Can Timber Buildings Fight Climate Change? (Webinar Transcript)
Hello everyone, and thank you for joining us today. My name is Christina Bidrothner, and I'm a Senior Associate on the Investment Team at the Clean Energy Finance Corporation, primarily focusing on the property sector. I'd also like to begin by acknowledging the traditional owners of the land on which each of us are on today. Speaking from Brisbane or Manchin, I acknowledge that boundaries are contested, so I pay my respects to both the Yuggera people and the Turrbal people, and their elders past, present, and emerging.
At the CEFC, we have a unique mission to accelerate investment in Australia's transition to net zero emissions. We invest to lead the market, operating with commercial rigour to address some of Australia's toughest emissions challenges. In terms of the built environment, significant progress has already been made to reduce the property sector's operational emissions. However, our ability to achieve further reductions will depend on success in areas that have proven harder to abate, such as scope 2 and 3 emissions, which are the indirect emissions that occur in the value chain, including both upstream and downstream emissions. In that sense, embodied carbon is the next frontier in the task to decarbonize the property sector.
Now, to demonstrate the growing importance of addressing embodied carbon, I'd like to draw your attention to the circular graphics on this slide. On the left-hand side, we see that embodied carbon in the production of building materials is responsible for 28 percent of emissions from the building and construction sector. Climate change policies for emission reduction strategies and factors such as the decarbonization of electricity grids and incremental improvements in building efficiency are expected to reduce the share of operational carbon emissions compared to embodied carbon. This is great news, but it does mean that by 2050, embodied carbon is expected to account for almost half of total emissions from new constructions. Concrete, steel, and aluminum are considered some of the more challenging materials to decarbonize.
Given the significant expected shift in breakdown between operational and embodied carbon emissions, we wanted to help quantify the challenge of cutting embodied carbon as well as identify some of the solutions and opportunities this could create. The report titled "Australian Buildings and Infrastructure: Opportunities for Cutting Embodied Carbon" was developed by Edge Environment for the CEFC in collaboration with the Green Building Council of Australia (GBCA) and the Infrastructure Sustainability Council (ISC). It draws on project data from the GBCA Green Star and the ISC infrastructure sustainability rating schemes, complemented by extensive modeling and industry discussions. Sorry, I'll just move that off the screen.
For the purposes of the report, embodied carbon is described as the greenhouse gas emissions, measuring carbon dioxide equivalent, that occur during the resource extraction, the transportation of resources to the manufacturer, the manufacturing process, and then the transportation of those materials to the construction site. You may notice when reading different reports they include slightly different stages in their definition of embodied carbon, but for the purposes of this report, those four stages are what's captured when we speak of embodied carbon.
Edge Environment estimates the embodied carbon emissions of materials used in Australia is somewhere between 30 to 50 million tons of CO2 equivalent per year. That's approximately 5 to 10% of national greenhouse gas emissions, so it really is a significant contributor to emissions across our economy. The economic value of the construction materials sector is approximately $65 billion, with demand for low embodied carbon solutions expected to rise significantly. We estimate it could result in a billion-dollar low carbon solutions market in the coming year, which really is a huge opportunity.
With that in mind, the analysis for the report focused on two key areas. Firstly, an analysis of how recent infrastructure and building projects have reduced embodied carbon, based on data from the ISC and the GBCA. Secondly, in an Australian first, an analysis of how new projects could adopt material and design initiatives for reducing embodied carbon, as well as the cost of implementing those initiatives. Key findings show that, for recent projects, the key findings were on average the sustainability-rated infrastructure projects assessed are achieving a 33% reduction in embodied carbon compared to a similar design with no sustainability measures incorporated. For the building projects, the average reductions were 15%, but we do know some individual projects are achieving significantly higher emissions reductions.
Now, for new projects, the analysis of material and design initiatives found that cost-effective solutions are available today to substantially reduce embodied carbon. Depending on the initiatives implemented, it's possible to achieve a 5 to 18% reduction in embodied carbon whilst also saving 0.4 to 3% in the cost of those materials. Key initiatives cutting embodied carbon emissions whilst also saving on costs include precast concrete, low carbon concrete, and, pleasingly, engineered timber. The report found that the use of timber can reduce embodied carbon by up to 75% compared to the use of conventional steel and concrete. So, on the back of these findings, we've just launched our $300 million Timber Building Program. This is a debt program to encourage mass timber construction across the property sector. Projects will be considered on a case-by-case basis but should utilize low-carbon engineered wood products in large-scale construction, involve appropriately sourced and accredited materials, and achieve sound embodied carbon outcomes. They require more than $20 million in CEFC debt finance, be commercial, and deliver a positive return to the CEFC, comply with our investment policies and guidelines, and it's open to Australian-based projects across all property sectors.
We hope the program will help achieve substantial embodied carbon savings through encouraging mass timber construction. We also hope to develop local skills and experience, supply chains, and delivery capabilities to catalyze even more timber-based building activity into the future. If you'd like to know more about the timber building program, you can visit our website, which has a really handy fact sheet as well. I'll now briefly touch on some of the investments the CEFC has already made to address embodied carbon. We have a $95 million commitment to the Rowe Highway Logistics Park in Western Australia. That project uses Boral’s low carbon concrete that achieves up to a 42% reduction in emissions compared with traditional concrete. This, along with some other features, will enable the project to achieve carbon neutrality. A $75 million commitment to Frasers Property is targeting embodied carbon reductions across two of their industrial projects. And a $54 million dollar debt finance commitment to Northcote Place in Melbourne is helping build sustainable town homes featuring the Holcim Eco-Pact product, which is a low carbon concrete that reduces embodied carbon by 30 to 60%.
If you'd like to know more about anything else I've spoken about today or the Timber Building Program specifically, feel free to reach out to myself or my colleagues Brian Rathbourne and Michael Gibrous, who are the co-leads of the property platform at the CEFC. Thank you all for listening, and I'll now hand over to Jonas from Edge Environment to touch on the more technical aspects of the report. It's a pleasure to be here, everybody, and thanks, Christina, for the great introduction and Paulo as well for setting the scene.
I'll talk a little bit more around the background and the details in terms of how the report was produced. It's pretty well documented in the report, which is obviously publicly available as well, but it's always easier to get a verbal description of how the work was produced into some aspects and then obviously more than happy to take any questions in this webinar or afterwards as well. The frame we went in with was to look at opportunities to reduce that upfront embodied carbon in Australian buildings and infrastructure. By the upfront embodied carbon, we mean the raw materials, the manufacturing of construction products and materials, and the transportation to the construction site, but not looking at any carbon emissions or implications beyond that. So it's that upfront, which is a pretty tight scope. I just want to use that as a caveat because looking at materials, it's very important around the maintenance, durability, end of life as well, specifically important for timber products. What is going to happen to the materials after the construction and end of life for potential reuse? I just want to frame that, but that's the scope of this assessment.
There was very much industry engagement and support throughout the process. The CEFC were a great partner to guide and instigate the development of this report and fund it. The Infrastructure Sustainability Council and Green Building Council of Australia provided the data, which was really good to get a view on the work that's been done over the last almost 10 years in the different areas. For the Infrastructure Sustainability Council, we got access to some project submissions in terms of what's been done with the material calculator in the IS rating tool. For the Green Building Council of Australia, we got access to the life cycle assessments of buildings that have been submitted through the Green Star project. There were almost 200 individual LCAs that we had the opportunity to look at and analyze, and that's where we got the typical reductions in terms of embodied carbon that Christina touched on in terms of that five to fifteen percent range typical. So, that's probably without pushing because a lot of the focus to date has been on the operational aspects and the energy aspects optimization, so lots of opportunities for further improvement.
Case studies were provided, and a few of those will be spoken to after my bit here. The industry engaged a lot in terms of providing information and data, so thank you specifically to InfraBuild and what they've done with the EcoPact and Holcim. The timber industry and builders also engaged a lot. It is a huge opportunity and a big market; it is around that five to ten percent of Australia's greenhouse gas emissions in this sector here, and it's a big economic opportunity as well. This is excluding imports, so if you look at the importation of construction materials into the built environment here, the estimate is that there's about 10 billion dollars of imported construction materials, with very limited exports from Australia. So, there's a net opportunity there to look at potentially building up more of a circular economy in this space.
Just to give an example of one project to give the order of magnitude of opportunity: WestConnex is an infrastructure project, a 33-kilometer motorway, and the quantity of material that goes into a development like that is one million cubic meters of concrete. When you weigh that against the total amount of concrete produced in Australia, which is typically around 30 million cubic meters, one project can make a huge difference. And 150,000 tons of steel, overall, one billion dollars of material contract values. So, when we talk about the billion-dollar market and opportunity, that's almost an understatement. It's a significant one from an economic perspective for producers and manufacturers that get on the front foot here, regardless of the product and materials.
In terms of methodology, the report is quite wide-ranging and broad, but I wanted to drill down specifically on the technical aspects to provide transparency and some data around that. The methodology applied to look at the reduction potential in individual asset classes and the cost implications was essentially to calculate the embodied carbon emissions for a reference case building and infrastructure projects. We looked at what the building classes were that we looked at, had that baseline of this is typical, and that's where we relied a lot on the GBCA data for Green Star in terms of providing that baseline in terms of quantities of materials and footprint. Then, we looked at what are the initiatives and opportunities to reduce, obviously, that needs to relate to what are the hotspots and the material areas where you can achieve those reductions, and then to quantify the emissions reduction potential for those different initiatives.
What was quite new to this assessment, which does not have too much added, was to combine the life cycle analysis and carbon assessment with the cost implications of that, which I'll talk more about in terms of the marginal abatement cost curve aspect in a second, and also talk about the enablers and barriers to implement a lot of these initiatives to drive that reduction. We didn't go too much into the enablers and barriers, but just to indicate that that's also part of thereport where you can find information about that.
Now, in terms of carbon reduction potential, the strategy with the most potential is, as we all know, the earlier you consider it and think about it. So, in the planning stage, that's where you can have the most radical reductions. So, there's just a caveat that we talk about carbon reduction potential. It's already way down this kind of scale in terms of opportunities that we're looking at. It's not for capturing the whole overall holistic opportunity to reduce carbon in the built environment. GVCA Baseline and so this is probably conventional knowledge, but looking at the grain stone GVCA life cycle analysis baseline, the concrete, steel, and aluminium are the major contributors to the embodied carbon in buildings. There's no surprise. A lot of the initiatives that we looked at were from that starting point that it's about how can we build with lower embodied carbon implications.
We focused a bit around the use of these materials and substitutions. That was the initial focus just to frame it up a bit. Now in the initiative types, we looked at both design and material. In the design aspect, we looked for in the material types of concrete, timber, and steel. For concrete, whether to use opportunities to use pre-cast elements instead of in-situ high-strength concrete, looking at substituting steel with engineered timber, looking at high-strength steel opportunities, and in the material selection, opportunities to include additives to lower cement content, use supplemental cementitious materials which are commonplace in the concrete industry already. Looking at carbon neutral concrete and more leading or innovative perhaps geopolymer concrete. Looking at carbon neutral steel, looking at steel produced from predominantly using renewable energy, and that gives an indication as well around the green hydrogen and use of hydrogen in steel making the order of magnitude of what the reduction potential is. The same with aluminium, it's a sourcing of aluminium produced powered by renewable energy. So those were the type of initiatives that we looked at predominantly.
What we did with this was we calculated the carbon reduction potential if you deploy a degree of uptake of those initiatives. So say that we use a 10% uptake of say precast instead of in situ 30% and 50%. We didn't look at a complete replacement, so looking at how can we reduce structural steel with engineered timber 10%, 30%, 50%, not completely just to give keep us conservative aspect as well knowing that there are limitations around design in some aspects. But we looked at this. So if you think about this, this would be the opportunities in terms of carbon reduction. Think about this as the x-axis conceptually, but then the cost aspect as well. So this is a different example, but say we take the LED light upgrades in a building in the operational stage. You can reduce a certain amount of overall life cycle carbon by having more efficient lighting. What would be the cost from a carbon reduction perspective over the life by replacing and using LED lighting instead? And you would then save life and save money over time by having more energy-efficient lighting. So that would be a carbon reduction opportunity where you end up saving money from a capex and opex perspective. So we looked at all the different initiatives from this payback, if you will, how much carbon can you reduce on the x-axis and what's the cost implication of reducing carbon in that way.
Now marginal abatement cost curves are based on specific scenarios, and there's a significant degree of variation between different project locations, material suppliers, etc. So this is just a starting point. This is for the purpose of essentially providing the framework and instigating the framework to use the lens of both carbon reduction potential coupled with the cost implications of it. We need to be very clear around when we look at the marginal abatement cost curves here that they're just based on average and specific scenarios and that there could be significant variation between projects and circumstances. So this is from the report looking at the office and mixed-use building, and you see
the format here for the marginal abatement cost curve and the most cost-effective opportunities potentially here is in the pre-cast concrete and engineered timber, substituting structural steel in buildings. And then you see using 30% cement substitution in concrete, there's a reduction potential in that and it doesn't typically come with a cost premium because it's commonplace, it's common practice to use a certain degree of cement substitution. If we go to the right here and look at carbon neutral concrete and carbon neutral steel, you can obviously achieve a lot in terms of carbon reduction but it will come with a cost premium almost certainly because there's this additional certification typically and the cost of the offsets to achieve the carbon neutral status to neutralize the emissions. Typically, that almost automatically comes with a cost premium. And then you can see the scale towards the right there with steel from renewable energy, green powered aluminium, concrete without mixtures, high strength concrete, geopolymer concrete – great initiatives to reduce emissions. But in this analysis, in this scenario that we looked at here, they would be an investment in terms of cost. So when we say implementing the 30% uptake of the three cost neutral and cost-negative initiatives, that alone has the potential in this scenario for this building class to reduce upfront embodied carbon emissions by 12%. So that's literally just going towards the ones that will save you money or are cost-neutral, and then you can go in and look at the other opportunities further and see whether for the project specifically or with the suppliers available, there's opportunities to include more initiatives. So this is just reflecting on what we see today, pretty much that a 10-15% reduction is readily available but much more potential to uncover.
For industrial buildings, the same view shows largely the same design and material initiatives come up with precast concrete and engineered timber, cement substitution in concrete. Across the project, we can achieve a cost saving of approximately $365,000, so about 3% of the project material cost by adopting those low carbon, cost-effective initiatives. So that gives an indication around what's available now and where to look for the biggest bang for buck and delve really into the cost implications. Hopefully, this makes sense and is useful in terms of the view and the framework for looking at reducing cost and embodied carbon in materials to go after that opportunity. For carbon reductions, taking a slightly different lens and looking not just on a specific project material selection specifically but what else is possible. Think about it as an order of magnitude reduction potential that could be achieved. Remember, we have about 30 to 50 million tons of carbon emitted every year that goes into construction materials and products. What if all material supplies switch to green power today? Now that's not possible, but what if? That would be the order of magnitude of reducing the emissions by seven million tons or seven megatons of carbon dioxide per year. That's from switching to renewable energy. What if one in ten projects uses the lowest carbon materials available? There's a potential of one to three million tons of carbon dioxide equivalent. Now this is where environmental product declarations and supplier LCAs come in about comparing – not all products come with the same carbon footprint, there are variations because some suppliers have invested more in low carbon production facilities and supply chains. There is variation between suppliers and the EPDs is a great way to evaluate. And there is a potential by just one in ten projects to look at that. I'm going to select a supply with a lower footprint, one in ten projects go carbon neutral using offsets, that's three to five megatons of carbon dioxide. Top 50 material suppliers reduce emissions in line with the Paris Agreement, so that's the decarbonization towards the 1.5-degree warming target. That would then produce between three to nine million tons of carbon dioxide per year of that total 30 to 50. And we also see a lot of suppliers and producers are already signing up to this decarbonization initiative and following the science-based target, so that's already well on its way both in Australia and internationally.
Finally, what we learned from looking at our experience talking to industry bodies, talking to projects, we can probably sum it up into six different key findings. One is that there are substantial emission reductions possible already and they are happening. We'll talk about that on case studies in a second. Targets to reduce embodied carbon should play a key role in the sustainability vision. Again, something that we see in industry from government and from construction firms and developers, they are starting to implement targets that cover the scope three emissions and being embodied as well. As we've seen, the targets and goals should be developed in the earlier stages of the project life cycle as well because that's when you have the most opportunity to reduce really, and the opportunity to find the most cost savings and benefits. All project stage cycles have a role to play in addressing embodied carbon. It cuts across absolutely every profession from suppliers to engineers, architects, client-side rating agencies like Green Star, procurement departments, builders – everyone has a role to play here, a significant role. Investment in embodied carbon reductions can reduce costs. We've provided one example and I'm sure that the case studies will talk a little bit about the cost effectiveness as well. And this is then, we think, what the analysis shows that going down this journey will essentially increase your competitiveness and set you on a path of a differentiator because you're going to develop a different way to do things and learnings that's going to save you money and save your carbon in future projects as well. So that's a bit of a snapshot and we'll hand over to the panelists to talk about the case studies as well and then obviously happy to take questions and follow up in the webinar afterwards. Thank you very much and I'll hand over to Atreo and Melissa. Thanks, Jonas. While Atreo is getting sorted, I'll give a little spiel about 25 King Street as it's more commonly known. Yeah, awesome. So, 25 King Street is a fun project I've had the privilege of seeing at both sides, being at Lendlease and then at Aurecon, and it's being Aurecon's HQ in Brisbane. Black Jonas kind of hinted
It's definitely a collaborative effort to get these kinds of projects off the ground at the moment as people are still experimenting and trying new things. You can see the list of the project at a glance of the architects and engineers and developers involved in making this project a reality. The project targeted a number of sustainability initiatives, but it was the tenant and the developer who really joined forces in making the decision to go timber. So it is a concrete podium base and a timber, seven or nine story building, sorry. The majority of the embodied carbon savings is coming from the timber itself and then it's supported by really ingenious concrete. That's replacement SMC, so cement replacement but also geopolymer. They tried a lot of things out on some of these projects with one leaf to sort of see how the timber and the concrete could work together in the most efficient way. So it wasn't just about substituting one concrete for another mix design; it was about making sure the concrete structural system was intelligent and smart and efficient in its way it was supporting the timber. It was about making sure that the core and the podium, you know, was efficient in its own right before then substituting that material with different strengths and so forth and mixed designs. And then also reinforcing, there was a strong focus on a recycled reinforcement approach with this project as well as post-tensioning, which was kind of not really the structural engineer's preference, but it made savings, so it was definitely included. And then of course, in the fit-out and the integrated approach of showing off the timber for what it really is, removing a material altogether in the sense of removing ceilings from the project actually resulted in a small saving, it's one percent, but it still adds up. It's one less product being used, being made, being instituted in a building, and also as that building grows and changes and adapts which is different uses over time, it's an embodied carbon saving that can kind of be banked along the way, even though it maybe doesn't show up so holistically in the life cycle assessment. So that's just kind of the quick spiel on 25 King Street. I gave a webinar presentation last week, so happy to take questions on it on how we did this calculation and how we came to these conclusions, but it's definitely drawing on all of the insights that Christina and Jonas have kind of hinted at that kind of came together for this project.
I'll hand over the mic to Atreyu. Okay, thanks everyone for joining. I'll keep this fairly brief, there is quite a lot of documentation available for this particular project. There's some existing presentations and webinars on wood solutions that sort of deep dive into the structural design and construction of this project, so I'll try to keep this fairly brief and focused more on the LCA side of things.
So, this project, La Trobe Uni student accommodation or north and south apartments as it's now known, was completed in 2020. I think it's still the largest mass timber, certainly CLT project in Victoria. It's predominantly a student accommodation building, 624 beds, approximately 18,000 square meter GFA, so it's quite a substantial structure in its own right. The building has achieved five-star Green Star certification as built, and as the CFC report speaks to, there were some quite substantial savings in the global warming potential of the building through the use of timber as compared to an earlier reference design for the project which was more conventional reinforced concrete.
Predominantly CLT construction, the timber was imported from Italy. That decision was largely driven by the builder and their procurement processes, cost-driven, but also importantly for this project, one of the big considerations was program and the local suppliers who would have had the capability to supply this project at the time weren't able to meet the required program. The timber was supplied from overseas. There was also a lot of concrete in the project, similar to the case study that Melissa just referred to. We took the approach of using concrete for the substructure and a sort of concrete podium in a lot of the cores, so a lot of energy was also put into smart selection of materials and concrete mixes for those aspects, which also plays into the overall reduction of energy used in the building. The client made a decision to go for a more high-performance facade, something more akin to a passive house standard, although they weren't targeting passive house. So, there were also quite significant savings in the operational energy for the building moving forward.
Just a snapshot of the life cycle analysis for the building, and consistent with Christina's presentation earlier, we've focused on modules A1 to A4. Right from the manufacturing process through to the transport and delivery of the materials to site. There's quite a lot of learning still to go, I think, within the broader industry around how we account for the remaining modules, but for the time being, the focus is typically on modules A1 to A4 or 5. There was around a 75% reduction in the embodied energy used for the structure; that's just the structure only, so it doesn't include all of the fit-out components and non-structural elements, and of course, it doesn't include the operational side of the equation, which is in itself quite significant. So this probably translates to something around 15% reduction of the total life cycle carbon for the building.
And that's pretty much my presentation complete, happy to answer any questions. Very good, so if you want to share Atreyu, thanks a lot. A very interesting presentation. I would now start by looking at the questions that we receive from the attendees; they are ranked also by some of you in terms of their interests, but there's plenty of interesting questions. So, I will start with the one from Mike Knight, and if you speakers and panelists would like to have a look as well: How does the global supply of timber look over the next 30 years if we achieve objectives towards transition to timber in Australia and internationally? So that's a broad question, and I open the discussion to the panel, to Christina, Jonas, maybe you are not timber procurement specialists, Melissa and Atreyu have been exposed to that, I have been exposed to that a lot, but honestly, I would like to hear the opinion from Christina and Jonas first and then the rest of the panel. Footprint associated with the biogenic carbon, so carbon that's absorbed from the atmosphere into the trees as they grow, and one which is associated with the emissions from combustion of fuels and other emission sources, depends on if you combine those and look at those individually. We can get negative numbers or positive numbers. Now just to reflect the way we did it in the CST study, since that was only looking at the upfront embodied carbon and we don't know what the end of life fate is of the steel and concrete and timber, we didn't actually account for the carbon that's sequestered. So we didn't use any negative numbers. We only used the emissions associated with the logging, transport, processing, and distribution to site. But when you see negative numbers, that's almost certainly accounting for the actual carbon dioxide that's been stored in the wood products and taking that into account. So that's why you see the difference if it makes sense.
Yeah, good. So you answered also a couple of questions which are related to biogenic carbon etc. I have now a question for Christina, if you don't mind. Nobody asked it, but I really feel like hearing their opinion about this. So the CFC has committed a large sum and more than the money, it has committed its support to developers who want to choose using timber in the coming months. What will success look like for your timber building program?
It's a very good question. Where we've got, I guess, 300 million dollars of debt finance that we're allocating towards supporting these types of projects, I think success would be over the next few years having deployed a significant amount of that money. But not just supporting the projects that we're actually investing in, but building the capability in the market. I guess by supporting demand, we're hoping that supply will follow, particularly domestically. But also the skills. We've seen some proponents having a traditional concrete steel structure as well as a timber design, and then when push comes to shove the timber design kind of falls away because it's difficult, they haven't done it before, it's not what they used to, people tend to stick with what they're comfortable with. And we really want to be that point of difference that locks in the timber design when it's right, when it's the right material for the right structure. We want to make sure that people are deciding to go to the timber, and we think that by driving that demand, hopefully the supply will follow and the skills and the experience just by having that exposure and building up their confidence with those designs. So yeah, hopefully it's broader than just the direct investments we do, but we want to see that shift I guess across the whole construction sector.
Yeah, excellent. Any comments from Melissa, Atreyu or Jonas on this? What would you suggest to the CEFC in order to evaluate the success of their program? Supporting the industry, that one I'm gonna pause on for a second. I guess I'd only reiterate Christina's comment on supporting the industry through the design process. Having been part of a few timber designs, it is a more challenging design process. It's kind of that traditional project management thing that says if you spend that little bit extra time in design, you end up with a better project. Timber almost forces you to do that with the manufacturing process in order to build with it. But doing so forces you to make a lot of upfront decisions, and I think as an industry we're not quite comfortable with that just yet. And it's great to see the support of knowing that we're going to have to make a few mistakes and fail and learn in order to get comfortable with that, and there's big organizations supporting that. So, I guess that doesn't answer your question, but it's definitely a comment I wanted to add in there.
Yeah, look, I can only agree. Yes, we need more timber, but especially we need more projects in which timber is used to its best together with other materials in an optimized mix. We want good projects with timber, not just more timber. I mean, without quality, it definitely supports the right materials for the right projects, not just timber for the sake of it. There is an interesting question which has many likes, six likes, on how does precast concrete help carbon abatement? Is this smaller volume of concrete by using high strength concrete or something else? Atreyu, maybe you are the design specialist here.
It's a pretty open-ended question. I'd like to hear from Jonas actually on that. My structural engineer sort of hat on tells me maybe it's not quite as different as in-situ concrete, but Jonas might have some more insight. Yeah, so the way we modeled this, just high level, was so the overall, this is a relatively high-level study that we did to get the order of magnitude, but when looking at pre-cast concrete, we looked at those optimizations in terms of efficiencies in producing precast and prefabricated components, which includes opportunities to, there would be less waste, for example, in the pouring of the concrete on site, that would be other opportunities too. So in essence, you saw the carbon reduction as well when we look at that. It wasn't that mind-blowing in terms of potential, it's more that the cost-effectiveness of it was really good because of those prefabricated elements and optimization. So that's what really like every time that you save the carbon dioxide, there is, you can do it at a very low cost essentially because of that. So that's really what comes through. It's kind of separating the x from the y axis if that makes sense. So not a huge potential, but when you can use it for those efficiency purposes, it's really cost-effective. I think I would support your comment, Jonas, and also saying that extending beyond that A1 to A4 boundary, precast also offers a lot of opportunities in the construction component of the life cycle. It gives constructors the ability to kind of swap and change and do things off-site in a modular aspect, which when you start to reduce your construction constraints and pull things out of your critical path, you start to get a lot of benefits. And some of those are also carbon abatement, not just in the material itself, but in the getting to site and their on-site time and their equipment on site as well.
Indeed, and look, there's plenty of questions that we still haven't answered, but we reached 10:12 p.m., so still, there's a lot of people online, almost 300 attendees still online, so if you don't mind we can go on for another couple of minutes. I would love to hear your question to each other because having a panel like this, it doesn't happen every day. So, any question from within the panel that would be interesting? Hybrid construction, no? Oh shy, I cannot imagine that. I'm very curious about that, you know, following from that comment around the sensible use and the future of hybrid construction, where is that actually in Melissa, where you see this discovery in terms of that's going to be going to get away from the trenches of steel versus concrete and so on and think more realistically, you see that's the web where this is handy?
We're seeing it at the moment, I'm seeing a lot of developers and builders having the conversation, they're probably not ready to make the jump into construction yet, the cost is still a little bit prohibitive and they're a bit scared of the risk for some of their more major projects, but we're definitely seeing a lot of investigation in it. With the new green buildings tool as well, with the climate positive approach, where I've seen hybrid structures, I've seen timber on top, I've seen all sorts of kind of design trials all the way through to that decision cost planning point of going, does this actually work out to get on site? And at the moment, it's just not making it there for a whole range of reasons, usually not to do with the material or the structure itself.
Yeah, I'd agree with that. You know, the barriers for the adoption of timber still seem to be around procurement and price, whether that's perceived or real. And so we are finding that the conversation's increasingly steering towards hybrid type solutions and that's what we think it's kind of purest as structural engineers. It's about using the right material for the right job and we've seen I think a lot of examples where there's perhaps been a more dogmatic approach to the use of timber and it's not always, you know, used in the most sensible way, so I think the pendulum's starting to swing back to a more of a balanced approach towards that. And perhaps some of the more established institutional type clients are now getting on board with that kind of thinking. So yeah, a lot of projects in the planning phases as Melissa says, I think the last couple of years we've sort of saw a bit of a slowdown of interest in timber just concern around market volatility, but I think we're starting to see that people hook their head above the parapet again and some more interest.
So, yeah. Well, and to wrap it up, I would like to say that I really thank all of you. I thank the organizations that are behind you, your colleagues who made it possible for you to elaborate this very interesting study that was presented, and to come to the decision of the CEFC board to support the construction industry, not just the timber industry, with such a statement and commitment, which will make a difference indeed. I'm really curious to see how much and in what terms, but I am already sure that this is a turning point in the construction industry. Timber construction has been considered mature, has been considered reliable, has been considered as a way to solve different problems, not just the carbon problems, but also the de-risking of a project, the procurement side of a project, the durability of a project, and therefore the whole life cycle. So, this is like a new start for the construction industry at large.
So, thanks again to the CFC and all those who supported their initiative, and I really look forward to see new exciting projects and organizing other meetings and webinars like this. And thank all of you again for being with us today. See you the next time.
End of transcript