Decarbonisation of Cement

Motion made, and Question proposed, That this House do now adjourn.—(Jade Botterill.)

Cement may not grab headlines, but it quite literally holds up our country. Virtually every hospital, school, bridge and home is built using cement. Without a thriving cement industry, it will not be possible to deliver the renewal our nation needs and the 1.5 million homes the Government have committed to build.

Derbyshire is the proud home of Britain’s cement and lime industry. This critical material has been made there for generations, sustaining families, supporting our local economies and making the midlands one of our country’s great industrial powerhouses. Today, Derbyshire and neighbouring Staffordshire account for around 40% of all the cement and lime produced in the UK, and the industry supports more than 2,000 high-quality and well-paid jobs in our communities.

However, cement also produces significant carbon emissions, with around 7% of all carbon emissions globally coming from cement—more than come shipping and aviation combined. To put that in scale, in the UK, cement produces more carbon emissions than the entire city of Birmingham. We simply cannot tackle the climate crisis, safeguard our planet for future generations and deliver a net zero economy without tackling this issue.

At the same time, our UK cement industry faces increased pressure, with UK cement production now at its lowest levels since 1950 and imported cement making up an increasing share of the market. Decarbonisation should never mean deindustrialisation, and without action, we risk losing high-skilled jobs across the midlands and the north and an industry that is vital to our nation.

It is therefore essential that we invest in new technologies and make the UK, and Derbyshire in particular, world-leading producers of clean, green cement. Many of these technological innovations are already being pioneered right here in Britain. For example, Cambridge Electric Cement has developed a means of recycling used concrete back into cement, and the Institution of Structural Engineers notes that nine British-based cement innovations are working to take captured carbon and store it within the concrete itself.

I was also pleased to recently meet with Coolbrook, which is developing a heater that will heat air up to 1,700°C without burning fossil fuels. That would allow cement plants to replace the fuel used for burning with electric heating and reduce the amount of CO₂ produced by between 30% to 40%. I encourage the Government to do all they can to support those emerging technologies and to use their research and development funding to ensure that such exciting innovations become commercially viable.

However, even if we reduce emissions from energy to zero, two-thirds of cement emissions are the by-product of the chemical process used to produce cement, and these emissions cannot be cut without carbon capture and storage. That means that even if all the exciting developments I have mentioned succeed, we cannot achieve zero-carbon cement without carbon capture and storage. Indeed, the fact that carbon dioxide is created as part of the chemical process used to make cement means that only carbon capture can eliminate the majority of emissions from its production.

To be clear, these projects have nothing to do with prolonging the use of fossil fuels. It is entirely about ensuring that we can safeguard this vital and important industry and protect the secure, high-quality, unionised jobs that are rooted in local communities such as the Hope valley. Without carbon capture and storage, we either have to stop producing cement or we fail to decarbonise—neither is an option that we can afford.

That is why Peak Cluster is so important. Based in the Hope valley, it is the world’s largest cement decarbonisation project, with the potential to decarbonise 40% of the UK’s cement and lime production. Under this project, carbon produced in Derbyshire through the production of cement will be captured and transported to Morecambe Net Zero, which will repurpose the Morecambe bay gas fields into a permanent and secure carbon storage facility, capable of storing more than 1 billion tonnes of CO₂. That is a real example of how a just transition can protect workers and communities while reducing carbon emissions.

This world-leading innovation will also deliver major economic benefits for our country, supporting more than 13,000 jobs and attracting around £5 billion of private investment. It also has the potential to remove more than 3 million tonnes of CO₂ each year, equivalent to a quarter of all the emissions created in Derbyshire and Staffordshire every single year.

That is why I was delighted that, in July, the National Wealth Fund announced that it would make its first venture into carbon capture and invest £28 million in Peak Cluster. This historic step demonstrates how the National Wealth Fund can play a major role in crowding in private investment and create the good, clean jobs of the future. It is estimated that every £1 of public investment in the project will deliver £4 of benefits. This is an economic opportunity that we cannot waste.

However, the job is not done yet. The investment from the National Wealth Fund is hugely welcome, but it is only the start. For the project to reach final investment decisions and unlock billions of pounds in private capital, industry needs one thing above all: certainty. At present, there is no clear route to market for carbon capture and storage projects beyond the track 1 and track 2 clusters. Without a defined framework for projects like Peak Cluster, private investors are left in limbo, which risks stalling progress just when momentum is building. We have seen too many examples in the past where projects received initial support from Government, only to stall because the next stage of policy never followed through. This cannot be another one of those cases.

I have two specific questions for the Minister. First, will he confirm that the Government will establish a clear route to market for industrial carbon capture projects beyond track 1 and track 2? Establishing a clear route to market would give investors and operators confidence that a final investment decision on Peak Cluster and Morecambe Net Zero will be made within this Parliament. The sooner that is done, the sooner businesses will have the certainty needed to invest, and the sooner all of us will benefit from the growth that such investments will deliver.

Secondly, will the Minister commit to introducing a contract for difference-style model for carbon capture to ensure that projects like Peak Cluster have the revenue certainty needed to attract private capital? Contracts for difference played a key role in enabling the widespread growth in renewable energy, and can also play a major role in supporting the growth of carbon capture technology. However, investing in clean cement here in the UK will be of no use if our builders import more polluting cement from abroad. The amount of imported cement has tripled over the last 20 years. Not only does imported cement have a higher carbon footprint, but the use of such cement undermines our British industry. The Government’s announcement that they will introduce a carbon border adjustment mechanism is therefore very welcome news, and demonstrates that this Labour Government will not allow our industrial industries to be offshored.

Furthermore, builders must also be incentivised to use cleaner, greener cement, and this will only be done if there are clear incentives to do so. It is therefore time for us to legislate to ensure that all developments report on how much carbon is released through the production and use of construction materials. Mandatory embodied carbon reporting is needed to drive down the emissions released from construction. Mandatory reporting would provide consistency to the construction industry, which must currently deal with a patchwork of local regulations, and reporting would also help stimulate the growth of lower-carbon building materials. Only sufficient demand will enable low-carbon technologies to develop at scale, and this demand can only be achieved through appropriate regulation.

The EU has plans to introduce mandatory embodied carbon reporting from 2028, and to set project limits on embodied carbon from 2030. When we left the EU, it was made clear that we would not reduce our environmental and climate standards, and I encourage the Government to align with the EU. The introduction of embodied carbon requirements in the EU also means that if we fail to decarbonise cement in the UK, our cement industry could be locked out of such markets, as builders will be required to use only low-carbon products in construction.

It is time once again to forge our future

“in the white heat of technology”.

By acting now, we can safeguard our historic industries, support our Government’s mission for growth, and deliver a more sustainable and greener world. It is time to be ambitious and to back British industry. It is, after all, desirable that the materials that build Britain are made in Britain.

I finish by returning to Peak Cluster. After all, whatever other positive interventions we make, simple chemistry means that we cannot cut the majority of emissions from cement without carbon capture. If we do not invest now, we will simply kick this can down the road, allowing other countries to move ahead of us and develop this emerging industry before we do. Today, I once again encourage the Minister to invest in jobs, British industry and decarbonisation. That can be done only if we establish a clear route for carbon capture projects not included in track 1 and track 2, and I encourage the Minister to establish such a route as quickly and urgently as possible.

I call the Minister. I see he is very ably supported by Edmund Ward, whom I recall from my career history.

I am so pleased that, due to a quirk in the timings, we have almost two hours for the discussion of cement. I will endeavour to make the best use of the time available.

I very much thank my hon. Friend the Member for Derbyshire Dales (John Whitby) for raising the issue of cement manufacture in the UK. I share his concerns about the current level of cement production both for Derbyshire and for the UK. I hope that by the time I resume my place on the Treasury Bench, he may feel a certain sense of reassurance given the priority I am personally giving to this issue. He made the case admirably for the cement sector based on the jobs and the impact on the local economy. I will endeavour to add to that economic argument by outlining the importance of the cement sector to the UK more broadly.

Breedon’s Hope cement works in my hon. Friend’s constituency is the largest in the UK. It supports 270 jobs in his constituency and contributes £60 million to the local economy. In my role as Minister for Industry, I intend to be as vocal and visible an advocate of British industry as he is for the industry in his own constituency. To be clear, my objective as Minister for Industry is to ensure that we secure a sustainable and prosperous future for this UK heavy industry.

Before I talk more broadly about the challenge of decarbonisation, I will briefly set out the role that the cement sector plays in the UK. Cement is of course an incredibly ancient material, which was developed and used extensively across Europe by the Romans. However, it would be wrong to think of it as a material of the past. It is subject to constant innovation, as we heard from my hon. Friend.

If you will forgive me for saying so, Madam Deputy Speaker, cement is quite literally the foundation of our modern economy. It is the essential ingredient used to construct everything from homes and hospitals to bridges, schools, roads and energy infrastructure. Without cement, there would be no new housing developments or transport networks. That is why we recognise in our industrial strategy that the cement industry is an essential ingredient in our eight key growth-driving sectors and part of our foundation industries.