Green lead markets

Demand for green materials, such as green steel or low-carbon cement, is essential to kick-start the transformation of the industrial sector towards climate neutrality by mid-century. Existing market barriers must be lifted to enable a full-scale shift to climate-neutral production, supply chains and business models. An enabling regulatory framework and economic incentives for climate-neutral and high-quality recycling production need to be aligned across the full value chain.  

There is often not enough consumer demand for low-carbon materials. This can be linked to a variety of factors such as higher cost of climate-neutral materials, lack of familiarity or engagement with new materials among downstream users, or lack of transparency and clear benchmarks for potential purchasers to compare different ‘low-carbon’ alternatives. Due to a lack of high-quality, comparable data on the embodied emissions of basic materials and intermediate products, manufacturers at the end of the production chain are often unable to effectively market products made from climate-neutral materials.

New regulatory tools, such as standards for “green steel” or “low-carbon cement” and policies to measure embodied carbon in final products, are needed to induce the necessary demand from end consumers and remove market entry barriers for new low-carbon products. The policy framework must be developed in parallel with supply-side policies to promote clean-energy infrastructure and the development and upscaling of breakthrough technologies. The coordination of ‘supply push’ and ‘demand pull’ policies at global, EU and national levels is essential.

Agora Industry aims to create a clear understanding of the role green lead markets can play in the industrial transition. Our work includes mapping a regulatory framework for demand signals, so as to guide policy makers and stakeholders at national, European, and international level. For example, we support and advise fora at G7 level and participate in the UN-driven “Industrial Deep Decarbonisation Initiative” aimed at scaling green lead markets at the international level. At EU level and in different European countries, we work with partners to inform policy processes to establish and harmonise embodied carbon regulation for final products, from buildings to vehicles. Building on our deep knowledge of climate-neutral production of basic materials we develop proposals for definitions and standards for green materials, such as steel and concrete.