Moholt CLT

Good for wood: new embodied carbon regulations

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As with any new year, 2022 begins with new laws and regulations taking effect. 

Fortunately for building with wood, Sweden and France have pioneering new regulations in place as of 1 January 2022 that mandate consideration of embodied carbon, referring to the carbon emissions stemming from manufacture, installation, upkeep and deconstruction/demolition of building materials.

Other countries will soon take similar steps, and the European Commission is focusing on embodied carbon too. After all, the manufacture of building materials – especially steel and cement – was responsible for 10 percent of global energy-related CO2 emissions in 2020, according to the United Nations Environment Programme.

This growing embodied carbon focus is helping drive demand for low-carbon building materials, especially wood.

Sweden’s climate declaration

In Sweden, from the beginning of this year developers must calculate the embodied carbon emissions for new buildings and file those with the government to receive final building permit approval. Under the Act on Climate Declarations for New Buildings, these calculations are to cover the so-called upfront embodied emissions, encompassing the initial material production and construction stages of the life cycle of a building.

With this regulation, Sweden aims to increase the building sector’s knowledge of the climate impact of building construction, and ultimately contribute to reducing greenhouse gas emissions from buildings. In a next step, maximum values on building embodied carbon emissions are likely to be implemented, perhaps as soon as 2027.

The Netherlands is thought to be the first country to mandate the assessment of embodied emissions from non-governmental buildings, doing so in 2013.

France’s pioneering LCA approach

France has gone even further than Sweden (and the Netherlands).

France’s new RE2020 regulation mandates analysis of embodied emissions over the entire life cycle of a building, from the facility’s creation to its deconstruction/demolition. This applies as of 1 January 2022 for residential buildings and into 2023 it expands to cover other building types.

What is notable about RE2020 is that it requires dynamic life cycle analysis (LCA), which weighs future emissions less than current emissions (the former of which are expected to cause less climate harm, given the decarbonization targets of countries worldwide.) Thus, RE2020 favors materials – such as wood - that have low emissions during their manufacture and/or that store carbon. France is believed to be the first country to apply a dynamic LCA approach to the building sector.

RE2020 includes embodied carbon limit values that over subsequent years will progressively lower to reduce emissions. The roll-out of limit values also took effect at the beginning of 2022. These limit values will be tightened in 2025, 2028 and 2031, with every step further pressurizing the building sector to decarbonise.

EU embodied carbon focus

More broadly, the European Commission is for the first time addressing embodied carbon in its regulations, which have great potential to boost demand for wood building products.

First, the initial part of the European Union’s rulebook for guiding money toward economic activities classified as sustainable took effect 1 January 2022. This part of the sustainable finance taxonomy addresses activities that can make a substantial contribution to climate change mitigation and climate change adaptation. For new buildings larger than 5,000 m2 to meet this condition, the life cycle global warming potential (GWP) of the building resulting from the construction has been calculated for each stage in the life cycle and is disclosed to investors and clients on demand.

Secondly, under the proposed revision of the Energy Performance of Buildings Directive (EPBD) introduced last month, as of 2027 new buildings larger than 2,000 m2 are required to have an LCA conducted over their entire life cycle, with the results publicly disclosed via the building’s energy performance certificate (2030 is when this requirement would take effect for smaller new buildings). The energy performance certificates would also share information on any building-level carbon storage.

Finally, the EPBD proposal calls for national building renovation plans for which the Member States would need to describe their policies for reducing whole lifecycle embodied carbon emissions and the uptake of carbon removals. The European Parliament will now take up this EPBD revision as part of legislative process, during which the proposal will be adjusted.

U.S. low-carbon materials focus

Even in the United States, embodied carbon has become a factor in national policy. In December, President Biden unveiled an executive order for the U.S. government to achieve net-zero emissions across its operations. By virtue of the huge scale of the U.S. government and its procurement power, this order has great potential to shift the U.S. market toward low-carbon solutions, including for building materials.

This order includes the launch of a Buy Clean initiative for low-carbon materials. Under this action, the U.S. government will be required to purchase low-carbon materials for its building and civil infrastructure projects. A presidential Executive Order can be undone by a future president; however, mass timber has support from both political parties because of its benefits toward both climate change mitigation and jobs in rural areas. For example, the bipartisan infrastructure bill that was signed into law in November 2021 includes up to USD 12M for each of five years to expand the use of wood products.

More action needed, but the trend is clear

The regulations mentioned in this text could be more ambitious. And given the urgency of the climate crisis, they should be more ambitious – and many more countries need strong regulations governing embodied carbon.

Still, these regulations symbolize an undeniable trend toward mainstreaming the regulation of embodied carbon in buildings, which bodes well for increased building with wood. Denmark and Finland are among the countries with embodied carbon regulations that will take effect in the next few years.

Stora Enso will continue to work with our industry groups and partners to advocate for more and even more ambitious embodied carbon regulations. We won’t achieve the low-carbon world we need with high-carbon buildings.

About the author

Gregory Richards
Policy and Regulations Manager

Gregory Richards

Gregory Richards is the Policy and Regulations Manager for Stora Enso’s Wood Products division. He monitors, analyzes and helps influence government regulations affecting the use of wood products. Prior to joining Stora Enso, Greg engaged with listed companies worldwide on environmental, social and governance (ESG) issues on behalf of institutional investors, and he served in key communications and marketing roles with leading multi-national construction firms. In 2021, he graduated with an MSc in Carbon Management from the University of Edinburgh.