The Paris Agreement adopted in 2015 aims to limit global warming to well below 2°C and preferably to 1.5 °C which is above the pre-industrial level. Achieving this goal demands major GHG reductions and accelerated decarbonization across all sectors. According to the Global Status report for Building and Construction, construction and operations of buildings are responsible for one-third of the planet’s GHG emissions. Research by Chaohui et al.(Carbon footprint of the construction sector is projected to double by 2050 globally | Communications Earth & Environment), shows that construction sector’s carbon footprint has doubled over the past three decades and is projected to double again by 2050.

The UNEP Emissions Gap Report (2024), highlights that to meet global decarbonization and climate goals, the building sector must act quickly. The report estimates the building sector holds about 11% of global mitigation potential by 2035, or roughly 4.2 GtCO₂e of avoided emissions aligned with a 1.5 °C pathway.

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Estimates from global research bodies shows that the construction sector drives 13% of the world GDP, highlighting its economic significance and climate impact. It can help drive decarbonization across sectors such as renewable energy, transportation, manufacturing, real estate, and urban development. 

Why Construction Sector is Critical to Decarbonization

The sector depends on the most-carbon intensive materials like cement, steel and clinker. Chaohui et al. reports that about 40% of construction emissions come from cement, clinker, bricks, and clay, while metals add over 15%. Construction uses half of global steel output, and together with cement accounts for around 7% of global GHG emissions.

Emissions in buildings and construction are classified as operational and embodied carbon. The UK Green Building Council defines embodied emissions as those from raw material extraction, manufacturing, transport, maintenance, and materials used throughout a building’s lifecycle. In 2023, embodied carbon made up about 18% of global building-related emissions, with cement as the largest contributor. Roughly 60% of embodied emissions come from cement and steel used in construction. Operational emissions arise from the energy required for heating, cooling, lighting, elevators, and equipment needed to run a building over its lifespan.

Key Decarbonization Challenges Faced by Construction Sector

Climate change and the race to Net Zero are the biggest challenges faced by the construction sector as per a report titled A Global Forecast for Construction to 2030. Materials like cement, steel and aluminium commonly used in the construction process as discussed earlier are high embodied carbon material, transitioning to low-carbon alternatives remain a challenge due to limited availability and cost factors. (GlobalABC 2024/2025 report)

Many countries lack strict or well- enforced energy codes. The total number of building codes globally by 2023, increased to 81 for residential and 77 for non-residential structures, 80% of them being compulsory. But over 30% of the codes were not updated since 2015. It is expected that by 2030, 80% of the floor area growth will happen in the developing economy but many do not have strict energy codes providing opportunity for enforcement and alignment to net zero (GlobalABC 2024/2025 report).

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Reportedly, recent studies highlight that the construction sector also lags in digitalization and low levels of productivity growth. Also, technologies like BIM, collaboration platforms, IOT onsite exist but expanding it across the company remains difficult.

Overcoming these challenges is important for reducing the emissions gap, ensuring decarbonization and a sustainable, low-carbon future for the built environment.

Approaches to Drive Construction Sector Decarbonization

Decarbonization of the construction and building sector is an urgent necessity as well as a strategic opportunity for sustainable growth. For decarbonization of the sector, several measures can be implemented, such as promoting circularity, reducing the demand of primary resources by optimizing processes, and implementing efficient designs that consume less resources. Construction decarbonization and material optimization can be done by choosing more energy-efficient equipment and materials, as well as electrifying process and equipment. The use of low-carbon materials should be promoted over traditionally used material; for example, warm-mix asphalt can be used in place of hot-mix asphalt, and to as this can reduce approximately 15% embodied carbon. Advancing decarbonization across materials and operations can significantly lower the emissions.

The report Decarbonization of the Building Sector by Global ABC and UNEP highlight measures for decarbonization and including – developing and ensuring implementation of energy code for buildings and use of lifecycle assessment to reduce whole-life carbon. It also suggests encouraging integrated design which will help find workable and cost-effective solutions. The OECD recommends introducing a structured approach to implementing carbon policies that should include proper goals and milestones in the long-term roadmaps.

What ‘s next – Global Policies for Construction Sustainability

As per the report by GlobalABC report, the worldwide policy for the decarbonization and construction sustainability is evolving. The EU’s Energy performance of Building Directive (EPDB) requires zero emission standards for new buildings by 2030 and by 2040 it intends to end the use of fossil fuel boilers. Other countries following similar pathway includes France with RE2023, Denmark’s 2023 lifecycle carbon limits, and the UK’s 2021 Building Regulations. Sri Lanka’s Energy Efficiency Building Code (2020) aims to support efficient design while China’s 2024 action plan aims to implement institutional framework and accelerate minimal energy consumption buildings by 2027.

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Legislation on Carbon Trading and Sustainable building code were enacted in India, where building and construction related activities contribute about 40% GHG emissions. Green frameworks such as GRIHA, IGBC, LEED have also been formulated for promoting construction sustainability. The Bureau of Energy Efficiency enacted Energy Conservation and Sustainable Building Code (ECSBC) in 2024 that aims to implement energy-performance requirement for building and integrates sustainability elements.

Conclusion

Since the construction and building sector accounted for over 32% of global energy demand and 34% of energy related CO2 emissions in 2023, its decarbonization and shift towards sustainable construction are essential for achieving climate goals. For decarbonization, the sector will be required to transition to a low carbon economy which will involve policies, investment, research and development and commitment from various stakeholders. Implementing strategies like circularity, digital tools, low-carbon materials, and shifting to renewable energy can lead to sustainable construction and support decarbonization efforts for a carbon neutral economy. With continued investment and policy support, the sector can lead to deep decarbonization and a resilient and net-zero future.

Why Choose InCorp Global?

At InCorp Global, we help companies in preparing and implementing tailored decarbonization and net zero roadmap. Our team has expertise across sectors such as construction and chemicals, delivering impactful low-carbon and net-zero projects. We offer end-to-end solutions, from assessing baseline emissions, identifying and prioritizing decarbonization initiatives to preparing detailed actionable decarbonization roadmaps. Our decarbonization processes are aligned with internationally recognized global standards and frameworks like SBTi, ISO 14064, and sector-specific decarbonization pathways. Our approach helps organizations to go beyond compliance, turning sustainability into strategic advantage which boosts industry leadership, brand value, and long-term resilience.

Authored by:
Muskan Patel | Sustainability & ESG

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