COP 29: Green public procurement and carbon capture for industry decarbonization in the spotlight

With emissions from heavy industries continuing to climb, this year’s climate talks highlighted the critical policies and technologies needed to reverse this trend across two of our world’s most carbon-intensive sectors: steel and cement. Countries with strong purchasing power reaffirmed their Green Public Procurement (GPP) commitments. Meanwhile, new evidence showed the effectiveness of GPP, revealing that major CO₂ reductions are possible if countries adopt the most ambitious levels of the Clean Energy Ministerial-Industrial Deep Decarbonization Initiatiave’s (CEM-IDDI) GPP Pledge, launched in 2022. Summit participants also emphasized the importance of technologies like carbon capture and storage (CCS), exploring new guidelines for measuring and reporting CCS impacts at the product level. Meanwhile, progress was made on defining what constitutes a green industrial product.

Evidence confirms that green public procurement is a key policy lever

As Canada, Germany, the United Kingdom and the United States reported on their progress towards meeting their commitments under the GPP Pledge, new evidence confirmed the significance of these commitments as well as the power of GPP for driving decarbonization. Presented by the United Nations Industrial Development Organization (UNIDO) and the IDDI, the new research showed that implementing policies in line with Level 3 of the GPP Pledge in those four countries alone could significantly reduce emissions. “By 2050, emissions from steel production could fall by 81 per cent and cement by 85 per cent,” said Fiona Skinner, Coordinator of the IDDI, which facilitates the GPP Pledge together with the CEM.

More countries urged to use their purchasing power to drive critical decarbonization

With the power of GPP evident, Canada, Germany, Lithuania, the United Kingdom and the United States– along with the IDDI, the First Movers Coalition, and the Net Zero Government Initiative–issued a joint statement urging more governments to join the GPP Pledge.

“Every step forward and every new commitment matters,” Ms. Skinner said. “The call to action is not static. It remains open for further governments to endorse in the coming months, with the ultimate goal of mobilizing a critical mass of governments working towards net-zero emissions via green public procurement and other demand stimulating policies,” she said.

Meanwhile, the United Arab Emirates increased its level of commitment under the GPP Pledge. “We now have five large public buyers driving the decarbonization of steel and cement,” Ms. Skinner said. “This is important because national and sub-national governments procure billions of dollars worth of building materials every year to construct public infrastructure,” she said. “When they set time-bound targets for buying low-emission steel and cement, it sends a strong market signal, giving industry and financiers the confidence to invest.”

Summit participants also discussed the practicalities of implementing GPP, emphasizing the importance of policymakers addressing the issue holistically and empowering procurement professionals. The IDDI also presented two new guides focusing on disclosure requirements to support market readiness, and setting commitments, expanding its series aimed at helping national and sub-national governments to implement green public procurement.

Urgent support is needed to accelerate technology deployment

Implementing the highest levels of the GPP Pledge remains challenging, though, as key technologies such as green hydrogen and CCS are still not commercially available. At the same time, more policy incentives and investments to accelerate technology deployment are urgently needed.

Summit participants discussed the need for governments to address these challenges by offering financial incentives and enabling policies. Grants, tax breaks, and public-private partnerships were discussed as measures that can speed up the deployment of these crucial technologies, with the Industrial Transition Accelerator launching a helpful toolkit for governments to stimulate green demand. Programmes like the US Inflation Reduction Act and Germany’s Carbon Contracts for Difference were highlighted as key steps toward this goal.

With CCS becoming such a critical decarbonization technology for cement in particular, the IDDI also released a new paper aimed at building agreement on how to measure and report CCS impacts at the product level. The paper– ‘Setting a foundation for Carbon Capture and Storage in product LCA–explores a new framework. “This is an emerging field, and by coalescing around a common understanding of how CCS should be integrated in product life cycles, governments, industry and standard setting organizations can contribute to building a coherent reporting framework,” Peter Hemingway, IDDI Policy Advisor said. The paper was developed with the support of the IDDI’s technical working group, and specialist groups including the CEM CCUS Initiative.

Interoperable standards key for international decarbonization efforts

Interoperable standards are critical to making green public procurement work and a number of discussions took place on this important topic. Earlier this year, the IDDI launched its milestone technical document: Guidance for PCR Harmonization. This provides a common foundation to harmonize greenhouse gas accounting methodologies for steel, cement and concrete products. These standards can enable manufacturers to differentiate their products based on environmental impact, allowing them to capture market value through investment in decarbonization. The standards also serve as an important enabler for green procurement in both the public and private sectors, driving demand for low-emission products.

At the same time, the Global Cement and Concrete Association (GCCA) officially launched its low carbon and near zero definitions. “We are seeing many different thresholds for low emission products emerge for steel, cement and concrete, and the GCCA’s definitions, which build on the International Energy Agency’s, are a welcome addition in helping to define green concrete products,” Mr. Hemingway said.

Significant attention was also given to recognizing the value of emission reductions as industry decarbonizes. At an IDDI event with the Government of Japan, worldsteel and Mitsubishi, presented progress on chain of custody approaches to track and value emission reductions across the steel supply chain, emphasizing the need for robust systems that prevent greenwashing and maintain trust among consumers and investors.

“Contributions from countries like Japan and organizations such as the Japan Iron and Steel Federation highlight the importance of international collaboration to establish practices that support a global market for low-carbon steel,” Mr. Hemingway said. “This effort is seen as crucial for driving investment and innovation for green steel,” he said.

New partnerships to mobilize technical and financial support launched

A big step forward for heavy industry decarbonization at COP 29 was the Climate Club’s Global Matchmaking Platform launch. Initially announced at COP 28, this new Platform is supported by the German Federal Ministry of Economic Cooperation and Climate Action and is implemented by UNIDO. By leveraging international cooperation, the platform aims to match heavy industry players in developing and emerging economies with financers, technology and expertise to create tailored decarbonization solutions.

Meanwhile, the new UK-Brazil Industrial Decarbonization Hub (ID Hub) was presented. The ID Hub is a country-led initiative between Brazil’s Ministry of Development, Industry, Trade and Services (MDIC) and the UK’s Department of Energy Security and Net Zero (DESNZ). It aims to coordinate international and domestic efforts to support Brazil’s transition to a low-carbon industrial economy. It connects the government with global partners, aligning financial and technical resources to drive sustainable industrial development.

Looking ahead

As we look to next year’s COP 30 in Brazil, achieving 1.5°C remains possible but requires unprecedented global action, including rapid decarbonization of steel and cement. Creating demand for these commodities is more crucial than ever. “IDDI will continue to focus on demand creation, the interoperability of standards, and transparent data and reporting frameworks,” Ms. Skinner said. “We are also focused on translating insights and learnings from this COP into action and change on the ground, and crucially to help mobilize more financial support,” she said.