Memorandum by the Cementitious Slag Makers
Association (CC64)
CLIMATE CHANGE LEVY ELIGIBILITY FOR REBATES
The members of our Association manufacture a
product (ggbs), which is used as a replacement for cement in the
construction industry. Ggbs is produced from blastfurnace slag
(a by-product of steel-making). Its use as a replacement for conventional
cement, reduces UK carbon dioxide emissions by some 1.5 million
tonnes per year (0.4 million tonnes of carbon). The use of ggbs
is increasing and today's figures are 50 per cent greater than
the comparable figure for 1990 (the base date for the Kyoto Protocol).
In the context of the Government's latest estimate that the levy
package will save 2 million tonnes of carbon a year, the carbon
savings to be achieved by encouraging the use of ggbs are very
significant. This use of ggbs has other environmental advantages,
eg it reduces quarrying by 2 million tonnes and landfill by 1.5
million tonnes per year.
Ggbs manufacture is a relatively energy-intensive
process where the cost of energy is well in excess of 10 per cent
of the total cost of manufacture. However it is not considered
polluting enough to be subject to "Integrated Pollution Prevention
and Control" regulation. Because of this, the current proposals
for the Levy offer rebates to the manufacturers of conventional
cement but not to the manufacturers of ggbs, favouring the less
environmentally-desirable of two directly competing products!
As a result, the net effect of the levy package
will be to increase the cost (per tonne) of ggbs manufacture by
about 50 per cent more than the corresponding cost increase for
conventional cement.
This would be a bizarre outcome, totally contrary
to the stated aim of the Levy, which is to encourage reductions
in CO2 emissions. We suggest that a way needs to be
found for ggbs manufacture to qualify for a rebate (or exemption),
if the operation of the Levy is to be consistent with its stated
aim.
Dr D D Higgins,
Director General
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