New Jersey’s top environmental official says he’s going to start pitching to other states a green concrete tax credit, similar to the first-in-the-nation law just signed by Gov. Phil Murphy (D).
“We’ll look at this piece of legislation and our ability to share and cross-pollinate with other states,” said Shawn LaTourette, commissioner of the New Jersey Department of Environmental Protection, referring to his role as infrastructure work group chair at the Environmental Council of the States, a national association of state agency heads.
“Does this change the behavior of everyone overnight? Absolutely not,” he said. “But what it does is begin to sow the seeds of change.”
Concrete is responsible for at least 7% of global carbon dioxide emissions contributing to heating the planet, according to clean energy research group BloombergNEF.
The new law gives businesses a credit of up to 5% of a project’s total concrete cost if they use materials with low levels of embodied carbon dioxide emissions. An extra 3% credit is available to companies that deliver concrete made with carbon capture, utilization, and storage technology.
One of the states environmentalists most want to see adopt the New Jersey model is California, both because its construction sector is so huge and because its legislature already passed a bill in 2021 requiring the cement sector to reach net zero by 2045.
California also has an existing “buy clean” program that concrete could simply be added to. Democrats last year introduced a bill to do just that, but it died in committee.
Even so, “it makes it easier that New Jersey has done it,” said Christina Theodoridi, policy advocate for heavy industry at the Natural Resources Defense Council. “Both New Jersey and California are emerging as climate leaders. They’re trying different things. It’s a really healthy policy competition. They’re showing it can be done, and done a little differently.”
Another tempting possibility for green concrete advocates is New York, where Gov. Kathy Hochul (D) signed a bill into law last January requiring the state to create a system for state agencies to consider a given type of concrete’s climate performance when awarding contracts.
Whatever system the state devises could include tax credits similar to New Jersey’s or other performance-based incentives, according to Sasha Stashwick, NRDC’s director of industrial policy.
In the meantime, LaTourette pledged tough enforcement to catch concrete producers making false claims in order to get the tax credit.
“We won’t take industry’s word for anything,” he said. “And not because we have a fundamental distrust of industry, but because it’s our job.”
But he said he doesn’t expect to see mass malfeasance.
To capture the tax credit, one of the first things Stashwick expects to see concrete makers do is reduce the amount of cement they stir into their product. That’s because most of the carbon emissions linked to concrete come from making cement, both from the chemical reaction that results when calcium carbonate is broken down and from the enormous heat levels that must be reached.
Cement tends to be overspecified in most concrete, meaning “you can really push down on the amount of cement you’re mixing into the recipe” without compromising durability or strength, Stashwick said.
If builders or local governments are worried about concrete collapsing because it has less cement, they can start by using it in sidewalks, then graduating to roads and buildings once the material has proven itself, Theodoridi said.
A Compelling Enough Offer?
New Jersey Sen. Linda Greenstein (D), who sponsored the Garden State’s tax credit bill, conceded that it’s unclear whether a significant number of concrete makers will be tempted enough by the maximum 8% tax credit to break longstanding business relationships and switch to new cement providers, especially since the green products generally cost more than the traditional ones.
Theodoridi said the concrete sector generally is slow to change. “I think the incentives are a first step to help demonstrate that it can,” she said.
To companies in the green cement and concrete industry, any legislation that creates more demand for their products is welcome.
Robert Niven, chairman of sustainable concrete firm CarbonCure Technologies, hailed the New Jersey law for using “financial incentives to encourage a green transition in an industry with hard to abate emissions, driving a voluntary embrace of innovation without hurting workers or jeopardizing their jobs.”
Loren Burnett, president of algae-based cement company Prometheus Materials, said the new law will not only lower carbon emissions but will also spur domestic job growth in the burgeoning green building products industry.
“As other states come online with similar types of bills and financial incentives, that will very rapidly affect concrete production in those states,” Burnett said. “I think it’s great news for the entire industry.”
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