UK construction buyers are increasingly weighing steel’s carbon footprint in procurement, but sustainability-related costs generally need to stay below approximately 2% of project value. Discussions at the Future of Green Steel conference in London on 28–29 October indicated that cost constraints limit the premiums buyers are prepared to pay for lower-emission material.
The discussions involved British construction companies, public-sector project developers, steel producers, and Serbian and Southeast European fabricators. Buyers showed growing interest in environmental product declarations as a practical way to assess emissions associated with structural steel.
Public-sector construction projects are emerging as a source of demand for lower-emission steel, particularly where procurement rules require developers to demonstrate environmental performance. Buyers also indicated that environmental product declarations often shape their material preferences, while they have relatively limited appetite for complex debates over green-steel classification systems.
Project budgets shape steel premiums
A bridge-project tender included steel produced through an electric-arc-furnace supply chain at a 5–10% premium on the material price. The example showed that a project may tolerate a substantial premium on an individual input when its effect on total construction costs is limited.
Premiums of €100–300 per tonne can add considerably to the cost of individual steel products without necessarily having a comparable effect on an entire project budget. The conference discussions indicated that this distinction matters to buyers assessing sustainability-related costs against overall project value.
Classification debates remain important to steelmakers. Scrap-based electric-arc-furnace production can produce relatively low-emission steel, while integrated blast-furnace producers seeking to decarbonise through alternative ironmaking technologies may face much larger investment requirements. Industrial policy must consider whether lower-carbon classifications reward existing low-emission output or provide additional support for transforming emissions-intensive production.
Product declarations and UK CBAM evidence
Credible environmental documentation may become increasingly important for Serbian and Southeast European fabricators bidding for UK construction and infrastructure contracts. The emerging market advantage lies in documenting lower-emission performance in a form that both buyers and regulators can use.
Product-level environmental declarations are not automatic substitutes for emissions verification under the UK Carbon Border Adjustment Mechanism (CBAM). The mechanism is due to begin on 1 January 2027, creating separate regulatory requirements for covered steel imports.
A supplier may therefore need both a product carbon-footprint declaration suitable for customer procurement and installation-level emissions evidence that meets the relevant CBAM calculation rules.