The impact of national and international climate policy on the cement industry

Despite the uncertainties surrounding specific formulation of particular elements of the Protocol, the Fourth Conference of the Parties to the Framework Convention on Climate Change in Kyoto will have an enduring effect on future national and international policies relating to climate change. Not only have nationally agreed reduction commitments been agreed at this conference that constitute binding pledges under international law if ratified by the national parliaments, but also the mechanisms for achieving these goals have been significantly expanded, especially by the introduction of emissions trading. The resolutions adopted indicate a degree of relaxation in national policies relating to climate change. There is now a delayed timetable for the 25 % reduction in CO2 emissions from 1990 levels that was to be achieved by the year 2005. Delaying the reduction timetable by up to seven years (2008 to 2012) should bring ecological as well as economic advantages. The extra time could help to avoid the economic disruption that rigid adherence to the previous target would probably have entailed, and should also allow sufficient scope for gradually adapting the existing capital stock to changed ecological requirements. On the other hand the flexibilisation of the range of mechanisms available to national environment policy presents new challenges compared to the previous regime that relied on regulatory stipulations and prohibitions and on increased levies lather than on quota controls compatible with market conditions. It is therefore to be expected that in the light of the Kyoto resolutions, national environmental policies will also rely more heavily on flexible mechanisms. Both the flexibilisation of the target and: the extended range of mechanisms will have beneficial effects for the cement industry. Reducing CO2 emissions and/or improving energy efficiency can only be achieved in this industry by replacing old, inefficient plant by modern, energy-efficient plant, as is the case in many energy-intensive areas of production.