HOLCIM'S NET- ZERO JOURNEY - CLIMATE REPORT 2022
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BUILDING PROGRESS At Holcim we are putting climate action at the heart of our strategy to build a net-zero future that works for people and the planet. Cover image: The Eight Gardens complex in the UK is built with ECOPact with 64% lower CO2
CONTENTS 01. ACCELERATING GREEN GROWTH 04 02. OUR NET-ZERO JOURNEY 10 03. DECARBONIZING THE BUILT ENVIRONMENT 22 04. NET-ZERO CONCRETE 32 p04 05. PRODUCT AND PROCESS INNOVATION 36 06. OUR CCUS STRATEGY AND TECHNOLOGICAL PATHWAY 44 p10 p22 07. GOVERNANCE 08. CLIMATE-RELATED 48 OPPORTUNITIES AND RISKS 50 09. SCENARIO ANALYSIS 62 10. A DVOCACY POSITIONS AND TRANSPARENCY 66 p32 p36 HOLCIM Climate Report 2022 01
MESSAGE FROM JAN JENISCH AND MAGALI ANDERSON Our world is growing, with population and urbanization on the rise. As a global leader in innovative and sustainable building solutions, we are putting climate action at the heart of our strategy to accelerate our world’s shift to net-zero. Around the world our 70,000 people are building progress for people and the planet. With this report, we invite all our key stakeholders to join us to make a bigger difference together. “At Holcim we are building “On our net-zero journey, progress for people and we are walking the talk the planet, putting at Holcim, taking clear climate action at the heart science-driven action to of our strategy to improve win the race for climate.” living standards for all.” MAGALI ANDERSON Chief Sustainability JAN JENISCH and Innovation Officer Chief Executive Officer 02 HOLCIM Climate Report 2022
DEAR STAKEHOLDERS, • Improve living standards for all, With our 70,000 people around the increasing access to affordable world, we will never stop pushing for With today’s rise in population and housing with innovative progress. This Climate Report is a urbanization, Holcim has a central partnerships and technologies. testimony to their drive to put climate role to play to build essential housing action at the heart of everything and infrastructure to improve living • Drive circular construction to build we do. We hope that their many standards for all. That’s why we are more with less, from green concrete achievements, which are reflected building more with less to accelerate made with recycled construction in the pages that follow, will inspire our world’s shift to net-zero. & demolition waste to roofs with you to join us to make a bigger upcycled plastic inside. As a global leader in innovative and difference together. sustainable building solutions, Holcim Across everything we do, we are The future isn’t written. It’s built. is part of the solution. We are putting building progress for people and climate action at the heart of our the planet: from our ECOPact green Join us to build a net-zero future that strategy, to build progress for people concrete and ECOPlanet green works for people and the planet! and the planet. cement; to our advanced roofing systems, from Firestone to Malarkey Around the world, we are innovating Roofing Products; all the way to our every day to: specialty building solutions, from 3D • Make cities greener from printing to magnetizable concrete; foundation to rooftop, from our and so much more. JAN JENISCH low-carbon materials to our energy- efficiency and renovation solutions. WE ARE BECOMING A Chief Executive Officer NET‑ZERO COMPANY. • Empower society with smarter On this journey we are taking a infrastructure, with tailored science-driven approach, with our systems to enable more green industry’s first net-zero 2030 and mobility, renewable energy and 2050 targets, validated by the Science essential sanitation. Based Targets initiative (SBTi). These MAGALI ANDERSON goals cut across our entire value chain, Chief Sustainability including Scope 1, 2 and 3 emissions. and Innovation Officer Image: Living tomorrow complex in Belgium is built with ECOPact with 70% lower CO2 HOLCIM Climate Report 2022 03
01. ACCELERATING GREEN GROWTH With today’s megatrends, from the rise in population and urbanization to improving living standards, the construction sector has never been more attractive. We are ready to seize the opportunities ahead with our “Strategy 2025 – Accelerating Green Growth.” THE FOUR PILLARS OF OUR "STRATEGY 2025 – ACCELERATING GREEN GROWTH" ACCELERATING EXPANDING LEADING IN DELIVERING GROWTH SOLUTIONS INNOVATION AND SUPERIOR Accelerating growth AND PRODUCTS SUSTAINABILITY PERFORMANCE across all markets with Reaching 30% of Innovating to remain at Fostering a high- leading profitability Group Net Sales the forefront of green performance culture and cash flow, by 2025, from new building solutions while operating at the driven by innovative builds to repair and and driving circular highest level of ethics and sustainable renovation. Becoming construction to build and integrity to deliver building solutions. global leader in more with less. ambitious financial roofing and expanding and sustainability specialty building targets in line with solutions, as double- net‑zero roadmap. digit growth engines. “STRATEGY 2025 – ACCELERATING GREEN GROWTH” INCLUDES AMBITIOUS SUSTAINABILITY TARGETS TO BE ACHIEVED BY 2025: 25% 10m 500m >40% of ready-mix sales tons per annum construction CHF of Green of financing agreements from ECOPact, with & demolition waste Capex per annum linked to sustainability goals 30% to 100% lower recycled in our products CO2 footprint and 75 million tons of waste recycled overall 04 HOLCIM Climate Report 2022
SOLUTIONS AND PRODUCTS: ACCELERATE GROWTH TO REACH 30% OF GROUP SALES BY 2025 2020 2021* TARGET IN 2025 8% 13% 12% 30% 11% 20% 57% 19% 60% CEMENT SOLUTIONS & PRODUCTS AGGREGATES READY-MIX * 2021 includes 9 months' contribution from Firestone; Malarkey Roofing Products acquisition closed in February 2022 and PRB Group acquisition is expected to close in Q2 2022 EXPANDING SOLUTIONS & PRODUCTS As a global leader in innovative and sustainable building solutions, Holcim is expanding Solutions & Products to reach 30% of Net Sales by 2025. Holcim is becoming a global leader in roofing with the milestone acquisitions of Firestone Building Products and Malarkey Roofing Products. Its roofing systems and clean air technologies span residential and commercial applications, including green and cooling roofing products, and enable solar roofing capabilities. Holcim is also expanding its specialty building solutions to play a bigger role in repair and refurbishment, with advanced energy efficiency and renovation systems. In 2021, Holcim announced the acquisition of PRB Group, the biggest independent specialty building solutions business in France and will continue to expand this segment with strategic investments and acquisitions. 12 BOLT-ON ACQUISITIONS Accelerating green growth, Holcim is pursuing a bolt-on acquisition strategy to expand its Aggregates and Ready- Mix Concrete businesses. In 2021, we bolt-on acquisitions completed 12 bolt‑on acquisitions in 2021 PRB GROUP in mature European and North American markets. At the forefront of green building solutions, we offer the world’s broadest range of green concrete, ECOPact, and green cement, ECOPlanet as well as a Sport Hall Dolni Brezany, Czech unique range of circular aggregates, Republic built with Firestone’s UltraPly such as Aggneo. TPO waterproofing membrane HOLCIM Climate Report 2022 05
01. ACCELERATING GREEN GROWTH CONTINUED LEADING CEMENT’S GREEN TRANSFORMATION We are committed to leading cement’s In 2021, we launched the world’s green transformation, in line with our broadest range of green cement, DID YOU KNOW? industry-first 2050 net-zero targets, ECOPlanet, delivering at least 30% MAKING LOW CARBON THE validated by the Science Based lower carbon footprint with equal STANDARD IN THE US Targets initiative. to superior performance compared Across the US, we are deploying to ordinary cement (CEM I/OPC) to our OneCem cement with a 10% We are decarbonizing cement by enable low-carbon construction at reduced CO2 footprint, making it increasing our use of innovative low- scale. This solution contributes to our standard product wherever emission raw materials from calcined achieving world-class environmental we can. We kicked off its launch clay to construction & demolition certifications such as LEED®, BREEAM® in Texas last year, switching all our waste. In addition, we are increasing and HQE®. It is currently being used production in that key market to our use of alternative fuels to reduce across 15 markets for a range of high- OneCem. Building on this success, the footprint of our cement operations. performance applications, including we have now rolled OneCem out For instance, in Europe we operate large structures with very specific across the Midwest, converting 100% with over 60% of alternative fuels technical requirements, such as of our production at our two cement with sites like Retznei, Austria, stadiums, bridges, dams and high-rise plants, Ste. Genevieve in Missouri already running at 100%. buildings. For instance, our ECOPlanet and Alpena in Michigan. With this with an 80% lower CO2 footprint was shift, we will reduce CO2 emissions used in Amazon’s new headquarters by approximately 300,000 tons this Egypt’s Iconic Tower is built with in Seattle, holding its glass spheres year, which is equivalent to taking ECOPlanet green cement with together, contributing to its LEED over 70,000 cars off our roads. 60% lower CO2 Gold certification. 06 HOLCIM Climate Report 2022
THE OPPORTUNITIES WE HAVE ARE ENORMOUS AND WE ARE READY TO CAPTURE THEM CIRCULAR ECONOMY: INCREASING DEMAND FOR LOW-CARBON THE OPPORTUNITY OF OUR TIME BUILDING MATERIAL PRODUCTS Reduce, reuse and recycle across everything Make low-carbon construction possible we do to build more with less with our ECOPact and ECOPlanet lines REPAIR, REFURBISH CONCRETE: KEY FOR CLIMATE MITIGATION AND RENOVATE BUILDINGS AND ADAPTATION Repair and renovate buildings Concrete to help upgrade cities to withstand to make them last longer the impacts of climate change HOLCIM Climate Report 2022 07
02. OUR NET-ZERO JOURNEY At Holcim we are becoming a net-zero company, putting climate action at the heart of our strategy to build progress for people and the planet. Across our net-zero journey, we are equivalent of 1,000 truckloads every EMPOWERING SMART DESIGN focusing on four key levers of action to day. In Switzerland we launched the AND SYSTEMS decarbonize the built environment: world’s first green cement with 20% We are deploying a range of recycled construction & demolition technologies to make buildings smarter MAKING GREEN BUILDING POSSIBLE waste within our ECOPlanet range and from foundation to rooftop and at AT SCALE are working to deploy this solution every stage of their life, from design We are at the forefront of green across as many markets as possible, and building to repair and renovation. building solutions to make low-carbon starting in Europe. With every roof that Our smart roofing systems, from construction possible at scale around we build with our Malarkey Roofing Firestone Building Products’ green the world, from Mumbai to New York. Products, we upcycle the equivalent and cool roofing solutions to Malarkey We launched the world’s first global of five rubber tires and about 3,200 Roofing Products’ clean air technology ranges of green concrete, ECOPact, plastic bags. that actively reduces air pollution, and green cement, ECOPlanet, with a CO2 footprint ranging from 30% 75+5+20O to 100% lower than the local market reference with no compromise in our Scope 1 emissions are generated OUR CO2 FOOTPRINT (%) performance. In our “Strategy 2025 – during the decarbonation of the Accelerating Green Growth” we aim to raw materials we use to produce reach 25% of concrete net sales with clinker. Fuel combustion necessary ECOPact by 2025. Off to a fast start to heat the cement kilns is another on this journey, ECOPact is already significant source of emissions. A available across all our five regions in small share of Scope 1 emissions 25 markets thanks to the breadth of come from our own power our green formulation expertise. generation and from operations linked to aggregates and ready-mix DRIVING CIRCULAR CONSTRUCTION concrete. TO BUILD MORE WITH LESS As a world leader in recycling, we are Scope 2 emissions account for 5% driving circular construction to reduce, of our carbon footprint. Scope 2 reuse and recycle materials wherever includes indirect emissions from the we can. In 2021, we recycled 54 million SCOPE 1: 119.3 MT CO2 75% generation of purchased electricity tons of materials across our business SCOPE 2: 7.0 MT CO2 5% consumed in the company’s owned and are doubling down on this rate or controlled equipment. SCOPE 3: 30.0 MT CO2 20% to reach 100 million tons by 2030. To Scope 3 emissions account for 20% build new from the old, we are scaling of our carbon footprint. Scope 3 Scope 1 emissions account for 75% up our capacity to recycle construction includes all other indirect emissions of our footprint and are at the core & demolition waste into new building generated in our supply chain, of our emissions reduction strategy. materials with the objective to reach such as for transportation and Scope 1 includes all emissions 10 million tons by 2025. In 2021, we the extraction and production of that are released directly from our already recycled 6.6 million tons of purchased materials and fuels. operations. Most of these come from construction & demolition waste, the cement production. Over 60% of 10 HOLCIM Climate Report 2022
enable more energy efficient buildings Today we offer the world’s broadest for buildings, roads and landfills. and healthier cities. With our specialty range of green cement, ECOPlanet, Holcim offers a range of high-value building solutions, from our Tector delivering low-carbon and circular aggregates and solutions for building range to Airium, we are making benefits with no compromise on and infrastructure projects available buildings last longer with advanced performance. ECOPlanet ranges in many countries around the world. repair and renovation systems. We are from 30% to 100% lower CO2 based We are driving the circularity of this also deploying technologies like 3D on our leading green formulation segment by producing 100% recycled printing to build more with less, across expertise, innovative low-emission aggregates from construction & a range of applications from affordable raw materials and use of alternative demolition waste with brands like housing to bridges and windmills. fuels. In this range, we launched the Aggneo. In addition, we are pursuing world’s first cement with 20% recycled other sustainable practices such as NEXT-GENERATION TECHNOLOGIES construction & demolition waste inside. using renewable energy in aggregates To accelerate our net-zero journey operations, restoring quarries after we are developing next generation READY-MIX CONCRETE: As the green use, preserving biodiversity and even technologies, from carbon capture, concrete company, we are making it recycling carbon from our operations utilization and storage (CCUS) the best material for our growing and into recycled aggregates. to concrete-based renewable urbanizing world. No other material energy systems. matches concrete’s performance SOLUTIONS & PRODUCTS: We are benefits. It is resilient, protecting our continuously expanding our range of Advancing our CCUS strategy we cities and infrastructure from natural Solutions & Products to make buildings are currently running over 30 pilot disasters such as effects from flooding. smarter from foundation to rooftop, projects around the world, ranging It is durable, fire and earthquake- at every stage of their life from design from recycling CO2 from our plants resistant, versatile, affordable, and building to repair and renovation. into low-emission raw materials for our insulating and available everywhere. Our advanced systems, from roofing green cement, all the way to using it as It is infinitely recyclable and acts and waterproofing to insulation, make a greenhouse gas for farming or as a as a carbon sink during its lifespan, buildings more energy-efficient, source of methanol for aviation fuel. reabsorbing part of the CO2 emitted enduring and resilient throughout their Working with a range of partners from during its production process. life cycle. As a double-digit growth start-ups to academic institutions, engine for Holcim, this segment will We offer the industry’s broadest we are developing breakthrough account for 30% of Net Sales by 2025. range of green concrete, ECOPact, technologies to accelerate the which delivers low-carbon and With our milestone acquisitions of transition to renewable energy, like circular benefits with no compromise Firestone Building Products and magnetizable concrete to enable roads on performance. It is sold at a range Malarkey Roofing Products, we are to charge electric cars while in motion. of low-carbon levels, from 30%- becoming a global leader in roofing Our net-zero journey is at the heart of 100% reduced footprint compared systems. We offer a complete range all our business segments. to the local industry benchmark. of solutions from commercial to Its sustainability profile is driven residential, enabling green, solar CEMENT: Cement sets the foundation by low-emission raw materials and and cooling roofs all the way to of our ambition to lead in innovative decarbonized operations, including shingles with clean air technology and sustainable building solutions. the use of alternative fuels. Making inside making cities healthier. We are committed to leading its low‑carbon construction possible at green transformation with a clear scale around the world, it is available decarbonization pathway, based on in all five regions across 25 markets. well-known levers through to 2030. At the same time we are developing AGGREGATES: Our range of innovative low-emission raw materials aggregates, from sustainably sourced and next-generation technologies, materials to recycled construction including over 30 pilot projects in & demolition waste, provide the raw CCUS projects, to further accelerate materials for concrete, masonry and our impact beyond 2030. asphalt, as well as the foundation HOLCIM Climate Report 2022 11
02. OUR NET-ZERO JOURNEY CONTINUED OUR NET-ZERO PLEDGE HOLCIM’S NET-ZERO PLEDGE: PROGRESS TO DATE Taking a rigorous science-driven approach, Holcim’s 2050 goals 2030 TARGET, HOLCIM WILL PROGRESS IN 2021 are among the first long-term targets validated by the Science World's broadest range of low Based Targets initiative (SBTi). Accelerate the use of carbon materials: ECOPact launched Consistent with the new net‑zero low-carbon and carbon- in 25 markets, ECOPlanet launched standard, we have now validated our neutral products, including in 15 markets. ECOPact to reach entire decarbonization pathway across ECOPact and Susteno 25% of Ready-Mix net sales by 2025 all scopes, setting a reference for our entire industry. In 2020, Holcim entered a new era Recycle 100 million tons per Recycled 54 million tons of waste in sustainability with our net-zero year of waste and byproducts and byproducts for energy pledge. Leading the way in green for energy and raw materials and raw materials in 2021 construction, we were the first global building materials company to sign the UNGC’s “Business Ambition for 1.5°C” initiative, with intermediate 2030 targets Scale up the use of calcined Calcined clay investments in a new approved by the SBTi in alignment with clay and develop novel line in France and launch of calcined a net-zero pathway. cements and new binders clay cement in Italy and France We continue to lead the industry on climate with the verification of our Scope 3 intermediate targets. Our intermediate targets now cover Double1 waste-derived fuels Waste-derived fuels in production the three "scopes" of carbon emissions in production to reach 37% reached 21% in 2021 as established by the Greenhouse Gas (GHG) Protocol to address both our direct and indirect impact. OUR 2030 COMMITMENTS Reach 475 kg of Scope 1 • Holcim commits to reduce Scope 1 Reduced to 553 kg of CO2 per ton CO2 per ton of and 2 GHG emissions 21% per ton of cementitious material in 2021 cementitious material of cementitious materials by 2030 from a 2018 base year.2 Within this target, Holcim commits to reduce 10+ new carbon capture Scope 1 GHG emissions 17.5% per Operate its first net-zero projects launched in 2021, ton of cementitious material and carbon cement reaching 30+ projects in Scope 2 GHG emissions 65% per production facility 12 countries (vs. 20 projects ton of cementitious materials in 7 countries in 2020) within the same timeframe. • Holcim commits to reduce its Scope 3 GHG emissions by 2030, from a 2020 base year, for the following categories: - purchased goods and services by 20% per ton of purchased clinker and cement - fuel and energy-related activities by 20% per ton of purchased fuels - downstream transportation and distribution by 24% per ton of materials transported. 1 Compared to 2018 baseline 2 The target boundary includes land-related emissions and removals from bioenergy feedstocks 12 HOLCIM Climate Report 2022
OUR PATH TO 2030 SCOPE 1 SCOPE 2 SCOPE 3 Our pathway to 2030 is clear. To reach our Scope 1 and Scope 2 commitments, 576 38 2018 we will reduce our clinker factor, use BASELINE BASELINE alternative fuels instead of fossil fuels (or increase our thermal substitution Kg CO2 per ton rate) and increase our use of renewable -0% of purchased clinker and cement energy. We will invest in proven technologies that produce positive Kg CO2 553 34 2021 returns. Our 2030 Scope 3 targets will -9% per ton of purchased fuels be achieved by focusing on our most material Scope 3 categories. Kg CO2 OUR 2050 GOALS -9% per ton of material transported • We will reduce Scope 1 and 2 GHG emissions by 95% per ton of Kg CO2 per ton cementitious from a 2018 base year.3 -20% of purchased clinker and cement • We will reduce absolute Scope 3 475 13 Kg CO2 per ton 2030 GHG emissions by 90% by 2050 Kg CO2 net/t Kg CO2/t -20% of purchased from a 2020 base year. cementitious cementitious fuels OUR PATH TO 2050 Kg CO2 Our 2050 targets have been validated -24% per ton of material transported by the SBTi aligned with its new net- zero standard. The pathway from 2050 2030 to 2050 leverages the same GHG emissions across the value chain validated by levers used between 2020 and 2030, while integrating new and advanced technologies. These technologies Holcim’s 2050 net-zero targets validated by SBTi: include novel binders, zero-emission • Holcim commits to reduce Scope 1 and 2 GHG emissions by 95% per ton vehicles, low-clinker cements and of cementitious materials by 2050 from a 2018 base year. 2 CCUS technologies. • Holcim commits to reduce absolute Scope 3 GHG emissions by 90% by 2050 from a 2020 base year. 3 The target boundary includes land-related emissions and removals from bioenergy feedstocks HOLCIM Climate Report 2022 13
02. OUR NET-ZERO JOURNEY CONTINUED OUR PATHWAY TO NET-ZERO Reducing CO2 emissions is key for us to continue creating long-term value. Our cement is one of the most carbon efficient in the sector. Our Scope 1 and Scope 2 emissions per ton of product are 29% lower than in 1990. Holcim is among the first companies worldwide to set 2050 net-zero targets validated by the Science Based Targets initiative (SBTi). With these goals, Holcim is the first in its industry with: • 2030 and 2050 net-zero aligned targets validated by SBTi, and • Scope 1, 2 & 3 targets, cutting across our operations and value chain. Mvule Gardens in Kenya, Africa’s largest 3D-printed affordable housing complex is built with TectorPrint HOLCIM’S PATHWAY TO NET-ZERO OUR ABSOLUTE SCOPE 1 + SCOPE 2 EMISSIONS PATHWAY 126 Mt CO2 2021 2030 0 Mt CO2 EFFICIENCY GAINS IN DESIGN + CONSTRUCTION EFFICIENCY GAINS IN CONCRETE DECARBONIZATION OF ELECTRICITY LESS CLINKER IN CEMENT (CLINKER FACTOR) 2050 LESS CO2 IN CLINKER (TSR, ARM, EFFICIENCY) CCUS, OTHER TECHNOLOGIES PASSIVE RECARBONATION 14 HOLCIM Climate Report 2022
SCOPE 1 GOALS Scope 1 includes all emissions released directly from our operations. They account for 75% of our footprint and are at the core of our emissions reduction strategy. A number of factors are involved in reducing our Scope 1 emissions to net-zero: 2021 2025 TARGET 2030 TARGET 2050 TARGET 553 Kg CO2 net/t 520 Kg CO2 net/t 475 Kg CO2 net/t cementitious cementitious cementitious EFFICIENCY GAINS IN CONSTRUCTION/CONCRETE The increasing importance of BUILDING MORE Our plant in Ternate, Italy, has already recognized the potential. embodied carbon per m2 of building / WITH LESS: Trucks filled with construction infrastructure will move the market to more carbon‑efficient construction. HOLCIM ITALY & demolition waste arrive at our sites every weekday. What initially "Optimization of cement in The use of low-emission primary started out as only two trucks per applications" refers to the progressive raw materials is a key lever in day has quickly grown to seven. optimization of the structural elements, reducing our carbon impact. This construction & demolition creating the same functional units Replacing limestone with an waste is pre-processed, meaning with less construction material such as alternative that emits less or no that wood, plastics and metals have concrete or cement. CO2 and carbon- CO2 is an obvious choice. But all been removed, leaving behind efficient construction legislation will where can a suitable replacement only the fine cement powder, sand trigger construction optimization, be found that delivers the and aggregates. leading to less material used per m2 necessary quality requirements? of building / infrastructure. Because the cement powder has Construction & demolition waste already been decarbonated, the ALTERNATIVE RAW MATERIALS overall process-related carbon is a highly attractive source of The use of alternative sources of emissions are much lower. The low-emission raw materials. It is materials is a key lever to further materials also require less heating abundantly available and has all the reduce our CO2 emissions. Waste in the kiln so less fuel is required, properties required for a second materials and byproducts from other further reducing the carbon impact. life as a primary raw material. industries can be used to replace some of the raw materials used in the production process. We are considering four major categories: • Decarbonated materials allowing reduction of CO2 emissions and thermal power consumption, and gains on kiln productivity. • Basic components (Ca, Si, Fe, Al, S) enabling the supply of the essential minerals required for clinker chemistry and safeguarding quarry lifetime (recycled water also fits in this category). • Urban mining, which consists largely of construction & demolition waste, is where we aim to close the loop in terms of circularity by recycling what we have contributed to building decades ago. • Historical landfills and stocks to reuse minerals after pretreatment and avoid have taken tint panel off the the mining of prime ore. This is part of bottom as seems to be style our contribution to “clean the past”. when caption under pic - We are working with innovative please let me know if wrong companies to keep on raising the Gioia 22, in Milan’s Porta Nuova former industrial district, is built standards and developing new with ECOPact green concrete with up to 50% lower CO2 alternative material streams. HOLCIM Climate Report 2022 15
02. OUR NET-ZERO JOURNEY CLINKER FACTOR It is the production of clinker, the main CONTINUED component of cement, that produces the most CO2 emissions. The majority of these emissions result from the chemical reaction that occurs when the raw material (limestone) calcinates into clinker during the production process. This decarbonation process is our largest source of CO2 emissions, accounting for 48% of our total CO2 footprint. Replacing the clinker in our final cement products with alternative mineral components reduces the carbon intensity of the cement product. We aim to reduce our clinker content from 70.1% currently to a 65– 68% range by 2030, and reduce further down to a 60–63% range by 2050. The main reduction will not only come from recycling construction & demolition waste and by-products from other industries, but also investing in calcined clay facilities and developing novel cements. In the coming decades we expect calcined clay and granulated limestone to gradually replace traditional mineral components such as slag or fly ash. DID YOU KNOW? WHAT IS THE DIFFERENCE BETWEEN MINERAL COMPONENTS AND ALTERNATIVE RAW MATERIALS? Mineral components are added at the cement manufacturing stage to replace clinker and produce blended cements. One example of a mineral component is calcined clay. Alternative raw materials (ARMs) replace the natural raw materials ECOPLANET WITH • Meets the carbon footprint requirements of the new French needed to produce clinker, such as limestone and clay. The use of PROXIMATECH regulation RE2020 – one of the first ARMs allows Holcim to reduce the regulations in the world to require a consumption of natural resources In July 2021, we launched the first 35% reduction of the carbon and its process CO2 emissions. calcined clay-based cement in the footprint of the built environment ARMs used by Holcim include French market as part of our ECOPlanet per m2 of building. waste materials from our own range. Produced from locally sourced plants and byproducts from other • Is suitable for applications with materials at our La Malle plant using industries, such as cement kiln dust, high durability requirements ProximaTech, Holcim’s proprietary construction & demolition waste, such as infrastructure projects, calcine clay technology, this ECOPlanet refractory bricks, fly ash, etc. construction in difficult variant has a 34% lower CO2 profile environments, long-lifespan per ton of cement, compared to (> 50 years) projects, and Ordinary Portland Cement (OPC). high volume concreting like ECOPlanet is designed to enable our bridge piers, dams or large ready-mix customers to produce concrete platforms. low-carbon concrete while ensuring high performance and durability for ECOPlanet and ProximaTech are all applications, as it: examples of how Holcim enables sustainable construction on a large Bruins Warrior Arena, Massachusetts, • Performs as well as OPC, with no scale by developing and producing impact on the construction system US, built with Artevia, helping achieve its own proprietary low carbon LEED certification by the US Green building materials. Building Council 16 HOLCIM Climate Report 2022
THERMAL SUBSTITUTION RATE Taking a circular approach, we will DID YOU KNOW? DID YOU KNOW? reduce the carbon intensity of our RETZNEI, A LEADER IN HOLCIM, A WORLD LEADER cement by substituting fossil fuels ALTERNATIVE FUELS IN RECYCLING with pretreated non-recyclable and Heating our kilns with pretreated Holcim recycled 54 million tons biomass waste fuels to operate our waste and other alternative fuels is of materials in 2021, up by 17% cement kilns. key in reducing our carbon footprint. compared to prior year. It includes We recover energy and recycle 6.6 million tons of construction & Preparing, recovering and recycling minerals from waste treatment demolition waste, representing more fuels and materials in our processes during the manufacture of cement than 1,000 trucks per day, advancing enables us to divert waste from landfill in a process called “co-processing”. its goal to reach 10 million tons of and improve the waste management construction & demolition waste hierarchy at the local level. Our Retznei plant is a champion in by 2025. Our goal is to recycle this area. It can run with virtually no To increase this thermal substitution 100 million tons by 2030. Circularity traditional fuels used to heat the kiln, rate, we will be investing in is at the heart of our net-zero leading to negative fuel costs. This co‑processing facilities and process journey driving the following key year, the plant achieved an annual improvements. We aim to increase our decarbonization levers: average thermal substitution rate thermal substitution rate from 21.3% of 97%, running at 100% thermal Recycling construction & demolition currently to 37% by 2030 and reach a substitution rate for 86% of the waste to build new from the old, we global performance of 70% by 2050. production days. recycle construction & demolition CCUS AND OTHER TECHNOLOGIES waste, as a source of low emission The plant is equipped to treat Carbon capture technologies play an raw materials for new green building waste streams of different qualities essential role in combating climate products, such as our ECOPlanet that are then fed into the system, change and delivering our net-zero range, including Susteno, the world’s ensuring consistent temperatures to journey beyond 2030. To develop first green cement with 20% rubble comply with quality requirements. blueprints for large-scale deployments inside. With global construction of CCUS solutions in transformational The added benefit of co-processing waste expected to grow to sectors, Holcim is partnering with is that the entire waste input is 2.2 billion tons by 2025, we are leaders in a range of sectors. recycled or recovered without scaling up our capacity to producing any additional residue. recycle 100% of concrete-based Retznei is one of our star achievers, construction & demolition waste but to achieve our carbon footprint into our green building materials. reduction we need to go further. Designing low-carbon building Co-processing is a scalable solution materials with recycled content that we are rolling out across the inside, ranging from desulfo- globe with our Geocycle business, gypsum to slag or fly ash. which is already operating in 50 countries worldwide. Powering our plants with alternative energy coming from waste at the Today in the European Union (EU), end of its life cycle. more than half of our plants operate with a 50% alternative fuels, and one third run with 70%. ACCELERATING GREEN GROWTH: SCALING UP CIRCULAR CONSTRUCTION Target 2030 +17% waste recycled increase in 2021 2021 100 MT 54 MT 6.6Mt 2020 46 MT of Construction & Demolition Waste recycled into new products (>1,000 truckloads per day) Our ECOPlanet green cement range includes the world’s first cement with 20% construction & demolition waste inside, launched in Switzerland, Susteno. HOLCIM Climate Report 2022 17
02. OUR NET-ZERO JOURNEY CONTINUED SCOPE 2 GOALS Scope 2 emissions account for 5% of our carbon footprint. They include indirect emissions from the generation of purchased electricity consumed in owned or controlled equipment. 2021 2030 TARGET 2050 TARGET 34Kg CO2/t 13 Kg CO2/t cementitious cementitious OUR SCOPE 2 LEVERS ENERGY Reduction of our EFFICIENCY electrical consumption WASTE HEAT Installation of new RECOVERY WHR systems (WHR) SYSTEMS POWER PURCHASE Electricity consumption from local decarbonized AGREEMENTS PPAs or contracts (PPAs) Progressive integration of low-carbon sources in GRID the grid to smartly source decarbonized EVOLUTION electricity where commercially feasible HARNESSING WIND POWER Altogether, renewables deliver about FOR OUR PLANTS 8 million gigajoules of electricity to At our Paulding plant in the US, our cement plants, eliminating the we’ve installed three wind turbines emissions of over 1 million tons of to supply clean wind power for CO2 annually. the electric needs of our plant, This shift to clean energy comes on eliminating the equivalent of top of the plant’s commitment to 9,000 tons of CO2 per year. heat its operations with 95% of Paulding is just one Holcim plant alternative fuels. using renewable sources of energy for electricity consumption. 18 HOLCIM Climate Report 2022
WASTE HEAT RECOVERY GE Renewable Energy, COBOD and DID YOU KNOW? We have waste heat recovery Holcim co-develop record-tall wind REDUCING SCOPE 2 programs in place designed to use turbine towers with 3D-printed EMISSIONS IN INDIA excess heat from cement kilns to concrete bases reaching record Holcim is investing CHF 100 million generate electricity. We currently heights up to 200 meters in Waste Heat Recovery (WHR) operate eight waste heat recovery systems in India to advance its units in four countries, with a clear plan net-zero journey. to triple the number by 2030. This investment across six sites will DECARBONIZING POWER SUPPLY be completed in 2022, doubling WITH RENEWABLE ENERGY Holcim’s waste heat recovery We will continue to expand our systems, which use thermal heat to renewable energy portfolio by produce decarbonized electricity. collaborating with power producers, generating renewable energy on our Installed power will amount to land by installing wind and solar farms. 85 MW with an expected generation of 650 GWh, representing 15% of its A range of solar and wind projects Indian business’ consumption. are already operational in our sites in the US and India, as well as, for WHR allows us to generate up example, contracts with offsite to 30% of the cement plant's renewable generators in Argentina power consumption from the excess covering typically between 20 and heat coming from its production 30% of the plants' consumption. process. This decarbonized energy system reduces both Scope 1 and In 2021, Holcim entered into Power Scope 2 emissions. Purchase Agreements with decarbonized power generators in several countries for a supply of around 500 GWh of renewable energy to power our operations. HOLCIM Climate Report 2022 19
02. OUR NET-ZERO JOURNEY CONTINUED SCOPE 3 GOALS Scope 3 emissions account for 20% of our carbon footprint. They include all other indirect emissions generated in our supply chain, such as those from transportation. Our Scope 3 intermediate targets have also been validated by SBTi, marking a new milestone in our industry. 2021 2050 TARGET 30 MT 2021 2030 2050 FUELS & ENERGY (KG CO2 PER TON 287.5 -20% -90% PURCHASED FUELS) DOWNSTREAM TRANSPORTATION (KG CO2 PER TON 9.5 -24% -90% MATERIAL TRANSPORTED) PURCHASED CLINKER & CEMENT (KG CO2 PER TON 705.3 -20% -90% PURCHASED CLINKER & CEMENT) In 2020, we deployed a comprehensive approach to measure the CO2 emissions C02 from our supply chain. We took this step because we are committed to a FUELS AND ENERGY 7.4 MT 25% rigorous and science-based approach for measuring and reducing our CO2 CLINKER AND CEMENT PURCHASED 5.9 MT 20% emissions, starting with the purchase UPSTREAM ACTIVITIES of clinker and cement, fuels and BULK MATERIALS 3.9 MT 13% OWN OPERATIONS downstream transportation. These categories account for 75% of our total SLAG 1.4 MT 5% Scope 3 emissions. The 2020 baseline is a solid foundation based on which we set CHEMICALS 0.5 MT 2% our 2030 actionable targets, as part of our net-zero journey. INBOUND LOGISTICS 1.8 MT 6% EQUIPMENT 0.8 MT 3% OTHER PURCHASES 1.0 MT 3% BUSINESS TRAVEL AND COMMUTING 0.1 MT
DOWNSTREAM TRANSPORTATION PURCHASED CLINKER AND CEMENT The CO2 emissions from transporting our materials (to customers, between Emissions from purchased clinker and cement account for 20% of our FIRST MOVERS factories and distribution terminals) total Scope 3 emissions. Our actions COALITION account for 23% of our total Scope 3 to reduce emissions in this category emissions. We travel approximately are aligned with the work we do at Holcim joined the First Movers 2 billion kilometers by road per year the sector level to drive down the CO2 Coalition (FMC) as a founding to transport our products, with footprint of our sector’s operations and member to drive more green approximately 95% of these trucks products. In addition, we are introducing demand and low-carbon owned and operated by third parties. a requirement that our clinker and technologies to advance our To reduce emissions from downstream cement suppliers provide the CO2 world’s climate goals. On the transportation we are taking the information related to their products, green procurement side, Holcim following actions: for example, through Environmental committed to FMC’s trucking Product Declarations (EPDs), to enable ambition of reaching 30% of • optimizing routes and loads zero-emission heavy-duty truck informed decisions and accelerate the • moving volumes from road to purchase of low-carbon products. purchases or contracts by 2030. waterways or rail On the supply side, Holcim will OTHER PRODUCTS AND continue to scale up its green • training and monitoring drivers' SERVICES PURCHASED building solutions and next- behaviors to increase road safety All other products and services generation technologies for net- and reduce fuel consumption purchased account for approximately zero construction. 32% of our total Scope 3 emissions. We • gradually replacing diesel with These commitments build on expect reductions from including CO2 eco-friendly fuels. Holcim’s industry-first 2050 requirements in the tendering process FUELS AND ENERGY and integrating CO2 as a parameter in net-zero goals, validated by the The “cradle-to-gate” emissions related the “Total Cost of Ownership” models SBTi. The FMC was launched to purchased fuels and energy account used to drive purchasing decisions. at COP26 by Secretary John for 25% of our total Scope 3 emissions. We also expect CO2 reductions from Kerry, US Special Presidential innovation and partnerships with Envoy for Climate, and the World The main source of emissions is derived Economic Forum (WEF). suppliers of global categories. For from the extraction, processing and example, we piloted our industry's transportation of fossil fuels. To reduce first autonomous electric haulers in a emissions in this category we are quarry in Switzerland. This technology, working on replacing traditional fossil which will eliminate the use of carbon- fuels with locally sourced, alternative and intensive fuels to power heavy mobile non-extractive fuels derived from waste. equipment, will reduce CO2 emissions in quarries by up to 85% and enhance operational safety. C02 DID YOU KNOW? SINCE 2017, WE HAVE OPERATED OUTBOUND OUR TRANSPORT ANALYTICS 7.0 MT 23% LOGISTICS CENTER, AN INDUSTRY-LEADING DIGITAL LOGISTICS PLATFORM DOWNSTREAM ACTIVITIES POWERED BY ARTIFICIAL 30 INTELLIGENCE We developed this data-driven digital platform to become more efficient, safer and reduce CO2 from our transportation activities. M TONS It is deployed in 55 countries worldwide, covering 1.7 billion kilometers each year, with real-time tracking systems in more than 90,000 trucks. This state-of-the-art data-driven SCOPE CO2 EMISSIONS technology allows us to optimize truck 1&2 SCOPE 3 utilization, routes and driver behavior. Through it, we can calculate real-time CO2 emissions for every single trip. HOLCIM Climate Report 2022 21
03. DECARBONIZING THE BUILT ENVIRONMENT Working toward a net-zero built environment, we play an essential role across a building’s A R entire life cycle. C UL R With the construction sector We are actively addressing CI representing 38% of the world’s global this with our low-carbon CO₂ emissions, we are committed to materials, from ECOPact playing our part at every step of a green concrete to building’s life cycle. Seventy percent ECOPlanet green cement of these emissions result from the all the way to empowering building in use. We are tackling this smart design to build more REDUCE stage with our advanced solutions for with less. energy efficiency and renovation, from Across all these applications, our roofing systems to our insulation we are driving circular products like Airium. construction to reduce, The resulting 30% of these emissions reuse and recycle materials are generated at the building phase. wherever we can. UPSTREAM AND DOWNSTREAM BUILDING MATERIALS SUPPLIERS LOW-CARBON MATERIALS FUEL CIRCULAR ECONOMY SMART DESIGN 22 HOLCIM Climate Report 2022
REUSE CO NS TR UC TI O N RECYCLE BUILDINGS ACCOUNT FOR 38% BUILDINGS IN USE ENERGY EFFICIENCY FROM FOUNDATION TO ROOFTOP of the world’s CO2 emissions 30% are linked to building 70% comes from buildings materials in use HOLCIM Climate Report 2022 23
03. DECARBONIZING THE BUILT ENVIRONMENT CONTINUED MAKING BUILDINGS SMARTER Its systems enabling solar roofs full coating of roofs. Building on Gaco’s We are making buildings more energy contribute to powering buildings with success in North America, Holcim efficient and smarter in use from our renewable energy in a self-sufficient is rolling out in scale its GacoFlex advanced roofing systems to our way. This system was deployed in TechoProtec waterproofing solutions specialty building solutions. Apple’s headquarters in Cupertino, throughout Latin America. California, a leading building from a Holcim is becoming a global leader GacoFlex TechoProtec is currently sustainability and circularity perspective. in roofing systems with the milestone available across Holcim’s Disensa acquisitions of Firestone Building There is nothing more sustainable retail network in Latin America, Products and Malarkey Roofing than enhancing and improving an from Mexico to Colombia, and Products, cutting across residential existing building through re-roofing. Ecuador to Argentina. and commercial applications. The roof is a building’s first defense in keeping the building air- and water- Firestone Building Products adds more tight as well as energy efficient. Within functionality into buildings with its Firestone building products, re-roofing advanced roofing and waterproofing constitutes over 60% of our business. solutions. For instance, the reflective We work with building owners and technology in its white TPO, EPDM specifiers to choose the right roofing and Asphalt roofing systems keeps system that can enhance their existing buildings cooler in high heat periods, building performance, saving energy making buildings more energy as well prolonging a building’s life. efficient. Its green roofs play a key In addition, our Gaco range of liquid role in combating smog and the applied membranes offers premium urban heat island effect as vegetation waterproofing solutions for roofing naturally contributes to reducing applications, for both small repair or urban temperatures. Apple Park, Cupertino, US, is built with Firestone EPDM enabling its solar roof 24 HOLCIM Climate Report 2022
FIRESTONE GREEN ROOFING: We provide solutions to bring nature BRINGING NATURE INTO CITIES into the built environment through DID YOU KNOW? As urbanization increases, we our green roofing systems that are GREEN ROOFS AND WALLS are experiencing a decrease in modular and circular in design. Green roofs and green walls are vegetation areas – that is set to vegetated surfaces of buildings Our Firestone Roofing Products that can reduce temperatures continue with ongoing migration provide solutions that prevent for outdoor spaces, helping to trends to urban centers. A result vegetation from degrading reduce the urban heat island of urbanization is both a loss of structures by stopping roots from effect in urban environments vegetation and biodiversity, and an damaging buildings. Our protective and also directly lower the increase of heat-absorbing surfaces membranes allow for intensive indoor temperature. such as roofs and pavement. vegetated roofs that use complex A scenario experienced across ecosystems with trees, plants and continents is the urban heat island irrigation. We also provide a effect of higher temperatures in The vegetation efficiently modular reusable system for urban areas due to man-made absorbs heat from the sun, extensive vegetation with our surfaces absorbing more solar which reduces the internal skyscraper vegetated roof made radiation. The resulting higher temperature of a building from recycled materials. temperatures require more energy and lowers the energy for cooling. Holcim’s products, including cement, consumption by up to 30% concrete, waterproofing and One of the key levers for mitigating insulating systems, allow buildings the urban heat island effect is with vertical forests and green increasing the vegetated area of walls to be part of cities and reduce cities and urban centers. Trees and temperatures for outdoor and vegetation naturally absorb CO2, during peak periods4 indoor spaces. which means greener cities not only reduce emissions but also capture and store carbon emitted elsewhere. Les Trèfles School, Belgium, is built with Firestone’s UltraPly TPO 4 Vertical Green Systems for energy saving in buildings. roofing system Perez et al. 2014 HOLCIM Climate Report 2022 25
03. DECARBONIZING THE BUILT ENVIRONMENT CONTINUED MALARKEY ROOFING PRODUCTS: GREEN CIRCLE CERTIFIED Holcim welcomed Malarkey Roofing Products into its family this year to advance its leadership in sustainable and innovative roofing. All Malarkey’s shingles are green circle certified for containing smog-reducing technology and upcycled materials inside. With these properties Malarkey shingles have proven to be more durable, longer lasting and with a lower environmental impact. EACH MALARKEY ROOF HAS THE SMOG-FIGHTING POTENTIAL OF TWO TREES With air quality being a concern for all of us, Malarkey launched the industry’s first smog-reducing shingles. This clean air technology reduces air pollution while releasing oxygen, making the average Malarkey residential roof work like the equivalent of two trees standing tall in your yard. MALARKEY ROOFS ADVANCE CIRCULAR CONSTRUCTION Continuously advancing its leadership in sustainability, each Malarkey roof contains recycled tires and plastic bags that improve their shingles’ strength, durability and impact resistance while reducing landfill waste. Each average- sized roof upcycles the equivalent of about five rubber tires and 3,200 plastic bags in its shingles. With its manufacturing and distribution footprint across North America, Malarkey Roofing Products are featured in a range of premium projects such as the Island House Hotel on Mackinac Island, Michigan, which won the Bronze Award from the Asphalt Roofing Manufacturers Association for the lasting protection offered to the historic property. 26 HOLCIM Climate Report 2022
PRB GROUP: EXTENDING THE With its leadership in sustainability LIFESPAN OF BUILDINGS and eco-design, PRB Group is a The best CO2 reduction lever is the one leading partner to support France’s that doesn’t need to happen. new regulation (RE2020) advancing energy-efficiency in buildings. This is why extending the life of buildings and infrastructure is so Other examples of Holcim’s important. We are expanding our renovation offering include our Ultra- range of specialty building solutions High Performance Concrete Ductal, to address the renovation needs of which is used in overlay applications buildings. For instance, we recently for bridge and road repairs. Airium announced the acquisition of insulation is sprayed in attics and the PRB Group, France’s biggest roof cavities, and our Tector building independent manufacturer of specialty solutions are used for specialty building solutions and a key interior and exterior refurbishments. player in its high growth repair and refurbishment market. HOLCIM Climate Report 2022 27
03. DECARBONIZING THE BUILT ENVIRONMENT CONTINUED Holcim is empowering smart Commonly referred to as Industry design to build more with less with innovative technologies, from 4.0, a suite of digital, connected hardware and systems have allowed WIRELESS 3D printing powered by digital rapid advances in both products SENSORS computational design to wireless and services. Adapting Industry 4.0 sensors and Building Information technologies to the construction We are deploying sensor Management (BIM) systems. industry has the potential to technologies that significantly decarbonize the built environment reduce the carbon footprint of BUILDING 4.0: BUILD MORE our building materials. These are by building more efficient buildings WITH LESS connected via a wireless network with fewer resources. Advances in technology have to cloud-based servers that relay impacted the way many industries data in real time to customers operate in the past decades, and Holcim's concrete team. with the manufacturing and Miro, the BREEAM-excellence telecommunication sectors certified office complex in This point of placement data undergoing transformations in Bucharest built with DYNAMax, the allows both customers and how they operate. Ultimate Performance Concrete Holcim to make informed decisions to optimize products. Holcim supplied concrete to the Eglington Light Rail Transit project in Toronto, Canada, where sensors were used to provide data on curing conditions that gave confidence in the representative strength results for concrete that was specifically designed for the project with a low carbon footprint. The project saved around 130,000 tons of CO2 emissions. 130k tons of CO2 emissions saved by wireless sensors 28 HOLCIM Climate Report 2022
3D PRINTING: STRIATUS In July 2021, we launched Striatus, the first-of-its-kind 3D concrete printed bridge, at the Venice Architecture Biennale. Designed by Zaha Hadid Architects and ETH’s Block Research Group in collaboration with incremental 3D, it was made possible by Holcim’s proprietary ink, TectorPrint. It establishes a new language for concrete that is digital, environmentally advanced and circular by design. The structure is composed of 3D concrete printed blocks that stand together solely through compression, with no reinforcements, no mortar and no binders, applying computational design and 3D printing for minimal material use and maximum strength. All the blocks are entirely recyclable. Striatus, the first of its kind 3D concrete printed bridge in Venice is built with TectorPrint, Venice @ Studio NAARO ENVIRONMENTAL PRODUCT DID YOU KNOW? BUILDING INFORMATION DECLARATION (EPD) The increased focus on climate change RAIL FACILITY MODELING (BIM) and global warming has highlighted the – NEW SOUTH The digital built environment, which includes the data, cost, time and importance of reducing GHG emissions attributed to the built environment. WALES, material properties in a representative model, allows the computational This scrutiny has highlighted the AUSTRALIA importance of using LCA tools to review, modification and collaboration quantify the impact of materials, Holcim developed an EPD for at a fraction of the cost. BIM gives a products and buildings with particular concrete that was supplied to the platform to interrogate and optimize focus on CO2. Life Cycle Assessment project to assist with the customer’s the digital built environment through requires credible and accurate data sustainability requirements. conventional human-centric design to quantify the total carbon footprint The concrete supplied reduced and advanced computational tools of projects. EPDs allow designers to emissions by over 30% in at an early design stage where all make informed decisions on which comparison to the local benchmark stakeholders can collaborate. materials give the best overall outcome and forecast to save 1.5 million kg for each project. EPDs are a publicly of CO2 during the project. Using integrated GHG Life Cycle Assessment data and designing disclosed, scientifically quantified and The EPD for the concrete gave for seasonal effects, geotechnical recognized communication of the CO2 transparent, credible and verified and structural requirements and generated by a product across Scope information to the customer, occupant-use patterns allows 1, 2 and 3 following a standardized allowing reduced carbon impact designers to find the lowest carbon reporting method. The tool provides through informed decisions. footprint, optimal occupant use and transparency to all stakeholders in More projects can profit in the most economical design before the value chain, which encourages future from Holcim Australia’s construction begins. informed consumer behaviors that help ability to produce concrete EPDs decarbonize the built environment. Refurbishment of existing buildings, on demand. instead of new buildings, can be done Accurate and available mass data is much more efficiently using existing crucial to the built environment value BIM environments to investigate, chain for the assessment of the whole redesign and reuse of materials in the life carbon footprint of projects to growing adoption of circularity. meet net-zero commitments. The application of data associated with the carbon footprint of buildings and materials at the early stage of design allows decisions to be made that facilitate the decarbonization of the built environment. HOLCIM Climate Report 2022 29
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