Changing Permissions and Rewards Systems to Get Ready for Carbon Trading and Meet the Sustainability Challenge

That we are in a global double whammy crisis few doubt. On the one hand economic malaise is starting to grip the cement and concrete industry and on the other, few doubt that when the ice stops melting we are in for a climate catastrophe of unprecedented proportions.

Rather than being an inevitable threat this paper makes it clear that in spite of failures to date of the Kyoto process carbon trading can still provide opportunities. There are however many changes in the building and construction industry that have to be implemented before these opportunities can be realised.

Fundamental to the construction industry in which concrete is dominant are the rewards and permissions systems framework within which we operate.  Objective performance criteria that can be interpreted and used for calculating valid offsets for both are essential if the industry is to profit from carbon trading. Instead of being a barrier to innovation our permissions and rewards systems could be a driver

Carbon Trading

If implemented successfully carbon trading is supposed to attach legal costs to emissions that will help the required migration to non fossil fuel energy sources and other green alternative technologies without such legal costs attached. In Australia this is being morphed as a cap and trade system that limits emissions, mainly for scope 1 and 2 emitters forcing trade to buy offsets if caps are exceeded which are provided by other emitters that do better than cap or potentially by scope 3 emitters with valid offsets to offer.  (For definitions of scopes 1-3 see Appendix 1 - Carbon Accounting)

Unfortunately, that there will be a certain and sufficiently high future cost for carbon cannot be totally relied upon as governments are subject to political vagaries. On another page on this web site with the title “The Implications of Gaia Engineering for the Cement and Concrete Industry” I  argue that carbon trading is not the most important tool but still necessary. This paper explains the steps required for the implementation of carbon trading in the building and construction industry.

Importance of Carbon Trading in Building and Construction.

That the building and construction industry represents low hanging fruit that can deliver significant improvements in sustainability has been pointed out by many from Stern[1] to RMIT[2]. According to ResearchandMarkets[3] “Buildings make a large contribution to the energy consumption of a country. It is estimated that, of the total energy generated in the industrialised world, 40% of it is used in the construction and operation of residential, public, and commercial buildings. Approximately one third of primary energy world-wide is consumed in non-industrial buildings such as dwellings, offices, hospitals, and schools where it is utilised for space heating and cooling, lighting and the operation of appliances. In the European Union (EU), energy consumption for buildings-related services accounts for between 33% and 40% of total EU energy consumption. Energy used for heating, lighting and powering buildings can account for up to half of a country’s total energy consumption. In an industrial economy domestic water heating can account for over 5% of total energy use, domestic space heating up to 20% and appliances and lighting up to 30%. In terms of the total energy end use, consumption of energy in the building sector is comparable to that used in the entire transport sector.”

The coal industry are extracting millions of dollars from the government on the basis of a technology that many believe cannot work because of leakage. The building and construction industry has a better alternative called concrete that is already green with a high specific heat capacity and considerable scope for further reductions in embodied energies and emissions and performance in relation to lifetime energies to the point whereby the material could even be a carbon sink. It is time to demonstrate the advantages to government of improved concretes that can deliver massive sequestration and to get ready for the profits that could come from carbon trading whatever form it finally takes.

Implementing Carbon Trading

Characteristics of the Industry

The building and construction industry is characterised by a long supply and waste chain, highly disperse profit centres and many players.  Fortunately most decisions affecting the embodied and lifetime emissions of structures are made in the design room by decision makers include architects and engineers and this represents opportunities.  A significant barrier to them making better decisions for sustainability is that they lack independent, verifiable, easy to access and easy to understand, materials information including data on embodied energy, life cycle emissions and the use of materials in ways that reduce lifetime energies. (See below)

A plethora of ridgid standards and permissions stand in the way of innovation.

The Requirements for Carbon Trading

Trading with scope 1 and 2 emissions will be relatively easy and is already on the governments agenda. Scope 3 emissions will be harder to implement. On the other hand reductions in scope 3 emissions in our industry promise significant reductions in emissions. By incorporating embodied energy and emissions objectives in our standards and modifying them to allow the innovation neccessary for improvement, the introduction of carbon trading will be easier and drive significant emissions reduction.

For methodology to evolve that will foster carbon trading it is important that the Concrete Institute of Australia and other industry groups like the Cement Industry Federation work with the other many and various materials, design, product and building groups to formulate and promote a national industry policy in relation to materials and materials in use and put forward a united view to the government so that they recognise the large contribution the building and construction industry has to global and national greenhouse emissions and incorporate scope 3 emissions in carbon trading.  In this way the trend to exclude materials and materials in use is reversed and carbon trading schemes may be able to recognise their significant impacts.

If industry bodies do not work together to provide input and help develop a system for determining offsets for carbon trading there is a very real danger of them being overlooked and/or having inappropriate regulations thrust upon them.

Properly implemented, carbon trading will drive desirable change in materials, how they are made, markets in which they are sold and how they are used.

Changing Criteria and Standards to meet the Sustainability Challenge and Engage if Offsets Trading

Associated with implementation there will be a strong need for independent, peer reviewed, accurate life cycle emissions and other data about materials to allow easy validation of offsets with the appropriate imprimatur.

A peer reviewed materials online Wiki database moderated by all the peak bodies concerned including the Concrete Institute of Australia and other industry groups like the Cement Industry Federation, RAIA, Master Builders, .HIA, AGDF, GBCA, Materials Australia etc. etc. is recommended.

The first step is to modify our permissions and rewards systems so that ultimately the numbers required can be generated. People create the build environment with permissions (engineering, standards, council approvals etc.) for reward (money, Leed rating, hopefully soon carbon offsets etc.). Getting the permissions and rewards systems right so that appropriate numbers are easily generated for and emissions trading scheme is important. Unfortunately the Australian government is not providing for offsets in the highly flawed CPRS. (See http://www.tececo.com/politics.replacing_kyoto.php) Carbon offsets are a lever that will assist implementation of innovative and better building and construction practices and technologies so that the way we build coincides with better environmental stewardship.

In spite of the important contribution of building and construction, other than for the manufacture of cement and concrete the industry is not on the radar of most governments including the Australian government for carbon trading. Professional and green bodies have not helped this deplorable situation.  Our standards and green point rewards system rather than working for sustainability are actually holding up progress in that direction because they are prescriptive.

There are many impediments to deployment of carbon trading including how we measure the performance of materials and buildings and encourage the urgent innovation needed. This paper address these issues in the context of aligning the permissions (standards) and rewards (green points and carbon offsets) systems we have in place with good environmental stewardship using concrete as the main example and suggests how the status quo might quickly and easily be improved so that the urgent improvements required can come about in a more profitable way.

Moving Towards a Sustainable Construction Industry by Bringing into Focus Permissions, Rewards and Objectives

Eventually all materials should be described in terms of all their properties including embodied energies and emissions and using reliable data provided by for example a Peer reviewed Wiki, engineers will be able to specify with knowledge of the outcome in terms of greater than normal sustainability.

There will be some difficulties in documenting the affect of materials in use as a result of design to reduce lifetime energies and this area will always remain to some extent subjective but should never the less be considered.

By way of example, given permissions and the right rewards, Portland cement concrete blends in 80% of applications can easily be made 80% more sustainable[4] and that not only can this be done, but a further 80% of the 80% that are more sustainable could be net carbon sinks.

80% is not unreasonable given that in an article by Kumar Mehta from Berkely in the February issue of Concrete International[4] who suggested a 50% reduction in clinker use could be achieved by using only three tools as hereunder:

1. The use of less concrete for the new structures (implying better design and greater durability)
2. The use of less cement in concrete mixtures (implying less water by using high range water reducing agents), and
3. The use of less clinker to make cements (implying the use of supplementary and pozzolanic addives.

In the rest of this article I will explain why and how 80% improvement can easily be achieved in the context of permissions and rewards. First some background.

So far there has been a lack of serious effort and much greenwash in the concrete industry. Players have not yet realised that their biggest source of revenue in the near future could be carbon credits and that there are huge improvements that could be made to concretes to profit by them. Before carbon credits can be enjoyed however we all have a lot of work to do.

Not only must our permissions and rewards systems be thoroughly overhauled to encourage the innovation required; these innovations must also result in measurable reductions in embodied energy and emissions as well as lifetime energies. For reward, be it monetary or as a result of carbon cost savings we must be able to easily produce the numbers required to quantify what the embodied energy and emissions of materials like concrete are and address how they can be reduced and how properties that contribute to the lifetime energy savings of a building can be improved.

Concrete is one of the greenest building materials (See graph below), it could however be a lot greener and that is where the next real challenge lies.

The Embodied Energy of Building Materials[5]

Members of the World Business Council for Sustainable Development Cement Industry Initiative[6] have mainly been working on efficiency, fuel changes and the use of supplementary cementitious materials like fly ash and latently cementitious materials like ground granulated blast furnace slag. This work is to be encouraged, especially the use of pozzolans.
Bringing permissions (standards and approvals) and criteria for reward (Greenpoints etc) in line with environmental stewardship will focus the industry into bringing about the green change required.

Global materials standards are unfortuantely generally prescriptive and this is the case for Portland cement which is usually defined as a fairly precise mixture of minerals the result of "clinker" making. Some attempts to move to standards based on performance have been made but are not yet the norm. A good summary of global concrete standards and codes of practice is to be found in Lea's, Neville and Newman's books[7][8][9] but none really push the advantage of performance based standards. I have written often about this problem on the TecEco website in technical web pages[10] , various papers (e.g. Do Water Problems Exist in our Minds[11] ), many submissions (See Submissions[12] ) and newsletters (See Newsletter 62, Newsletter 66[13] ) and do so with reference to green rating systems which should, but do not lead the way towards greater sustainability.

World rating systems, Leed in the US and in Australia the Star rating system have not in the past properly addressed the means to green in terms of performance objectives for materials focusing instead mainly on prescriptions. In relation to concrete, a few methods of greening such as the use of supplementary cementitious materials and recycled aggregates etc. are described.
Prescriptive criteria stifle innovation and leave little room for improvement. In the case of green point criteria they often leave out the obvious such as water binder ratio with no credits. It is essential that these systems be changed to a performance basis to encourage innovation and connect to LCA and other data (and thus to carbon accounting) and it is hoped that this article provides the stimulus. The route to greater sustainability is nowhere near as important as the direction and we do not therefore have to get the numbers exact.

In Australia early versions of our green rewards system such as those produced by the Green Building Council of Australia focussed on the use of supplementary cementitious materials and up to three (3) green star points were awarded in Mat-4 Concrete v2 if it could be demonstrated that the concrete to be used in a building construction or refurbishment that had a significant recycled content.

• 1 point was awarded where 20% of all aggregate used was recycled aggregate.
• Up to 2 points could also be awarded as follows:
• 1 additional point where 20% of cement used for in-situ concrete and 15% of cement used for pre-cast concrete was replaced with industrial waste product
• 2 additional points where 40% of cement used for in-situ concrete and 30% of cement used for pre-cast concrete is replaced with industrial waste product[14].

The current criteria for concrete is a little better. The first few lines of Mat-5 Concrete v3 read well "up to three points are available where the project has reduced the absolute quantity of Portland cement" but then the criteria falls into the trap of being prescriptive by stating "by substituting it with industrial waste product(s) or oversized aggregate as follows...." At least the role of oversize aggregate with less process energy was introduced and the role of recycled or slag aggregate recognised.

Given the contribution of the built environment to emissions and that concrete, currently considered as part of the problem could become part of the solution; the need for change is urgent. A target rather than a prescription will not only clearly encourage urgently needed innovation, but make it easier to establish benchmarks and eventually link to the number crunching required for calculating carbon offsets and huge potential for profit through carbon trading.

When putting the need for a change in the way standards are written and green points are awarded in the context of the concrete industry it is important to note that there are some obstacles to implementation including the low level of skills in the industry. There is also a problem with units such as tonne to the tonne (tonnes CO2 or C per tonne of material) as we live in 3D space not in 50 or 100 tonne buildings! Accounting for carbon in terms of 3D space is unfortunately however not suitable for some structures such as roads so I suggest composite measures may be appropriate depending on the contribution of a material to the design objectives of a structure. More research by competent people is required in this area and this may only be achieved through the co-operation of all the professional bodies involved.

The current emphasis is generally on substitution, not on the total cement used relative to aggregates and or properties which are more relevant such as strength and durability. There are many other ways to reduce the binder:aggregate ratio other than by substitution with fly ash or slag such as placing drier concretes or using high range water reducers as suggested by Mehta[15] in his recent article. It follows that prescription is inadequate on its own and targeted objectives would be much more useful. On the subject of properties durability also contributes significantly to sustainability and is currently not currently addressed at all even though Hawken pointed out its role in his book "The Ecology of Commerce" some years ago now [16]. An approach that encourages innovation, the recognition of a wider range of properties other than just strength and the development of new binders such as geopolymers and our own Eco-Cements is required.

To further understand why performance based criteria should be mandatory for both permissions and rewards criteria consider the hierarchy of means by which concretes as we know them today based on Portland cement as well as new and innovative concretes such as Eco-Cements and geopolymers address the sustainability objective and could be further improved.

Methods:	Example:	Estimated Possible Improvement:
Change fuels	Burning genuine waste that does not result in emissions of other gases.  Using non fossil fuels	10% - 70%
New kiln designs such as the TecEco Tec-Kiln can capture CO2 and other gases	Split lime manufacture from clinker manufacture and calcine in a closed system without releases using grinding energy for calcining. Using the TecEco Tec-Kiln especially in the context of Gaia Engineering11	10% - 90%
Improve efficiencies.	Wet to dry process for PC manufacture etc.	10-20%
Change proportion minerals[17]	e.g. More aluminates less alite (C3S) in Portland cement	5-15%
Make cements containing more supplementary cementitious or pozzolanic materials.	Cements containing up to 60% fly ash and even higher proportions of ground granulated blast furnace slag or both can be used	20% ~ 80% depending on the formulation.
Use alternatives such as geopolymers[18]	Geopolymers can have less than 2/3 the embodied energy of Portland cement concretes depending on whether wastes are used or pozzolans have to be manufactured.	40% ~ 80% depending on the context.
Use alternatives such as TecEco Eco-Cements	If the magnesia for Tec or Eco-Cements is made in the TecEco Tec-Kiln they can have very low embodied energies[19].	50% ~ 150% depending if in the context of Gaia Engineering [20] for Eco-Cements [21]
Use of high range water reducing admixtures	High range water reducing admixtures can reduce water in concrete mixtures by 20 – 25% which can result in a corresponding reduction in cement usage[22]	20 - 25%
Air entrainment	Air entrainment reduces water and thus binder required.	5 - 15%
Use air as an aggregate as it has low embodied energy, low weight and results in lower conductance.	Air is a good cheap lightweight low conductance aggregate.	Variable
Improve particle packing	More precise particle packing reduces the amount of binder required.	15- 25%
Use of oversized aggregate	Large stone has lower embodied energy and makes concrete go further.	Variable
Use recycled, local or waste aggregate	Use of recycled aggregate	5-10%
Use less concrete is structures through better design and quality especially durability.	Through better design less concrete of possible greater strength and certainly greater durability may be used to produce the same 3D space.	15 - 30%
Change placement method.	Placing drier concrete and compacting it into place reduces the water binder ratio allowing significant reductions in binder for the same strength. Logistical embodied energy is also reduced.	20 - 30%
	Various other alternatives include the use of algae.	~20 - 30%
Use man made carbonates aggregates as in Gaia Engineering	The more CO2 that can be locked away as stable carbonate in the built environment the better.	~>100%
Carbonate ordinary premix concretes	This can be done by using magnesia and is the subject matter of a patent pending	~30%
Increase specific heat capacity through choice of aggregates	Some minerals have much higher heat capacities than others and could be included as aggregates.	Variable
Use materials as aggregates that have low conductance	Materials such as sawdust or pumice included in concretes as aggregates reduce conductance	Variable

The above table is not meant to be inclusive[23]. It does however demonstrate that around 80% improvement in sustainability is easily achieved through reduced embodied energy and emissions as well as improved lifetime energy performance.

Like sustainability, standards should consider and green point systems should define a direction rather than a destination, they have to be in focus with rewards and environmental stewardship and at the top of a pyramid or point of an arrow with all possible methods of achieving the direction underneath or behind. So that the permissions can be connected to rewards it is important to consider the objectives in common with the objectives of environmental stewardship which should be green advocacy and government policy. Rewards such as carbon offsets must as a result of the coalescence of objectives be easy to determine. LCA fundamentals such as embodied energies and emissions should be the basis of rewards and one of several measures for permissions. Other criteria for permissions may include strength, durability and other desirable parameters for a particular material type such as R rating. Diversions in objectives should be allowed for permissions to encourage innovation and for special uses but clearly stated. e.g. strength (if an objective) may be deliberately compromised for light weight and insulation. As technologies improve through the resulting innovation targets like embodied energy and emissions can be raised. The affect of materials on lifetime energies is important but a harder concept to fully incorporate in any system.

I have for at least the last ten years argued that what is required are changes in technical paradigms that result in less damaging molecular flows. Only innovation can achieve this and there are many examples such as the development of neon and now diode lighting that results in much lower energy consumption for the same lux[24] output. At the present time the use of prescriptive criteria by green organisations such as the Green Building Council of Australia (GBCA) for encouraging green procurement and building does not foster innovation. As the most important agents of change it is therefore fundamental that these organisations rapidly come to grips with the need for innovation to redefine resource use[25] and hence impacts and to redefine their ratings systems accordingly.

In relation to concrete, John Phair was right when in his 2006 paper he said "Growth in the codes, standards, guidelines, training and certification programs will play a significant role in the development and acceptance of alternative cements. An emphasis-shift to long-term cost-benefit analyses and performance- based criteria for designing concrete will result in the selection of a cement for a particular application and promote the selection and familiarity of alternative binders."[26] Under the new way I promote here our Eco-Cements and geopolymers may at last find the place they deserve.

Summary and Recommendations

This article is an attempt to give considerable direction to the changes required to our rewards and permissions systems for better environmental stewardship. It concludes that there is an urgent need to improve rewards rating systems and standards, approvals systems and other permissions generally and particularly for materials such as concrete[27] by making them performance based.  By being prescriptive new innovative ways for improvement are a priori excluded.

Using the above table as an example for the concrete industry a simple summation of the possible reductions in embodied energies and emissions and improvements to properties that impact on lifetime energies by using a combination of new cements, technologies and techniques can be assessed and demonstrate that it is possible to easily achieve at least 80% improvement. If clinker manufacture was separated from lime manufacture and lime was made using the TecEco Tec-Kiln, Portland cement itself could have much lower embodied energies and emissions and given the use of man made carbonate aggregate in the context of Gaia Engineering concrete made with it could even be a net carbon sink.

It is time that the Concrete Institute of Australia became more active in this area. Although there are no Australian statistics that I know of a recent survey of the membership of the ACI reported that 77% of members think that sustainable design an construction will become increasingly important[28].  The Concrete Institute should therefore liaise with the other materials organisations in the building and construction industry which use most of the materials produced to develop the concepts presented in this paper and essential if we want to solve the problems of global warming and waste.

A source of information like a materials Wiki funded collectively by the organisations concerned and to the extent possible through grants and other Federal and state government assistance would overcome the difficulties where the quality of the information available depends on the price paid.

It is also important that those involved in the building and construction industry put forward a united view in relation to other supporting initiatives including government procurement and support of research and development, and imperative if the substantial government assistance that is required is to be obtained.

Appendix 1 - Carbon Accounting

The World Business Council for Sustainable Development and World Resources Institute published guidelines that the Australian government seem to be following.
According to the methodology:

Emissions can be accounted for on a control basis at an organisational or financial level or equity basis as in consolidations.

Everything must be accounted for at an organisational or equity level in order to apply incentives or disincentives, but at a national level double counting must be eliminated.

To help delineate direct and indirect emission sources, improve transparency, and provide utility for different types of organizations and different types of climate policies and business goals, three “scopes” (scope 1, scope 2, and scope 3) have been defined:

Scope 1
Covers direct emissions from sources within the boundary of an organisation, such as fuel combustion and manufacturing processes.

Scope 2
Covers indirect emissions from the consumption of purchased electricity, steam or heat produced by another organisation. Scope 2 emissions result from the combustion of fuel to generate the electricity, steam or heat and do not include emissions associated with the production of fuel.

Scopes 1 and 2 are carefully defined to ensure that two or more organisations do not report the same emissions under the same scope (i.e. so double counting can be eliminated at a national level).

Scope 3
Includes all other indirect emissions that are a consequence of an organisation’s activities but are not from sources owned or controlled by the organisation. These estimates are provided for information only as Scope 3 emissions and are not be required to be reported under the National Greenhouse and Energy Reporting Act 2007 , but may be reported on a voluntary basis.

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