UK cement: the importance of policy

The UK cement sector has had a difficult few years. Despite the optimism shown with projects like HyNet and the Peak Cluster, it was recently announced that UK cement production had fallen to its lowest levels for decades. What are the primary challenges facing the UK sector at present?

UK cement is an essential, foundational industry, but it’s being squeezed on competitiveness. High energy, regulatory, and labour costs are making it harder to invest and compete with overseas producers. The latest production data underlines the point – domestic output has fallen to its lowest level since 1950. A growing reliance on imports puts the UK at risk of losing its materials security and offshoring its emissions. If we’re serious about delivering homes and infrastructure at pace, we need to be serious about our materials supply chain, too.

What kind of support are you looking for from policymakers? Where would government assistance be most impactful?

We need a fair and competitive environment to do business. In practical terms, that means tackling industrial electricity prices, which are among the highest in the world, getting carbon policy right so UK producers aren’t at a disadvantage, and creating the economic certainty and stability that unlocks investment.

We need policymakers to focus on creating a level playing field.

The UK Carbon Border Adjustment Mechanism (CBAM), set to come into effect in January 2027, could help ensure imports face a carbon cost comparable to domestic production by accounting for both the costs of carbon and the indirect costs embedded in electricity prices. The draft legislation doesn’t do this at present. As the sector identified as most at risk of carbon leakage, cement should qualify for Energy Intensive Industry (EII) compensation to help offset these costs, but it is currently excluded. The result is that British cement producers are left facing sky high electricity costs without compensation. We’re also asking for earlier testing and clarity on the rates that will be applied as part of the CBAM, so when the policy kicks in, there’s confidence that it will work effectively.

Public procurement policy would also play a powerful role. Prioritising British-made cement would help support domestic production, reduce carbon leakage, and back good jobs and growth across the domestic supply chain.

Without these measures in place, there is an increasing risk of deindustrialisation in a sector that underpins critical infrastructure, housing, and many of the government’s plans for growth.

Moving to the topic of CCS: How central is this technology to the UK cement industry’s net zero ambitions, compared to other levers like fuel switching or clinker substitution?

All the levers matter. The cement and concrete sectors have already made progress, decarbonising faster than the UK economy, having reduced their emissions by 63% since 1990 through methods like fuel switching.

But cement is slightly set apart from other heavy industry because its emissions aren’t just tied to fuel use – they’re inherent to the chemistry of making clinker, which is needed to make portland cement. Over 200 years, this type of cement has been rigorously tested and proven to be reliable and can be produced at scale domestically. So, while low-carbon, alternative cement chemistries could play a role in decarbonising cement, they’re not the complete answer. They still need to go through the same stringent safety and durability testing as portland cement. We can’t let our industry be lost while we wait. Therefore, carbon capture is still essential to deal with the process emissions that simply can’t be eliminated any other way.

The UK’s CCS strategy is built around industrial clusters like the Peak Cluster and HyNet – how well does this model work for cement producers, and what are the options for plants outside of these clusters?

A cluster approach can work well because shared transport and storage infrastructure lowers cost and risk. Clear timelines, open access, and investable business models are a must for this to work in reality.

However, we need a government-led CO₂ transport and storage plan that accounts for both clusters and dispersed sites, so businesses can plan and so the whole sector can decarbonise. Accounting for dispersed sites is more challenging, but not impossible. What’s really important is giving industry visibility and options, rather than leaving sites guessing.

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Read the article online at: https://www.worldcement.com/special-reports/08062026/uk-cement-the-importance-of-policy/