Rising costs and complex logistics threaten cement sector's carbon capture plans without public support

A senior executive at Heidelberg Materials has told Carbon Pulse that soaring electricity prices and complex supply chains have undermined the investment case for carbon capture and storage (CCS) at cement plants, leaving large-scale deployment dependent on public support.

Industry analyses and academic studies paint a similar picture: capturing the bulk of CO2 from a cement kiln is highly energy‑intensive and costly, and those costs quickly erode the already thin margins that characterise cement production. According to a review in MDPI, removing roughly 90% of a kiln’s CO2 output can raise a plant’s energy demand by 25–40%, driving substantial extra fuel or power bills. That uplift in energy needs, combined with the capital required to retrofit capture systems, has been estimated to multiply clinker production costs severalfold absent carbon pricing or subsidies.

Independent cost studies point to wide but consistently significant price tags for capture. A U.S. Department of Energy task‑force report puts first‑of‑a‑kind capture costs for cement in the range of $104–$194 per tonne of CO2, while industry briefings and project analyses commonly cite capture costs between $80 and $150 per tonne. Those capture costs translate into material price increases: one industry review suggests capture at those levels could add $30–$60 to the cost per tonne of cement, potentially lifting retail prices by 20–40% in some markets. Boston Consulting Group projects delivered cement prices rising from a present‑day $90–$130 per tonne to at least $160–$240 per tonne by 2050 once CCS and associated logistics are factored in, with $20–$30 per tonne for capture energy and a further $20–$40 per tonne for transport to storage.

The geographic and energy context matters. Proximity to CO2 storage sites and access to low‑cost renewables are decisive competitive factors, according to the BCG analysis, while the DOE task‑force notes that CCS can be more economical than heat electrification only where zero‑carbon power is relatively cheap , with breakeven thresholds cited around $50 per MWh for greenfield projects and $25 per MWh for brownfield retrofits. In the current market environment of elevated wholesale power prices across many European markets, those thresholds are often unmet, undermining the economics of capture.

Corporate voices in the sector acknowledge CCS will play a role but caution against treating it as a cost‑free fix. Speaking to Climate Home News, Rozemarijn Wesby, Holcim’s vice‑president for CCUS, said that high CCUS costs make it a “last piece of the puzzle” rather than the principal route to decarbonisation; Holcim has emphasised other mitigation pathways ahead of widescale capture. Heidelberg Materials’ assessment echoes that stance, arguing that without targeted public intervention , whether through direct subsidies, regulatory mandates, or premium carbon pricing , CCS projects in cement will struggle to get financed.

Beyond capture itself, transport and storage add further complexity and expense. Studies highlight that CO2 pipelining, interim hubs and the need for permanent geological storage increase project timelines and require coordinated infrastructure investment that individual cement producers seldom can shoulder alone. That creates a classic infrastructure coordination problem: industrial clusters and state‑led CO2 network development improve project bankability, but they require long lead times and cross‑sector policy alignment.

Some analyses suggest parts of the cost burden might be redistributed along the construction and end‑use value chain. Research in ACS Sustainable Chemistry & Engineering argues that higher cement costs could, at least partially, be absorbed downstream within the built environment, especially where low‑carbon construction commands a premium or where policy nudges material substitution. Yet that reallocation is unlikely to fully offset capture costs in price‑sensitive markets such as India and parts of Africa, where affordability constraints are paramount.

For policymakers and industrial decarbonisation strategists, the evidence reinforces three interlinked priorities. First, stable, long‑term incentives or carbon pricing that reflect the societal value of avoided emissions are essential to change investment calculus. Second, public investment in shared CO2 transport and storage infrastructures , or regulatory frameworks that derisk those investments , is critical to reduce unit costs for emitters. Third, accelerating access to low‑cost renewable electricity will both shrink operational costs for capture and make electrification alternatives more viable where appropriate.

Absent such measures, cement producers face stark choices: absorb rising costs and compress margins, pass costs to customers and risk competitiveness, or delay CCS deployment and seek emissions reductions through alternative measures such as fuel switching, energy efficiency and process innovation. As Heidelberg Materials’ senior executive told Carbon Pulse, the present combination of high power prices and fragmented value chains means CCS will remain economically marginal for many cement assets unless public interventions change the financial equation.