CO2 in 2018. Of this, around 25% is associated with government-funded projects using federal funds and the remaining is related to public projects using states and local governments-own funds.

Around 18% of the annual CO2 emissions associated with steel consumption is associated with public construction which was around 21 Mt CO2 in 2018. Of this, about 27% is associated with government-funded projects using federal funds and the remaining is related to public projects using states and local governments-own funds.

We quantified the annual CO2 emissions reduction potential resulted from Buy Clean for cement and steel in the U.S. in 2018. We also made similar estimates for fifteen selected states.

For the United States to meet its climate change mitigation commitment and stay in course to meet its Paris Agreement goals, it is crucial to address the carbon emissions embodied in public construction, especially for carbon-intensive materials such as cement and steel. While state-level Buy Clean policies are great to get started in the U.S., a federal Buy Clean policy is needed to have a larger impact especially in view of proposed infrastructure spending. Despite the existence of several barriers to federal Buy Clean, policymakers can take advantage of international best practices to set up federal Buy Clean for construction materials, especially cement and steel. In this study, we looked at several international best practices on Buy Clean in other countries and made recommendation for the U.S. federal Buy Clean policy.

Some of the key aspects of international best practices of green public procurement policies that can be adopted in the U.S. for successful design and implementation of federal Buy Clean for construction materials are:

• Design criteria at the national level and implement at the national, state, and local levels by an individual entity and enforced by law

• Establish standardized reporting and evaluation. Standardized reporting could entail mandatory life cycle analysis for entire project bids and/or use of environmental product declaration (EPD) for materials and products.

• Make tools and databases created to support Buy Clean publicly available.

• Establish programs and funds to help bidders adopt these new practices and help them in Life cycle assessment (LCA) and EPD preparation, which can be an expensive and complex process.

• Include policy elements that promote innovation. Increase standards over time to account for technological improvements and encourage continued emissions reduction.

Industry support is one the key drivers of success in Buy Clean programs. Businesses need to be willing to participate in Buy Clean to make manufacturing more sustainable and spur innovation. Thoughtful policy design that promotes stakeholder engagement, transformation support, and protection against the unfair competition can increase support for Buy Clean from businesses, trade associations, and other key stakeholders.

To read the full report and see complete results and analysis of this new study, Download the full report from the link above.

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