The low-Carbon Economy

A low-carbon economy is an international emissions trading system that uses a market-based approach to control pollution by providing economic incentives for achieving reductions in the emission of greenhouse gases.

Also known as cap and trade, the trading process starts with a central authority, usually a government, setting a limit or cap on the amount of pollutant that can be emitted. Each operator, such as a power plant or manufacturer, has an allowance of credits, where each unit gives the owner the right to emit one metric ton of carbon dioxide (CO) or other equivalent greenhouse gas. Operators that have not used up their quotas can sell their unused allowances as carbon credits, while businesses that are about to exceed their quotas can buy the extra allowances as credits, privately or on the open market.

By permitting allowances to be bought and sold, an operator can seek out the most cost-effective means of reducing its emissions, either by investing in “cleaner” machinery and practices or by purchasing emissions from another operator who already has excess capacity.

COP21 and 2016 Paris Agreement

Efforts towards a low-carbon economy began in 1972, at the UN Conference on the Human Environment in Stockholm. It became an international reality in 2015, with the signing of the Paris Agreement under which most industrialized countries committed to dealing with greenhouse gases emissions alleviation, adaptation and finance starting in the year 2020. The central aim of the agreement is to support the global response to the threat of climate change by ensuring a global temperature rise this century will remain well below 2⁰C above pre-industrial levels and to pursue efforts to limit the temperature increase even further to 1.5 degrees Celsius.1 Before and during the Paris conference, countries submitted comprehensive national climate action plans (INDCs). These plans are not yet enough to keep global warming below 2°C, but the agreement forges a path to achieving this target. Additionally, the agreement aims to strengthen the capacity of countries to deal with the effects of climate change.

Not part of the Paris Agreement (and not legally binding) is a plan to provide US$100 billion per year in aid to developing countries for executing new measures to minimize climate change.

In early March 2016, the Obama administration gave a $500 million grant to the Green Climate Fund as “the first chunk of a $3 billion commitment made at the Paris climate talks.”2

Solidia: A Competitive Edge for Cement in the Low-Carbon Economy

Solidia offers the cement industry a way to pivot to the low-carbon economy with a competitive edge. The Solidia process sequesters CO₂ in the production of cement, mitigating the impact of new carbon taxes. It also offers new product options and savings for concrete customers while leveraging the same manufacturing process, equipment and raw materials currently used by the cement industry.

Replacing ordinary Portland cement (OPC) with Solidia Cement could have a dramatic and lasting global impact. The Cement Sustainability Initiative of the World Business Council for Sustainable Development responded to a worldwide demand for more sustainable cement and concrete by setting 2050 CO₂ reduction targets for the global industry. Solidia’s cement and concrete technologies represent the only demonstrated pathway that meets the WBCSD 2050 goal. Adoption by even a fraction of concrete manufacturers for select applications would represent a significant step towards reducing the industry’s carbon footprint.

1. “The Paris Agreement,” United Nations Framework Convention on Climate Change, 13 October 2016
2. “Obama Administration Pays Out $500m to Climate Change Project,” The Guardian, 7 March 2016


Big numbers in a Low-Carbon Economy

25% — Countries representing one-quarter of the world’s economy are putting carbon markets in place.1

40% — The Regional Greenhouse Gas Initiative has helped reduce emissions by 40% in nine US states since 2009.2

$2.8 Billion — In 2011, California companies received $2.8 billion, or 57%, of the $4.9 billion in venture capital offered up in the clean-tech category of funding nationwide.3

250 Million — China is implementing cap-and-trade pilot programs in seven provinces and cities that encompass 250 million people.4

1.3% — European Union emissions have been decreasing at an average rate of 1.3% since the EU launched its carbon reduction strategy.5

1. “A 2016 Carbon Market Forecast,” The Climate Trust, 2016
2. “RGGI Report: Investments Provide $2.9 Billion in Energy Bill Savings,” Regional Greenhouse Gas Initiative, 2015
3. “California Leads Nation in Green-tech Venture Capital Funding,” Los Angeles Times, 2012
4. “Why China’s New Cap and Trade Plan is the Real Deal,” Paulson Institute, 2015
5. “EU Rating,” Climate Action Tracker, 2016

Additional Resources:

How Cap and Trade Works,” Environmental Defense Fund, February 2009
The World’s Carbon Markets,” Environmental Defense Fund, November 2016
How does the emission trading scheme work?,” Carbon Control, 10 March 2012
Greenhouse Gas Emission Trading Allowance Scheme,” Europa, Summaries of EU Legislation, 7 July 2016
Moving to a Low-Carbon Economy,” Climate Policy Initiative, October 2014